FDIC Insurance Coverage Now Provides $250,000 Of Protection, Per Client And Account
January 17, 2013
With the expiration of the Dodd-Frank Deposit Insurance Provision on December 31, attorney IOLTA accounts no longer have unlimited FDIC insurance coverage. All types of trust accounts, including attorney IOLTA accounts, have now reverted to the standard maximum deposit insurance amount of $250,000.
Attorney IOLTA accounts qualify under FDIC regulations as fiduciary accounts, and are eligible for pass-through coverage on a per-client basis. This means that each client's funds are insured up to $250,000 per IOLTA account, provided the FDIC's other requirements are met: the account's records must indicate generally the account is a custodial or fiduciary account, and the attorney-client relationship and deposit amount allocated to each client must be ascertainable from records kept in the regular course of business.
If the IOLTA account is properly maintained under the requirements of the Ohio Rules of Professional Conduct, FDIC coverage will be available up to $250,000 per client, even if the total balance in the account exceeds $250,000.
For more information from the FDIC website, click here.