Report trust account deficiencies and irregularities as soon as practicable |
If an irregularity occurs in a trust account, no matter the value, is it important that we are informed promptly. If you are a lawyer, an associate of a law practice, an approved clerk, an external examiner or a bank that deals with legal practice trust accounts, and you become aware of a deficiency or irregularity in a trust account or trust ledger, you must tell us as soon as practicable. You can do that by filling out the reporting form below.
A deficiency or irregularity includes:
- an error made in a trust ledger
- a deficiency occurring in a trust account/trust ledger
- where trust money has been intermixed with other money,
- or any other type of irregularity involving the receipt, recording or disbursement of trust money
For more information about what constitutes trust money, see our Trust money webpage.
Yes. If you are a lawyer or an approved law clerk, then you must also give written notice to us if you believe on reasonable grounds there is an irregularity in the trust account of another law practice or approved barristers’ clerk, even if you are not associated with it.
If we don’t know that a deficiency or irregularity has occurred, we can’t help to fix it. There is also the risk of significant harm occurring to a client.
In some instances, we may commence a formal investigation of how and why the error occurred, and there may be possible serious penalties for people who had knowledge but failed to act. Causing a deficiency in any trust account or trust ledger, or failing to pay or deliver any trust money without reasonable excuse is a serious offence.
For more information on our risk-based approach to the regulation of lawyers’ trust accounts, and conducting of trust account investigations, see our Policy on risk-based regulation of lawyers’ trust accounts.
We will contact you if we need you to give us any further information or if we need you to take any further action to address the irregularity. Note that if you have not taken immediate action to rectify the irregularity, you must do so at the earliest opportunity. You must also ensure that when errors are corrected, the records disclose that prompt action was taken to rectify the error. In addition, if the irregularity or errors have affected client billing and invoices or their given directions (or instructions) relating to the money, they must be notified accordingly.
