Monday, June 25, 2012

Finder's Fees and Unclaimed Property

Last week, a variety of news sources in Ohio reported that the Ohio Department of Commerce (the government entity responsible for the Buckeye State's unclaimed property program) issued a "cease and desist" order to a company that was allegedly charging Ohioans for unclaimed property claim forms.  In addition, the claim section of Ohio's "Treasure Hunt" website has been revised to display a prominent disclaimer at the top:
A Claimant may file a claim WITHOUT the assistance of a paid professional finder.
 The website has also been revised to bar unclaimed property "finder" firms from printing claim forms from the Department of Commerce's website.  Apparently, these finder firms operated by searching for and printing claim forms from Ohio's website (a free service provided by the Department) and then "selling" those (free) forms to the individuals identified. 

While the relevant section of the Ohio Unclaimed Property Act does not, strictly speaking prohibit private "finder" firms from charging a fee to assist private citizens with the recovery of unclaimed property from the Department of Commerce, it does strictly limit such activities.  For example, the Act provides that no agreement to assist with claiming property is valid within the first 2 years after the property has been reported to the state, and the "finder fee" must be registered with the state.  In addition, the law has a number of disclosure requirements that specify certain terms that must be in the finder contract.

While we often write about the state's interest in using "unclaimed funds" that it holds to balance budgets and make expenditures, it should perhaps come as no surprise that a number of private parties are also looking to grab a piece of the pie.  Agreements with so-called "finder firms" are allowed in many states, pursuant to which the finder agrees to assist a claimant with obtaining his or her money from the state in exchange for a percentage fee.  Indeed, in Escheatable's home state of New Jersey, the Unclaimed Property Act allows for a fee of up to 35% of the value of the property.  (see N.J.S.A. 46:30B-106).

Of course, states generally charge no fees for searching, claiming and receiving unclaimed property that they hold for the benefit of the rightful owner.  That does not mean that all finder firms are shady -- indeed, there are a variety of situations where most of us will gladly pay another to provide a service that we don't have the time, patience or expertise to do ourselves -- but it does mean that a consumer should only enter into such an agreement if he or she understands exactly what he or she is paying for.  In the case of unclaimed funds, a finder fee firms (might) provide you with expertise or time (i.e., the they will deal with the the claim process so you don't have to).  They are NOT, however, providing you with access to the money; the money is yours.  The finder is not "giving" you anything; the relationship is more akin to letting the finder firm mine for gold on land that you own; except, of course, in the case of unclaimed property there are two important caveats:

1.  First, if the finder is contacting you, there's money being held for you (in other words, there is likely something of value on your land in our mining example);

2.  Second, and more saliently, what is backbreaking and dangerous work in our mining example is usually just filling out a form and sending it to the state.

Everyone is free to spend their time and money how they wish, and everyone has their own individual balance.  Just know what you are paying for.  In the case of unclaimed funds and finder firms, it is (maybe) time and expertise, not access, that you are buying.


  1. The finder firm likely has invested time along with subscriptions to proprietary databases in order to ascertain the rightful owners of lost property. They do provide value in notifying the owner or their heirs of lost assets and deserve some compensation.

  2. It's also the case that without the expertise of "finders", the owner of the property/funds would never know they exist and, in time, ownership passes legally to the government.

  3. The databases mentioned in the original postings are from the states' unclaimed property databases, which are in most (if not all) cases free and publicly available online. Also, with respect to the vast majority of unclaimed property acts in the US, the Acts are "custodial" in nature, meaning that ownership of the underlying funds does not pass to the government.

    1. But isnt the government still making money off that unclaimed money???? that's y the government dnt want the citizens 2 knw they have this money.

    2. The proprietary database that the above mentioned is the one needed to find the client.Unless you're a celebrity googling some ones name doesn't show a current and correct telephone number.

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  7. They are trying to make it look like money finders are gold diggers. Atleast we are providing a service and contacting the client instead of hoping it slips by without being claimed and the goverment adds it to their GENERAL FUND to blow as they please. We make sure the citizens get what is theirs and to provide that service takes time and subscriptions to databases and knowledge of how to get around all the roadblocks that are in place to deter the inexperienced person from following through with their claim. Yes a person can search for free, but then there is the process of claiming your property... We handle all that for the client. I haven't had one client balk at paying for my services. Who wouldn't be happy to hear they have money instead of mad later because they missed the deadline to claim and that the government made no effort to notify them they had money. Who's shady?