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Trust accounting pilot to launch

Senior Editor Regular News

Trust accounting pilot to launch

Senior Editor

The Florida Bar Board of Governors has approved a contract allowing TMI Trust Company, Inc., to work with Fidelity National Information Services, Inc., (FIS) on the development of an automated trust accounting system that promises to make life easier for thousands of attorneys.

Andy Sasso The unanimous vote came at a May 18 board meeting in Key West, but only after a round of cheers and a burst of applause. The contract calls for a 90-day development phase followed by the launch in late August of a six-month pilot program of the FIS AddVantage platform that would allow lawyers, if they make the correct entries when they deposit or withdraw funds under certain parameters, to automatically comply with the Bar’s trust accounting rules.

Special Committee on Trust Accounting Solutions Chair Andy Sasso said the committee, working with Bar members and staff, will soon be selecting about a dozen lawyers from small, medium, and large firms to participate in the pilot program.

“The goal of the program is to do all of the trust accounting as required by Chapter 5 of the Rules Regulating The Florida Bar,” Sasso said. “There’s discussion of a standing board policy that will provide if the lawyer uses reasonable care and is acting in good faith using the program, then they will be in compliance.”

The Florida Bar Foundation, which draws the bulk of its revenue from the IOTA program, will be another potential winner, Sasso says.

Currently there is about $5.5 billion in some 33,000 IOTA accounts spread across nearly 200 separate banks, Sasso said. Earning an average of 11 basis points in interest, the accounts generate about $6 million annually for the Foundation.

All funds held in any IOTA accounts established pursuant to the terms of the program will be deposited into the FIS FDIC Insured Deposit Sweep Program offered by Total Bank Solutions, LLC, which was recently paying 150 basis points. The Florida Bar Foundation will receive a rate of return equal to 80 percent of the published rate for the FIS FDIC Insured Deposit Sweep Program, so even if only 10 percent of the trust funds move into the program, the Foundation could nearly double its income, Sasso says.

Security will be enhanced on multiple fronts. Funds will get a higher level of FDIC coverage (presently estimated at $10 million) and by using individual passwords, law firms will be able to monitor their trust account transactions.

After the vote, Florida Bar President Michael Higer asked board members to give Sasso another round of applause.

“It’s his idea, he’s given birth to it, it’s now about to start walking,” Higer said.

While it was Sasso’s idea, the man who doubles as the board’s parliamentarian got a lot of help, Higer said.

“It really was a group effort,” Higer said. “Big kudos to Governors (Brian) Burgoon and (Scott) Westheimer, who flyspecked everything, who were watching it carefully to make sure that all the i’s were dotted and the t’s were crossed.”

Sasso said the pilot program will ramp up slowly to catch problems as soon as possible.

“We’re not going to start with everybody on the first day,” Sasso said, “We’ll start with one, and then maybe the next week, we’ll add another, and so on.”

Eventually, Sasso said, the goal is for Florida lawyers to have the option, free of charge, to go onto the Bar website and establish an automated account with subaccounts to track each client or legal matter and corresponding trust account.

“Until it’s developed we don’t know, but the way I envision it, it’s going to work something similar to the e-portal,” Sasso said. “The first time every lawyer went on, you set up your account and then, every time you have a new case, you set up a new matter in the portal.”

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