Tuesday, June 28, 2011

International Unclaimed Property: Australia

From time to time, we provide information concerning "foreign" (i.e., non-U.S. unclaimed property laws).  Earlier articles have covered unclaimed property in the Cayman Islands, Jamaica, Kenya, and New Zealand.  Today, we continue our trip in the South Pacific by looking at unclaimed property in Australia. 

According to an article in this weekend's Sydney Morning Herald, there are more than A$600 million in unclaimed financial accounts, and some A$1 billion in unclaimed shares held by Australian regulators, state governments, and transfer/exchange agencies.  In addition, the article indicates that there is much more in unclaimed "super" (i.e., retirement benefits), to the tune of A$13.6 billion, or $900 for each working-age Aussie.

The full article, complete with information on claiming funds from the applicable agencies can be found here.

Monday, June 27, 2011

Wisconsin Unclaimed Property Auction Underway

Need a sterling silver necklace with "lima bean" shaped pendant?  How about a Harley Davidson 90th Anniversary Silver Bar?  Maybe a silver four-leaf clover pendant?   That's right . . . it's unclaimed property auction time!  Last Friday, Wisconsin began its latest online unclaimed property auction, including the above-listed items and more!

The auctioned items are generally those reported and remitted to the state from abandoned safe deposit boxes.  According to the Wisconsin Unclaimed Property Act, safe deposit boxes are considered unclaimed "5 years after the lease or rental period on the box or other repository has expired."  The relevant law further provides that the Treasurer's office may sell the reported items after they have been held for 3 years (i.e., 8 years after last activity).
A link to the Department's eBay site is here.  The auction will end on July 1.

Tuesday, June 21, 2011

Breaking News: Nevada Passes New Law Targeting High-Dollar Holders

The Governor of Nevada has approved Senate Bill 136.  The new law, which makes several changes to Nevada's banking laws, also makes some very unique changes to the state unclaimed property act.  The new legislation shortens the dormancy period for several property types, but only for holders who have reported $10 million in the most recent year's report.

Specifically, the relevant language of the new law provides that for stock, security interests, debt of a business association, deposits and similar accounts, retail credits and for all other non-specified property:

the 3-year period described in each of those paragraphs must be reduced to a 2-year period if the holder of the property reported more than $10 million in property presumed abandoned on the holder's most recent report of abandoned property

Senate Bill 136 at Section 8.  Though the universe of Nevada holders reporting and remitting $10 million per year is probably minimal, this marks the first time that a state is explicitly targeting large-volume holders for special treatment (i.e., shorter dormancy periods) under the unclaimed property laws.

Monday, June 20, 2011

Texas Unclaimed Property Changes Become Law

As we mentioned last week, Texas was considering House Bill 257, a bill designed to help the Lone Star State partially overcome its budget problems (at least for this year) by shortening the dormancy periods for certain property types.  That bill was signed by the Governor on Friday.  Accordingly, the act establishes the following new (shortened) dormancy periods:
  • utility deposits -- 18 months;
  • money orders -- 3 years;
  • bank deposits -- 3 years;
  • savings accounts -- 3 years;
  • matured certificates of deposits (CDs) -- 3years. 
These shortened dormancy periods are effective as of September, 2011.

The finalized law will also result in a change to the reporting schedule effective January 1, 2013.  Under this revised reporting schedule, reports will be due July 1, as of the previous March 1.  Texas will become the second state (after Michigan) to use a July/March reporting period.

Wednesday, June 15, 2011

Unclaimed Property Goes Primetime (or, at least Daytime)

Yesterday, Good Morning America followed John Purdue, the West Virginia State Treasurer, as he presented a check for nearly $15,000 to one West Virgina resident.  The property at issue was a CD belonging to the claimant's mother, who passed away last year.  The full story is available on the Good Morning America website, and there is an accompanying article that has stories from GMA readers/viewers who have claimed money, as well as a list of tips for finding unclaimed property.

Tuesday, June 14, 2011

Bills to Shorten Dormancy Periods Sent to Governors in Illinois & Texas

Bills that would shorten the dormancy periods for certain types of items have been sent to the Governors of Illinois and Texas, respectively.

Illinois -- Illinois has traditionally been one of a small handful of states where payroll/wages had a dormancy period of longer than 1 year.  That will probably not be true for much longer.  On June 10, House Bill 1560 was sent to the Governor for signature.  Pursuant to that legislation, which will take effect immediately, "unclaimed wages, payroll, and salary, in any form, shall be reported after remaining unclaimed for one year."

Texas -- In Texas, we previously covered House Bill 257, which would shorten the dormancy period for utility deposits from three years to 18 months; money orders from seven years to three years; and bank deposits, savings accounts, and matured certificates of deposits from five years to three years.  That bill has been approved by the state legislature and has been sent to the Governor for signature.

Friday, June 10, 2011

Unclaimed Savings Bonds

During this time of year, there are many graduation celebrations of all levels -- from preschool to college.  A popular gift for many of those graduates are U.S. Savings Bonds.  Under the most popular savings bond program (series EE), the bond is purchased for 50% of its face value, and matures 20 years from issuance.  Though the bond matures after 20 years, they continue to earn interest for an additional ten years (or until cashed).

Of course, with a 20 year period before the bond matures, many graduates will put them in a drawer or safe deposit box and lose track of them completely.  These items held by the federal government, however, are not escheated to the states as unclaimed property.  Instead, the Treasury Department has a special webpage to help bondholders find information about lost or matured bonds.  Please check it out.

Wednesday, June 8, 2011

News Report About Sacramento's Use of Unclaimed Property to Balance its Budget (Video)

Recently, a frequent topic has been government efforts to use unclaimed property to reduce, or eliminate, budget deficits (see, for example, here and here).  Now, it seems that state governments are not the only ones getting in on the Act.  According to a report by KOVR (CBS 13) in Sacramento, city officials there are considering the use of the city's unclaimed funds (i.e., items payable by the city like utility refunds and uncashed checks) to alleviate their municipal budget deficit.  According to the story, Sacramento has a budget deficit of more than $30 million, and about $2 million in unclaimed property, which it may keep if it is unable to reunite with its rightful owners.

Tuesday, June 7, 2011

Vermont Takes in $9 Million in Unclaimed Property

Vermont is among a handful of states that require holders to report unclaimed property in the Spring (most states' report deadlines are October 31 or November 1).  According to a press release issued by the Vermont State Treasurer's office, the state brought in approximately $9 million of unclaimed property so far this fiscal year, raising the total amount held by Vermont to more than $52 million, with an average dollar amount of about $190.

For the same period, Vermont has paid out about nearly 10,000 claims, with a total dollar value of $3.5 million.  Vermonters can check if they have money held by the state Unclaimed Property Division by visiting the Treasury website.

Monday, June 6, 2011

UPPO Hosting Holder's Seminar - July 25-26 in Boston

The Unclaimed Property Professionals' Organization is hosting its annual Regional Conference on July 25 and 26 in Boston, Massachusetts.  This year's conference offers both beginner and intermediate session tracks, so there is something for both unclaimed property neophytes and veterans.  I highly recommend the regional conference, especially if you are new to the field and/or are just taking on unclaimed property responsibilities.  In little more than one day, you can learn the basics of unclaimed property as well as how to set up an unclaimed property department, or defend an audit.  The timing is especially helpful, as fall reporting will be here before you know it.

Registration information is available at the UPPO website.

Wednesday, June 1, 2011

Michigan Considers B-to-B Exemption & Some Thoughts on Nomenclature

The Michigan legislature is currently considering House Bill 4563.  The bill would add a so-called "business-to-business" exemption to the Michigan Unclaimed Property Act providing that "This act does not apply to any property issued, held, due, or owing in any commercial transaction between 2 or more business associations or other business entities."  That bill is still pending before the Michigan House.

Of course, such "B2B" property is big business for the state too.  According to the Michigan House Fiscal Agency, the bill would have a "negative impact" on "revenue" from this source.  Daily readers might recall that yesterday's post quoted a news article that described Texas's shortening of dormancy periods as "allowing unclaimed property to revert more quickly to the state."  What do these statements have in common?  A presumption (practically correct, but legally invalid) that unclaimed property "belongs" to the state.  In the Michigan example, the House Fiscal Agency candidly states what is obvious - that the states consider unclaimed property (i.e., money that belongs to someone else) - to be "revenue."  In the Texas example, the underlying presumption appears to be that all property belongs to the state, but requires the Unclaimed Property Act to "revert" back to its rightful owner (not the person entitled to the funds, but the state). 

Granted, it would be much more cumbersome for those drafting legislative analysis to write that "the bill negatively impacts unclaimed property collection, which is treated as revenue by the state during the time it is held in trust for the rightful owner, until the same is claimed."  But, if the state truly stands in the shoes of the owner, it should make that clear even when describing its own functions.