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Information for Lawyers
Establishing an Interest on Lawyersâ€™ Trust Accounts (IOLTA) Account
Enclosed for your information and use is a two-page information sheet entitled â€śComplying with Rule 11â€ť that describes the basic requirements of Rule 11 of the Rules of Supreme Court of Hawaii. This information sheet lists the various banks in Hawaii that offer IOLTA accounts, and we think you will find the process easier than you probably now imagine. Enclosed also is â€śForm 2,â€ť which is the form you should give to your bank regarding establishing your trust account. Your IOLTA account is commonly referred to as your â€śtrust account,â€ť since the funds in the IOLTA account are held by you in trust for your client until fees and costs are earned and billed to the client, at which time they can then be transferred to another appropriate location. Please work directly with your bank to establish your IOLTA account. Please fax or mail to HJF a copy of a voided check or deposit slip, once you have your new IOLTA account established. Please note that under HRPC 1.15(b), the title of the account should be â€śClient Trust Accountâ€ť and not â€śClients Trust Accountâ€ť or â€śClientâ€™s Trust Account.â€ť
All typical monthly service fees (other than special fees charged for cashierâ€™s checks, insufficient funds, etc.) are paid by your bank and/or HJF. The net monthly interest from your trust account is paid over to HJF, and HJF uses this to fund various legal services projects and related activities. All fifty states have similar programs.
We realize that it will take some of your valuable time to establish this IOLTA account, and we appreciate your efforts. The Office of Disciplinary Counsel does require that unearned client fees be handled appropriately, either through your IOLTA account or through a special trust account set up for a particular transaction. You should contact the Office of Disciplinary Counsel if you have specific questions, or you can read Rule 11 of the Rules of the Supreme Court of Hawaii. Rule 11 outlines in detail the requirements of IOLTA accounts.
Each year in November or early December, the Hawaii State Bar Association (HSBA) will send you your HSBA Dues Notice for the following year. Part of that dues information package will be your â€śIOLTA Certification,â€ť which is a simple two-sided form. To meet your IOLTA reporting requirements, all you do is complete and sign that twosided form and attach a void check or deposit slip from your IOLTA Account. You return the form to the HSBA with your dues payment. Thus, once you have the IOLTA account set up, maintenance of your IOLTA account is relatively easy. You are of course required to report to HJF any changes in the location of your IOLTA trust account. We wish you the very best in your practice of law, and thank you again for your cooperation.
(Form Dated: 9/18/07)