When Settlement Funds Fall Through the Cracks: Protecting Clients and Your Business
Settlement funds can become compromised when law firms dispute control, delay distribution, or mishandle trust account obligations. Returned checks, uncashed payments, or prolonged disputes place clients at risk—especially when those funds are needed for urgent repairs or recovery work.
To protect client interests, professionals should maintain thorough documentation, verify when and how settlement funds were issued, and communicate proactively with insurers and counsel. Depending on the circumstances, it may be appropriate to request reissued payments, clarify fiduciary responsibilities, or seek guidance from regulatory bodies.
Above all, the focus should remain on ensuring the client receives their funds promptly and safely so they can move forward with necessary repairs and claim resolution.
