Lamar Smith: “the Arkansas State Bar has decided to revise the ethics portion of its bar exam. It seems a number of practicing…”

“the Arkansas State Bar has decided to revise the ethics portion of its bar exam. It seems a number of practicing attorneys have had trouble in this area, despite having passed the old exam. The new test reads: Question 1: A State attorney general enters into a business deal. He put up no money, but gets a half interest in a land development company that will need many State government permits to operate. Discuss the possible ethics ramifications, if any. Question 2: A State Governor arranges for a business partner, who controls a federally insured S&L, to make payments on a personal loan that the Governor has taken out. The Governor then claims these interest payments as interest deductions on his own tax return. Are there any ethics complications here? Question 3: A State Governor arranges for a friend to get a large Federal grant ostensibly to fund projects for disadvantaged business owners. The Governor then induces this friend to lend hundreds of thousands of dollars to a land development company the Governor jointly owns. The true nature of the loan is not disclosed and the money is not repaid. Are there any ethics problem here? The new test is not hard, but to make it even easier, perhaps Arkansas could get the administration to do the grading.”