               IN THE SUPREME COURT OF IOWA
                                No. 17–1599

                            Filed June 29, 2018


IOWA SUPREME COURT ATTORNEY DISCIPLINARY BOARD,

      Appellee,

vs.

MARK T. HAMER,

      Appellant.


      On appeal from the report of the Iowa Supreme Court Grievance

Commission.



      Grievance commission recommends a six-month suspension of

attorney’s license. LICENSE SUSPENDED.



      David L. Brown and Alexander E. Wonio of Hansen, McClintock &

Riley, Des Moines, for appellant.


      Wendell J. Harms, Tara van Brederode, and Susan A. Wendel

(until withdrawal), for appellee.
                                            2

APPEL, Justice.

       In this attorney disciplinary case, we are called upon once again to

remind the Iowa bar that while our ethics rules allow attorneys to engage

in financial transactions with clients and to represent both party clients

in a financial transaction, the demanding nature of the disclosures

required and the necessity of documenting informed consent mean that

these matters may not be undertaken lightly as a matter of informal

routine.

       The Iowa Supreme Court Attorney Disciplinary Board (Board)

charged attorney Mark Hamer with multiple violations of the Iowa Code

of Professional Responsibility for Lawyers (code) and the Iowa Rules of

Professional Conduct (rules) 1 arising from (1) several loan transactions

occurring between multiple clients of Hamer without adequate conflict-

of-interest     disclosures   and     informed         consent,    (2)    several   loan

transactions involving Hamer and a client without adequate conflict-of-

interest   disclosures     and    informed        consent,   (3)    two    failed   joint

investments in which Hamer and his client suffered substantial losses,

and (4) a clearly excessive and dishonest attorney’s fee collected through

a bonus to which the client did not agree. Hamer denied the allegations.
       After an evidentiary hearing involving only two witnesses but over

2200    pages     of   documents,     the       Iowa   Supreme      Court    Grievance

Commission (commission) found Hamer violated numerous code and rule

provisions with respect to the loans and the attorney’s fee issues but

declined to find an ethical violation in connection with the failed




       1Prior  to July 1, 2005, an Iowa lawyer’s conduct was governed by the code.
Thereafter we adopted the rules. Because some of Hamer’s alleged misconduct
occurred prior to July 1, 2005, and some after, the Board has alleged violations under
both ethical standards.
                                    3

investments.   As a result, the commission recommends that Hamer’s

license to practice law be suspended for six months.

      Upon our de novo review, we conclude Hamer engaged in a number

of ethical violations in connection with the loan transactions between

Hamer’s clients and between Hamer himself and Douglas Paul. We also

find Hamer engaged in deceit in connection with the bonus payment for

legal work.    Based on the violations, we conclude a six-month

suspension is the appropriate sanction.

      I. Factual and Procedural Background.

      A. Background to the Events at Issue.            Hamer received his

license to practice law in Iowa in 1972 and represented businesses,

entrepreneurs, franchisors, and franchisees for forty years. During all

times relevant to the allegations in the complaint, Hamer worked for a

prominent Iowa City law firm.

      In 1982, Douglas Paul, an entrepreneur in the field of education,

founded an education writing and editing business that eventually

became known as Buckle Down Publishing Company.             Buckle Down

developed customized curriculum materials for school districts.      Paul

also owned ZAPS Learning Company, an ACT and SAT student-test-

preparation company. In 1988, Hamer became Paul’s attorney for both

business and personal matters.            In addition to their business

relationship, Hamer and Paul became friends and frequently socialized

together.

      In 2004, Hamer helped Paul sell both Buckle Down and ZAPS.

Paul sold his interest in Buckle Down for $23 million cash and some

preferred stock. Paul also sold his interest in ZAPS for $1.5 million. DLP

Management, an entity wholly owned by Paul, was formed to handle the

money generated by the sale of Buckle Down.
                                     4

      B. Bonus for the Successful Sale of Buckle Down.            Paul was

pleased with the Buckle Down sale and wanted to reward the people who

worked on the transaction.      Paul considered giving a cash bonus to

Hamer, an accountant, and a secretary.        The record does not clearly

establish the amount of the proposed bonus that Paul was considering

giving Hamer.

      On April 15, Hamer accepted the bonus for his secretary, but told

Paul that a cash bonus for himself was problematic because he would be

required to share the bonus with the other partners of the law firm. Five

days later, Hamer told Paul that the legal fees in connection with the

Buckle Down transaction were $268,447.13.          Paul paid the fees on

April 21 and received an unitemized bill.     The unitemized bill did not

state it included a $110,000 bonus fee.          When Paul received the

unitemized bill he requested an itemized fee statement, but Hamer

demurred. He told Paul he would give Paul an itemized bill the following

week but did not do so.

      On July 28, a Paul-owned entity made a five-year loan of

$1,000,000 at 2.5% yearly interest to a Hamer-owned entity, Quad Four,

L.L.C. Paul claimed this attractive loan was three percent below what

Hamer would have otherwise been required to pay and was made in lieu

of a cash bonus on the Buckle Down transaction that Hamer would have

had to share with other members of the firm if paid as part of the bill.

      Over the years, Paul continued to press Hamer several times for an

itemized bill related to the Buckle Down transaction, including in an

email on January 21, 2009.      Hamer did not provide an itemized bill,

however, until Paul’s new lawyer sent a demand letter asking for

documentation in early 2010.
                                     5

      When Paul received the itemized bill in February 2010, there was a

note in Hamer’s handwriting attached to the file copy of Paul’s payment

check stating the bill included a $110,000 bonus. The note attached to

the check included the words “CF Doug Paul 4/20/04.”             Paul later

testified that the notation meant nothing to him. Paul stated he did talk

to Hamer on April 20, 2004.         He claimed, however, there was no

discussion about the bonus but only about the total amount of the bill.

      C. Paul’s Investments with Other Hamer Clients in “Private

Banking.”     After the sales of Buckle Down and ZAPS in 2004, Paul

began making investments that he and Hamer called “private banking.”

In these transactions, Paul directly loaned money to individuals and

businesses.

      From March 2004 to August 2005, Hamer presented to Paul, and

Paul accepted, opportunities to loan money to nine individuals or entities

who were also clients of Hamer. In all but one of the loans, Hamer made

no effort to get Paul’s informed consent in writing.      Paul would later

testify he had no knowledge the other parties in these loans were

Hamer’s clients. He also testified that Hamer never discussed the perils

of multiple representation or obtained Paul’s verbal informed consent to

any real or potential conflicts of interest arising out of the transactions.

Paul also testified Hamer informed him that most of the loans would be

secured by adequate collateral.      In fact, Hamer never perfected the

various security interests or filed the required mortgages nor did he

advise Paul that Paul would need to do so himself.

      Paul    signed   a   multiple-client   representation   letter   dated

December 29, 2004, that he received from Hamer for one of the

transactions. The letter began, “As we understand your request, we will

be dealing with the documentation and reporting relating to these
                                     6

transactions.”     The   letter   was    lengthy   and   contained    mostly

generalizations:

      Before entering in this agreement, we believe it is necessary
      and appropriate for us to spell out for you the potential
      ramifications of our representation of you.

      As you may be aware, the Iowa Code of Professional
      Responsibility for Lawyers, and in particular Canon 5,
      requires that a lawyer must exercise independent
      professional judgment on behalf of his client.         In this
      connection,    any    lawyer     requested    to    undertake
      representation of multiple clients having potentially differing
      interests must weigh carefully the possibility that his
      judgment may be impaired or his loyalty divided if he accepts
      the employment and the lawyer must resolve all doubts
      about the propriety of the representation prior to accepting
      the engagement. Once a lawyer accepts such employment
      and in the event the interests of the clients do become
      actually differing, the lawyer must withdraw from the
      employment.

      There are, of course, many instances in which a lawyer may
      properly serve multiple clients having potentially differing
      interests in matters not involving litigation. For example, if
      the interests vary only slightly, it is generally likely that the
      lawyer will not be subjected to an adverse influence and can
      retain his independent judgment on behalf of each client and
      if the interests do become differing, withdrawal is less likely
      to have a disruptive effect upon the clients.

      However, in those instances in which a lawyer is justified in
      representing multiple clients, it is nevertheless essential that
      each client be given the opportunity to evaluate his need for
      independent representation and to obtain other counsel if
      desired.     Further, each client should be fully advised
      concerning the implication of the common representation
      (which we hope this letter will do) and be fully advised as to
      any other circumstances that might cause one of the clients
      to question the undivided loyalty of the lawyer to the
      engagement and or interests of all the clients (which we will
      do later in this letter).

      ....

      In regard to our requested representation, we have evaluated
      our knowledge of your respective interests. It appears to us
      that all of you are experienced; that you are willing and
      capable of completing these transactions; that you can make
      relatively equal though substantially different business
                                     7
      decisions; and, finally, that you appear to share the same
      business philosophy. While those factors alone are not
      enough to suggest that you should enter into this
      transaction, these factors do suggest to us that your
      individual interests and goals are sufficiently similar to
      convince us that we can represent you without any concern
      of the propriety of the multiple representation and without
      any concern that our judgment will be impaired or our
      loyalty divided among you.

      On the other hand, however, you must both be advised (and
      we’re sure already know) that the undersigned have
      previously represented all of you extensively and for many
      years. We anticipate continuing to represent all of you on a
      variety of matters. In addition, we anticipate that all of you
      will request that we give our opinion as to the structure,
      wisdom and advisability of your business transaction as it
      related to each of you and that we will provide our opinion(s)
      to you at all times during the engagement.

      We do not anticipate that there will be any conflicts arising
      which might threaten the transaction between you.
      However, in the event of such a conflict, we anticipate the
      termination of our representation in the area of the conflict
      and the continuation of our representation on other matters.
      We would not, in such a case, represent either party relative
      to any conflict between you. In other words, in the event of
      any conflict between you which would require the assistance
      of legal counsel, you would all be required to employ counsel
      other than ourselves or those in this firm.

      If, after careful consideration of all the factors contained in
      this letter, you want [Hamer’s law firm] to represent you with
      regard to these transactions, then you should sign the
      Consent attached to this letter, and have it witnessed and
      dated.

Attached to this letter was a consent form, which Paul and the borrowers

signed. Hamer prepared a similar letter for one of the other loans, but
this letter was never presented to Paul, and he did not sign it.

      Paul discontinued private banking facilitated by Hamer because

two of the loans “went south” in 2006 and 2007. The borrower on one

loan defaulted in 2006. Paul understood the loan would be secured by a

mortgage on real estate owned by the borrower. Paul instructed Hamer

to seize the collateral. Hamer demurred. He told Paul the collateral was
                                      8

not easily liquidated but offered to talk to the borrower “to straighten

things out.” After Hamer spoke with the borrower, the borrower caught

up on overdue interest payments and then made occasional payments

against the principal.    The terms of the loan, however, were never

formally modified in writing. The loan was eventually repaid in March

2009.

        A borrower on a second loan defaulted in 2007. Paul understood

that this loan was secured by an investment portfolio. Paul instructed

Hamer to seize the portfolio. Hamer refused. Hamer advised Paul that

Hamer could not take the action because the borrower was his client.

Hamer told Paul that if Paul wished to pursue collection, he would have

to seek other representation. Paul did not pursue other representation

and eventually agreed to reduce the interest rate and extend the terms of

the troubled loan. The troubled loan has since been extended multiple

times and, as of Paul’s 2013 complaint, about $350,000 remained

unpaid. Under the new terms of the loan, the loan is scheduled to be

paid in full in 2029.

        D. Paul’s Loans to Hamer and Hamer-Owned Entities.             In

addition to the loan that Paul made to Hamer’s Quad Four, L.L.C., Paul

made two other loans to entities that Hamer either owned or had an

interest in—one in July 2004 and the other in March 2006. All of these

loans were fully repaid as agreed.

        E. Paul   and    Hamer’s     Joint   Investments   in   Platinum

Exploration and Unified Worldwide Transport.        From 2004 to 2006,

Paul and Hamer made joint investments in two entities, Platinum

Exploration, Inc. (Platinum) and Unified Worldwide Transport, L.L.C.

(UWT).
                                     9

      In July 2004, Paul invested almost $2,000,000 in Platinum, while

Hamer invested $100,000 in the enterprise. Platinum, according to Paul,

was a Texas oil exploration company that offered investments in a group

of wells and guaranteed a recovery of the investment in twenty-four

months through monthly payments. After the twenty-four months, the

investor would be paid based on the profits of the wells.

      Hamer introduced the Platinum investment to Paul. The monthly

payments stopped after seventeen months because, according to Paul,

the guaranteed payments were found to be illegal in Texas. A company

that took over Platinum made a few more distributions and then

collapsed.

      Paul also invested about $4,500,000, and Hamer invested at least

$600,000, in UWT. UWT purported to be a communications company

involved with voice-over internet protocol with long-distance telephone

contracts on the verge of a buyout but was later revealed to be a sham

with no equipment or customers.          UWT made a few small dividend

distributions before it folded. Paul also loaned over $2,000,000 to UWT

in 2005 and 2006.       Hamer prepared the paperwork for the loan,

including security agreements in UWT equipment.         UWT defaulted on

both loans.

      Paul pursued legal action against UWT in California, eventually

obtaining a judgment against the company.         UWT, however, had no

available assets. For his litigation efforts, Paul collected aggravation but

no money.

      F. Paul’s Complaint.     Paul filed a complaint with the Board on

February 14, 2013. In the complaint, Paul accused Hamer of gaining his

“unquestioning trust” and then abusing the relationship by representing

the 2004 and 2005 private banking loans as being vetted and secured
                                            10

when they were not.          Paul alleged he suffered losses due to Hamer’s

abuse of the attorney–client relationship.             Paul also accused Hamer of

erratic billing and failing to promptly provide a detailed billing record on

request.

       The Board forwarded the complaint to Hamer and asked for a

response.       Hamer denied any wrongdoing, arguing Paul was a

sophisticated client and understood the nature and risks of all of the

transactions at issue.

       G. Board’s Complaint.             The Board filed a complaint with the

commission on September 30, 2015.                    The complaint included four

counts with fifteen subdivisions alleging multiple violations of the pre-

2005 code and post-2005 rules. 2

       Count I of the complaint concerned the loans between Paul and

other Hamer clients. For the period before the adoption of our current

disciplinary rules, the Board alleged violations of various provisions of

the prior code.        The Board alleged Hamer violated DR 5–105(B) and

DR 5–105(C).          These code provisions together forbid beginning and

continuing the representation of multiple clients if the lawyer’s “exercise


       2Previously,   when the Board has alleged violations of numerous rules but the
core of the issue is really a violation of a single, significant rule, we have focused our
attention on that key rule violation to the exclusion of the secondary rule violations that
have tagged along. See Iowa Supreme Ct. Att’y Disciplinary Bd. v. Guthrie, 901 N.W.2d
493, 498 (Iowa 2017) (noting the Board alleged violations of a number of ethical rules
for trust account irregularities but the core of the issue was misappropriation of client
funds and thus limiting analysis to misappropriation of client funds). Here, the core of
the issue involved in Hamer’s representation of both sides in financial transactions is
conflict-of-interest violations. See Iowa Code Prof’l Responsibility DR 5–105(B)–(D); Iowa
R. Prof’l Conduct 32:1.7(a)(2), (b). With respect to the transactions between Hamer and
Paul, the core of the issue is also conflict-of-interest violations involving the attorney’s
own interests. See Iowa Code Prof’l Responsibility DR 5–104(A); Iowa R. Prof’l Conduct
32:1.8(a). Regarding the cash bonus for the sale of Buckle Down, the key issues are
collecting a clearly excessive fee and engaging in conduct involving dishonesty, fraud,
deceit, or misrepresentation. See Iowa Code Prof’l Responsibility DR 1–102(A)(4),
DR 2–106(A). As in Guthrie, we will consider these alleged violations first, and upon
finding violations of these code and rule provisions, we will not consider the other code
and rule provisions charged. See 901 N.W.2d at 498–99.
                                     11

of independent professional judgment on behalf of [one] client will be or

is likely to be adversely affected by . . . represent[ing] another client.

Iowa Code Prof’l Responsibility DR 5–105(B)–(C).

      The Board also alleged a violation of DR 5–105(D).         This code

provision allows multiple representation only “if it is obvious that the

lawyer can adequately represent the interest of each client and if each

consents to the representation after full disclosure of the possible effect

of such representation on the exercise of the lawyer’s professional

judgment on behalf of each.” Id. DR 5–105(D).

      For the period after the adoption of the rules, the Board alleged

multiple violations parallel to those brought under the prior code.

Specifically, the Board alleged Hamer’s representations of Paul violated

rule 32:1.7(a)(2). Under this rule, a lawyer is generally prohibited from

representing a client when a concurrent conflict of interest involves “a

significant risk that the representation of one or more clients will be

materially limited by the lawyer’s responsibility to another client.” Iowa

R. Prof’l Conduct 32:1.7(a)(2).

      The Board also alleged a violation of rule 32:1.7(b).     Under this

rule, a lawyer may represent a client when there is a concurrent conflict

of interest “if . . . the lawyer reasonably believes that the lawyer will be

able to provide competent and diligent representation to each affected

client” and, among other things, “each client gives informed consent,

confirmed in writing.” Id. r. 32:1.7(b).

      Count II concerned the loans that Paul made to Hamer or Hamer-

owned entities. The Board alleged Hamer violated DR 5–104(A) during

the period prior to the adoption of our current rules.      This provision

states that “[a] lawyer shall not enter into a business transaction with a

client if they have differing interests . . . and if the client expects the
                                      12

lawyer to exercise professional judgment [on the client’s behalf] unless

the client has consented after full disclosure.”            Iowa Code Prof’l

Responsibility DR 5–104(A).

      The Board also alleged a violation of rule 32:1.8(a). This provision

states that

      [a] lawyer shall not enter into a business transaction with a
      client or knowingly acquire . . . [a] pecuniary interest adverse
      to the client unless . . . the transaction and terms . . . are
      fair and reasonable to the client[;] . . . are fully disclosed and
      transmitted in writing . . . [to] the client; . . . the client is
      advised in writing of the desirability of seeking and is given a
      reasonable opportunity to seek the advice of independent
      legal counsel . . .; and the client gives informed consent, in a
      writing signed by the client, to the essential terms of the
      transaction and the lawyer’s role in the transaction.

Iowa R. Prof’l Conduct 32:1.8(a).

      Count III concerned the joint investments Hamer and Paul made in

Platinum and UWT. In this count, the Board also alleged violations of

DR 5–104(A) and rule 32:1.8(a).

      Finally, in count IV, the Board alleged ethics violations in
connection    with    the   undisclosed    bonus   Hamer    included    in    his

unitemized bill to Paul for legal services. The Board alleged, among other

things, that Hamer violated DR 1–102(A)(4), which prohibits lawyers from

“engag[ing]   in     conduct   involving    dishonesty,    fraud,   deceit,   or

misrepresentation.” Iowa Code Prof’l Responsibility DR 1–102(A)(4). The

Board also alleged that Hamer violated DR 2–106(A), stating lawyers

shall not collect a “clearly excessive fee.” Id. DR 2–106(A).

      H. Hamer’s Response. Hamer filed a response on April 22, 2016.

Hamer admitted the transactions occurred but denied any conflict of

interest, failure to disclose, or lack of consent on Paul’s part.

      Specifically, Hamer agreed he offered Paul the private financing

opportunities at issue. Hamer denied allegations of conflict of interest
                                      13

and allegations he did not fully disclose to Paul the multiple

representations and their potential effects.   Hamer denied failing to

explain to Paul how independent counsel might address Paul’s interests

differently and asserted

      although he most certainly did not have a discussion
      detailing how each and every possible other “counsel” may
      have approached Paul’s interests, Respondent did not
      conflict with Paul’s interest in any way and a complete
      disclosure of the circumstances was made to Paul upon
      which Paul could, and did, make an informed decision—as
      he always did and this included discussions of independent
      counsel.

      Hamer denied telling Paul the loans would be fully secured with

adequate collateral. Hamer agreed he never took steps to perfect Paul’s

security interests but denied that this was ever intended to be his

responsibility. He stressed the decisions whether to make the loans were

solely Paul’s and Paul undertook the decisions with complete disclosure.

      With respect to the joint investments, Hamer denied that his and

Paul’s interests were inconsistent with or diverse from each other.

Hamer further denied that he failed to make necessary disclosures to

Paul or failed in his duty to Paul.

      With respect to the bonus and loan related to the sale of Buckle
Down, Hamer asserted Paul agreed to pay Hamer the cash bonus that

Hamer collected. Hamer denied that Paul repeatedly asked Hamer for a

detailed statement of the legal fees associates with the Buckle Down sale

or that Hamer repeatedly promised to provide the detailed statement but

did not do so until February 2010. Hamer agreed he never made any

disclosures in writing to Paul related to the loans to him or entities he

owned but denied that this was improper and asserted that all parties

accepted the terms of the loan.
                                     14

      I. Grievance Commission Hearing.         From March 14–16, 2017,

the commission held a hearing in the matter.        The Board called one

witness, Paul, and admitted over 500 pages of exhibits.      Hamer called

one witness, himself, and admitted over 1700 pages of exhibits.

      Paul was the first witness. Paul described how, after the sale of

Buckle Down, he had engaged in private banking with individuals and

businesses that were also Hamer’s clients.      The Board asked Paul in

detail about every loan at issue. The Board often showed Paul the loan

instruments, and Paul explained what Hamer communicated about the

loans, which was very limited information. Paul asserted that generally

he did not know that the other parties in the transactions were other

Hamer clients. Some of the loan instruments included language such as

“[t]his Note is to be fully secured and guaranteed.” Paul explained that in

the case of one loan, Hamer told him that the loan would be secured and

guaranteed by collateral consisting of “spec houses” because the

borrower was a realtor and that Hamer would take care of the collateral.

Paul also explained what he believed to be the collateral or security

interests in other loans. Paul said Hamer never told him that Paul would

be responsible for ensuring that Paul’s interests in the collateral or

security interests were perfected.    Paul also reported Hamer did not

communicate to him anything about the effect of multiple-client

representations, other than what was said in the single multiple-client

representation letter that he received and signed in only one of the

transactions.

      On the subject of the market-value loans to Hamer, Paul related

that Hamer requested several loans in 2004 and 2005 for business

entities that Hamer either owned or had an ownership interest in. Paul

reported that Hamer did not disclose any financial information about the
                                     15

business entities, that a conflict of interest might affect Hamer’s

professional judgment, or that Paul should seek independent counsel.

      The Board asked about the investments in Platinum and UWT.

Paul stated Hamer told him about Platinum, and they along with others,

jointly invested in the business. Paul reported Hamer told him that he—

Hamer—had studied Platinum’s financial information.           Hamer, Paul

claimed, indicated the business was financially solid, had an excellent

reputation, and therefore was a low-risk investment. Paul said Hamer

did not disclose that Hamer’s professional judgment would be impaired

by Hamer joining Paul in the investment or that Paul should seek

independent counsel.

      On the subject of UWT, Paul testified he learned about the

investment from Hamer, UWT’s CEO, and a UWT selling agent.              Paul

described Hamer as a conduit of information about the investment—

Hamer did not generate any of the information, but Hamer would receive

information from UWT and pass it along to Paul. Paul, Hamer, partners

in Hamer’s law firm, and other clients of Hamer jointly invested in UWT.

As with Platinum, Paul claimed Hamer did not disclose that Hamer’s

professional judgment would be impaired by Hamer joining Paul in the

investment or that Hamer should seek independent counsel. Paul also

said Hamer told him the risks of investing in UWT would be low, based

on UWT’s representation that the business was about to be sold.

      After making several investments in and loans to UWT, Paul,

Hamer, and the other investors discovered UWT was a fraud.              Paul,

Hamer,     and   many   other   investors   sued   UWT   to   recover   their

investments.     They received a judgment in their favor but recovered

nothing.   Paul explained that the people behind UWT were criminally

prosecuted for the fraud and were currently in federal prison.
                                     16

      Concerning the bonus, Paul testified that he was very pleased with

the sale of Buckle Down.       Paul said that he wanted to give Hamer a

bonus of $150,000. According to Paul, Hamer said a cash bonus was

problematic because Hamer would be required to share the bonus with

the other law firm partners. Instead of a cash bonus, Hamer asked Paul

to offer him a $1,000,000 loan over five years at three percent less than

he would pay elsewhere, which would yield $30,000 a year. This would

not have to be shared with the partners, Hamer reportedly told Paul.

Paul said he agreed to the loan.

      Paul reported Hamer later told him the legal fees for the Buckle

Down sale would be about $268,000. Paul paid the fees and received a

single sheet, unitemized bill. Paul said when he paid the fees, he did not

understand he was paying Hamer a bonus. Paul described repeatedly

requesting over a period of five years an itemized bill which he ultimately

receive in February 2010.       When Paul received the itemized bill, he

learned he had paid Hamer a double bonus, which Paul insisted was

contrary to their agreement.

      On cross-examination, Hamer’s attorney dug into Paul’s testimony

in detail. Of particular note, Hamer’s attorney asked Paul if the bonus

Paul suggested was in fact $110,000 and not $150,000. The attorney

pointed out that in a deposition, Paul said he had proposed a $110,000

bonus. Paul explained he misspoke in the deposition but promptly, in

the next paragraph of the deposition, corrected himself and said it was

not that amount. He reported $110,000 was in his mind because he was

reviewing the documents prior to the deposition and $110,000 was the

amount on the note attached to the check copy.

      Hamer’s lawyer further questioned Paul about the amount of the

proposed bonus, reading from the deposition that Paul had then said, “I
                                   17

think initially I proposed $250,000, but I don’t have any notes on the

whole thing.” Paul replied that the value of the amount he was giving

Hamer in the loan depended on, from Paul’s perspective, the interest rate

he could get for the loan in the market. If Paul could have gotten 7.5%,

he said, then he would have been giving Hamer a five point break which

would result in a gift of $250,000 over five years.       Hamer’s lawyer

accused Paul of making up bogus mathematical formulae to try to

support Paul changing the number, but Paul denied this.

      Hamer then testified on his own behalf. With respect to the loans

to his other clients, Hamer testified to his version of events.        He

emphasized Paul’s sophistication and business acumen and claimed he

did speak with Paul about multiple-client representation. He testified he

was sure Paul knew the borrowers were his clients. Hamer insisted he

never gave investment advice to Paul and Paul researched all the details

of the investments and independently made his own decisions. Hamer

just presented business opportunities to Paul. Hamer pointed out Paul

made “well over a million dollars” from the private loans that Hamer

presented to Paul in 2005 and 2006. Throughout, Hamer maintained he

had not abused Paul’s trust or committed any ethical improprieties in

these transactions.

      A commissioner questioned Hamer about some of the loan

instruments referring to the transactions as being “secured.”          The

commissioner asked Hamer whether he ever told Paul of the necessity of

perfecting his security interest, because otherwise it would be fair for

Paul to expect those sort of loose ends to be taken care of by his

attorney. Hamer replied,

      What I testified to a little bit earlier was a comfort level—I
      think I used that term. In these transactions where I was
      bringing them to him, it was important that he have a
                                     18
      comfort level with the people, with the situation, and with
      the transaction, itself. He looked at these transactions very
      carefully, each one of them. He looked at them, and if he
      directed that I do something, I did it; if he didn’t, I didn’t.
      When you are in a situation when you have a conflict of this
      sort, as [I] understood the rules then and followed the rules,
      I was bringing it. I didn’t negotiate. He said I negotiated; I
      couldn’t negotiate.

      The commissioner pressed, asking whether at any time he told

Paul that, for Paul’s own protection, Paul needed to perfect the security

interest because if something went wrong there would be a much higher

risk of loss.    Hamer replied he had discussions with Paul about the
attorney–client relationship and conflicts, and he emphasized that Paul

was a sophisticated investor who had done UCC transactions before.

      The commissioner asked if Hamer considered Paul to be on his

own in perfecting the security interests without Hamer’s assistance.

Hamer replied,

      Not necessarily. In some cases he wasn’t. I didn’t expect
      that he would or wouldn’t. . . .      I mean, we had 22
      transactions, and in those 22 transactions, 21 of them paid
      back as he expected, as we expected. And the one that we
      didn’t, the security was there . . . What [Paul] thought he
      got, he got.

Hamer confirmed he did not prepare any security agreements; advise

Paul to have a security agreement prepared; advise Paul to request

mortgages on properties; or prepare or advise Paul to have prepared the

personal guarantees, when those were mentioned in the loan instrument.

Hamer stated, “Knowing the individuals involved, and given the fact that

I was signing off on this as the signatory on this, the security in many

respects, in my mind, was myself.”

      Hamer also described the circumstances of the market-value loans

that Paul made to entities Hamer owned or had an ownership interest in.
                                    19

He stressed these were paid back early or on time.      Hamer concluded

these were successful transactions for Paul.

      Concerning the joint investments, Hamer testified he personally

lost $2,250,000 in UWT and Platinum. He never recovered any money

from the lawsuit against UWT.       Hamer believed the origin of Paul’s

complaint was the revelation that UWT was a scam, which hurt both

Hamer and Paul. Hamer suggested Paul manufactured these claims out

of anger at Hamer over the failed investments.       Hamer described the

scam perpetrated by UWT as “incredibly sophisticated,” noting many

other investors were bilked by UWT and the people responsible for UWT

were federally prosecuted for their crimes.

      On the subject of the bonus, Hamer stressed there was only one

bonus, which was a cash bonus of $110,000 and Paul proposed this

amount. The $1,000,000 loan at 2.5% was an ordinary loan, and the

interest rate was Paul’s idea and was not suggested by Hamer. When

questioned why the interest rate on that loan was so much lower than

the other loans that Paul made to Hamer and Hamer’s clients, Hamer

said he could not explain why Paul did what he did, but Hamer saw the

low rate as a gift.

      With respect to mitigating factors, Hamer described the numerous

community activities in which he participated.         This list included

coaching, parent–teacher associations and other school groups, various

religious groups and other nonprofits, and the Iowa City Community

Theater and other community organizations.      Hamer also indicated he

had reduced his practice and was in the process of winding it down

because of health problems which began in 2015.

      J. Grievance     Commission        Findings,   Conclusions,    and

Recommendation. In the commission’s findings of fact, conclusions of
                                          20

law, and recommendation, the commission noted it found both Hamer

and Paul lacked credibility 3 “in at least portions of their testimony at the

hearing.”     As a result, it held the Board failed to establish by a

convincing preponderance of the evidence that Hamer never informed

Paul that the borrowers in the transactions were also Hamer’s clients.

       The commission nevertheless found Hamer violated all of the code

and rule violations described above, except in count III with respect to

the joint investments. There it found inconsistencies in Paul’s testimony

about his reliance on Hamer for investment advice, communications with

UWT, and negotiations.         The commission noted Paul had contact with

UWT’s CEO and broker, reviewed investment materials, and negotiated

some of the terms on the Platinum investment. Hamer did not originate

the UWT information that Paul considered when deciding whether to

invest in UWT.

       For mitigating circumstances, the commission recognized Hamer

had no record of prior disciplinary actions and had cooperated with the

Board’s investigation. Hamer also engaged in community and volunteer

activities. Finally, the commission noted all of the loans Paul made to

Hamer’s clients except one had been repaid.

       For aggravating circumstances, the commission noted that while

each violation was not great in and of itself, collectively they warranted a

severe sanction because they showed Hamer either did not understand

the nature of his actions or did not believe the actions were violations of

the rules. The commission observed violations of multiple ethical rules


       3A  finder of fact is free to credit some testimony of a witness while discounting
other testimony from the same witness. Top of Iowa Coop. v. Sime Farms, Inc., 608
N.W.2d 454, 468 (Iowa 2000); see also In re Askew, 96 A.3d 52, 60 (D.C. 2014).
Further, finding some testimony not credible does not necessarily mean finding that the
witness was being deliberately dishonest—a witness could be simply mistaken, for
example. See Aden v. Holder, 589 F.3d 1040, 1045 (9th Cir. 2009).
                                   21

and a pattern of conduct occurring over years warranted increased

disciplinary   sanctions.   The   commission   found   Hamer    was   an

experienced attorney and this was an aggravating factor to be

considered. Finally, the commission found Hamer’s misconduct reflected

poorly on the legal profession as a whole, requiring a suspension to

penalize the lawyer and deter others.

      Based on all the facts and circumstances, the commission

recommended a six-month suspension.

      II. Standard of Review.

      We review commission reports de novo.      Iowa Supreme Ct. Att’y

Disciplinary Bd. v. Kieffer-Garrison, 847 N.W.2d 489, 492 (Iowa 2014);

Iowa Supreme Ct. Att’y Disciplinary Bd. v. Howe, 706 N.W.2d 360, 366

(Iowa 2005). We give weight to the factual findings of the commission,

especially with respect to witness credibility but are not bound by the

commission’s determinations. Iowa Supreme Ct. Att’y Disciplinary Bd. v.

Blessum, 861 N.W.2d 575, 582 (Iowa 2015). The Board has the burden

of proving attorney misconduct by a convincing preponderance of the

evidence. Iowa Supreme Ct. Att’y Disciplinary Bd. v. Bowles, 794 N.W.2d

1, 3 (Iowa 2011).

      “Although we respectfully consider the discipline recommended by

the [c]ommission, the final decision on the appropriate sanction is for

this court.”   Kieffer-Garrison, 847 N.W.2d at 492 (quoting Howe, 706

N.W.2d at 366).

      III. Conflicts of Interest Between Current Clients.

      A. Positions of the Parties. Hamer argues the Board has failed

to prove any violation of attorney ethics under the code or the rules. He

emphasizes the rules for ethical conduct do not prevent multiple-client

representation when two or more clients have exceedingly similar or
                                     22

aligned interests.   Here, he argues, all parties had similarly aligned

interests in the private loans and there was no likelihood Hamer would

be subject to adverse influences affecting his independent judgment on

behalf of each client. He asserts he made appropriate disclosures to all

clients and received informed consent.

      The Board      argues   Hamer violated    numerous rules in the

transactions between Paul and other clients. The Board contends Hamer

violated DR 5–105(C) and (D) in initiating and arranging loans between

Paul and other clients. Hamer represented both creditor and debtor in

commercial transactions.      See Iowa Supreme Ct. Bd. of Prof’l Ethics &

Conduct v. Wagner, 599 N.W.2d 721, 728–29 (Iowa 1999) (noting

disclosure of dual representation and detailed nature of conflicts

required in large commercial transaction). The Board argues although

Hamer allegedly told Paul the borrowers were clients, Hamer never said

he explained the pitfalls that might arise in the transaction that would

make it desirable for Paul to obtain independent counsel.         Although

Hamer testified he strove to make disclosures to his clients to achieve a

mutual comfort level for them to proceed with the transaction, the Board

contends the multiple-client disclosure letter that Paul signed for one of

the loans was inadequate. See Iowa Supreme Ct. Att’y Disciplinary Bd. v.

Clauss, 711 N.W.2d 1, 2–4 (Iowa 2006).

      With respect to the loan occurring after July 2005, the Board

argues Hamer violated rule 32:1.7(a)(2), (b). Hamer never obtained Paul’s

informed consent in writing as required by the rule.        While Hamer

provided a multiple-client representation letter, Paul never saw this.

Further, Hamer did not advise Paul that confidential communications

from Paul would be shared with the other client and vice versa.
                                    23

      B. Required Disclosures for Informed Consent in Conflict-of-

Interest Representations Between Clients.

      1. Under the code. The Iowa Code of Professional Responsibility

for Lawyers DR 5–105(B) provides,

             (B) A lawyer shall decline proffered employment if the
      exercise of independent professional judgment on behalf of a
      client will be or is likely to be adversely affected by the
      acceptance of the proffered employment, except to the extent
      permitted under DR 5–105(D).

Additionally, DR 5–105(C) states,

             (C) A lawyer shall not continue multiple employment if
      the exercise of independent professional judgment on behalf
      of a client will be or is likely to be adversely affected by the
      representation of another client, except to the extent
      permitted under DR 5–105(D).

Id. DR 5–105(C).

Finally, the exception to the above provided in DR 5–105(D) reads,

            (D) In the situations covered by DR 5–105(B) and
      DR 5–105(C), a lawyer may represent multiple clients if it is
      obvious that the lawyer can adequately represent the interest
      of each and if each consents to the representation after full
      disclosure of the possible effect of such representation on the
      exercise of the lawyer’s independent professional judgment
      on behalf of each.

Id. DR 5–105(D).

      For full disclosure under DR 5–105(D), the Iowa Supreme Court

has said that it requires the

      attorney not only to inform the prospective client of the
      attorney’s relationship with the [other party], but also to
      explain in detail the pitfalls that may arise in the course of
      the transaction which would make it desirable that the buyer
      obtain independent counsel.

Wagner, 599 N.W.2d at 728 (quoting In re Dolan, 384 A.2d 1076, 1080

(N.J. 1978)). We spoke further of the level of detail that is required to

make full disclosure:
                                      24
      [A full disclosure] requires a detailed explanation to the
      client of all possible areas where the interest of one client
      may differ from that of the other. The burden is upon the
      lawyer to raise all possibilities. A simple recitation of the
      applicable law is inadequate.        An explanation of the
      applicable law to every possible factual situation is essential.

Id. at 729 (alteration in original) (quoting Iowa Supreme Ct. Bd. of Prof’l

Ethics & Conduct Formal Opinion, No. 79-19).

      In Wagner, an attorney represented both the buyer and the seller

in a real estate transaction. Id. at 724–25. This triggered a duty of full

disclosure in order for the attorney to get informed consent. Id. at 728.

The attorney, however, only told the clients about the possibility of a

conflict, but did not advise what possible conflicts might arise and why

independent counsel was advisable.         Id. at 729.      The attorney’s

disclosures were, therefore, inadequate. Id. The client was harmed, the

court explained, by not having the opportunity for representation by a

truly independent counsel who could have better protected the client’s

interest in the transaction.    Id.   The fact that the attorney did not

negotiate the purchase price between the parties did not eliminate the

conflict of interest. Id. at 726. The attorney thus violated DR 5–105(B)–

(D). Id. at 729.

      In Clauss, an attorney represented both a landlord and a renter in

the collection and payment of past-due rental fees.       711 N.W.2d at 2.

The attorney attempted to obtain a waiver of the conflict, sending a letter
to both, which they both signed, simply stating the attorney was asking

them to waive the conflict and the other client had no problems under

the circumstances.    Id.   The Clauss court held these were not valid

waivers of conflict under DR 5–105(D).        Id. at 3.    Importantly, the

attorney’s letter lacked a “full disclosure of the possible effect of such
                                      25

representation on the exercise of the lawyer’s independent professional

judgment on behalf of each.” Id. at 3 (quoting DR 5–105(D)).

       2. Under the rules. Rule 32:1.7(a) reads,

             (a) Except as provided in paragraph (b), a lawyer shall
       not represent a client if the representation involves a
       concurrent conflict of interest. A concurrent conflict of
       interest exists if:

             (1) the representation of one client will be directly
       adverse to another client; or

             (2) there is a significant risk that the representation of
       one or more clients will be materially limited by the lawyer’s
       responsibilities to another client, a former client, or a third
       person or by a personal interest of the lawyer.

Iowa R. Prof’l Conduct 32:1.7(a)(1)–(2). Rule 32:1.7(b) states,

              (b) Notwithstanding the existence of a concurrent
       conflict of interest under paragraph (a), a lawyer may
       represent a client if:

             (1) the lawyer reasonably believes that the lawyer will
       be able to provide competent and diligent representation to
       each affected client;

              (2) the representation is not prohibited by law;

             (3) the representation does not involve the assertion of
       a claim by one client against another client represented by
       the lawyer in the same litigation or other proceeding before a
       tribunal; and

             (4) each affected     client   gives   informed     consent,
       confirmed in writing.

Id. r. 32:1.7(b)(1)–(4).

       We recently heard Iowa Supreme Court Attorney Disciplinary Board

v. Willey, 889 N.W.2d 647 (Iowa 2017). In Willey, the attorney Willey had

two clients, Wild and Wieniewitz. Id. at 650. Wild was the president of a

company called Synergy. Id. When Willey learned that Wieniewitz was

interested in investment opportunities, Willey offered an investment in

Synergy and arranged the investment in the form of a loan.                  Id.
                                     26

Wieniewitz denied that Willey told him that Wild and Synergy were

Willey’s clients.   Id.   All communication about the loan went through

Willey. Id. Willey never obtained informed consent from Wieniewitz nor

confirmed in writing any potential conflict of interest with Wild and

Synergy. Id. at 651. Willey did not recommend Wieniewitz consult with

independent counsel. Id. Wieniewitz never received any of the promised

payments for the investment, which was supposed to be repaid within

forty-five days with additional payments to follow. Id. at 650–51. Willey

repeatedly assured Wieniewitz there was only a short delay and

payments would be made within a week. Willey made such assurances

frequently for over a year and a half. Id. at 652.

      In determining whether there was a conflict of interest under rule

32:1.7(a)(2), we explained that we use a two-step approach to determine

whether an attorney violated the rule.       Id. at 653.    We first decide

whether the lawyer’s representation of one client was affected by his or

her “responsibilities to another client, a former client, or a third person.”

Id. (quoting Iowa R. Prof’l Conduct 32:1.7(a)(2)); see also Iowa Supreme

Ct. Att’y Disciplinary Bd. v. Stoller, 879 N.W.2d 199, 207 (Iowa 2016). If

the answer to this is yes, we then determine whether the attorney’s

“representation of one client was materially limited by his [or her]

representation of another.”      Willey, 889 N.W.2d at 653.       We noted

comment 8 to rule 32:1.7 states,

             Even where there is no direct adverseness, a conflict of
      interest exists if there is a significant risk that a lawyer’s
      ability to consider, recommend, or carry out an appropriate
      course of action for the client will be materially limited as a
      result of the lawyer’s other responsibilities or interests.

Id. (quoting Iowa R. Prof’l Conduct 32:1.7 cmt. 8). We stressed

      [t]he key questions a lawyer must ask are whether it is likely
      a difference in interests will occur between the clients and, if
                                    27
      so, whether that difference in interests will interfere with the
      lawyer’s ability to offer independent, professional judgment
      to each client.

Id. at 653–54.

      We held there was a concurrent conflict of interest.      Id. at 656.

The interests of Wieniewitz, who loaned the money, and Synergy and

Wild, the borrowers, “were at odds from the beginning.”        Id.   Willey’s

representation of Wieniewitz was materially limited because Willey was

unable to adequately pursue Wieniewitz’s interest in obtaining the return

of his original investment—Willey only forwarded information from one

client to another and did nothing to protect Wieniewitz. Id. We also held

Willey failed to obtain informed consent, confirmed in writing, from

Wieniewitz before continuing to represent both parties in the transaction.

Id.

      C. Discussion. First, considering the transactions between Paul

and other Hamer clients that occurred before July 2005, we hold the

Board has shown by a convincing preponderance of the evidence that

Hamer violated Iowa Code of Professional Responsibility for Lawyers

DR 5–105(B)–(D). For later conduct, we also hold the Board has shown

Hamer violated Iowa Rule of Professional Conduct 32:1.7(a) and (b) by a

convincing preponderance of the evidence.

      Under both the code and the rules, the Board must show there was

a concurrent conflict of interest between Paul and the other Hamer
clients in order to trigger Hamer’s duty of obtaining informed consent

from Paul and the other clients, after full disclosure.     The Board has

done this by showing that Hamer represented Paul as the lender and the

other clients as the borrowers in the private loans.      As we explained

under similar circumstances in Willey, there was a concurrent conflict of

interest when Hamer represented both the lender Paul and the borrowers
                                    28

because the interests of Paul and the borrowers “were at odds from the

beginning.” 889 N.W.2d at 656.

      In attempting to argue there was no conflict of interest between

Paul and the borrowers, Hamer stressed Paul and the borrowers had

similarly aligned interests. This is simply wrong. While it is generally

true that both lenders and borrowers have an interest in successfully

completing the loan transaction, lenders and borrowers have conflicting

interests at the initiation of the transaction in obtaining favorable terms.

It hardly needs to be said that a term that is a favorable term for the

borrower tends to be an unfavorable term for the lender and vice versa.

      Hamer also stresses he performed no negotiations on behalf of

either Paul or the lenders, but as we noted in Wagner in the context of a

real estate transaction, the fact that an attorney does not perform any

negotiations between the parties does not eliminate the conflict.       599

N.W.2d at 726.      Borrowers and lenders may also have conflicting

interests throughout the transaction, particularly when the borrower

encounters difficulties in repaying the loan, as happened here in at least

two of the loans described in the complaint.

      The code and the rules have slightly different requirements for

informed consent, and so whether Hamer obtained informed consent

from Paul must be analyzed separately under the code and the rules.

      Under DR 5–105(B)–(D), unlike under rule 32:1.7(a) and (b), the

client’s informed consent need not be confirmed in writing.       Here, we

have conflicting testimony from Hamer and Paul about the nature and

type of disclosures that Hamer orally made to Paul about the conflict.

While we agree with the commission’s findings of credibility with respect

to Hamer and Paul, even assuming that we completely credit Hamer’s

testimony about the disclosures he made, we would still find that Hamer
                                    29

failed to fully disclose to Paul the possible effect of representing both

Paul and the borrower on the exercise of Hamer’s independent

professional judgment on Paul’s behalf. See Clauss, 711 N.W.2d at 3.

      We note that in Hamer’s response to the Board’s complaint, Hamer

repeatedly asserted that “he most certainly did not have a discussion

detailing how each and every possible other ‘counsel’ may have

approached Paul’s interest.” While the code does not require Hamer to

have disclosed how “each and every possible” independent counsel might

approach his or her representation of Paul, the code does require Hamer

have disclosed how an unconflicted attorney would be better able to

represent Paul’s interests than Hamer with respect to the transactions at

hand. At the very least, Hamer’s disclosure should have included how

an unconflicted attorney would be able to represent Paul in the event of

the borrower defaulting on the loan—which, of course, is one of the most

obvious events that could happen in a loan and that any competent

attorney must envision as a possibility.     In addition, an unconflicted

attorney representing the lender in a loan transaction would carefully

examine available collateral, advise the client of potential remedies in the

event of default, and ensure any security interests supporting the loan

were properly perfected.    We further note the one time that Hamer

provided Paul with a multiple-client representation letter, this letter,

while somewhat lengthy, failed to provide the required specific, in-context

assessment of the pitfalls that might arise in the course of the loan that

would make it desirable that Paul obtain independent counsel.           See

Wagner, 599 N.W.2d at 728.

      With respect to the transaction that occurred after July 2005, it is

undisputed that Hamer did not obtain informed consent from Paul

confirmed in writing as required by rule 32:1.7(b). We note that Hamer
                                        30

prepared a multiple-client representation letter and consent form for this

transaction, but this letter was not signed by Paul.        We further credit

Paul’s testimony that he was not contemporaneously presented with the

letter. Even if Paul had signed this consent form, as we explained above

with respect to the prior, similar informed-consent letter, this letter was

insufficient to serve as full disclosure because, at the very least, it lacked

a specific discussion of the potential pitfalls involved in the transactions

at hand.

      For the above reasons, we conclude the Board proved by a

convincing preponderance of the evidence that Hamer repeatedly violated

DR 5–105(B)–(D) and rule 32:1.7(a) and (b).

     IV. Conflicts of Interest Between Attorney and Client: Loans
and Joint Investments.

      A. Positions of the Parties. Hamer argues the loans he entered

into with Paul were standard commercial transactions because of Paul’s

expertise and experience as a private banker. In a comment to Iowa Rule

of Professional Conduct 32:1.8, if a client offers standard commercial

transactions for products and services, including banking or brokerage

services, then “the lawyer has no advantage in dealing with the client,
and   the   restrictions   in   [rule    32:1.8(a)]   are   unnecessary   and

impracticable.” Iowa R. Prof’l Conduct 32:1.8 cmt 1. Hamer asserts Paul

was engaged in private banking and was an expert in it, and thus the

loans fall squarely within the standard commercial transaction exception

to the rule.   See generally Iowa Supreme Ct. Att’y Disciplinary Bd. v.

Dolezal, 841 N.W.2d 114, 122–23 (Iowa 2013) (discussing standard

commercial transaction exception to rule 32:1.8(a)).

      The Board argues that Hamer violated numerous code provisions

and rules in arranging loans between Paul and entities that Hamer
                                    31

owned or an ownership interest in.       First, the Board argues Hamer

violated DR 5–104(A) for the million dollar “bonus” loan between Paul

and Hamer’s company Quad Four, L.L.C. in July 2004.

      The Board also asserts the July 2004 loan to Quad Four, L.L.C.

violated DR 5–101(A).    See Clauss, 711 N.W.2d at 3–5 (representing

judgment creditor and judgment debtor simultaneously).              Hamer

accepted employment when his own interests impaired or may have

impaired his independent professional judgment by borrowing money

from Paul and becoming one of Paul’s debtors.

      B. Required Disclosures for Informed Consent in Conflict-of-

Interest Representations Between Attorney and Client.

      1. Under the code.    Iowa Code of Professional Responsibility for

Lawyers DR 5–101(A) states,

            (A) Except with the consent of the client after full
      disclosure, a lawyer shall not accept employment if the
      exercise of the lawyer’s professional judgment on behalf of
      the client will be or reasonably may be affected by the
      lawyer’s own financial, business, property, or personal
      interests.

DR 5–104(A) states,

            (A) A lawyer shall not enter into a business
      transaction with a client if they have differing interests
      therein and if the client expects the lawyer to exercise
      professional judgment therein for the protection of the client,
      unless the client has consented after full disclosure.

Id. DR 5–104(A).

      In Committee on Professional Ethics & Conduct v. Mershon, 316

N.W.2d 895 (Iowa 1982), an attorney formed a corporation with his client

named Miller and a third individual named Schenk, who was not a client.

Id. at 896–97. When Miller died, the attorney and Schenk disputed the

ownership of the corporation. Id. at 897. The question before the court
                                    32

was whether the evidence showed the attorney violated DR 5–104(A),

prohibiting business transactions with clients when there is a conflict,

unless the client has consented after full disclosure. Id.

      The Mershon court explained,

            In order to establish a violation of DR 5–104(A) it is
      necessary to show that the lawyer and client had differing
      interests in the transaction, that the client expected the
      lawyer to exercise his professional judgment for the
      protection of the client, and that the client consented to the
      transaction without full disclosure.

Id. at 898. The court noted that there was no dispute that the attorney

and Miller had differing interests in the transaction and that Miller relied

on the attorney to exercise his professional judgment to protect him. Id.

The fighting issue was whether the attorney made full disclosure to

Miller. Id. at 898–99.

      The court held that because a fiduciary relationship exists, an

attorney

      has the burden of showing that the transaction “was in all
      respects fairly and equitably conducted; that he fully and
      faithfully discharged all his duties to his client, not only by
      refraining from any misrepresentation or concealment of any
      material fact, but by active diligence to see that his client
      was fully informed of the nature and effect of the transaction
      proposed and of his own rights and interests in the subject
      matter involved, and by seeing to it that his client either has
      independent advice in the matter or else receives from the
      attorney such advice as the latter would have been expected
      to give had the transaction been one between his client and a
      stranger.”

Id. at 899 (quoting Goldman v. Kane, 329 N.E.2d 770, 773 (Mass. App.

Ct. 1975)).   Thus, because the record did not show that the attorney

made a full disclosure to Miller before Miller consented to the

transaction, a violation of DR 5–104(A) was established. Id. at 900.
                                     33

      Since Mershon, we have regularly confirmed that “when an

attorney engages in business transactions with a client involving

conflicting interests, the burden is on the attorney to show that he acted

in good faith and made full disclosures.”         Iowa Supreme Ct. Att’y

Disciplinary Bd. v. Wintroub, 745 N.W.2d 469, 474 (Iowa 2008); see also

Iowa Supreme Ct. Bd. of Prof’l Ethics & Conduct v. Sikma, 533 N.W.2d

532, 535–36 (Iowa 1995); Smith v. Bitter, 319 N.W.2d 196, 198 (Iowa

1982) (emphasizing the “harsh and demanding responsibilities of an

attorney” in a business relationship with clients). If the record fails to

affirmatively show the client was fully advised about the facts and legal

consequences of a transaction that are necessary to make an intelligent

decision, there is an ethical violation. Wintroub, 745 N.W.2d at 474.

      2. Under the rules. Rule 32:1.8(a) provides,

             (a) A lawyer shall not enter into a business
      transaction with a client or knowingly acquire an ownership,
      possessory, security, or other pecuniary interest adverse to a
      client unless:

            (1) the transaction and terms on which the lawyer
      acquires the interest are fair and reasonable to the client and
      are fully disclosed and transmitted in writing in a manner
      that can be reasonably understood by the client;

            (2) the client is advised in writing of the desirability of
      seeking and is given a reasonable opportunity to seek the
      advice of independent legal counsel on the transaction; and

            (3) the client gives informed consent, in a writing
      signed by the client, to the essential terms of the transaction
      and the lawyer’s role in the transaction, including whether
      the lawyer is representing the client in the transaction.

Iowa R. Prof’l Conduct 32:1.8(a)(1)–(3). Comment 1 to rule 32:1.8 states

      the rule does not apply to standard commercial transactions
      between the lawyer and the client for products or services
      that the client generally markets to others, for example,
      banking or brokerage services, medical services, products
      manufactured or distributed by the client, and utilities’
      services. In such transactions, the lawyer has no advantage
                                    34
      in dealing with the client, and the restrictions in paragraph
      (a) are unnecessary and impracticable.

Id. r. 32:1.8 cmt 1.

      C. Discussion.     We first address Hamer’s argument that the

commission erred in requiring him to affirmatively show he fully

disclosed the conflict of interest to Paul. Hamer is incorrect under our

longstanding precedent described above.         Once the Board shows an

attorney engaged in business transactions with a client and they had

conflicting interests, the burden shifts to the attorney to show good faith
and full disclosure. If the attorney cannot affirmatively show this, the

attorney has violated the code or the rules.

      The fact that an attorney’s disclosure requirements are “harsh and

demanding,” and that our rules require the attorney to demonstrate good

faith and full disclosure at a disciplinary hearing, serves to remind

attorneys to be very careful when engaging in these type of transactions.

See Smith, 319 N.W.2d at 198.      While the code and the rules allow a

client to waive the conflict of interest, the onerous burden of ensuring

documentary evidence of good faith and full disclosure should make

such business transactions the exception rather than the rule. A client

simply cannot waive the conflict as a matter of informal routine.      The

disclosure must include a detailed, situation-specific discussion of the

ways that are reasonably foreseeable in which the attorney’s conflict

could potentially impact that particular client with that particular

conflict, along with all of the other required disclosures including how

confidential information will be handled.

      With respect to the loans between Paul and Hamer, we find Hamer

has failed to meet his burden of showing that he obtained Paul’s

informed consent for the transactions.         We wish to stress the loans
                                       35

between Paul and Hamer were not standard commercial transactions.

While Paul and Hamer may have termed Paul’s loans “private banking,”

they bear little resemblance to actual banks and their lending practices.

For example, borrowers did not need to fill out any forms for Paul or

disclose their financial information. Paul did not run a credit check on

the borrowers prior to lending them money.

       Because the loans between Paul and Hamer were not standard

commercial transactions, and because Hamer has not shown that Paul

was advised of the need to seek independent legal counsel or that he

gave informed consent to the terms of the transaction and the lawyer’s

role   in   the   transaction,   we   find   Hamer   violated   DR   5–101(A),

DR 5–104(A) and rule 32:1.8.

       With respect to Paul and Hamer’s investments in Platinum and

UWT in count III, the commission found the Board had failed to show

Hamer violated the code and rule provisions.         The commission found

Paul was not credible when he testified that he relied upon Hamer for

investment advice in Platinum and UWT.          The commission found Paul

reviewed investment information material from Platinum and UWT,

negotiated with Platinum, and had personal contact with individuals at

UWT. In short, the commission found the record did not establish Paul’s

reliance on Hamer for advice in connection with what turned out to be

bad investments.         The Board on        appeal does not contest the

commission’s approach. We find no reason to disturb the commission’s

conclusion regarding Platinum and UWT.

       V. Excessive Fee and Dishonest Conduct: The Bonus.

       A. Positions of the Parties. Hamer argues the commission erred

in finding that Hamer collected an excessive fee for his role in the sale of

Buckle Down.        First, Hamer reasserts Paul’s testimony was totally
                                    36

lacking in credibility.   Hamer points to Paul’s inconsistency about the

amount of the bonus he claimed he originally proposed, whether

$250,000, $150,000, or $110,000. Hamer claims the testimony that he

declined the cash bonus and proposed a $1,000,000 loan at 2.5% was

completely fabricated, motivated by Paul’s desire to hurt Hamer. Finally,

Hamer argues the total fee was not excessive because the sale of Buckle

Down was highly technical and required Hamer’s advanced legal

expertise for work that spanned six years.

      The Board argues Hamer violated DR 1–102(A)(4) and DR 2–106(A)

in collecting two bonuses for the sale of Buckle Down, one cash bonus of

$110,000 that Paul did not know about and one discounted-interest

bonus on a $1,000,000 loan to which Paul had agreed.           The Board

argues it has met its burden to show Hamer’s intent for the charge of

misconduct under DR 1–102(A)(4) because Hamer withheld the itemized

bill for Buckle Down from Paul until long after Hamer obtained the loan.

See Iowa Supreme Ct. Att’y Disciplinary Bd. v. Kress, 747 N.W.2d 530,

538 (Iowa 2008) (establishing the Board’s duty to show intent).       The

natural and logical consequences of delaying the bill’s release to Paul

were to intentionally mislead Paul and dishonestly obtain a second

bonus through the low-interest-rate loan.

      B. Discussion. The resolution of disciplinary issues surrounding

the bonus issue depends on credibility determinations. If Paul’s version

of events surrounding the bonus issue is believed, Hamer would face at

least two potential disciplinary problems. First, it would be improper for

Hamer to secure a preferential loan from Paul, which would inure solely

for Hamer’s personal benefit, in lieu of a cash bonus for Hamer’s work on

the Buckle Down transaction, which would be paid to Hamer’s law firm.

We have condemned the diversion of fees owed to a firm into a lawyer’s
                                        37

personal account on numerous occasions. See State v. Henrichsen, 825

N.W.2d 525, 527–28 (Iowa 2013).          But the Board did not charge Paul

with a Henrichsen-type violation. See Iowa Supreme Ct. Att’y Disciplinary

Bd. v. Nelson, 838 N.W.2d 528, 536 n.2 (Iowa 2013) (noting that finding

an attorney in violation of a rule not charged by the Board would deprive

the attorney of procedural due process).

      Instead, the Board charged Hamer with ethical violations in

connection with the payment of what Paul characterizes as an

unauthorized, double bonus that was included in the unitemized fee

statement that Hamer presented to Paul for his work in the Buckle Down

transaction. In his brief, Hamer notes that if the facts were as alleged by

Paul, it would amount to theft. Iowa Code of Professional Responsibility

for Lawyers DR 1–102(A)(4) prohibits a lawyer from “[e]ngag[ing] in

conduct involving dishonesty, fraud, deceit, or misrepresentation.”       To

prove a violation of DR 1–102(A)(4), the Board must show the attorney

intentionally engaged in fraud, dishonesty, or deceit. Kress, 747 N.W.2d

at 538.    Intent is shown for the purpose of a disciplinary proceeding

“where the evidence shows that the actor intends the natural and logical

consequences of his or her acts” by a convincing preponderance of the

evidence. Id.

      On    the   factual    question    of   whether   Hamer   charged   an

unauthorized double bonus in his unitemized fee statement, we note

several features of the record.         On the one hand, Hamer has no

explanation as to why Paul would extend the $1,000,000 loan to him at

the very low rate of 2.5% annual interest. The interest rate on the loan

was far below the interest rate Paul received on other loans, including a

later loan to Hamer.        Further, why did it take Hamer five years to

disclose to Paul that an $110,000 bonus was contained within the
                                     38

unitemized fee statement? On the other hand, Paul did not mention the

double-bonus problem in his original complaint filed with the Board. If

Paul had, in fact, paid an unauthorized second bonus of $110,000, one

would expect this to be included in an ethics complaint filed with the

Board.

      The commission found the facts on the double bonus adversely to

Hamer.     We ordinarily give deference to the fact finding of the

commission on questions where the credibility of witnesses is involved.

Iowa Supreme Ct. Att’y Disciplinary Bd. v. Moothart, 860 N.W.2d 598, 602

(Iowa 2015).    Based on the cold record, it is difficult to determine

whether there was a double bonus or whether there was simply some

kind of misunderstanding between Paul and Hamer.         At a minimum,

however, we think Hamer acted deceitfully when he presented Paul with

an unitemized bill with an undisclosed substantial bonus and refused to

provide him with an itemization for five years. We thus think the Board

proved a violation of DR 1–102A(4) by a clear and convincing

preponderance of the evidence.

      VI. Sanction.

      A. Positions of the Parties.        Hamer argues that no sanction

should be imposed. If we do impose a sanction, however, Hamer asserts

that his involvement in the community, including pro bono work and

volunteering, is a significant mitigating factor.

      The Board requests that we impose an “appropriate disciplinary

sanction” against Hamer.        It draws our attention to the following

aggravating factors: a pattern of misconduct, multiple offenses, refusing

to acknowledge the wrongful nature of the conduct, harm to the client,

and Hamer’s substantial experience in the practice of law.
                                    39

       B. Appropriate Sanction.       We now turn to the issue of the

appropriate sanction. We individually craft an appropriate sanction for

each case in light of its particular circumstances. Dolezal, 841 N.W.2d at

127.

       In determining the appropriate discipline, we consider the
       nature of the alleged violations, the need for deterrence,
       protection of the public, maintenance of the reputation of the
       bar as a whole, and the respondent’s fitness to continue in
       the practice of law, as well as any aggravating and mitigating
       circumstances.

Iowa Supreme Ct. Att’y Disciplinary Bd. v. Marks, 831 N.W.2d 194, 201

(Iowa 2013) (quoting Iowa Supreme Ct. Att’y Disciplinary Bd. v. Cannon,

821 N.W.2d 873, 880 (Iowa 2012)).

       In Willey, we imposed a suspension of sixty days for one instance

of an attorney representing both sides in a loan without first obtaining

informed consent from both parties. 889 N.W.2d at 658. In Wagner, we

imposed a three-month suspension for one instance of representing both

parties in a real estate transaction in which the attorney had an interest

in, which he failed to disclose to the client.    599 N.W.2d at 729–31.

Clauss also involved a single instance of representing both parties in a

loan without first obtaining informed consent, but we imposed a six-

month suspension because of aggravating factors, including an extensive

history of disciplinary infractions and the fact that Clauss personally

beneficiated financially from the transaction. 711 N.W.2d at 4–5. Here,

however, Hamer repeatedly and over the course of several years

represented both parties in many loans. See, e.g., Iowa Supreme Ct. Att’y

Disciplinary Bd. v. Mendez, 855 N.W.2d 156, 175 (Iowa 2014) (imposing

suspension of sixty days for one conflict-of-interest violation, among

other violations); Iowa Supreme Ct. Att’y Disciplinary Bd. v. Qualley, 828

N.W.2d 282, 288, 294 (Iowa 2013) (suspending attorney’s license for
                                     40

sixty days for one conflict-of-interest violation, along with other rule

violations); Iowa Supreme Ct. Att’y Disciplinary Bd. v. Netti, 797 N.W.2d

591, 606–07 (Iowa 2011) (suspending attorney for two years for a

conflict-of-interest representation violation, along with a dizzying array of

other violations, because attorney’s conduct was “serious, egregious, and

persistent” and harmed clients); Iowa Supreme Ct. Att’y Disciplinary Bd.

v. Zenor, 707 N.W.2d 176, 187 (Iowa 2005) (suspending attorney for four

months for engaging in criminal defense work while working as the

county attorney); see generally Stoller, 879 N.W.2d at 219 (canvassing

the caselaw and concluding a majority of sanctions imposed in conflict-

of-interest cases range from suspensions of sixty days to a suspension of

four months, depending on the egregiousness or number of violations).

      That brings us to the question of double bonuses.            Whatever

confusion there may have been originally about the payment of a bonus,

we think Hamer acted with deceit when he refused to give Paul an

itemized statement disclosing the $110,000 bonus that was included in

his billing for the Buckle Down sale. On top of the other nondisclosures,

this is a troublesome violation.      See, e.g., Iowa Supreme Ct. Att’y

Disciplinary Bd. v. Bartley, 860 N.W.2d 331, 338, 340 (Iowa 2015)

(suspending license for six months for, among other things, a series of

misrepresentations to law firm and to the court); Iowa Supreme Ct. Att’y

Disciplinary Bd. v. McGinness, 844 N.W.2d 456, 459–60, 467 (Iowa 2014)

(suspending attorney’s license for six months for deceit persisting over a

period of time involving forged proof of service); Iowa Supreme Ct. Bd. of

Prof’l Ethics & Conduct v. Stein, 586 N.W.2d 523, 526 (Iowa 1998)

(neglecting client matters and making numerous misrepresentations to

hide neglect warranted 180-day suspension).
                                    41

       Turning next to mitigating factors, Hamer does have an impressive

record of community service. See Iowa Supreme Ct. Att’y Disciplinary Bd.

v. Taylor, 887 N.W.2d 369, 382 (Iowa 2016).       Additionally, Hamer has

never had any prior disciplinary action taken against him. Bartley, 860

N.W.2d at 339.

       There are, however, a substantial number of aggravating factors.

Hamer’s lengthy career as a business attorney must be a strike against

him, as well as his continued professed lack of understanding that the

actions which he admits to doing clearly violated attorney ethics. See id.;

Comm. on Prof’l Ethics & Conduct v. Hall, 463 N.W.2d 30, 36 (Iowa 1990)

(finding that attorney’s belief that nothing he did was really wrong in a

conflict of interest representation is an aggravating factor). Additionally,

Hamer committed numerous violations over a period of years, showing a

pattern of misconduct. See Cannon, 821 N.W.2d at 883.

       In short, Hamer displays an obviously cavalier attitude toward the

requirements of our disciplinary rules. Because of the nature of Hamer’s

practice and the nature of his clients, the disclosure rules, according to

Hamer, are somehow inapplicable, unnecessary, or optional.          This is

incorrect.      The disclosure rules are always mandatory.       See Iowa
Supreme Ct. Bd. of Prof’l Ethics & Conduct v. Lett, 674 N.W.2d 139, 143

(Iowa 2004) (“The disciplinary rules are mandatory provisions of our code

of ethics . . . .”).

       Further, and despite Hamer’s insistence to the contrary, Paul

experienced at least some harm as a result of Hamer’s conflicts of

interest.    See Iowa Supreme Ct. Att’y Disciplinary Bd. v. Lynch, 901

N.W.2d 501, 511 (Iowa 2017); Iowa Supreme Court Bd. of Prof’l Ethics &

Conduct v. Jay, 606 N.W.2d 1, 4 (Iowa 2000). One of the loans is still

outstanding and may in fact never be paid back.
                                    42

      There is no clear-cut formula for the determination of appropriate

sanction in disciplinary cases. Based on the totality of circumstances,

however, we think that a six-month suspension is required in this case.

      VII. Conclusion.

      For the above reasons, we suspend Hamer’s license for a period of

six months from the date of this opinion without the possibility of

reinstatement. The suspension applies to all facets of the practice of law,

as provided by Iowa Court Rule 34.23(3), and requires Hamer to notify

his clients, as provided by Iowa Court Rule 34.24. Upon any application

for reinstatement, Hamer must establish that he has not practiced law

during the suspension period and that he has complied with the

requirements of Iowa Court Rule 34.25. The costs of this proceeding are

assessed to Hamer pursuant to Iowa Court Rule 36.24(1).

      LICENSE SUSPENDED.

      All justices concur except Hecht, J., who takes no part.
