Manafort finds no client-accountant privilege

Former Trump campaign chairman Paul Manafort’s accountant testified this week at his trial for tax perjury and bank fraud that she sent false documents and misrepresented a home so that Manafort could get a mortgage on one of his New York City propertiesm reported NBC News. She is the first witness to take the stand who has been granted immunity.

By any measure, when a cooperating witness is the defendant’s accountant, her testimony about her services is a betrayal of the client.

Manafort might have assumed that private financial information provided directly to a tax preparer was privileged information exchanged between a client and a professional. Financial records are often highly sensitive, and the same kind of information is often exchanged in protected attorney-client communications. As a result, a client might expect that his communications with an accountant are entitled to some form of protection from a sweeping grand jury investigation. That expectation is ill-informed.

Courts have historically allowed grand juries considerable latitude when conducting criminal inquiries and procuring information. However, a grand jury’s subpoena power has limitations. A grand jury cannot pierce the secrecy of a client’s validly asserted privilege.

The attorney-client privilege exists in the federal courts to protect confidential communications between a lawyer and his client. Its purpose is to encourage clients to make full and frank disclosure to their attorneys to assist in seeking legal advice. The privilege recognizes that sound legal advice serves the public interest and that this advice depends upon the lawyer's being fully informed by the client.

If the privilege applies, confidential communications between lawyer and client are completely protected from disclosure to a grand jury. Privilege then, by definition, simultaneously impedes the grand jury’s beneficial purpose of seeking full and free discovery of the truth.

For this reason the attorney-client privilege is to be narrowly construed in the grand jury context. It is recognized only to the very limited extent that excluding that obviously relevant evidence has a public good that outweighs the grand jury’s mission in ascertaining truth.

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