Not going to lie, having the state do the work and carry the expense of continuing to search for someone is not a bad deal for you. The state will also put the information into a state database that is publicly searchable and make other attempts to find the owner. Instead of an attorney having to maintain records on what is in the trust account for years to come with no hope of turning it over to the rightful owner, a lawyer can turn said money over to the unclaimed property fund for them to hold. In many cases, unclaimed property is an ideal way to “clean up the books” of a company or law firm trust account. You need to do something with it, right? Benefits of Reporting Unclaimed Property The money does not suddenly become yours or the firms. Typically, this means that you must keep prepaid fees and other amounts in a client trust account.Īlso under Rule 1.15, you must maintain full records to identify the property and account for all transactions into and out of the account for five years after the termination of the representation.īut what happens to money left in the account more than five years after the termination of representation? Or any money that cannot be distributed because you have lost contact with the rightful owner? Rule 1.15 covers safekeeping client property separate from your own property. ![]() The American Bar Association has promulgated model ethics rules, which many of the states have adopted in part or in full. Instead of a holder, in this case a lawyer, holding onto the financial assets, you can turn the amounts over as unclaimed property to the appropriate state’s unclaimed property office. ![]() Or just cannot make the owner cash the check, no matter what. ![]() Meaning that you do not know the rightful owner of the funds or cannot find the rightful owner if you do know who they are. Unclaimed property is a set of state laws that govern checks, bank accounts, and other financial assets that are abandoned. Not to mention, one of the fastest and easiest ways to get disbarred is to inappropriately manage your IOLTA account or other client funds. I’ve had several discussions with fellow lawyers recently about unclaimed property and about whether unclaimed property laws apply to lawyer trust accounts.Īnd nothing like a good networking event question to trigger a blog post, right? Share on LinkedIn Share on Twitter Share on Facebook Share on Email
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