There are tools to help protect trust accounts from malicious actors – The Florida Bar


Tools are available to protect trusted accounts from malicious actors.

My biggest nightmare when I started my own company was making sure my accounting was accurate. And then when it happens, it really ruins my day.’

Thad A.  Yates

Thad A. Yates

Thad Yates, the lone professional serving on the board of governors, ran to his keyboard in a panic a few weeks ago to pull up the bank’s website.

His custodian reported an unauthorized withdrawal from the organization’s trust account. Entering, Yates saw a second.

“He was the guy paying the credit card bill,” he said. “Together it was about $5,000.”

The bank quickly returned the money and Yates politely reported the matter to the Florida Bar.

“People at the bar told me that this kind of fraud happens all the time,” he said.

Yates was a little disappointed to learn that the incident could have been easily prevented.

His bank, Trust, offers a free automated service called “Fraud Checker”. Yates quickly enlisted.

Now, he will receive an email whenever money is about to flow from his trust account.

He has until 2pm that day to stop the transaction. If no action is taken, it will pass.

If more members of the Florida Bar used a service like this, it would prevent a lot of headaches, Yates said.

Cybersecurity experts warn that attorneys, especially solo and small-firm professionals without an IT department, are “low-hanging fruit” for hackers and ransomware attacks.

Theft from law firm trust accounts is by no means uncommon, said Shanelle Schuyler, director of admissions for the Bar Attorney/Consumer Assistance Program (AAAPP).

“We’ve seen an explosion of cases like this on the trust register,” she says. “There were forged checks, forged checks, forged signatures.”

It’s not just a Florida problem, Schuyler says.

“I’ve just given a national presentation on this,” she said. “Other states are seeing this type of action on their members’ faith accounts.”

Truist’s Fraud Inspector is not the only free or affordable service available to Florida attorneys, Schuyler explained.

She points to “positive charge.”

LegalFuel, the Florida Bar’s practice resource center, offers A wealth of free forms and other resources Chapter 5 of the Bar Rules relating to fiduciary accounts and governing fiduciary accounts.

“We strongly recommend that you ask your bank to activate a positive charge on your trust account when you open your account,” advises Legal Fuel.

The link includes a positive charge statement.

According to LegalFuel, PositivePay gives the bank a way to match the date, check number, dollar amount and account number of each check against the details provided by the account holder.

“These services are free, they’re simple, and they add an extra layer of protection to make sure nothing gets out of your trust account that shouldn’t be out,” Schuyler said.

Yates couldn’t agree more.

“My biggest nightmare when I started my own company was making sure my accounting was accurate,” he said. “And then when this happened, it really ruined my day.”

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