What does the rule require of lawyers and law firms who handle client funds?
A. Rule 1.15 of the Colorado Rules of Professional Conduct requires all client funds to be held in an interest-bearing account, with the interest payable either to the client or to the Colorado Lawyer Trust Account Foundation (COLTAF). COLTAF accounts are for client funds that are nominal in amount or are expected to be held for a short period of time with the intent that such funds not earn interest in the excess of the reasonably estimated cost of establishing, maintaining and accounting for trust accounts for the benefit of such clients. For these funds, the lawyer or law firm maintains a pooled interest-bearing account and instructs the financial institution to pay the interest on this account to COLTAF. For client funds that are large enough or are expected to be held for a long enough period of time to warrant the cost of establishing, maintaining, and accounting for the interest, lawyers are expected to set up separate interest-bearing accounts for the benefit of such clients.
