Under Rule 7.2, what are lawyers prohibited from doing regarding referral fees?

Under Rule 7.2 of the ABA Model Rules of Professional Conduct, lawyers are indeed prohibited from paying a referral fee for lead generation without proper disclosure. This rule aims to maintain ethical standards in legal practice by preventing conflicts of interest and ensuring that clients are fully informed about the arrangements that may influence their legal representation.

When a lawyer pays for a referral, it can lead to situations where the referred clients may not receive the best representation since the referring source's interest could be financially motivated rather than focused on the client's needs. Therefore, if such payments are made, they must be accompanied by appropriate disclosures so that clients understand the relationship and any potential biases involved.

The other options represent actions that are either permissible or not specifically addressed by Rule 7.2 regarding referral fees. Charging clients a commission on settlements, for example, is not directly related to the concept of referral fees governed by this rule. Similarly, offering discounts for client referrals or advertising referral services does not fall under the restrictions that Rule 7.2 places on referral fee arrangements that lack transparency. The focus of the rule is primarily on financial arrangements that could compromise a lawyer's duty to the client.