Statement of ABA President H. Thomas Wells, Jr.
Re: FTC Announcement Regarding "Red Flags" Rule and Lawyers

WASHINGTON, D.C., July 29, 2009 — The Federal Trade Commission has taken a very vital step by announcing a 90-day delay in enforcing the “red flags” rule and providing additional information regarding how it will be applied to lawyers. The American Bar Association is very pleased that the FTC has responded to the deep concerns expressed by Congress, the American Bar Association and more than two dozen state and local bar associations, and commends them for taking action before the scheduled Aug. 1 enforcement deadline.

This temporary reprieve is important to all in the legal profession. However, the FTC’s continued assertion that it can, as it sees fit, regulate lawyers under the “red flags” provisions is troubling, and unacceptable to the ABA. It undercuts an unbroken history of strong regulation by state bars and supreme courts. It threatens the independence of the profession from federal controls, independence that is fundamental to the lawyer’s role as client confidante and advocate. And it is goes against Congress’ intent when the law was passed. 

The ABA and its counterparts at the state and local levels will continue to work with Congress to clarify that this rule should not apply to lawyers. And if necessary, the ABA remains prepared to take the issue to the courts for a final resolution.

With more than 400,000 members, the American Bar Association is the largest voluntary professional membership organization in the world.  As the national voice of the legal profession, the ABA works to improve the administration of justice, promotes programs that assist lawyers and judges in their work, accredits law schools, provides continuing legal education, and works to build public understanding around the world of the importance of the rule of law.

- 30 -

Media Contact:  Stephanie Ortbals-Tibbs, 202-662-1091, ortbals-tibbss@staff.abanet.org