GENERAL DUTIES REGARDING SAFEKEEPING PROPERTY

(a) A lawyer must not, even temporarily, use funds or property of clients or third persons for the lawyer’s own purposes without authorization. (b) A lawyer must hold funds or property of clients or third persons that is in the lawyer’s possession in connection with a representation separate from the lawyer’s own funds or property. All such funds must be deposited in one or more separate and identifiable interest- or dividend-bearing client trust accounts maintained at an eligible financial institution in the state where the lawyer’s office is situated, or elsewhere with the informed consent of the client or third person. A client trust account means an IOLTA account as defined in Rule 1.15C(b), or a separate, interest-bearing non-IOLTA client trust account established to hold the funds of a client or third person as provided in Rule 1.15C(c). Other, tangible property must be identified as such and appropriately safeguarded. Each client trust account must be maintained only in an eligible financial institution selected by the lawyer in the exercise of ordinary care. (c) A lawyer may deposit the lawyer’s own funds in a client trust account for the sole purpose of paying bank service charges or minimum balance requirements on that account, but only in an amount necessary for that purpose. (d) A lawyer must deposit in a client trust account funds received to secure payment of legal fees and expenses, to be withdrawn by the lawyer only as fees are earned and expenses are incurred. A lawyer must deposit in the lawyer’s general account or other account belonging to the lawyer funds received as a fixed fee, an engagement retainer, or a special purpose retainer, as described in Rule 1.5. (e) Upon receiving funds or property in which a client or third person has an interest, a lawyer must promptly notify the client or third person. Except as stated in this Rule or otherwise permitted by law or by agreement with the client, a lawyer must promptly deliver to the client or third person any funds or property that the client or third person is entitled to receive. Upon request by the client or third person, a lawyer must promptly render a full accounting regarding such funds or property. (f) When in the course of representation a lawyer is in possession of funds or property in which two or more persons (one of whom may be the lawyer) claim interests, the funds or property must be kept separate by the lawyer until the dispute is resolved. The lawyer must promptly distribute all portions of the funds or property as to which the interests are not in dispute. (g) Withdrawals from a client trust account must be made only by check payable to a named payee or by electronic transfer and not by cash. No check may be made payable to “cash.” No withdrawal of cash may be made from a deposit to a client trust account or by automated teller or cash dispensing machine. Adopted July 1, 2009, effective January 1, 2010; amended July 1, 2011, effective September 1, 2011; amended April 7, 2015, eff. July 1, 2015; amended Mar. 1, 2023, eff. July 1, 2023. Comment [1] An attorney’s unauthorized use of another’s funds is called conversion. The Illinois Supreme Court has drawn a distinction between the common-law tort of conversion and the conduct by an attorney that warrants the imposition of discipline, noting that “[a] typical, although not necessarily exclusive, type of conversion by an attorney which warrants discipline involves the conversion of funds that have been deposited or received by an attorney for a specific purpose or for the use of another.” In re Thebus, 108 Ill. 2d 255, 264 (1985). Conversion of trust funds occurs when a lawyer uses those funds for a purpose other than that for which they were delivered. Conversion is typically proven when the client trust account is either overdrawn or when the lawyer allows the balance in the client trust account to become less than the sum total of all client and/or third person funds the lawyer is required to maintain in trust. In re Ushijima, 119 Ill. 2d 51, 58 (1987); In re Cheronis, 114 Ill. 2d 527 (1986). [2] Funds of clients and third persons include amounts received by a lawyer to secure payment of legal fees and expenses and to be withdrawn by the lawyer only as fees are earned and expenses incurred; funds belonging in part to a client or third person and in part presently or potentially to the lawyer or law firm; and funds in which two or more persons (one of whom may be the lawyer) claim interests. [3] A lawyer should hold property of others with the care required of a professional fiduciary. Securities should be kept in a safe deposit box, except when some other form of safekeeping is warranted by special circumstances. All property that is the property of clients or third persons, including prospective clients, must be kept separate from the lawyer’s business and personal property and, if monies, in one or more client trust accounts. Client trust accounts should be made identifiable through their designation as “client trust account” or “client funds account” or words of similar import indicating the fiduciary nature of the account. Separate trust accounts may be warranted when administering estate monies or acting in similar fiduciary capacities. [4] While normally it is impermissible to commingle the lawyer’s own funds with client funds, paragraph (c) provides that it is permissible when necessary to pay bank service charges or to meet minimum balance requirements on that account. The lawyer must keep accurate records regarding which part of the funds belong to the lawyer. [5] A lawyer who receives funds or property by any means must take reasonable steps to safeguard and segregate client and third-person funds and property pursuant to Rule 1.15. Lawyers using an electronic payment method, including credit cards, ACH transfers (Automated Clearing House electronic funds transfers), and online payment systems, to accept the payment of client or third-person funds must take reasonable steps to ensure that the use of such a method does not result in any commingling with the funds of the lawyer, does not risk the loss of any client or third- person funds, and does not compromise the identity of any client or third-person funds. A lawyer also must take reasonable steps to ensure that client or third-person funds accepted through an electronic payment method are transferred immediately to an IOLTA account or non-IOLTA client trust account maintained by the lawyer. [6] In addition to the steps described in Comment [5], lawyers have an obligation to make a reasonable investigation into the reliability, stability, and viability of an electronic payment method or system to determine whether the method or system takes appropriate measures to segregate, safeguard, and ensure the prompt transfer of client funds. Rule 1.1 governs a lawyer’s duty to understand the benefits and risks of relevant technology. Rule 1.6 governs a lawyer’s duty to maintain confidentiality of information relating to a representation. [7] Paragraph (d) relates to legal fees and expenses that have been paid in advance. The types of fee agreements are described, and the reasonableness, structure, and division of legal fees are governed by Rule 1.5 and other applicable law. [8] Lawyers often receive funds from which the lawyer’s fee will be paid. The lawyer is not required to remit to the client funds that the lawyer reasonably believes represent fees owed. However, a lawyer may not hold funds to coerce a client into accepting the lawyer’s contention. The disputed portion of the funds must be kept in a trust account, and the lawyer should suggest means for prompt resolution of the dispute, such as arbitration. The undisputed portion of the funds must be promptly distributed. Specific guidance concerning client trust accounts is provided in the Client Trust Account Handbook published by the Illinois Attorney Registration and Disciplinary Commission and available on its website (www.iardc.org). [9] Paragraph (f) also recognizes that third parties may have lawful claims against specific funds or other property in a lawyer’s custody, such as a client’s creditor who has a lien on funds recovered in a personal injury action. A lawyer may have a duty under applicable law to protect such third-party claims against wrongful interference by the client. In such cases, when the third-party claim is not frivolous under applicable law, the lawyer must refuse to surrender the property to the client until the claims are resolved. A lawyer should not unilaterally assume to arbitrate a dispute between the client and the third party, but, when there are substantial grounds for dispute as to the person entitled to the funds, the lawyer may file an action to have a court resolve the dispute. Adopted July 1, 2009, effective January 1, 2010; amended July 1, 2011, effective September 1, 2011; amended April 7, 2015, eff. July 1, 2015; amended Mar. 1, 2023, eff. July 1, 2023. RULE 1.15A: REQUIRED RECORDS (a) For each client matter, complete records of client trust account funds and other property must be kept by the lawyer and must be preserved for a period of seven years after termination of the representation. (b) Maintenance of complete records of client trust accounts requires that a lawyer: (1) prepare and maintain receipt and disbursement journals for all client trust accounts required by this Rule containing a record of deposits to and withdrawals from client trust accounts specifically identifying the date, source, and description of each item deposited and the date, payee, client matter, and purpose of each disbursement. In addition, for each electronic transfer, the journals should include the name of the person authorizing transfer and the financial institution and account number to or from which funds were transferred; (2) prepare and maintain contemporaneous ledger records for all client trust accounts showing, for each separate trust client or beneficiary, the source of all funds deposited; the date of each deposit; the names of all persons for whom the funds are or were held; the amount of such funds; the dates, descriptions, and amounts of charges or withdrawals; and the names of all persons to whom such funds were disbursed; (3) maintain copies of all accountings to clients or third persons showing the disbursement of funds to them or on their behalf, along with copies of those portions of clients’ files that are reasonably necessary for a complete understanding of the financial transactions pertaining to them; (4) maintain all client trust account checkbook registers, check stubs, bank statements, records of deposit, and checks or other records of debits; (5) maintain copies of all retainer and compensation agreements with clients; (6) maintain copies of all bills rendered to clients for legal fees and expenses; (7) prepare and maintain three-way reconciliation reports of all client trust accounts on at least a quarterly basis; and (8) make appropriate arrangements for the maintenance of the records in the event of the closing, sale, dissolution, or merger of a law practice. Records required by this Rule may be maintained by electronic, photographic, or other media provided that printed copies can be produced and the records are readily accessible to the lawyer. (c) A three-way reconciliation consists of the following steps: (1) The first step is to take the balance in the checkbook register at the end of the reconciliation period and compare it with the adjusted bank statement balance for that period. The bank statement balance is adjusted by adding deposits not yet credited and subtracting any checks or other debits not yet posted to the account. (2) The second step in the reconciliation is to add together the ending balances of all client ledgers. (3) The third step in the reconciliation is to subtract the disbursements journal balance from the receipts journal balance by (i) taking the ending figure calculated for the previous period, (ii) adding the receipts journal balance for the period in question, and (iii) subtracting the disbursements journal balance for that period. All three balances (figures from the check register, client ledgers, and receipts/disbursement journals) must agree with the adjusted bank statement balance. Adopted Mar. 1, 2023, eff. July 1, 2023. Comment [1] A lawyer must maintain on a current basis complete records of client trust account funds, including transfers made electronically, as required by paragraph (b), subparagraphs (1) through (8). These are minimum requirements, which articulate recordkeeping principles that provide direction to a lawyer in the handling of funds entrusted to the lawyer by a client or third person. Compliance with these requirements will benefit the lawyer and the client or third person, as these funds will be safeguarded and documentation will be available to fulfill the lawyer’s obligation to provide an accounting to the owners of the funds and to refute any charge that the funds were handled improperly. [2] A three-way reconciliation is a comparison of the bank statement balance with the balances in the lawyer’s records to determine that the figures in the lawyer’s records are accurate and in agreement with the bank’s figures. The three-way reconciliation report amount must always equal the total sum belonging to all clients and third persons whose money the lawyer is holding in trust. While a lawyer must prepare and maintain three-way reconciliation reports of all trust accounts on at least a quarterly basis, lawyers should note that banks may allow only 30 days from statement date to notify the bank of errors. [3] If the balances in a three-way reconciliation do not agree, records should be reviewed for entries that do not match or for any addition or subtraction errors, until all three figures are the same. For a more detailed discussion, see the Client Trust Account Handbook published by the Illinois Attorney Registration and Disciplinary Commission and available on its website (www.iardc.org). RULE 1.15B: TRUST ACCOUNTS AND OVERDRAFT NOTIFICATION (a) Use of IOLTA Accounts. A lawyer must deposit all funds belonging to a client or third person into an IOLTA account unless the funds can otherwise earn net income for the client or third person. Net income means interest that exceeds the costs incurred to secure such interest. A lawyer must deposit client or third-person funds that can earn net income for the benefit of the client or third person in a separate, interest- bearing non-IOLTA client trust account, with the client or third person designated as the recipient of net interest generated on that account. A lawyer must not deposit any client or third-person funds into an account that does not bear interest or pay dividends. (b) Account Determination. A lawyer must consider the following factors in determining whether the client or third-person funds can earn net income for the benefit of the client or third person: (1) The amount of client or third-person funds to be deposited; (2) The expected duration of the deposit, including the likelihood of delay in the matter for which the funds are held; (3) The rate of interest at the financial institution where the funds are to be deposited; (4) The cost of establishing and administering a non-IOLTA client trust account for the benefit of the client, including the cost of the lawyer’s services, financial institution fees and service charges, and the cost of preparing tax reports; (5) The capability of the financial institution, through sub-accounting, to calculate and pay interest earned by each client’s funds, net of any transaction costs, to the individual client; and (6) Any other circumstances that affect the ability of the client’s funds to earn net interest for the client. The lawyer must review the lawyer’s IOLTA account(s) at reasonable intervals to determine whether changed circumstances require further action regarding the deposited client or third- person funds. A lawyer who exercises reasonable judgment in determining whether to deposit client or third-person funds into an IOLTA account or a non-IOLTA client trust account pursuant to this rule will not be subject to a charge of ethical impropriety or other breach of professional conduct on the basis of that determination. (c) Eligible Financial Institutions. (1) A lawyer must use an IOLTA account established at an eligible financial institution that is authorized by federal or state law to do business in the state of Illinois; that has complied with the Overdraft Notification provisions of Rule 1.15B(e); and that offers IOLTA accounts within the comparable rate, remittance, and reporting requirements of this paragraph (c) as administered by the Lawyers Trust Fund of Illinois. (2) To be eligible to hold IOLTA funds deposited by Illinois lawyers, a financial institution must offer IOLTA accounts that pay no less than the highest interest rate or dividend generally available from the institution to its non-IOLTA account customers when the IOLTA account meets or exceeds the same minimum balance or other account eligibility guidelines. (3) To meet the requirements of paragraph (c)(2), an eligible financial institution must offer one or more of the account product options identified in this paragraph (c)(3). For all account product options, IOLTA funds must be subject to withdrawal upon request and without delay as soon as permitted by law. (i) An eligible financial institution may hold IOLTA funds in a checking account paying preferred interest rates, such as money market or indexed rates. (ii) An eligible financial institution may use alternative account products for IOLTA accounts with higher balances, including: (A) A government (such as for municipal deposits) checking account; (B) A business checking account with an automated investment feature, such as an overnight sweep and investment in repurchase agreements fully collateralized by U.S. Government securities; (C) A money market fund with, or tied to, check-writing capacity, that must be solely invested in U.S. Government securities or securities fully collateralized by U.S. Government securities, and that has total assets of at least $250 million; or (D) Any other suitable interest-bearing deposit account offered by the eligible financial institution to its non-IOLTA customers. (iii) An eligible financial institution may pay on its existing IOLTA accounts the highest rates it offers on the account product options in paragraph (c)(3)(ii) in lieu of moving the funds into those products. (iv) As an alternative to the account product options in paragraph (c)(3)(i-iii), an eligible financial institution may pay on IOLTA deposits a “safe harbor” yield equal to 70% of the current Federal Funds Target Rate, or a rate of 1.0% (100 basis points), whichever is higher. An eligible financial institution that pays the safe harbor yield must agree to pay the rate and then ensure that the monthly IOLTA interest it remits to the Lawyers Trust Fund meets the safe harbor threshold. (v) An eligible financial institution periodically may be required to certify to the Lawyers Trust Fund that the rates it pays on IOLTA deposits, regardless of account type, meet the requirements of this paragraph (c). (4) An eligible financial institution must remit monthly earnings on each IOLTA account directly to the Lawyers Trust Fund. (i) For each individual IOLTA account, the eligible financial institution must provide: a statement transmitted with each remittance showing the name of the lawyer or law firm directing that the remittance be sent, the account number, the remittance period, the rate of interest applied, the account balance on which the interest was calculated, the reasonable service fee(s) if any, the gross earnings for the remittance period, and the net amount of earnings remitted. (ii) Remittances must be sent to the Lawyers Trust Fund electronically unless otherwise agreed. (iii) The financial institution may assess only allowable reasonable fees, as defined in Rule 1.15C(i). Fees in excess of the earnings accrued on an individual IOLTA account for any month must not be taken from earnings accrued on other IOLTA accounts or from the principal of the account. (d) Unidentified Funds. A lawyer who learns of unidentified funds in an IOLTA account must make periodic efforts to identify and return the funds to the rightful owner. If, after 12 months from the discovery of the unidentified funds, the lawyer determines that further efforts to ascertain the ownership or secure the return of the funds will not succeed, the lawyer must remit the funds to the Lawyers Trust Fund of Illinois. A lawyer who remits funds in error or subsequently identifies the owner of the remitted funds may make a claim for a refund to the Lawyers Trust Fund. The Lawyers Trust Fund will return the funds to the lawyer after verifying the claim. A lawyer who exercises reasonable judgment in making a determination under this paragraph will not be subject to a charge of ethical impropriety or other breach of professional conduct on the basis of that determination. (e) Overdraft Notification. All trust accounts, whether IOLTA or non-IOLTA, must be established in compliance with the following provisions on overdraft notification: (1) A lawyer must maintain a client trust account only at an eligible financial institution that has agreed to notify the Attorney Registration and Disciplinary Commission in the event any properly payable instrument is presented against a client trust account containing insufficient funds, irrespective of whether or not the instrument is honored. The financial institution must file an agreement using a form provided by the ARDC. Any such agreement must apply to all branches of the financial institution and must not be canceled except upon advance notice of 30 days or more made in writing to the ARDC. The ARDC must annually publish a list of financial institutions that have agreed to comply with this paragraph and shall establish rules and procedures governing amendments to the list. (2) The overdraft notification agreement must provide that all reports made by the financial institution to the ARDC will be in the following format: (i) In the case of a dishonored instrument, the financial institution’s report must be identical to the overdraft notice customarily forwarded to the depositor and should include a copy of the dishonored instrument, if such a copy is normally provided to depositors; and (ii) In the case of instruments that are presented against insufficient funds but which instruments are honored, the financial institution’s report must identify the financial institution, the lawyer or law firm, the account number, the date of presentation for payment and the date paid, and the amount of the resulting overdraft. Such reports shall be made simultaneously with, and within the time provided by law for, notice of dishonor, if any. If an instrument presented against insufficient funds is honored, then the report shall be made within five banking days of the date of presentation for payment against insufficient funds. (3) Every lawyer admitted to practice in this jurisdiction is conclusively deemed to have consented to the reporting and production requirements mandated by this Rule. (4) Nothing in this paragraph (e) may preclude a financial institution from charging a particular lawyer or law firm for the reasonable cost of producing the reports and records required by this paragraph. Fees charged for the reasonable cost of producing the reports and records required by paragraph (e) are the sole responsibility of the lawyer or law firm and are not allowable reasonable fees for IOLTA accounts as those are defined in Rule 1.15C(i). (f) Disbursement of Real Estate Transaction Funds. In the closing of a real estate transaction, a lawyer’s disbursement of funds deposited but not collected shall not violate his or her duty pursuant to this Rule 1.15B if, prior to the closing, the lawyer has established a segregated Real Estate Funds Account (REFA) maintained solely for the receipt and disbursement of such funds, has deposited such funds into a REFA, and: (1) is acting as a closing agent pursuant to an insured closing letter for a title insurance company licensed in the State of Illinois and uses for such funds a segregated REFA maintained solely for such title insurance business; or (2) has met the “good-funds” requirements. The good-funds requirements shall be met if the bank in which the REFA was established has agreed in a writing directed to the lawyer to honor all disbursement orders drawn on that REFA for all transactions up to a specified dollar amount not less than the total amount being deposited in good funds. Good funds shall include only the following forms of deposits: (i) a certified check; (ii) a check issued by the State of Illinois, the United States, or a political subdivision of the State of Illinois or the United States; (iii) a cashier’s check, teller’s check, bank money order, or official bank check drawn on or issued by a financial institution insured by the Federal Deposit Insurance Corporation or a comparable agency of the federal or state government; (iv) a check drawn on the trust account of any lawyer or real estate broker licensed under the laws of any state; (v) a personal check or checks in an aggregate amount not exceeding $5,000 per closing if the lawyer making the deposit has reasonable and prudent grounds to believe that the deposit will be irrevocably credited to the REFA; (vi) a check drawn on the account of or issued by a lender approved by the United States Department of Housing and Urban Development as either a supervised or a nonsupervised mortgagee as defined in 24 C.F.R. § 202.2; (vii) a check from a title insurance company licensed in the State of Illinois, or from a title insurance agent of the title insurance company, provided that the title insurance company has guaranteed the funds of that title insurance agent. Without limiting the rights of the lawyer against any person, it shall be the responsibility of the disbursing lawyer to reimburse the trust account for such funds that are not collected and for any fees, charges and interest assessed by the paying bank on account of such funds being uncollected. Adopted Mar. 1, 2023, eff. July 1, 2023. Comment [1] Paragraph (a) requires that a lawyer deposit client or third-person funds that cannot earn net interest for an individual client or third person into one or more IOLTA accounts as defined in Rule 1.15C(b), with the interest earned on any such accounts remitted to the Lawyers Trust Fund of Illinois. Paragraph (b) identifies the factors a lawyer must consider when making the determination about whether client or third-person funds should be deposited into an IOLTA or non-IOLTA client trust account. The lawyer should exercise reasonable judgement in making this determination. [2] The Lawyers Trust Fund of Illinois will use the interest remitted from IOLTA accounts for the purposes set forth in its bylaws, including financial support to Illinois legal aid organizations. The purposes of the Lawyers Trust Fund of Illinois may not be changed without the approval of the Supreme Court of Illinois. [3] Paragraph (c) requires that lawyers maintain IOLTA accounts only at an eligible financial institution that pays interest rates on IOLTA accounts that are comparable to those it pays on non-IOLTA accounts. An eligible financial institution may use one or more of the account products or alternatives described in paragraph (c) for the deposit of IOLTA funds. To assist lawyers in identifying eligible financial institutions, the Lawyers Trust Fund maintains a periodically updated list of such financial institutions on its website (www.ltf.org). [4] Paragraph (d) applies when a lawyer cannot document accumulated balances in an IOLTA account as belonging to an identifiable client or third person, or to the lawyer or law firm. Paragraph (d) provides a mechanism for a lawyer to remove these funds from an IOLTA account when, in the lawyer’s reasonable judgment, further efforts to account for them after a period of 12 months are not likely to be successful. This procedure facilitates the effective management of IOLTA accounts by lawyers; addresses situations where an IOLTA account becomes the responsibility of a lawyer’s successor, law partner, or heir; and supports the provision of civil legal aid in Illinois. Paragraph (d) relates only to unidentified funds, for which no owner can be ascertained. Unclaimed funds in client trust accounts—funds whose owner is known but that have not been claimed—should be handled according to applicable statutes including the Uniform Disposition of Unclaimed Property Act (765 ILCS 1025 et seq.). [5] The Lawyers Trust Fund of Illinois will publish instructions for lawyers remitting unidentified funds. Proceeds of unidentified funds received under paragraph (d) will be distributed to qualifying organizations and programs according to the purposes set forth in the bylaws of the Lawyers Trust Fund. [6] Paragraph (e) requires that lawyers maintain trust accounts only in financial institutions that have agreed to report trust account overdrafts to the ARDC. The trust account overdraft notification program is intended to provide early detection of problems in lawyers’ trust accounts, so that errors by lawyers and/or banks may be corrected and serious lawyer transgressions pursued. [7] Paragraph (f) applies only to the closing of real estate transactions and adopts the “good- funds” doctrine. That doctrine provides for the disbursement of funds deposited but not yet collected if the lawyer has already established an appropriate Real Estate Funds Account and otherwise fulfills all of the requirements contained in the Rule. RULE 1.15C: DEFINITIONS FOR RULES 1.15, 1.15A, AND 1.15B (a) “Funds” denotes any form of money, including cash; payment instruments such as checks, money orders, or sales drafts; and electronic fund transfers. (b) “IOLTA account” means a pooled interest- or dividend-bearing client trust account, established with an eligible financial institution with the Lawyers Trust Fund of Illinois designated as income beneficiary, for the deposit of client or third-person funds as provided in Rule 1.15B(a) and from which funds may be withdrawn upon request as soon as permitted by law. (c) “Non-IOLTA client trust account” means a separate and identifiable interest- or dividend-bearing client trust account established to hold the funds of a client or third person as provided in Rule 1.15B(a). This type of client trust account is not pooled, and the client or third person for whom it is established should be designated as the income beneficiary. (d) “Eligible financial institution” is a bank or a savings bank insured by the Federal Deposit Insurance Corporation or an open-end investment company registered with the Securities and Exchange Commission that agrees to provide overdraft notification regarding any type of client trust account as provided in Rule 1.15B(e) and that, with respect to IOLTA accounts, offers IOLTA accounts within the requirements of Rule 1.15B(c). (e) “Properly payable” refers to an instrument that, if presented in the normal course of business, is in a form requiring payment under the laws of this jurisdiction. (f) “Money market fund” is an investment company registered under the Investment Company Act of 1940, as amended, that is qualified to hold itself out to investors as a money market fund or the equivalent of a money market fund under Rules and Regulations adopted by the Securities and Exchange Commission pursuant to said Act. (g) “U.S. Government securities” refers to U.S. Treasury obligations and obligations issued by or guaranteed as to principal and interest by any AAA-rated United States agency or instrumentality thereof. A daily overnight financial repurchase agreement (“repo”) may be established only with an institution that is deemed to be “well capitalized” or “adequately capitalized” as defined by applicable federal statutes and regulations. (h) “Safe harbor” is a yield that, if paid by the financial institution on IOLTA accounts, will be deemed as a comparable return in compliance with Rule 1.15B. The safe harbor yield must be calculated as 70% of the Federal Funds Target Rate or a rate of 1.0% (100 basis points), whichever is higher. When the Federal Funds Target Rate is expressed as a range, the point of reference for the safe harbor yield should be the top of that range. (i) “Allowable reasonable fees” for IOLTA accounts are per-check charges, per-deposit charges, a fee in lieu of a minimum balance, federal deposit insurance fees, automated investment (“sweep”) fees, and a reasonable maintenance fee, if those fees are charged on comparable accounts maintained by non-IOLTA depositors. All other fees are the responsibility of, and may be charged to, the lawyer or law firm maintaining the IOLTA account. (j) “Unidentified funds” are amounts accumulated in an IOLTA account that cannot be documented as belonging to a client, a third person, or the lawyer or law firm. Adopted Mar. 1, 2023, eff. July 1, 2023. Comment [1] Rule 1.15C provides definitions that pertain specifically to Rule 1.15, Rule 1.15A, and Rule 1.15B. Paragraph (a) defines expansively the meaning of “funds,” to include any form of money, including electronic funds. Paragraphs (b) and (c) define an IOLTA account and a non-IOLTA client trust account, respectively. Paragraph (d) defines an eligible financial institution for purposes of the overdraft notification and IOLTA programs. Paragraph (e) defines “promptly payable,” a term used in the overdraft notification provisions in Rule 1.15B(e). Paragraphs (f) through (i) define terms pertaining to IOLTA accounts. Paragraph (j) defines “unidentified funds” as that term is used in Rule 1.15B(d).