Multistate Professional Responsibility Exam Practice Question
Laurel, a lawyer, works with Tamara, a tax advisor, who directs individuals seeking legal assistance to Laurel. Whenever one of these people hires Laurel, Tamara receives a set sum. Which statement best describes these dealings?
Categorizing it as a normal operating expense addresses some prohibitions
Linking this financial benefit to a recommendation goes against professional rules
Telling individuals about Tamara’s involvement reduces potential concerns
It fits ethical norms if Tamara is considered an advertising platform
Ethics rules generally prohibit a lawyer from delivering compensation to a nonlawyer tied to a personal endorsement. Merely disclosing Tamara’s role or categorizing the funds as a business expense will not meet the ethical requirements because the payment is contingent on sending clients to Laurel. The other statements fail to address the prohibition on providing a nonlawyer a direct reward for referring people.
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What are the key ethical rules regarding lawyer referrals?
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What is the significance of disclosing referral fees?
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Why can't a lawyer categorize referral payments as normal business expenses?