As reported yesterday, the Board of Trustees of the Interest on Lawyer Account Fund (IOLA) has adopted new standards for IOLA accounts requiring such accounts to bear higher interest rates. Today Governor Spitzer announced that Citibank has agreed to participate in the expansion of the IOLA program thus providing accounts with the required interest rate.
According to the Governor’s Press Release, the new IOLA regulations will significantly increase the interest banks pay on the roughly $3.1 billion in escrow accounts lawyers use to hold clients’ funds and increase the IOLA fund’s grant-making to as much as $60 million per year from approximately $14 million in 2007. Citibank and JP Morgan Chase are the two largest holders of IOLA deposits.
Managing Director at Citibank, Hugh Donlon, said: “We are pleased to join Governor Spitzer in announcing that we have reached agreement with the IOLA Fund regarding this important initiative, which will greatly increase the amount of funds available for legal aid services for indigent clients, truly a worthy cause.”