“My definition of an expert in any field is a person who knows enough about what’s really going on to be scared.”

– P. J. Plauger

Ensuring Compliance with Professional Ethics

We Help Attorneys Comply With Rule 1.15 of the New York Rules of Professional Conduct

According to Rule 1.15, all New York attorneys must maintain, for seven years, the records of all deposits in and withdrawals from escrow/trust/special accounts and of any other bank account that “concerns or affects” the lawyer’s practice of law.  Attorneys that receive or handle client funds must deposit those funds in a separate bank account designated as “trust” or “escrow” account at an eligible banking institution and should maintain separate general and client ledgers which are reconciled on a regular basis.  We ensure your compliance with state-of-the-art technology and a personal approach which includes a monthly face-to-face meeting to reconcile all ledgers and assure attorneys’ compliance with their non-delegable supervisory obligations.

Escrow violations are the most frequent ground for attorney discipline in New York.  An attorney can be disciplined for failing to spot misappropriations from their escrow accounts even where the account was managed by another law firm partner; and a bounced check will automatically trigger a report to the Attorney Grievance Committee and, in almost every instance, will lead to an audit covering the preceding six months of records.  Likewise, discipline can be imposed even where no client is harmed when an attorney commingles personal funds with business funds.  Indeed, New York is the only state where the ethics rules specifically provide for discipline for mishandling escrow records.  Rule 1.15(j) of the New York Rules of Professional Conduct provides that:

“A lawyer who does not maintain and keep the accounts and records as specified and required by this Rule, or who does not produce any such records pursuant to this Rule, shall be deemed in violation of these Rules and shall be subject to disciplinary proceedings.”

Rule 1.15

Section 118 of Part 22 of the New York Court Rules and Regulations requires each New York attorney to file a biannual registration statement with the Office of Court Administration in which the attorney must certify that he or she has read Rule 1.15 of the New York Rules of Professional Conduct, which contains the record-keeping rules for attorney bank accounts.  We actively work with you to assure your compliance with Rule 1.15 and with Judiciary Law § 497 (which also governs attorney accounts) on an ongoing basis.

We Understand The Lawyers’ Duty Of Supervision Under Rule 5.3

Under the New York Rules of Professional Conduct, Rule 5.3(b) states that an attorney is responsible for supervising the work of any non-lawyer assistants, such as paralegals or legal assistants, who work on a case or matter. Rule 5.3(b) also requires the attorney to make reasonable efforts to ensure that the work of the non-lawyer is compatible with the attorney’s professional obligations and shall be responsible for the work product of such non-lawyer assistants. Rule 5.3(b) further provides that the attorney must ensure that the non-lawyer’s conduct is compatible with the attorney’s professional obligations and shall be responsible for the conduct of such non-lawyer assistants. Additionally, Rule 5.3(c) states that an attorney must not delegate professional responsibilities to a non-lawyer if the attorney knows or reasonably should know that the non-lawyer is not competent to perform them.

Call Us To Learn How We Can Help Your Law Firm

The Rules provide a comprehensive framework for the ethical practice of law in New York state, particularly related to accounting, escrow and related issues. These rules cover a wide range of topics, such as the management of client funds and property, and are designed to ensure that attorneys maintain the highest standards of professional conduct and protect the interests of their clients. We can help you achieve that compliance:

• We assist New York attorneys in meeting the biannual registration requirements outlined in Section 118 of Part 22 of the New York Court Rules and Regulations.
• We ensure that our clients have read and understand Rule 1.15 of the New York Rules of Professional Conduct, which pertains to attorney bank account record-keeping.
• We actively work with clients to comply with Rule 1.15 and Judiciary Law § 497 on an ongoing basis.
• Our services include regular reviews and assessments of attorney bank account records to ensure compliance.
• We provide guidance and support for any necessary adjustments or corrective actions to maintain compliance.

Please note that the information provided on this website is for general informational purposes only and is not intended as legal or tax advice. The information is subject to change, and it is important to consult a specialist before making any decisions. Law Ledgers provides accounting services to New York lawyers and law firms, including escrow protection, tax advice and bookkeeping administration. Contact us today for personalized support.