2023 New York Laws › JUD - Judiciary › Article 15 - Attorneys and Counsellors › 468-B - Clients' Security Fund of the State of New York.

§ 468-b. Clients' security fund of the state of New York. 1. The court
  of  appeals shall appoint a board of trustees to administer the lawyers'
  fund for client protection of the state of New York established pursuant
  to section ninety-seven-t of the state finance  law.  Such  board  shall
  consist  of  seven members. Of the trustees first appointed, three shall
  be appointed for a term of three years; two for a term of two years; and
  two for a term of  one  year.  As  each  such  term  expires,  each  new
  appointment shall be for a term of three years. The court of appeals may
  require  such  reports  or  audits of the board as it shall from time to
  time deem to be necessary or desirable.
2. The board shall  have  the  power  to  receive,  hold,  manage  and
  distribute  the funds collected hereunder for the purpose of maintaining
  the integrity and protecting the good name of the  legal  profession  by
  reimbursing,  in  the  discretion of the trustees to the extent they may
  deem proper and reasonable, losses caused by the  dishonest  conduct  of
  attorneys  admitted  to  practice  in  this  state. For purposes of this
  section, the term "dishonest conduct"  shall  mean  misappropriation  or
  wilful  misapplication of clients' money, securities, or other property,
  by an attorney admitted to practice in this state.
3.  The  board  of  trustees   shall   adopt   regulations   for   the
  administration  of  the lawyers' fund for client protection of the state
  of  New  York  and  the  procedures  for  presentation,   consideration,
  allowance  and  payment  of  claims,  including  the  establishment of a
  maximum limitation for awards to claimants.
4. The board of trustees shall have the sole discretion  to  determine
  the  merits  of  claims  presented for reimbursement, the amount of such
  reimbursement and the terms under  which  such  reimbursement  shall  be
  made.  Such  terms  of  reimbursement  shall  require  that the claimant
  execute such instruments, take such action or enter into such agreements
  as  the  board  of  trustees  shall  require,   including   assignments,
  subrogation  agreements  and  promises  to  cooperate  with the board of
  trustees in making claims against the attorney whose  dishonest  conduct
  resulted in the claim.
5. The board of trustees shall serve without compensation but shall be
  entitled  to receive their actual and necessary expenses incurred in the
  discharge of their duties.
6. The board of trustees  may  employ  and  at  pleasure  remove  such
  personnel  as it may deem necessary for the performance of its functions
  and fix their compensation within the amounts made available therefor.
7. The board of trustees shall be considered employees  of  the  state
  for the purpose of section seventeen of the public officers law.
8.  All  payments  from the lawyers' fund for client protection of the
  state  of  New  York  shall  be  made  by  the  state  comptroller  upon
  certification and authorization of the board of trustees of said fund.
9.  Acceptance of an award of reimbursement from the lawyers' fund for
  client protection shall, to the extent of such award, (a) subrogate  the
  fund  to  any right or cause of action that accrued to the claimant as a
  consequence of the dishonest conduct that  resulted  in  the  claimant's
  award  and  (b)  create a lien in favor of the fund that shall attach to
  any money asset that is designated to be paid to the claimant  from,  or
  on  behalf  of, the attorney who caused the claimant's loss. If the fund
  fully reimburses the claimant's loss, as  determined  by  the  board  of
  trustees,  the  lien  shall be in the amount of the fund's award. If the
  claimant's loss exceeds the fund's award, the lien shall not  extend  to
  the claimant's right to recover additional restitution from the attorney
  for  the claimant's unreimbursed loss. In the event of a recovery by the
  fund, a claimant shall be entitled to any money recovered in  excess  of
  the fund's award of reimbursement to the claimant.