Tuesday, March 17, 2009
The District of Columbia Bar's disciplinary rules revision committee has proposed amendment to Rule 1.15 with the stated goal of increasing revenue generated by IOLTA funds. A summary of the proposed changes:
- Change the existing “opt out” IOLTA program into a comprehensive program in which every D.C. Bar member must participate, regardless of where the member principally practices.
- Exempt a lawyer from the requirements of the IOLTA program when the lawyer is required by any tribunal, or by a foreign jurisdiction in which that lawyer principally practices, to follow a contrary rule about particular trust accounts. This would include requirements of a foreign jurisdiction’s IOLTA Program where the lawyer is participating either by failing to “opt out” or for affirmatively “opting in.” To the extent that Rule 1.15 does not resolve a multi-jurisdictional conflict, the general conflict of laws provisions of Rule 8.5 will govern.
- Require lawyers to advise the Bar Foundation of the opening and closing of a D.C. IOLTA Account, and report and periodically certify to the Bar Foundation compliance with, or exemption from, the IOLTA requirements in a manner and form established by the Foundation. (The Rules Review Committee did not analyze this part of the Foundation’s proposal.)
- Require that banks that wish to qualify as “Approved Depositories” -- institutions where lawyers are allowed to open and maintain client trust accounts -- agree to provide certain interest rates on IOLTA accounts (rate comparability).
- Create a new subsection of Rule XI of the D.C. Court of Appeals Rules Governing the Bar that would address the requirements for banking institutions with IOLTA accounts
- Delete in their entirety existing RPC Rule 1.19 and Appendix B with appropriate provisions from those rules relocated in RPC Rule 1.15 and Rule XI.