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If a client expresses an intention to transfer assets to a numbered company for the purpose of defrauding creditors, what must a lawyer do?

  1. Continue representing the client without reporting

  2. Report the client to law enforcement immediately

  3. Cease representing the client

  4. Advise the client on how to legally transfer assets

The correct answer is: Cease representing the client

The other options (A, B, and D) are incorrect because they all involve continuing to work with the client and potentially aiding in their fraudulent actions. A lawyer has a duty to uphold ethical standards and working with a client to defraud creditors goes against this duty. The correct course of action is to cease representation and possibly report the client to authorities. Continuing to work with the client or advising them on how to transfer assets legally would be enabling their fraudulent behavior.