Bank of Tampa Simple Page - iota
If you have any questions regarding The Bank of Tampa's response on the Florida IOTA Program, please contact Frank Territo at fterrito@bankoftampa.com or (813) 998-1937.
Background
On March 16, 2023, the Florida Supreme Court amended several Bar rules, including the section that addresses the IOTA program. As a result of this change, for a financial institution to be eligible to participate in the program, it must pay a minimum interest rate of 3.00% when the Wall Street Journal Prime Rate (index rate) is between 3.25% and 4.99%. When the index rate is above 5.00%, to stay eligible, financial institutions are required to pay a minimum interest rate equal to 40% of the index rate.
However, we, along with others in our profession, believe this new rule has broader reach than the regulation of lawyer’s conduct in handling their IOTA account, is out of line with similar structures in other states, and most importantly, is linked to an inappropriate index rate that imposed a 3,000% increase in the interest rate banks are required to pay on IOTA accounts.
What is The Bank of Tampa doing?
With the support of your bank, The Florida Banker’s Association, which advocates on behalf of Florida banks and promotes the banking industry in the state, partnered with Senator Erin Grall (R-Vero Beach), a lawyer herself, and Representative Robert Brackett (R-Vero Beach) to introduce SB 1336 and HB 1253. The proposed legislation would reform Florida’s current IOTA program by providing a more appropriate interest rate to be paid on IOTA accounts.
While a petition to reconsider the rule is pending before the Florida Supreme Court, this proposed legislation would provide another path to resolving this untenable situation.
Where can I learn more?
Please visit the resources listed below for the latest information to learn more.
Case View in Regards Amendments to Rules Regulating The Florida Bar
Interest on IOTA Accounts Program - The Florida Bar Foundation
The IOTA Rule - The Florida Bar Foundation
The Florida Bar Founation's IOTA Policy on Reasonable Service Charges and Fees