Trust Account Program
The OLR Trust Account Program has two primary goals: 1) to identify problems in the management of client trust accounts and other fiduciary accounts, and potentially, to prevent conversions from such accounts; and 2) to educate lawyers with respect to safeguarding funds and maintaining the required records. For further information, please see the Trust Account Program Annual Report .
Lawyers who are licensed in Wisconsin are required to authorize their financial institution, by written Agreement , to notify the Office of Lawyer Regulation of overdrafts on trust and fiduciary accounts from which they or a member or employee of their firm can disburse funds via check. The Agreement to Notify OLR of Overdrafts on Lawyer Trust Accounts, along with guidelines on Proper Identification of IOLTA Trust Accounts and Proper Formatting of Trust Account Checks are found at the Agreement link above, and may also be obtained by contacting OLR's Trust Account Program at (608) 261-8296 or toll-free at (877) 315-6941, Option 2.
The Wisconsin Supreme Court established trust account overdraft reporting requirements in Wisconsin, effective January 1, 1999. See, SCR 20:1.15(h) [formerly SCR 20:1.15(i)-(p)]. Pursuant to SCR 20:1.15(h)(3), whenever a check is presented against a lawyer's trust account or fiduciary account that has insufficient funds to cover that check, the financial institution must report the overdraft to OLR, regardless of whether or not the financial institution pays the check or returns it due to insufficient funds.
With respect to fiduciary accounts, the Court established limited alternatives to the overdraft reporting requirements of SCR 20:1.15(h) in SCR 20:1.15(j)(9) . Those alternatives are: 1) an annual audit of the fiduciary account by an independent CPA or 2) a responsible co-signatory, such as a co-personal representative or co-trustee, for all disbursements from the fiduciary account. These alternatives do not apply to trust accounts.
Scam alert: If you receive an e-mail saying that your IOLTA account has "insufficient funds," DO NOT open the attachment. Read more .
Topics of interest to lawyers
For guidance on proper handling of trust and fiduciary accounts; recordkeeping requirements; legal fees; and procedural information regarding OLR's Trust Account Program, including overdraft investigations, please use the following links:
- Insurance requirements for IOLTAs
- IOLTA agreement
- IOLTA participating institutions (external link)
- Legal fees
- OLR Trust Account Program and investigations
- Online banking
- SCR 20:1.15, effective January 1, 2011
- Trust accounts and recordkeeping
For guidance on dealing with common trust account problems that occur in certain specialized practice areas, including bankruptcy, real estate, and personal injury, please use the following links (all in Adobe PDF format):
- Bankruptcy filing fees - paying by credit card
- Combined payment of earned and unearned fees
- Credit card trust accounts
- Personal injury and other settlements
- Protecting third party interests in trust property
- Real estate transactions - availability of funds
- Real estate transactions - lawyer's fees
- SPD (State Public Defender) direct deposits
- SPD (State Public Defender) payments
- Unclaimed funds
Management of a trust account
OLR has created a Trust Account Manual that provides basic information on proper recordkeeping, including a transaction register, sample ledger pages, and guidelines on handling the monthly reconciliations.
Upcoming trust account seminars: October 3, 2014
For further information, contact Mary Hoeft Smith, Trust Account Program Administrator: telephone: (877) 315-6941, option 2; e-mail: firstname.lastname@example.org.
Ethics opinions and published articles on trust account issues