One of the most important commandments in the field of legal practice: Thou shalt not commingle funds.  Indeed, property or financial assets belonging to clients or third persons in possession of an attorney must not be placed in the attorney's bank account.  Occasionally, news stories report of a lawyer's illegal financial exploitation, dipping into prohibitive accounts or depositing funds that are slated to go to an escrow or trust account to his/her own account. 

Hence, I receive the occasional phone call from attorneys who wish to use two separate accounts -- one for operating expenses and another representing a trust account.  Specifically, attorneys may need credit card processing-related fees deducted directly from an operating bank account and any deposits to go directly to the trust fund account.  Can this be set up under one merchant account?

While policies vary between merchant account processors, there are providers who will enable the merchant to set up one merchant account.   Under the umbrella of this merchant account, the provider makes deposits to one bank account and withdraws fees from another.   On the merchant account application, the lawyer should notate the account information for deposits and withdrawals, and provide a voided check or bank confirmation letter for each account.

This type of system (i.e., one merchant account for two separate bank accounts) can be set up whether the attorney swipes the client's credit card payment or keys it in, or even accepts payment online.

The question arises: What if the attorney has both operating account deposits AND trust fund deposits?  In this scenario, most processors would then require two separate merchant accounts.  Here, the lawyer would be able to designate which account he/she wants deposits to be sent to and credited.  Basically, for each merchant account, there can only be one bank account designated for deposits. It would be up to the lawyer to determine which merchant account he wanted to use for the specific deposit account.

As we're all familiar with the separation of church and state, attorneys have to embrace the separation of operating and trust bank accounts.  While it's possible and ideal to set up one merchant account ensuring attorney "no commingling" compliance, it may be necessary to set up two or more merchant accounts if the attorney has different types of deposits and/or many different trust clients.