D.C. lawyer Mark Zaid, who represents victims of the Pan Am Flight 103 terrorist bombing, was stunned when he unsuccessfully tried to deposit nearly $8 million in settlement funds into his Interest on Lawyer’s Trust Account at Bank of America.
Bank of America refused to accept the deposit Nov. 24 even though Zaid presented the bank a notarized and double-witnessed power-of-attorney. Zaid says he was told he would need his signature and his clients’ signature on the checks. The solo practitioner questions whether it’s a potential malpractice offense to send that amount of money through the mail without indemnity.
Zaid said he was bounced around in the vast Bank of America network. He Googled names of bank officials, searching for phone numbers and e-mail addresses. He notified the bank’s general counsel and legal department. A Bank of America lawyer in Boston was supposed to call. She never did. A “professional and pleasant” paralegal in the Baltimore office called Nov. 25, but Zaid was offended. He wanted to speak with a lawyer.
Zaid is now demanding answers from Bank of America—he wrote a sternly-worded letter to Bank of America CEO Kenneth Lewis—and is concerned about the extent to which lawyers at smaller firms are enduring the same obstacles. Zaid is managing partner at Mark S. Zaid, P.C. He is calling on bar associations—including the D.C. and Maryland bars—to review the relationship between banking and legal communities.
“This is a very sensitive issue that needs to be looked at by all bar associations," Zaid says. "The fact of the matter is the banks are nullifying the usefulness of power of attorney, which is at the cornerstone of much of what we do.”
Bank of America could have taken “numerous” steps, Zaid said, to verify the identities of his clients and to confirm the authenticity of the power of attorney. “Bank of America’s concerns could have easily been addressed. It would have required me to jump through hoops. But Bank of America didn’t raise a hoop for me to jump through,” Zaid says. “They just shut me down completely.” A Bank of America spokesman could not be reached for comment.
Zaid has maintained an IOLTA account at Bank of America for two years. “It wasn’t as if I was a stranger was walking into the bank,” he says, noting his close association with the local branch’s manager. Zaid says he used the same version of power-of-attorney to deposit $32 million in accounts at Citibank in 2003 and in 2004 without a problem.
JPMorgan Chase & Co., which issued the Pan Am Flight 103 checks as the financial trustee for the settlement, plans to wire transfer the funds directly to Zaid’s clients “ensuring that as few dollars as possible of the nearly $8 million will traverse [the Bank of America] internal system,” Zaid wrote in the letter.
"After more than a decade of litigation against Libya ... just when the light at the end of the tunnel was in sight for a final resolution, your bank's actions have yet again victimized these people by its unreasonable actions to refuse to honor their settlement payment," Zaid wrote.
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