Sign In
  • Inside Track
    September 19, 2012

    Ethical Dilemmas: Credit Card Transactions Okay, But Be Careful Where You Put Them

    Sept. 19, 2012 – Ethical dilemmas affect every lawyer’s practice. This series of questions and answers appears each month in InsideTrack. The answers, offered by State Bar’s ethics counsel Timothy Pierce, are intended to provide guidance only and are not legal authority. Each situation will depend on the facts and circumstances involved.

    Question

    I’ve heard that other lawyers accept fee payments via credit card, but I’ve also been told that you can’t accept credit cards. What gives?

    Answer

    A lawyer may not allow any credit card transactions into the lawyer’s trust account, but may accept payment via credit card into the lawyer’s business account. Therefore, advances on fees and costs may not be paid via credit card, but already-earned fees and reimbursement for costs advanced may be accepted by credit card because the funds must go into the business, rather than trust account (see Ethical dilemmas: Retainer or advanced fee? Business or trust account?, InsideTrack, Jan. 18, 2012).

    However, under the recently adopted SCR 20:1.15(e)(4)(h), lawyers may establish special trust accounts solely for the purpose of receiving fee and cost payments via credit cards. Funds must be transferred by check to the appropriate account (IOLTA for advanced fee or costs, or business for earned fees) account as soon as they are available, and all other requirements of trust accounts apply. Alternatively, a lawyer may deposit advanced fees, but not costs, by credit card directly into the lawyers business account if the lawyer complies with SCR 20:1.15(b)(4).

    References: SCR 20:1.15(b)(4), (e)(4)(e) and (e)(4)(h).



Join the conversation! Log in to leave a comment.

News & Pubs Search

-
Format: MM/DD/YYYY