Most attorneys practice law

because it gives them a grand

and glorious feeling.

You give them a grand - and they

eel glorious.

Milton Berle

BEVERLY MICHAELIS
ATTORNEY |PRACTICE MANAGEMENT ADVISOR

TRUST ACCOUNTING
DOS AND DONTS

TOPICS

Its Nice to be Paid but

Credit Cards Revisited
Unclaimed Funds
Northern Friends
Protecting Client and Firm
Money

ITS NICE TO BE PAID,

BUT
WATCH OUT FOR THESE
TRAPS

WHEN A CLIENT OVERPAYS

The payment should be deposited

in:
o The IOLTA
account
o The firm account
o This is a trick
question
Vote
Oregon RPC 1.15-1

PRACTICE

Update firm fee agreements

THIRD PARTY PAYMENT

1.Follow Oregon RPC 1.8(f)

2.Redact billing statements
3.Specify who receives refund

OSB Formal Ethics Opinion

2005-157

PRACTICE

Avoid the third party

Third party loans funds to client
Client brings funds to lawyer

PREPAID OR EARNED UPON

RECEIPT FEES

1. Must be in writing
2. Use the magic words
3. Subject to refund

OSB Formal Ethics Opinion 2005-151

Oregon RPCs 1.15, 1.5, and 8.4

 Use stage of completion

If half the work is done,
refund half the fee
Hourly rate computations
not allowed

How Much Do I Owe You?

"New" Guidelines For Fixed And So-called
Nonrefundable Fees
http://www.osbar.org/publications/bulletin/11oct/barcounsel.html

Designation of a prepaid fixed fee

as nonrefundable may be
misleading, if not false,
in violation of Oregon RPC 8.4(a)
(3)

PRACTICE

Pros of Prepaid Fixed Fees

Clients like
certainty
Easy to budget
Immediate income

PRACTICE

Cons of Prepaid Fixed Fees

Bad bargain?
Calculating refunds
Money out-of-pocket
Requires timekeeping
Excessive fee?

PRACTICE

The Best of Both Worlds?

Fixed fee goes into trust
Agreement specifies when earned

CREDIT CARDS
REVISITED

MERCHANT FEES
1. Express agreement to
pay?
2. TILA disclosures made?
3. Cash discount offered?

OSB Formal Ethics Opinion 2005-172

ECOURT AND CREDIT CARDS

Visa, MasterCard, or Discover
IOLTA-linked debit cards permissible
Manage risks
No ACH for now

eCourt Filing Fees and IOLTA www.osbplf.org > Practice Management >
Forms > eCourt

REIMBURSING ADVANCED COSTS

Billed to
client

Docume
nt filed

Posted
to client
account

Filing fee
charged to firm
CC
Cost
advance
d

UNCLAIMED FUNDS
REMITTING AND AVOIDING

UNCLAIMED FUNDS
1. Abandoned after two years
2. Exercise due diligence to find
client
3. Assess in June
4. Remit in October

ORS 98.332 - OSB Formal Ethics Opinion 2005-48

https://www.osbar.org/resources/abandonedfunds.html

UNCLAIMED FUNDS
5. Funds + copy of forms to OSB
6. Original forms to DSL
7. Monitor status of uncashed
checks
8. Return proceeds to client?

ORS 98.332 - OSB Formal Ethics Opinion 2005-48

https://www.osbar.org/resources/abandonedfunds.html

THE DILEMMA OF THE SMALL CHECK

http://www.mybanktracker.com/news/stop-payment-fee-comparison-top10-us-banks

NORTHERN FRIENDS
DIFFERENT STATES |
DIFFERENT RULES

WASHINGTON RPCS
Random audits
Non-lawyers cannot sign
7 year record retention
Two merchant accounts
Flat fee disclaimer different

www.osbplf.org > Practice Management > Forms > Trust Accounting

>Trust Accounting Rules for Washington Practitioners

PROTECTING MONEY

EMBEZZLEMENT | FRAUD |
SCAMS

ABA Legal Technology

Survey Report - 2014

PROTECT AGAINST
EMBEZZLEMENT

1.Limit opportunity
2.Separate accounting duties
3.Require documentation
4.Cancel invoices

PROTECT AGAINST
EMBEZZLEMENT

Dont use signature stamps

Eliminate cash transactions
Video surveillance?
Bond | Insure

ASSESS DATA BREACH RISK

1. Network compromised?
2. Devices lost or stolen?
3. Remote wiping enabled?
4. Encryption used?
5. Anti-malware current?

ASSESS DATA BREACH RISK

6.
7.
8.
9.

Secure firewall?
Staff educated about scams?
Unsecured Wi-Fi use prohibited?
Covered? [PLF Excess or Other]

USE FRAUD PROTECTION

SERVICES
Positive pay
Reverse positive pay
ACH Blocks or Filters
Perfect Receivables

PRACTICE

www.osbplf.org > CLE > Forms > Past

Contact Us
PLF Practice Management Advisors
www.osbplf.org
503-639-6911 - 800-452-1639
Beverly Michaelis
beverlym@osbplf.org
Sheila Blackford
sheilab@osbplf.org
Jennifer Meisberger
jenniferm@osbplf.org
Hong Dao
hongd@osbplf.org

and confidential