Recent discussions with officials at Northern Trust have shed some additional light on the bank’s communications with its IOLTA account holders during the summer, and its stated intention to close the IOLTA accounts of many customers after October 3.
The bank informed LTF that it has some leeway to accommodate lawyers who have not been able to move their IOLTA accounts to other financial institutions in advance of the October 3 deadline. Lawyers who need additional time should contact the bank directly.
Northern Trust also explained that its actions to curtail the IOLTA accounts of many customers are driven by its business decision to become a “wholesale bank.” Regulations related to that status require the bank to target its services away from the retail banking sector that encompasses many IOLTA accounts, even many with sizeable deposits. Although Lawyers Trust Fund regrets the disruption this has caused for many lawyers, LTF does not believe Northern Trust is targeting IOLTA accounts.
There are many Illinois banks that are interested in providing IOLTA accounts and other services to lawyers. There is a list of eligible financial institutions on LTF’s web site as well as detailed instructions and the forms needed for opening a new IOLTA account on the “Establishing an IOLTA Account” page.
LTF’s staff is available to provide information and assistance about establishing an IOLTA account at a new bank. Please feel free to contact any of the following: