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#628606 - 10/24/06 07:38 PM IOLTA - Atty Client Trust
Officer of everything Offline
New Poster
Joined: Mar 2006
Posts: 7
So, in June we opened our very first IOLTA/Attorney Client Trust checking account. Unfortunately, it wasn't set up right and nobody caught it. The short story is that it has accrued interest since the account was opened, but it has never credited the account, nor have we sent any interest to the Bar Association. We have coded the account properly now and at the end of October, all of the accrued interest will credit to the account and we will send it to the Bar. My question is how to report this to the Bar and how to ensure that we, as the Bank, don't "get in trouble" for not sending it to them before. Help.

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#628607 - 10/24/06 08:55 PM Re: IOLTA - Atty Client Trust
TXBSA Offline
100 Club
Joined: May 2006
Posts: 170
TX
We have 10 IOLTA accounts. We send the interest in quarterly. I would go to this website and see what the regulations are regarding your state. http://www.abanet.org/legalservices/iolta/ioltdir.html

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#628608 - 10/25/06 07:17 AM Re: IOLTA - Atty Client Trust
RayLynch Offline
Platinum Poster
RayLynch
Joined: Oct 2003
Posts: 544
Why not contact your state bar organization and tell them of the one time mistake, how you have corrected it and let them know that at the next remittance date you will include the interest which should have been previously submitted.

My experience is that State Bar organizations are interested in getting money and not interested in playing the role of enforcer. Your post seems to suggest you are trying to find a way to "cover up" your mistake when it seems to me that being up front about the issue will probably clear the air and avoid your bank getting "in trouble".

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#628609 - 10/25/06 02:40 PM Re: IOLTA - Atty Client Trust
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 39,785
Cape Cod
My experience with the Massachusetts IOLTA Committee (the designated recipient in MA) was much as Ray suggests. They worked with us to make reporting easy and never gave us trouble when we made the occasional slip, as long as we took care of it at the next opportunity.

The only hassle they ever gave us was to repeatedly beg us to up the rate we paid on IOLTA accounts. We paid our NOW rate, and it was pretty dismal a couple of years back (come to think of it, NOWs still don't set the world on fire!)
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John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
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