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June 01, 2012

Washington News Briefs

FINANCIAL CRIMES: The ABA expressed concerns last month over a proposed rule issued by the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) that the association said would require law firms that establish accounts at financial institutions on behalf of their clients to disclose the identity and other beneficial ownership information regarding those clients. Kevin Shepherd, chair of the ABA Task Force on Gatekeeper Regulation and the Profession, emphasized in a May 4 letter to FinCEN that the ABA shares the overarching goal of protecting the U.S. financial system from criminal abuse and to guard against terrorist financing, money laundering and other financial crimes. He said, however, that FinCEN’s advance notice of proposed rulemaking, which would establish new due diligence requirements for financial institutions, “could impose unreasonable and excessive burdens on many law firms with client trust accounts and could undermine both the confidential lawyer-client relationship and traditional state court regulation of lawyers.” Shepherd explained that requiring law firms to disclose clients’ identities and the corporate clients’ beneficial ownership whenever they establish accounts for those clients or deposit client funds into the law firms’ trust accounts is “clearly inconsistent with lawyers’ existing ethical duties outlined in ABA Model Rule 1.6 and the binding state rules of professional conduct that mirror the model rule.” According to the letter, the risk that the client’s identity and other confidential beneficial ownership information regarding corporate clients would be divulged by the lawyer or law firm could discourage a client from retaining a law firm and entrusting funds with lawyers or law firms, thereby interfering in a substantial way with a client’s fundamental right to counsel. Shepherd also emphasized in the letter that instead of federal mandates like the FinCEN proposals, the ABA supports existing attorney guidelines known as the “Voluntary Good Practices Guidance for Lawyers to Detect and Combat Money Laundering and Terrorist Financing,” which were developed by the ABA and a number of specialty bar associations. The Voluntary Guidance, he said, lays out “prudent, proportional risk-based steps tailored to individual situations rather than adhering to a burdensome and rigid ‘one-size-fits-all’ approach.”

IMMIGRATION: The ABA called a recent proposed rule issued by the U.S. Citizenship and Immigration Services (USCIS) a step in the right direction to lessen the hardships faced by U.S. citizens and their families as they navigate the complicated and often lengthy permanent residence process. The proposed rule would amend USCIS regulations to allow immediate relatives of U.S. citizens who are physically present in the United States to request provisional unlawful presence waivers to enable them to adjust their status in the United States. Those individuals must currently depart from the United States and request waivers of inadmissibility during the overseas immigrant visa process, a requirement that often separates U.S. citizens from their immediate relatives for extended periods of time. The ABA believes that the proposed rule could be further enhanced by broadening its scope to reach eligible family members of lawful permanent residents as well as persons in removal proceedings. In a June 1 letter to the Office of the Secretariat of USCIS, ABA Governmental Affairs Director Thomas M. Susman recommended several steps, including the following: permit individuals in removal proceedings to receive provisional waivers; expand the provisional waiver process to include preference categories of unmarried adult children of U.S. citizens and spouses, and children of lawful permanent residents; and expand the rule to permit lawful permanent residents to serve as qualifying relatives for hardship purposes. Susman also wrote that applicants in the United States who have been scheduled for an immigrant visa interview at a consulate should be eligible to apply for a provisional waiver as well as those who have a Form I-212 waiver for prior removal order. “The ABA has long supported timely family reunification as a fundamental principle of our nation’s immigration policies,” Susman wrote, adding that the ABA believes the stated goals of reducing prolonged family separation and increasing the efficiency of the waiver process for both government and applicants can be met by incorporating the association’s recommendations.

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