Ed discusses the factors that influence collection success. Client selection: you have to get the right client. You must understand the wants and the needs of the client. You have to get confirmation of the arrangement between you and the client in writing. And, check the client’s credit.
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.
Yesterday, I watched the Richard Gere film, Aribtrage. The film portrays a successful billionaire’s moral decline as he attempts to save his failing company from his poor decisions. He "cooks" the company books by borrowing money that is not shown on the books as such in order to keep up appearances in order to complete a sale of the company, falsifies investors reports and otherwise plays "loose" with the truth. This is a man in trouble, but Gere continues to exude confidence in order to reach his goal.
Coincidentally, in today’s Wall Street Journal, reporters once again discuss the Dewey & LeBoeuf LLP demise. Prosecutors are still questioning whether there was deception about the financial condition of the firm in the last few months. Were partners told the truth, were they given accurate financial reports, and were the firm obligations to pay down outstanding debt on behalf of terminated partners honored? And, were the transgressions that did occur a matter of a struggling business doing what it could to survive or a matter of criminal and/or civil fraud?
As a matter of "black letter law," it’s clear that management (managing partner and management committee members) owe a fiduciary duty to others — investors, lenders and partners. Did they breach this duty? How close to Arbitrage did the leaders of Dewey come?
In a recent display of enthusiasm, pizza shop owner, Scott Van Duzer, gave President Obama a bear hug when the President visited his shop on a Florida campaign tour. The visit and the ensuing bear hug provided quite a spectacle. After all, how could the secret service have permitted this? But, both the owner and the President seemed to enjoy the moment.
What impressed me more was the interview of the shop owner. He said, in response to a question about whether he feels that Obama has let the country down, “The bottom line is this: I own a small business. I take accountability for my business. I’m not looking to blame the government. And if people had the same mentality of taking care of their own businesses instead of looking to blame somebody when things are a little bad—just tightening things up and doing the best they can—I think we’d be better off that way, too. The whole world is not in a good place right now, and I’m not looking to blame someone. I think that’s the problem. We’re looking more so to blame him for our misfortunes.”
In other words, we’re not “entitled” to a particular way of life; we have to work to achieve our success; and we are accountable to ourselves … neither the government nor anyone else has “done it to us.”Blaming someone else merely allows us to feel like a victim. We do have power and control over our own lives to a far greater degree than we admit.
By analogy, in a show the other day, Katie Courac talked to two teenagers who were bullied. Their common characteristic was that they refused to feel like a victim. They remained upright and confronted their attackers. Their stories provided an interesting perspective
Can we use help? Absolutely. Do we need rules of the road to assure that we have a level playing field? I believe so, but that’s my bias. Should the government provide us with help? Before you answer this question, read the Time Magazine article by Jeremy Styron to understand how the government actually is in our daily lives, more than we know, more than we care to admit, providing us with material assistance just to get through our normal day’s routine.
But, without the accountability to ourselves, without rules that apply to all, equally, we go nowhere. Thank you, Mr. Pizza Shop Owner, for putting entrepreneurship and small business in the proper perspective.
“I am really tired, and want to retire.” But, retirement is out of reach for many lawyers after their homes and retirement plans took heavy hits over the last few years. “Business purgatory” is how one phrased it.
Delays in retirement are now common, with 38% in one survey saying their retirement will be at least 5 years later than expected. The income stream for many lawyers comes from their law practice. Selling, closing or merging the practice are options, but none are likely to provide the same income stream the lawyer is accustomed to receiving.
Unless the lawyer is willing to adjust one’s life style, he will remain in practice, working to build up the practice further in order to reap the rewards needed to fund retirement.