Virtual Law Practice

Category: Online Payments

Client Portal Matrix

Last week I gave a presentation with Chad Burton at the ABA LPM Spring meeting about the eLawyering Task Force‘s newest project, the Client Portal Matrix, formally titled as the “Comparative Evaluation of Web-based Practice Management Software with Client Portal Applications for Solos and Small Law Firms.” Donna Seyle, who did most of the work gathering data for the matrix, was unable to make the meeting so I filled in to discuss some of the practical uses of a client portal in law practice and the best practices and ethics issues that might come up.

The matrix will be posted on the eLawyering website in the near future. It is a work in progress, but is already a useful tool and starting point for lawyers considering virtual practice. It was designed primarily for solo and small firm practitioners. The matrix focuses on cloud-based, SaaS solutions and specifically excludes the online client portals and tools provided by branded networks, such as Rocket Lawyer. The focus of this project was on client-facing technology so also excluded were systems that focused on other administrative tasks, such as time and billing, calendaring, or matter management among others. There are fourteen companies with client-facing features on the matrix so far.

It makes me think back to eight years ago when I opened my solo virtual law office and co-founded the system that is now Total Attorney’s platform with client-facing features. At the time, there weren’t any SaaS options out there for a practitioner. Now there are choices and more most likely in the works. Expect to hear more clients asking their lawyers and firms for online access to their legal accounts. If you don’t have a client portal or any client facing features in the technology you use for your firm, you need to consider in the near future how you will add it to the mix. This is going to be the case whether you are delivering legal services online with a virtual law office or operating a traditional law firm without online delivery options. It’s about client access and good customer service which should apply in any firm structure.

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June 3, 2013
Bitcoin as Payment for Legal Services

One of my law students recently raised this question to me: Could a lawyer allow payment for legal services in Bitcoin? It’s not a question I’ve ever heard before, and it’s a good one.

Bitcoin is digital currency and it’s not managed by any central authority but the transactions occur through Bitcoin miners which is basically a server that communicates and confirms the transaction and records it on a ledger. They can be transferred by mobile devices. Recent articles have suggested that eBay and Paypal may open up their sites to the use of Bitcoin.

There is criticism around Bitcoin that the exchange rate is too volatile. A Twitter follower in response to my posing of this question replied: “Would you accept bearer bonds?” There are also potential security issues. The best article I’ve read on that subject was in Wired by an author who had tried to break Bitcoin and failed. And then there are the questions about IOLTA and trust accounting rules and compliance. There is a Bitcoin Foundation which supports the standardization of Bitcoin and claims to support the software design and cryptography behind it.

I could find only one other instance where anyone in the legal profession was offering payment by Bitcoin. A law firm in Albuquerque called Law 4 Small Business published a press release announcing their offering of payments via digital currency.

For a virtual law practice, adding Bitcoin to possible online payment methods might make sense. I’m still thinking through this one. Anyone else have any reactions?

May 14, 2013
Taking Advantage of the Economic Downturn

Attorneys considering opening a virtual law practice should take a look at Susan Cartier Liebel’s recent blog post “Is Now The Perfect Time To Start Your Solo Practice?” The post is motivational and gives great examples of why and how attorneys may make the most of the economic downturn to create innovative law practices.

Along those lines, I just finished writing a post on the VLOTech blog about how web-based virtual law offices are the ideal way for a solo or small firm practitioner to turn a bad situation into a growing law practice. From low overhead to providing more cost-effective and efficient services, VLOs are a great way to serve clients who are seeking out convenient and affordable legal assistance. This is also a good way to build client loyalty and grow your virtual practice through referrals.

I’ve seen an increase in my virtual law practice client base since this summer. Many of my clients, especially the estate planning clients with families, are very upfront with me. They can’t afford a traditional law practice. They can’t take the time off work to go in for multiple appointments in a law office. Or they don’t want the added cost of paying for child care while they meet with a paralegal or attorney in person. They need flexibility in payment methods and the ability to pay online with a credit card or through Paypal. They need to be able to work with me online on their own time even if that is at 1:00am in the morning.

How do I think attorneys can take advantage of the economic downturn? Respectfully understand your clients’ economic concerns and give them what they need in this difficult time. With my web-based VLO, I have more flexibility in my practice and it doesn’t hurt my bottom line. Efficient and affordable customer service will create client loyalty that will continue in good times and grow your virtual law practice over the years.

October 21, 2008
Accepting Online Payments in a Virtual Law Office

Accepting credit card payments from clients has come up several times recently on the ABA’s Solosez listserv. Some list members were questioning whether it was ethical to accept client funds online if the funds were meant to be held as a retainer. By most state bar regulations, a retainer should be held only in the attorney’s trust account.

How should an attorney operating a completely virtual law office handle accepting online payments from clients?

To start, if a virtual law practice accepts credit card payments from clients, then the attorney must make sure that the practice is Payment Card Industry Data Security (PCI DSS) compliant. PCI compliance must occur whenever any business stores, transfers or collects credit card information from clients. Failure to comply with these rules, set by the credit card industry, may result in a business no longer being allowed to take credit card purchases, in addition to multiple fines and penalties.

It is unlikely that a virtual law practice would handle the number of transactions that require an audit by the PCI DSS Qualified Security Assessors. However, the standards in this area are constantly being changed. The responsibility falls to the VLO attorney to keep any online purchases of legal services by credit card compliant with the most current rules and regulations.

It should go without saying that a VLO must also be set up to comply with rules set forth in that attorney’s state bar trust account guidelines or other bar association regulations. Because many attorneys operating a VLO will choose to use the fixed fee method of billing in which the client is provided and agrees to pay a fixed fee before the completed services are delivered in full, the VLO attorney may not require a separate retainer. If a retainer is required as part of the initial price quote and must be completed before the VLO attorney proceeds, then those funds should most likely be placed in the VLO’s trust account and kept separate from the VLO operating account per the rules of most state bar associations.

As I mentioned above, one gray area is the use of PayPal or other credit card processing service to hold retainer fees. The issue is whether the retainer may be run through the credit card processing company even if that company routes the funds to the attorney’s trust account rather than operating account. Because the funds would first be transmitted to the attorney’s online account at the credit card processing company and then routed to the trust account, this may be in violation of the online attorney’s state bar trust account rules because for a short period of time the funds are held by the credit card processing company.

There are a variety of ways that the online attorney might choose to set up the payment function of the VLO and his or her compliance with trust account rules would depend on that particular setup. With the use of the VLO billing features and invoicing process, it may be not be desirable for the attorney to request a traditional retainer fee from the online client or if necessary, the VLO attorney could request to receive the retainer through snail mail for direct deposit into the attorney’s trust account. In which case, the question of the trust account being attached to the credit card processing company would not exist.

While all of this may sound hyper-technical because the funds would end up in the attorney’s trust account as required, if PayPal or the credit card processing company in question was not one of the financial institutions approved by the attorney’s state bar for the purpose of maintaining trust accounts, then the transaction might be in violation of their bar’s trust accounting rules. This is a question that the individual state bars may have to address as more attorneys provide legal services through virtual law practices.

June 3, 2008

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