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Lawyers Are Better Regulated Than Many Other Professionals

We have more safeguards against bad actors than other professions.

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As this column has already discussed at length, there are a number of “bad apples” within the legal arena.  Despite the need to pass the bar and abide by the profession’s ethical standards, some lawyers seem to fall through the cracks and commit bad acts despite all of the safeguards set up by the legal profession.  However, when you really think about it, the legal profession is one of the best-regulated professions out there, and we can all kind of be happy that we have more safeguards against bad actors than other professions.

One thing that distinguishes attorneys from other professionals is that state bar authorities typically have much oversight over the financial activities of lawyers.  Indeed, attorneys typically need to provide bar authorities with bank account information, and many lawyers also need to establish special trust accounts that deposit interest into funds for clients harmed by lawyers.  We can all understand why bar authorities have such financial oversight over lawyers, since attorneys are typically entrusted with money of their clients, and as such, there needs to be additional accountability.

However, many other professions also deal with client money.  Indeed, accountants, financial planners, and others all deal with the money of clients, and there seems to be less oversight of these professionals than there is for lawyers.  In addition, doctors also deal with complicated billing practices, and there have been doctors who have defrauded Medicare and private insurance companies, seemingly warranting some kind of financial oversight.  However, physicians do not have the same financial reporting requirements as attorneys, and the oversight bar authorities have over lawyers is something that distinguishes the legal arena as a particularly well-regulated profession.

Furthermore, many professions do not have restrictions on advertising in the same way as lawyers.  As many attorneys are already aware, lawyers typically need to abide by certain prohibitions concerning advertising, and must make specific disclosures if they advertise their services.  Many of these restrictions are included in ethics rules, and other restrictions on attorney advertising are found in statutes and caselaw.

It seems like many other professionals do not have the same disclosure requirements when it comes to advertising, and numerous doctors, dentists, and other professionals have commercials and other advertisements that would never pass muster in the legal arena.  Of course, many attorneys probably think that most restrictions on attorney advertising are a pain in the butt, but we can be kind of happy that our profession is better regulated in this regard than a number of other professions.

Another thing that distinguishes lawyers among other professionals is the character and fitness process to be admitted to the bar.  Of course, many professions, including the medical field, have a character and fitness component.  However, some licensed and credentialed professionals do not have to go through such great lengths to prove their fitness to practice their profession.

Even a cursory review of the character and fitness process for the medical field seems to indicate that lawyers have a more thorough process of vetting potential attorneys.  Of course, the character and fitness process for lawyers and medical professionals differs from state to state, but the attention bar examiners spend on financial dealings, fraudulent conduct, and other matters seems much more thorough than the questions asked of medical professionals.  In any case, lawyers can generally be happy that the legal profession thoroughly vets prospective attorneys, in a way that is not really done with other professions.

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Another thing that distinguishes lawyers from other professions is that many state bars set aside a fund for clients that have been wronged by attorneys.  Many states fund these programs through dues that attorneys pay and/or through interest that accrues on money in attorney trust accounts.  In any case, these funds typically have millions of dollars set aside for victims of bad actors within the legal profession.

After some searching, I had trouble finding many other professions that have similar programs.  Of course, clients and patients can be wronged by doctors, brokers, financial advisers, and a slew of other licensed and credentialed professionals, but few funds are set up by those professions to help the wronged.  Setting aside funds for defrauded clients is another way that the legal arena is much better regulated than other professions.

In addition, the legal profession is a lot more transparent than other licensed and credentialed professions.  In many states, it is very easy to conduct an internet search and find government-provided information about every attorney licensed in a state.  Some of the publicly-accessible information about attorneys include disciplinary problems, educational information, and other details.  I did a few quick searches for similar databases of other professions and couldn’t find much of anything.  The legal arena is a lot more open when it comes to providing information about practitioners, and this distinguishes us from other professions.

In the end, people have many reasons for taking a dim view of the legal profession, and a number of bad actors have brought a lot of grief to legal practitioners.  However, for a number of reasons, the legal arena is one of the best-regulated professions out there.

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Jordan Rothman is the founder of Student Debt Diaries, a personal finance website discussing how he paid off all $197,890.20 of his college and law school student loans over 46 months of his late 20s. You can reach him at [email protected].

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