“Staying In or Going Out: The Value of Teamwork Between a Bank’s Inside and Outside Counsel,” Inside Counsel
In the conclusion of a three-part article, Colleen M. Murphy, an attorney in Goldberg Segalla’s Global Insurance Services Practice Group, concludes the discussion of the targeting of in-house counsel by regulators and prosecutors by outlining a number of ways inside and outside counsel can work together to mitigate specific regulatory risks.
Regarding attorney-client privilege, Colleen and co-author Aaron J. Aisen identify as a key issue the various roles inside counsel are called on to perform.
“As we discussed in Part 1, inside counsel are often asked to wear two hats — a legal hat and a business hat. The question is, when is the inside counsel giving legal advice versus business advice? This is critical because, as a general rule, business advice given by an attorney is not covered by the attorney-client privilege.
“By utilizing outside counsel, especially where the line between inside counsel’s business and legal roles is blurred, the bank can increase the likelihood that the communication is privileged. This is also useful in the event investigators seek to destroy the privilege by employing the crime-fraud exception to the privilege. This is how the government gained access to so many documents in the case of United States vs. Lauren Stevens discussed in Part 2.”
Colleen concludes that, “As banks continue to face increasing regulatory scrutiny, inside counsel will continue to navigate legal and ethical minefields. By working together with outside counsel as discussed above, a bank’s inside counsel can provide an even greater service to the bank.”