Tuesday, March 24, 2009
Attempt to rescue IOLTA plan during bad economy
As all other states, Illinios has an IOLTA program which uses the interest earned in certain lawyer trust bank accounts to fund legal aid programs. During the current bad economy, though, the interest rates have fallen so low that the program has not been generating much income at all. In an attempt to remedy the situation, last Friday the Illinois Supreme Court approved an amendment to Rule of Professional Conduct 1.15 which guarantees an interest rate of least 1 percent on IOLTA accounts. Ruth Ann Schmitt, executive director of the Lawyers Trust Fund, said the rule change provides banks the option of paying a ''safe harbor'' yield equal to 70 percent of the Federal Funds Target Rate or 1 percent, whichever is higher.