NYSBA Committee on Professional Ethics – Deceptive conduct: Opinion 1171

New York State Bar Association Committee on Professional Ethics

Deceptive conduct

Foreign clients – Currency control laws

Ethics Opinion 1171

Background: The inquiring lawyer is only admitted in New York, but represents four companies in a multi-step transaction to invest funds now located in China to acquire an interest in an enterprise for a project in the U.S. The amount of funds at issue exceeds the strict limits imposed by China’s currency control laws for transfer out of China. The inquiring lawyer has developed a plan to use the lawyer’s escrow account to circumvent the currency control laws of China.

Opinion: The Committee concluded that a lawyer may not engage in deceptive conduct to help clients in foreign countries circumvent currency controls of that country.