The Society has recently moved its trust account oversight from the Professional Responsibility department to the Finance and Administration group. The newly renamed Trust Assurance Program is a risk-based process to ensure lawyers are in compliance with the Trust Account Regulations that relate to lawyers’ trust accounts, including those regulations related to other client property, client ID and verification rules, unclaimed trust funds, applicable Professional Standards and more.
The Trust Assurance Program strives to be more supportive and educational, with a lens on being “Triple P” (principled, proactive and proportional) in our response to violations and non compliance.
The Society currently has in place a Trust Assurance Administrator and has just hired an in-house trust assurance auditor. The auditor will conduct risk-based audits, as we have always done using a consultant. The auditor will also engage in education, risk identification and management, and assist with complaint investigations when needed. As part of this work, the auditor will assist in developing and delivering resources and tools for new firms, or those opening new trust accounts, and in helping them apply and understand the Trust Account Regulations and best practices. As with all NSBS staff, the trust assurance unit will adopt a Legal Services Support approach.
The Trust Assurance Program will also support the Society by providing research and advice in areas of potential risk and fraud including cybercrime, money laundering, trust safety, etc. Over the next year or so, the Society will also be reviewing the Trust Account Regulations to ensure that they meet the Society’s Triple P objectives. We will review the Audit and Accountants’ review on trust accounts process as well.
One immediate change to anticipate: since the NSBS is now using risk as a driving factor in its regulation, some firms that have had no problems or concerns arising from their trust account reports for several years may have the requirement for an accountant’s report on the TAR waived this year. We are piloting this initiative to determine if we can reduce the cost of compliance by law firms without increasing the risks borne by the Society. Because this is a new initiative, only a few firms will benefit from it in year one.
Sean Walker, CPA, CGA, CIA
Director, Finance & Administration