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Ten Commandments of Trust

6: Account for Your Clients

You can hold all of your various clients' funds in a single IOLTA account. But you won't know what belongs to whom unless you separately account for each client and case.

A subset of the information listed on the overall trust account ledger, the client trust ledger provides a snapshot of all trust activity for a given client in a given case. This ledger must show the date of the deposit or disbursement, the amount of each, and the purpose for which the funds are to be used. For disbursements, the ledger must identify the payee and check or transfer number and show the balance of funds remaining in the account in connection with the matter.

Without allocating specific funds to specific clients, how would you know that Carlos Clienté has spent $6,543.21 of his $10,000.00 retainer? How would you know that Tortfeasors Mutual's $13,000 check represents the gross recovery in Curley deStooge's case, or how PIP payments from his own insurer were allocated to medical providers? The example below comes from an extremely simple auto accident case. But without a record of all trust activity, you would quickly lose track of even the simplest case.

Don’t think you can rely on memory to keep this straight. As the number of clients and cases grow, you’ll quickly lose control of your account and won’t know which funds pertain to which cases. You may not intend to “steal” from your clients, but careless accounting may lead to misappropriation and harm them just as much.

A Client Trust Ledger Accounts for All Transactions in a Given Case in Your IOLTA Account
A Client Trust Ledger Accounts for All Transactions in a Given Case
Attorney Grievance defense attorney specializes in defending lawyers in disciplinary proceedings before the Maryland Attorney Grievance Commission and the D.C. Bar's Board on Professional Responsibility involving professional misconduct, legal ethics, disbarment, suspensions of law licenses, petitions for disciplinary action, reprimands and sanctions for unethical conduct. If you receive a letter from Bar Counsel Lydia Lawless, Disciplinary Counsel Hamilton Fox, or from any attorney disciplinary board in Maryland or the District of Columbia, retain experienced attorneys with expertise in lawyer discipline and breach of ethics cases to avoid sanctions for professional misconduct. We help lawyers avoid disbarment, suspension, reprimands, censure and informal admonitions by drafting responses to client grievances and ethical complaints; representing lawyers in peer reviews, evidentiary hearings, and oral arguments before the BPR and the Court of Appeals; filing petitions to reinstate an attorney's license to practice law; conducting law firm ethical compliance audits; and drafting legal ethics opinions to protect lawyers from ethics charges. In many cases, disciplinary proceedings may be dismissed, dismissed with a warning, or result in a conditional diversion agreement with Bar Counsel to rectify misconduct. Lawyers may need help in managing their law firm attorney escrow IOLTA trust account and complying with attorney trust accounting rules to avoid charges of ethical misconduct. Do not represent yourself in responding to an attorney grievance, law firm client complaint, or other allegation of ethical impropriety. Attorney grievance defense counsel may help you comply with legal ethics rules, avoid sanctions like suspension or disbarment, and avoid future attorney grievances.


By The Lawyer's Lawyers | Kramer & Connolly and Irwin R. Kramer who are responsible for the content of this informational website.   This website is designed for lawyers faced with attorney grievances. As cases do differ, past performance does not guarantee future results.