Tag Archive: IOLTA

State Bar: Friend or Foe?

Jim Heiting, former president of the State Bar of California, commented on my article in LawBiz® Tips last week. He said, "I fully agree with your article about bar associations … and the new push to create more unemployment and less opportunity for the solo and small practitioner. Why not develop a [Bar] program that assists solos and small practitioners to represent people for reduced fees to get experience, make money, provide services otherwise unavailable at that rate, etc. We have many, many who would like to make a modest living but can’t/don’t seem to do it. This would assist the needy in both arenas: client and attorney."

For my money, Jim Heiting has been the only California Bar leader who truly had members’ (lawyers) AND the public’s interests in mind. Others before and since Jim have seen the Bar as a regulatory agency for the public with little or no concern for members. Unfortunately, this is likewise the case across the country.

There are way too few leaders in the legal community, whether in the Bar or the law school, who understand The Business of Law® and are willing to focus on members’ (lawyers) needs. Instead, they focus on creating new licensure opportunities that will not truly help the intended market and will both weaken the value of the law degree and the economic well-being of members.


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IOLTA accounts may be in jeopardy

Under current law, clients’ trust accounts are protected under the IOLTA program. The FDIC provides unlimited insurance coverage.

However, unless extended by Congress, beginning January 1, 2013, such unlimited coverage will terminate and the new limit will once again be $250,000 per depositor. All funds held in such trust accounts as well as all funds held, personally, by the same client in the same institution will be considered in the $250,000 limit.

Be careful and review your bank’s regulations and the funds you are holding for the benefit of your clients. Watch Congress for any "lame duck" laws on this and the FDIC and its responsive regulations. You may have to split clients’ funds into two or more banking institutions in order to keep his/her money insured. And you may once again have the responsibility of checking on the financial soundness of the banking institution in which you maintain your clients’ trust account.



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