I am representing an estate. Substantial money has come into the estate account. I am suggesting, because there will be some delay in distribution, that the money be invested. Can I ethically do that?
The Rules of Professional Conduct have changed recently on the issue of lawyers involved with investments. There is a brand new Rule 5.8, which should be carefully read by every attorney. That rule is titled “Dealing in Investments, Products, Prohibitions and Restrictions.” The rule essentially states, under Subsection (a), a lawyer shall not broker, offer to sell, sell or place any investment products, unless separately licensed to do so. Under Subsection (b), a lawyer should not recommend or offer investment products to a client or any person with whom the lawyer has a fiduciary relationship, or invest funds belonging to such a person in an investment product, if the lawyer or someone related to the lawyer has an interest in compensation paid or provided by a person other than the client or person with whom the lawyer has a fiduciary relationship or has an ownership interest in the entity sponsors insuring the investment.
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