Regulatory
Trust Account
A separate bank account maintained by a law firm to hold client funds, settlement proceeds, and other money belonging to third parties. Trust accounts must be kept strictly separate from the firm's operating funds and are subject to detailed state bar regulations. Commingling personal and client funds or misappropriating trust account money is one of the most common grounds for attorney discipline and malpractice claims.
Related terms
IOLTAInterest on Lawyers Trust Accounts, a program in which client funds held in trust by attorneys are d...Fiduciary DutyThe highest standard of care imposed by law, requiring an attorney to act in the best interest of th...Conflict of InterestA situation in which an attorney's duties to one client, a former client, or the attorney's own inte...