Q. By questioning an applicant's credit ratings or level of debt, aren't licensing boards creating a "means test" that discriminates against less affluent JDs?
A. Bar examiners insist that applicants who demonstrate financial responsibility are better equipped to protect their clients' financial affairs and less likely to mishandle them. Some would even argue, perhaps unfairly, that financial distress and debts may increase the temptation to put the lawyer's interests above the client's, to charge excessive fees, to misappropriate funds held in trust, or to cut other ethical corners.
Denying any attempt to penalize candidates based upon wealth, many licensing boards believe that reviewing an applicant's financial stability and responsibility is a legitimate way to protect clients from those who may be unfit to protect their financial interests. This calculation is not a mathematical one, as bar examiners give greater weight to the nature and extent of these debts and how applicants have attended to them.
But let's face it: This is not the sort of concern raised by trust fund babies who flaunt considerable wealth, spend lavishly on frivolous items, or gamble thousands without a care in the world. To some extent, then, denying admission on the basis of excessive debt does tend to discriminate against those of more limited means.
By scrutinizing their finances while ignoring the spending habits of their wealthier counterparts, bar examiners invite the following objections:
➤ Financial Discrimination — Denying admission based on debt levels can be seen as a form of financial discrimination. It effectively creates a barrier to entry for individuals who may come from lower-income backgrounds or have faced financial hardships. This can disproportionately affect applicants who lack financial resources;
➤ Disproportionate Impact — Financial difficulties and debts may arise from various circumstances, such as medical expenses, educational costs, or economic downturns. Denying admission based on debt fails to consider the underlying reasons behind an individual's financial situation. It unfairly penalizes those who have faced financial challenges beyond their control. But most of the time, bar examiners will take these factors into consideration;
➤ Dubious Relevance — Financial responsibility may be important, but it may not directly correlate with an individual's ability to practice law. Nor is there any evidence that indebted lawyers are more prone to unethical behavior than those without significant debt. While overcoming financial struggles may reflect a person of strong character who is fit to practice law, debts alone tell us very little. Ethical conduct is undoubtedly influenced by many factors, including an individual's personal integrity, ethical values, and commitment to professional standards, all of which tell us far more than the individual's balance sheet; and
➤ Barriers to Diversity and Inclusion — Denying admission based on debt levels may perpetuate existing disparities in the legal profession. It may disproportionately impact individuals from underrepresented or marginalized communities, who may already face barriers to legal education and career opportunities. This may impede efforts to foster diversity and inclusion within the profession.
Even if the critics are right, most of them have one thing that you do not — a license to practice law. So save the objections until after the swearing-in ceremony. Until then, work to rectify financial concerns, stay current on loans, and candidly address your shortcomings to alleviate any fear that you lack the fiscal responsibility to protect the public.