Alert January 18, 2011

FDIC Approves Final Rule that Would Extend Unlimited FDIC Insurance Coverage to IOLTAs from December 31, 2010 through December 31, 2012

The FDIC adopted a final rule (the “Final Rule”) amending its deposit insurance regulations to include Interest on Lawyers Trust Accounts (“IOLTAs”) in the definition of “non-interest bearing transaction account” so that funds in IOLTAs will receive unlimited deposit insurance coverage during the period from December 31, 2010 through December 31, 2012.  The FDIC noted that the coverage for IOLTAs is separate from, and in addition to, insurance coverage provided to a depositor for other FDIC-insured accounts.  The Final Rule will become effective on the date it is published in the Federal Register.