Lawyers Fight Bill Forcing Them to Report Suspicious Client Acts

Lawyers are pushing back against anti-money laundering legislation that would require them to report suspicious transactions by clients, as banks already must do.

US House lawmakers led by Tom Malinowski (D-N.J.) and Maxine Waters (D-Calif.) are behind the provision in that body’s version of the defense authorization bill. The requirement would also apply to accountants, payment service providers and trust companies.

Opponents worry the plan would disrupt attorney-client privilege and empower the Treasury Department to conduct random audits. “The audit power really is quite broad and unconstrained,” Covington & Burling partner Nikhil Gore said in an interview.

The legislation, prompted ...