Indiana’s Interest on Lawyers’ Trust Account program is expecting to receive a portion of the federal government’s historic multi-billion-dollar settlement with Bank of America, bringing a much-needed influx of funds to the program that has suffered dramatic declines in revenues as a result of the economic recession.
Charles Dunlap, executive director of the Indiana Bar Foundation which administers the state’s IOLTA program, said he is pleased with the additional resources but cautioned the financial help will not arrive immediately.
“It could take several years for the funds to be distributed so relief for people struggling with mortgage foreclosure could still be more than a year away,” he said.
Dunlap was recently elected president of the National Association of IOLTA programs. He has been a member of the national organization for 13 years.
The U.S. Department of Justice announced the $16.65 billion settlement Aug. 21 to resolve federal and state claims against Bank of America and its former and current subsidiaries, including Countrywide Financial Corp. and Merrill Lynch, for financial fraud leading to and during the Great Recession.
This is the largest civil settlement with a single entity in American history and will provide billions of dollars in relief to struggling homeowners.
Although the portion of the settlement slated to come to Indiana is unknown, Dunlap, said the amount will be significant.
“While $17 billion is certainly a big number, the portion that Indiana’s IOLTA program will receive is only a small portion of the overall amount and comes on the heels of over five years of unprecedented low revenues due to the historically low prevailing interest rate environment we have experienced,” Dunlap said. “We are extremely grateful for the increased ability we will have to help struggling Hoosiers with these settlement funds, but we have to be patient to see how all the details work out.”