New York Codes, Rules and Regulations › Title 22 - JUDICIARY › Subtitle B - Courts › Chapter IV - Supreme Court › Subchapter E - All Departments › Part 1200 - Rules of Professional Conduct › Subpart - Client-Lawyer Relationship › Section 1200.1.15 - Preserving identity of funds and property of others; fiduciary responsibility; commingling and misappropriation of client funds or property; maintenance of bank accounts; record keeping; examination of records

Current
						through Register Vol. 46, No. 28, July 10, 2024
(a) Prohibition Against
						Commingling and Misappropriation of Client Funds or Property.
A lawyer in possession of any funds or
						  other property belonging to another person, where such possession is incident
						  to his or her practice of law, is a fiduciary, and must not misappropriate such
						  funds or property or commingle such funds or property with his or her
						  own.
(b)
						Separate Accounts.
(1) A
						lawyer who is in possession of funds belonging to another person incident to
						the lawyer's practice of law shall maintain such funds in a banking institution
						within New York State that agrees to provide dishonored check and overdraft
						reports in accordance with the provisions of 22 N.Y.C.R.R. Part 1300. "Banking
						institution" means a state or national bank, trust company, savings bank,
						savings and loan association or credit union. Such funds shall be maintained,
						in the lawyer's own name, or in the name of a firm of lawyers of which the
						lawyer is a member, or in the name of the lawyer or firm of lawyers by whom the
						lawyer is employed, in a special account or accounts, separate from any
						business or personal accounts of the lawyer or lawyer's firm, and separate from
						any accounts that the lawyer may maintain as executor, guardian, trustee or
						receiver, or in any other fiduciary capacity; into such special account or
						accounts all funds held in escrow or otherwise entrusted to the lawyer or firm
						shall be deposited; provided, however, that such funds may be maintained in a
						banking institution located outside New York State if such banking institution
						complies with 22 N.Y.C.R.R. Part 1300 and the lawyer has obtained the prior
						written approval of the person to whom such funds belong specifying the name
						and address of the office or branch of the banking institution where such funds
						are to be maintained. No special account or trust account aforementioned may
						have overdraft protection.
(2) A lawyer or the lawyer's firm shall
						identify the special bank account or accounts required by Rule 1.15(b)(1) as an
						"Attorney Special Account," "Attorney Trust Account," or "Attorney Escrow
						Account," and shall obtain checks and deposit slips that bear such title. Such
						title may be accompanied by such other descriptive language as the lawyer may
						deem appropriate, provided that such additional language distinguishes such
						special account or accounts from other bank accounts that are maintained by the
						lawyer or the lawyer's firm.
(3) Funds reasonably sufficient to
						maintain the account or to pay account charges may be deposited
						therein.
(4) Funds
						belonging in part to a client or third person and in part currently or
						potentially to the lawyer or law firm shall be kept in such special account or
						accounts, but the portion belonging to the lawyer or law firm may be withdrawn
						when due unless the right of the lawyer or law firm to receive it is disputed
						by the client or third person, in which event the disputed portion shall not be
						withdrawn until the dispute is finally resolved.