Banks To Implement New Maine Bar Rules On Legal Fund Accounts April 1

Banks across Maine will begin implementing new Maine Bar rules governing “Interest on Lawyers Trust Accounts” (IOLTA) on April 1. The new rules will require financial institutions holding IOLTA funds to pay interest or dividends comparable to the highest interest rate or dividend generally available to other similar accounts. The new rules also require all practicing lawyers in Maine to participate in the IOLTA program.

Lawyers in Maine participate in the IOLTA program, which was set up in 1986, by placing client funds that are either short-term or in small amounts, into an interest-bearing account. That interest is administered by the Maine Bar Foundation which distributes the funds through grants to programs providing legal aid to low-income and disadvantaged Maine residents or improving access to justice in Maine.

“We are very pleased the Court has adopted and set a date for implementation of the IOLTA comparability rule, “notes Calien Lewis, executive director of the Maine Bar Foundation. “While the need for legal aid in Maine has increased each year,   Federal funding for legal services has decreased to less in real dollars than in 1980. The move to comparability of interest rates and dividends will have a huge impact.  We appreciate that Maine’s banking community is working with us to help all Maine residents achieve access to legal assistance.”

The IOLTA program currently provides nearly $1.5 million annually.  The participation of financial institutions adhering to this new rule is expected to nearly double the amount of funds available through the IOLTA program.

The Maine Bar Foundation is Maine's only statewide nonprofit 501(c)(3) organization devoted exclusively to law-related charitable work. The Foundation receives 96 percent of its funding through the IOLTA Program it manages, which has produced more than $11.4 million dollars since 1985. The groups supported by the Maine Bar Foundation include: Cumberland Legal Aid Clinic, Immigrant Legal Advocacy Project, Legal Services for the Elderly, Maine Equal Justice Partners, Pine Tree Legal Assistance, Maine Volunteer Lawyers Project and others. The primary purpose of the Foundation is to support projects designed to improve access to justice, especially for low income and socially disadvantaged populations. The Maine Bar Foundation also supports law-related education.