1. What does the new rule do?
Introduces competition for IOLTA accounts by permitting brokerage houses to participate in IOLTA;
Permits use of government money market funds for IOLTA; and
Defines institutions eligible to hold IOLTA accounts as only those institutions which pay IOLTA account customers the highest interest rate or dividend generally available at their own institution to similarly situated non-IOLTA customers.
2. When is the new rule effective?
The new rule is effective on April 1, 2008. Therefore, banks and savings & loan associations which currently offer IOLTA accounts have approximately 3 months to comply with the new rule.
3. Does the rule require attorneys or law firms to contact their bank or savings & loan association?
No. The Foundation will initiate compliance activity on an institution-by-institution basis and will contact affected attorneys or law firms with specific information and assistance. Affected attorneys and law firms only will need to sign their institutions standard forms for payment of higher interest rates on their existing IOLTA account.
4. Will attorneys or law firms have to move their IOLTA accounts to institutions paying higher rates?
No. The rule only requires institutions to pay IOLTA accounts the highest rate or dividend generally available to similarly-situated non IOLTA account customers at their own institution.
5. Is this voluntary for attorneys and law firms?
No. The new rule requires attorneys and law firms to maintain their IOLTA account only at eligible banks, savings & loan associations or investment companies which comply with the interest or dividend requirement of the new rule.
6. Are attorneys and law firms responsible for monitoring their institutions compliance with the interest or dividend requirement rule?
No. The Foundation will monitor to ensure compliance.
7. Where can I get more information about the new rule?
By contacting the Foundation: The Louisiana Bar Foundation 1615 Poydras Street, Suite 1000 New Orleans, LA 70112 Phone: (504) 561-7309 Fax:(504) 566-1926 Email: email@example.com