The new service offering will take a tech-forward approach to cater to law firms, legal tech companies and ALSPs as the industry's banking, financing and business needs continue to evolve.
Phoenix-based Western Alliance Bank announced on Wednesday the launch of a new venture—”NewLaw Banking,” a collection of customizable banking offerings and financial experts packaged as a service for the legal industry.
The new national service will function as a part of the bank’s Juris Banking Group, which focuses on building customized solutions for attorneys.
Francesca Castagnola, the senior managing director of Western Alliance Bank’s Settlement Services Group and Juris Banking Group, told Legaltech News that NewLaw Banking is meant to tackle the legal industry’s evolving banking needs, from increased cybersecurity concerns, to the prominence of online transactions and the growing demand for digital payment methods in class action settlements.
The service is a collection of existing, but updated offerings and increased “thought leadership” for the business of law, Castagnola said. She added that NewLaw is meant for law firms, legal tech companies and alternate service providers alike, and aims to create a transaction “ecosystem” among all legal players.
While many of the offerings already existed, they were less tailored to legal, and more staggered within various service groups. These offerings are being updated to account for the legal industry’s growing use and reliance on technology.
“We really have been studying how companies and consumers are consuming legal services from law firms, and how law firms have to pivot and shift how they are delivering those services,” Castagnola said. “Law firms are now having to take this tech approach to how they deliver their services. We feel like [NewLaw] dovetails right into that.”
For example, a law firm that operates within a certain case management system may want its bank accounts in the same platform, she noted. In response, the NewLaw group would be able to facilitate and set up new APIs to communicate banking activities within the case management software, “so that reconciliations are done automatically.”
For Castagnola, one of the more timely focuses of the NewLaw group will be on fraud prevention and digital payment solutions for settlement checks in class-actions.
Castagnola noted that “if you take the class action space, five years ago, really [most claims payments] were done in checks,” which includes a manual process of the claims administrator having to allot the checks to right claimants, and the claimants gaining access to their payments.
However, with a greater understanding of the various needs different populations have, such as “unhoused people who [may not] have an address to which to send a check, but most of them have a cell phone to accept a digital [payment like Zelle or Venmo],” Castagnola said the group is hoping to educate and facilitate a framework for law firms to switch from checks to digital payment methods.
What’s more, as NewLaw conducts more distributions of payments between legal entities and their clients, Castagnola said that machine learning will be leveraged to study how the fraud trends are evolving for legal, which parties are more likely to be bad actors, and so forth.
NewLaw Banking also consists of other, more dispersed offerings as well, combining two facets—depository and financing—under one umbrella.
On the depository side, the service will include offerings like payroll accounts, client trust accounts, operating accounts, and court ordered accounts that can be managed through integrations. On the financing side, NewLaw will offer lines of credit to fund technology updates within legal, working capital pipelines of credit, and real estate loans for law firms hoping to rent offices and property, Castagnola added.