Many of the largest malpractice losses result from representing a dishonest client. At the 2010 Aon Law Firm Symposium program “Recurring Risks Posed by Dishonest or Unworthy Clients” panelists identified seven factors to consider in determining whether a client is worthy of your services.
- Is the client a public or private company? Unworthy clients are typically not public companies.
- Is the client’s business financial services or a related industry dealing with other people’s money?
- Has the business experienced phenomenally aggressive recent growth that could be the result of cutting corners?
- Is the client unusually secretive and does the client refuse to provide requested information purportedly to protect their competitive position?
- Does the business have a dominating CEO who runs the business with an iron hand?
- Does the business employ a bullying style when dealing with outside professionals?
- Is a foreign business client unusually secretive?
If you decide that a client is unworthy, risk manage the situation by withdrawing immediately.
Source: Conference Report: Aon Law Firm Symposium, ABA/BNA Lawyers’ Manual On Professional Conduct, Current Reports, Vol. 26, No. 22, p.657 (10/27/10).