New Rule Provides Unlimited FDIC Coverage to IOLTA Accounts

On November 26, 2008 the FDIC published a final rule that extends unlimited deposit insurance coverage to client funds deposited in IOLTA accounts at participating financial institutions. The coverage is provided under the Temporary Account Guarantee provisions of the FDIC’s Temporary Liquidity Guarantee Program. All funds in an IOLTA account, regardless of size, will now be insured in full by the FDIC and backed by the full faith and credit of the United States government.  

The additional coverage began October 14, 2008 and will remain in effect until December 31, 2009, unless extended. Financial institutions are required to post disclosures stating their participation in the program, or their decision to opt out of the additional coverage.

The final rule is available at: www.fdic.gov/news/board/08BODtlgp.PDF