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Lawyers have fiduciary obligations to safeguard and account for the funds and property of clients and others in their possession. A trust account must be maintained to hold the funds of clients and third parties that come into a lawyer’s possession in connection with a representation.
Examples of funds which must be placed in trust accounts include:
- Personal Injury Settlements
- Divorce Settlements
- Real Estate Escrows and Closing Proceeds
- Advanced Fees for legal services
- Cost Advances
SCR 20:1.15 (d)(6) states “A lawyer or law firm shall direct the IOLTA participating institution at which the lawyer or law firm’s IOLTA account is located to do all of the following, on at least a quarterly basis:
- Remit to WisTAF the interest or dividends, less allowable reasonable fees as allowed under par. (5), if any, on the average monthly balance in the account or as otherwise computed in accordance with the IOLTA participating institution’s standard accounting practice.
- Provide to WisTAF a remittance report showing for each IOLTA account the name of the lawyer or law firm for whose IOLTA account the remittance is sent, the rate and type of interest or dividend applied, the amount of allowable reasonable fees deducted, if any, the average account balance for the period for which the report is made, and the amount of remittance attributable to each IOLTA account.
- Provide to the depositing lawyer or law firm a remittance report in accordance with the participating institution’s normal procedures for reporting account activity to depositors.
- Respond to reasonable requests from WisTAF for information needed for purposes of confirming the accuracy of an IOLTA participating institution’s certification.
At the time an attorney client establishes an IOLTA trust account with your institution, they will need to complete two forms in cooperation with your financial institution: the Attorney IOLTA Trust Account Agreement (send a copy to WisTAF upon completion) and the Overdraft Notification Agreement (send a copy to the Office of Lawyer Regulation upon completion).
E-banking Information
On April 4, 2016, the Wisconsin Supreme Court repealed and re-created SCR 20:1.15-Safekeeping property; trust accounts and fiduciary accounts, and amended SCR 20:1.0, SCR 20:1.5 and SCR 22.39, effective July 1, 2016. The changes expanded the use of electronic transactions in trust and fiduciary accounts beyond the current limits of accepting payments for legal fees and costs and collecting debts. For more information regarding e-banking requirements, please contact the Office of Lawyer Regulation at 877-315-6941 x2 or see OLR's instructions here.
If your institution does not currently hold IOLTA accounts and you would like to join Wisconsin's IOLTA program, please contact IOLTA Program Manager, Tehmina Islam at (608) 257-6845 or tislam@wistaf.org before opening IOLTA accounts.
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