How should lawyers handle client funds?

Lawyers are required to handle client funds with the utmost care and integrity, which is why depositing client funds into a trust account is the appropriate method. A trust account, often called an IOLTA (Interest on Lawyers' Trust Accounts) in Kentucky, is specifically designed to hold client funds separately from the lawyer's personal funds. This separation helps to avoid any potential misuse or misappropriation of those funds and ensures that clients' financial interests are protected.

Maintaining accurate records in conjunction with using a trust account is also essential. This includes keeping detailed records of all transactions involving client funds, such as deposits, withdrawals, and balances. Such meticulous record-keeping is crucial because it safeguards against any disputes regarding the handling of a client's money and provides transparency, which is a fundamental principle of the legal profession.

The other provided options fail to adhere to these ethical standards. For instance, mixing client funds with personal funds can lead to conflicts of interest and potential misappropriation, while keeping client funds in a personal account presents significant risks of commingling, which is unethical. Lastly, simply withdrawing funds once a case is closed without proper procedures can jeopardize the lawyer's compliance with ethical obligations regarding client funds. Therefore, option B accurately reflects the ethical requirements