Four years after regulators launched a task force to stamp out business corruption, numerous chief executives are on their way to prison, two of the nation’s biggest accounting firms are defunct or on probation, and investment banks have shelled out billions of dollars in settlements. But lawyers serving fraud-ridden companies have emerged relatively unscathed, reports the Washington Post. Unlike the accounting profession, forced by the Sarbanes-Oxley Act in 2002 to submit to independent oversight, lawyers have generally ducked proposals that would have forced them to blow the whistle to outsiders.
Law firms that dispensed bad advice or failed to act on red flags mostly have avoided prosecution. Nor have securities regulators pursued sweeping civil cases against groups of law firms, seeking to determine if they may have performed shoddy work or ignored fraud under their noses. Some say it is time to hold lawyers accountable. Lawyers enjoy broad privileges that prevent them from sharing client confidences. But courts have held that exceptions can be made in cases where fraud or other crimes have taken place, such as covering up accounting schemes, funneling money to themselves and their bosses or tampering with documents.