PETALING JAYA: The Bar Council has introduced a new rule requiring two partners in a legal firm to act as signatories for cheques, and to manage the multi-factor authentication for online transactions involving clients' accounts.
The Bar said the rule, which will take effect next year, was introduced following concerns over “significant” high insurance payouts arising from misconduct and dishonesty in managing clients' accounts.
“This trend is unsustainable, as substantial payouts will inevitably result in higher overall losses and, over time, increased premiums for all firms," the circular, which was issued on Sept 25, read.
The new rule requires legal firms with more than one partner to have two partners as signatories for all transactions, except for stopping account operations or cancelling transactions, where one will suffice.
Firms using electronic banking must also implement multi-factor authentication for access to clients' accounts, managed by the firm's partners.
While many firms already apply similar safeguards, the new rule seeks to standardise these practices without imposing unnecessary burdens, the circular read.