IOLTA and Client Trust Accounts

Send inquiries regarding the trust account rules: Rule 1.15A (Safeguarding Property) and Rule 1.15B (Required Trust Account Records) of the Rules of Professional Conduct (RPC) to:

Rita Swanson, audit manager
Washington State Bar Association
1325 Fourth Ave., Suite 600
Seattle, WA 98101-2539
206-727-8242

The WSBA publication, Managing Client Trust Accounts, Rules Regulations and Common Sense, provides guidance on how to manage your lawyer trust account, including what funds must be deposited into the account, what must not be deposited into the account, along with the recordkeeping requirements. For guidance on how to complete the required periodic trust-account reconciliations, fill out the WSBA’s Monthly Reconciliation and Review Report, which is PDF fillable form.

The Legal Foundation of Washington, not the Washington State Bar Association, maintains the list of financial institutions authorized to offer IOLTA accounts.  A list of approved banks is available at the Legal Foundation of Washington website. Take the Request to Establish an IOLTA Account Form to the bank when you open your IOLTA or individual trust account. If you have any questions regarding the bank list, please contact Linda Graham (IOLTA Manager) at 206-957-6282.

Trust Account Overdrafts

Under Rule 15.4 of the Rules for Enforcement of Lawyer Conduct (ELC), banks are required to report trust account overdrafts and checks presented against insufficient funds (whether or not paid) to the Washington State Bar Association. Lawyers are also required to notify the WSBA. A trust account overdraft may result in a grievance investigation under ELC 5.3.

If your trust account is overdrawn, or if a check is presented against insufficient funds, you must report the overdraft and provide a full explanation of the cause of the overdraft to:

Craig Bray
Disciplinary Counsel
Washington State Bar Association
1325 Fourth Ave., Suite 600
Seattle, WA 98101-2539
206-239-2110

Random Examinations

Under ELC 15.1(a), the Office of Disciplinary Counsel is authorized to examine the books and records of any lawyer or law firm selected at random to determine whether the lawyer or law firm is complying with RPC 1.15, RPC 1.15B, and the other Rules of Professional Conduct referenced in RPC 1.15A or RPC 1.15B.

Resources

ELC 15.7 (Trust Accounts and the Legal Foundation of Washington)
WSBA Informal Ethics Opinion 1957 (whether lawyer is required to open multiple accounts to ensure full FDIC coverage) 
WSBA Trust Account Information FAQs
Sophisticated scams abound – Florida Bar News
May 12, 2016 Sidebar article – “What you need to know about this new cashier’s check scam