Lawyers under the influence of money

Corporate legal practice sits at the intersection of public trust and private capital. The profession’s foundational duties of the lawyer, being restraint, candour, fidelity to the law are increasingly being tested by the practices adopted in the markets it serves. Are traditional safeguards adequate in the face of the gravitational pull of money and the pressures of contemporary practice?

In review

The personal consequences of abstract decisions

In Has passivity contributed to the rise of corrupt lawyers?, Bret Walker AO SC proposes that lawyers closest to the big money of their business clients, having little to do with the general corpus of law and no real interest in the administration of justice, might leave the legal profession and join with the management consultants, accountants, finance brokers and merchant bankers.

The concern is imitation.

Proximity to vast corporate interests can lead lawyers to absorb commercial norms that diminish professional standards. The lawyer becomes a strategist or partner in pursuit of commercial outcomes, at the expense of their role as steward of legality and guardian of risk.

The degree to which a lawyer adopts a client’s commercial ethics might vary. It could mean looking away when an error is made, allowing commercial demands to prevail over regulatory compliance, risk mitigation, or socialising decisions with affected counterparts. It could take a guiding hand by giving advice to facilitate a third party's objectives where the compromise required by the client is undisclosed. Professional standards are deprioritised in order to accommodate these influences. The knock on effect requires those downstream of that decision to assess the materiality of the consequence. These decisions can compound. The concern, then, is not only about individual lawyers compromising standards, but about what happens when the profession itself loses sight of who it serves and why.

History marches to a familiar drumbeat.

• Charles Mitchell of National City Bank was tried for morally bankrupt securities transfer schemes. 1929 describes the practice, which was technically legal but unethical. The core of his successful defence was that the structures had been approved by the lawyers and were adopted as standard market practice.
• In the McCabe tobacco litigation, a lawyer advised British American Tobacco on a document management strategy that would see BAT destroy thousands of pages of internal research linking smoking to cancer—advice later criticised as a scheme devised to keep evidence from dying plaintiffs. In celebrating its exoneration from legal sanction, the law firm proudly declared: "At the core of our values is the integrity of that advice".
• The Panama Papers scandal exposed dubious legal practices across the globe. Magic-circle and mid-tier firms alike were participants in creating thousands of shell entities while pocketing fees for opacity sold as ‘confidentiality’.

Not all unscrupulous decisions reach a courtroom or the front page of the financial press. The everyday approval of aggressive tax structures, transparency shields, sanctions workarounds, or due-diligence reports that somehow miss red flags, are not aberrations. They are the predictable output of systems that reward commerciality above candour and billable hours or bureaucratic box-checking above difficult decisions. Until the incentives are aligned with the objectives, imitation is not a risk—it is the business model.

The role of the lawyer

Who are the people in your practice or workflow? What sort of risk appetite do they exhibit? When a structure is devised, a document is drafted, or an improbable assumption is allowed to pass unchallenged, what consideration for the interests of those affected by that decision is taken into account?

Robust output depends on more than regulation or policy. It depends on professionals who act in ways that earn trust, at small moments as well as large ones. Lawyers sit on a spectrum between risk guardian and commercial partner. That position shifts with context — sometimes determined by the intensity of regulation in an industry vertical, sometimes by the gravitational pull of a client’s interests. It's one thing for a client to accept a disclosed risk. It's another thing for a lawyer to paper over that risk in the interest of documenting a clean case in support of the pursuit.

The tension is not new.

Samuel Untermyer who was later famed for his role in shaping stock-market regulation is reported to have claimed that an attorney needed US$5 million to secure professional independence (or ~US190M in adjusted terms).

Courts would later condemn the work he performed in the early years of his career. They called him the “managing genius” behind a straw-paper monopoly formed through dubious means. The prospectus he drafted was found to contain misleading representations about the company’s ability to dominate the market. Stock was sold to the public before the company collapsed into bankruptcy. His comment was dismissive of the expectation that lawyers (who had not yet attained independence level wealth) would not pump and dump when it was a technique available to use.

Untermyer's career reflects the central paradox: the lawyer as guardian of markets and their most sophisticated exploiter when acting as commercial partner to the interests of money.

The question is not whether lawyers will continue to serve capital, but whether the profession can maintain the distance required to serve it with fidelity to the law. The present reward system does not merely tolerate ethical drift; it demands partnership in the joint pursuit of the commercial interests. It is no longer enough to lament the loss of distance. An active effort to impose distance is part of the solution.

Discussion prompts

• The profession expects restraint, but in some environments, commercial reality encourages imitation of client behaviour (short-termism, moral neutrality, make-way tactics). What is the role of the commercial lawyer?

• If lawyers closest to the money adopt the worldview and ethics of financiers, are they still members of a legal profession (whose first duty is to the court) — or are they a different sort of service merchant?

• Are good ethics gated behind “walk-away money”? What compromises are expected from lawyers who have not amassed it?

• Is commercial partnership an explanatory frame, or a shield for conduct that law and ethics should challenge?

Thanks to The Ethics Centre for sharing this essay.

Further reading

Untermyer was among the lawyers of the gilded age who devised and implemented legal strategies that would drive the business world throughout the twentieth century. These practices are examined in White Shoe: How a New Breed of Wall Street Lawyers Changed Big Business and the American Century.

Last updated

November 2025