When a couple is in the midst of a divorce, often times, a house will be sold, or other assets will be sold and the proceeds from those sales will be held in trust by one of the party's attorney. Unfortunately, from time to time there are news articles that pop up that talk about an attorney using those monies which are held in trust for their own purposes. Although trust accounts are in the name of the attorney, the monies that are held in trust are not the attorneys' property and any use of the funds for purposes other than those authorized by the client are illegal. I find it disturbing that an attorney would use trust account funds in a wrongful way, because such behavior can be grounds for immediate disbarment, depending on the severity of the misappropriation. I think that as a general rule, most attorneys would never consider using funds held in trust for anything other than their intended purpose. However, it still happens from time to time and it is important to protect yourself. Therefore, if you are going to place any amount of money into an attorney's trust account, follow these general rules:
1. Always ask for a receipt when you give any amount of money to your attorney to be held in trust.
2. Ask for a monthly statement of your trust balance and keep an eye out for any unusual withdrawals.
3. Enter into a formal agreement that states that any withdrawals from the trust account requires your written approval.
4. Find out who your attorney's legal malpractice insurance carrier is, therefore, if you realize that the funds which are held in trust are being misappropriated, you can immediately file a claim for recovery.
5. In the event that funds which have been held in trust have disappeared without explanation, immediately file a grievance with your local bar association.