Whatever the ABA may think of greater regulation of other industries, it’s generally not in favor of more federal oversight of lawyers. Rep. Barney Frank’s bill to create the Consumer Protection Financial Agency is just the latest legislation on its target list.
In an interview while attending the ABA’s annual meeting, outgoing President H. Thomas Wells Jr. said the association is working to thwart language in H.R 3126 that might end up regulating some lawyers, such as tax attorneys, under the label “financial advisors.” Frank, who chairs the House Financial Services Committee, introduced the legislation earlier this month. The bill doesn’t yet have a Senate companion.
“In part, we view it as a lawyer independence issue,” Wells said. “Lawyers in this country have historically been regulated by the states. In general, we are opposed to federal regulation of the profession.”
To fight the legislation, the ABA has ramped up its financial markets regulatory task force led by former FDIC general counsel William Kroener III, now a partner with Sullivan & Cromwell in Washington and Los Angeles, and former SEC general counsel Giovanni Prezioso, now a partner at Cleary Gottlieb Steen & Hamilton in Washington. For now the association has a draft resolution on the issue in a holding pattern, but Wells is hoping the House of Delegates will move ahead next week to approve a general set of principles with respect to financial services regulation, he said.
The effort is the latest in a string of battles the ABA has waged this year against increased federal regulation of the industry. The association won one round this week when it successfully pushed the Federal Trade Commission to delay enforcement of new rules designed to prevent identity theft. The ABA has been lobbying for months to have lawyers exempted from the rules, calling them burdensome regulation as applied to the legal profession.
The ABA may also weigh in with an amicus brief in the Supreme Court’s review of Milavetz, Gallop & Milavetz v. United States, a suit over the application of certain provisions of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 to lawyers and law firms. The House of Delegates will review that issue when it meets early next week.