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Showing posts from 2015

New York Finds $1.67M in Unclaimed Funds Belonging to . . . New York? A Lesson in Claiming

According to an article in Monday's Daily News by Erin Durkin, New York City Public Advocate Letitia James and her staff found over $1.67M in over 2,000 accounts held by the New York Office of Unclaimed Funds on behalf of New York City agencies, departments, and organizations.  As the article notes, many of the accounts may have been missed in earlier reviews by the City because of owner names in the state database that might have been abbreviated or misspelled. The article raises an important lesson for owners searching the state's database for unclaimed property -- the information in the state's database is only as good as what gets reported.  If an owner's name is abbreviated or misspelled on the holder's report, it will probably be that way on the state's database.  So, in searching for your property, don't forget to try common or likely misspellings or abbreviations of your (or your company's) name.  For example, if you were searching for propert

Friday Lost + Found: Australia Amendments, NY Numbers, Escheat Events

Australia to Revise Bank Account Rules -- According to an article om News.com.au , the Australian government is considering legislation to (re)revise its laws relating to unclaimed bank accounts.  Under the current rules , certain bank accounts are deemed unclaimed if there has been no activity for 3 years.  The proposed revisions would change the period of inactivity required to 7 years. New York Holding $14B in Unclaimed Property -- Every once in a while, we like to keep tabs on the current amount of money being held by the states' as unclaimed property.  According to one recent article , the amount currently held by the New York Office of Unclaimed Funds for New Yorkers is $14 billion as of fiscal year end March 31. Upcoming UPPO Webinar on Recovering Property -- Though we spend the vast majority of time on this site writing about the process of reporting and remitting unclaimed property, it is worth remembering that most holders of unclaimed property are also ow

Delaware Audit / VDA Bill Signed by the Governor

Earlier this month, we mentioned the legislative approval of Delaware Senate Bill 141. The bill has now been signed by the Governor and enacted into law.  As noted earlier, the legislation extends voluntary disclosure program run by the Secretary of State, and implements some new audit practices, including: limiting the lookback period for audits already underway to January 1, 1986; limiting the lookback period for new audits to January 1, 1991; and beginning in 2017, limiting the lookback period for new audits to 22 years.

Senate Bill 141 Passes House, Awaiting Executive Action

Early this morning Delaware Senate Bill 141 passed the House, and now is ready to be signed by the Governor.  If passed, the bill would make some significant changes to the First State's audit practices and would further extend the voluntary disclosure program run by the Secretary of State (which is closed at the moment, but would become permanent if the law passes). As to the state's audit practices, the new legislation: limits the lookback period for audits already underway to January 1, 1986; limits the lookback period for new audits to January 1, 1991; and effective January 1, 2017, limits the lookback period for new audits to 22 years The bill also reopens the Secretary of State's VDA program, and provides that any holder entering into the VDA program by December 31, 2016, and agrees to pay within 2 years of entry will have its records reviewed back to the "transaction" year 1996.  Holders enrolling thereafter would have similarly have a 19 year

Legislative Updates - Updates from Texas, Nevada, and Maine

Texas Lowers Aggregate Reporting Threshold . . .  -- Texas Senate Bill 1021 lowers the aggregate reporting threshold from $50 to $25, effective September 1, 2015.   . . . And Provides for Cash Redemption of Certain Low Value Gift Cards -- Also in the Lone Star State, Texas House Bill 2391 provides that consumers may obtain a cash refund for stored value cards with balances of $2.50 or less after purchase. Nevada Enacts Business-to-Business Exemption -- Nevada Senate Bill 348 enacts a business-to-business exemption, providing that certain credits (but not checks) among businesses need not be reported if there is an ongoing business relationship between the parties. Maine Enacts Savings-Bond Escheat Bill -- Maine Senate Bill 320 extends the provisions of that state's unclaimed property act to matured U.S. Savings Bonds. 

West Virginia Supreme Court Rules That Insurers Must Track Policyholder Death Information

The West Virginia Supreme Court of Appeals recently issued an opinion in Purdue v. Nationwide Life Insurance Company , a case presenting the issue of whether a life insurer is required to undertake periodic investigations to determine whether any of its policyholders are deceased. The case began in 2012, when West Virginia State Treasurer John D. Purdue sued ten life insurers , claiming that they failed to report and deliver unclaimed insurance policies in accordance with the West Virginia Unclaimed Property Act.  Specifically, the Treasurer alleged that because the insurers did not regularly review in-force policies against the Social Security Death Master File (DMF) to determine whether the policyholder was deceased, they failed to report property when due.  The Treasurer's office sued dozens of additional insurers in 2013 , making similar allegations against a total of 69 separate companies.  The insurers contested the Treasurer's theory, generally arguing that as a co

A "Star Wars Day" Update

Today, May 4th, is Star Wars Day ("May the Fourth be with you").  Little known fact:  According to the State of Texas unclaimed property database.  The Lone Star state is in possession of funds for Darth Vader (last-known address:  The Death Star). Apparently, mail sent to the Death Star was returned as undeliverable.  Must have been after the Battle of Yavin . Happy Star Wars Day!

Legislative Updates Relating to Life Insurance, Savings Bonds, and Dormancy Periods

Death Master File Searches -  Idaho Senate Bill 1023 was enacted in March, to come into effect on July 1, 2016.   Arkansas Senate Bill 768 , a similar bill, was enacted earlier this month, to come into effect June 30, 2016.   Utah House Bill 168 comes into effect in July of this year.   These laws require, among other things, life insurers to do a search of in-force policies against the Social Security Death Master File on a semiannual basis. Extension of State Unclaimed Property Acts to U.S. Savings Bonds -- Indiana Senate Bill 282 and  Arkansas Senate Bill 356 apply the unclaimed property acts in those states to U.S. savings bonds that have stopped earning interest, or matured, respectively. Dormancy Period Changes --  Arkansas House Bill 1782 reduces the dormancy period for certain corporate bonds, deposit accounts and mineral proceeds from 5 years to 3 years.

Unclaimed Property Provides Boost to South Carolina Budget

The Charleston Post & Courier has an article about the boost provided to South Carolina's budget as a result of unclaimed property collections.  Just as lawmakers were putting the finishing touches on the state budget, State Treasurer Curtis M. Loftis, Jr. announced that unclaimed property estimates for the year would rise by nearly $50 million.  The article notes that some of the excess resulting from unclaimed property and other increases was used to reduce cuts to educational and hospital programs.

Court Renders Federal Preemption Decision in Temple Inland - Case to Continue

Earlier this summer a company called Temple-Inland commenced a lawsuit against the State of Delaware, challenging the findings of a Kelmar-initiated unclaimed property audit, especially as to how estimated liabilities are calculated.  In particular, Temple-Inland alleged that Delaware made an audit demand in excess of $1 million for estimated historical unclaimed property liabilities after having identified only about $150 in actual liability.  Delaware promptly moved to dismiss that litigation (that is, that the court should not even hear the dispute) and Temple-Inland responded by asking the Court for summary judgment (an order that Plaintiff is entitled to judgment as a matter of law, without the need for a trial) on the grounds of federal preemption. Wednesday afternoon, the trial court issued its decision on the dueling motions.  In sum, both parties' attempts for a quick knockout were largely rejected, and the case will continue.  The one substantive decision that the

Friday Lost + Found: Happy Unclaimed Property Day and Kentucky & California Questions

Kentucky State Treasurer Defends His Post -- Kentucky.com has an article about Kentucky Treasurer Todd Hollenbach's defense of the position of State Treasurer.  Although term limits prevent Hollenbach from running again, a  according to Kentucky.com some candidates for the position of State Treasurer seek to abolish the office - arguing that the various tasks can be handled by other government departments. California Legislative Analysts' Office: California Can Do More to Return Unclaimed Property -- The LA Times is reporting on a release by the California Legislative Analyst's Office (LAO) noting a potential conflict between the California Controller's Office's obligation to return unclaimed money to California citizens, and the revenue generated by the more than $400 million in revenue that unclaimed funds contribute to the state budget. February 18 Was Unclaimed Property Day in South Carolina -- According to WMBF , February 18 was declared "Unclaim

On Second Thought, Never Mind -- NJ Repeals Gift Card Data Requirement

Perhaps we can now tie a bow on the long-running New Jersey gift card saga.  First, a brief refresher: In 2012, Governor Christie signed Senate Bill 1928 into law , which revised New Jersey's 2010 gift card legislation.  Briefly, the bill extended the dormancy period for gift cards from 2 years to 5 years, and delayed implementation of a requirement that retailers obtain zip code information at the point of sale for 4 years.  While many gift card issuers applauded the amendments, not everyone was happy.  In particular,  the some holders and gift card issuers favored legislation that would remove gift cards from the New Jersey unclaimed property act entirely or, at least, to eliminate the zip code collection requirement.  As a NJ BIZ article recounts, however, repealing legislation got watered down on the State House floor.  After more than 2 years of legislative wrangling, the issuer and holder communities got (at least part of) what they were looking for.  On February

Delaware Adopts Some Unclaimed Property Task Force Recommendations

At the start of the year, we noted that the Delaware Unclaimed Property Task Force issued a report suggesting certain reforms to the state's unclaimed property practices and procedures.  Unfortunately, many of the high-profile recommendations (e.g., limiting lookback periods, implementing a new VDA program, implementing a statute of limitations) did not make it through the legislative process.  Instead, the Delaware legislature recently passed Senate Bill 11 (as amended) which implements some far more modest changes to the state's rules.  In particular, the new law provides that the Department of Finance can not give more than 50% of its outside audits to the same auditing Firm, sets forth a 2 year "cooling off" period before former unclaimed property staff can join auditing firms, and makes some minor changes to the state's administrative appeal process. While these are all positive developments, they likely fall short of what the holder community was lookin

Note to States: The DMF is Not Infallible

Since the  widespread audits of life insurance companies' unclaimed property compliance became public knowledge in 2011, there has been copious ink spilled on discussion regarding the  Social Security Death Master File .  The macabre-sounding index is not the central plot point of a horror movie, it is a  database file maintained by the Social Security Administration that tracks deaths reported to the SSA.  That information, in turn, is used for a number of purposes by government agencies and private industry.  In more recent years, the DMF has also become a new (if controversial) tool of unclaimed property auditors and states seeking to recover property that does not otherwise meet the black-letter presumption of abandonment set forth in state unclaimed property laws.  (The propriety of such a practice is a topic for another day).  At a minimum, however, Fox has an article that proves that resort to the DMF is not panacea for the states or holders. According to Fox , a 94 yea

Unclaimed Property Laws Even Trip Up Government Entities

Private companies are not the only ones with the obligation to comply with unclaimed property laws.  In many states, the escheat laws also apply to state, municipal, and local government entities.  For example, under the Uniform Unclaimed Property Act of 1995 , property held by a "court, government, governmental subdivision, agency, or instrumentality" is escheatable 1 year "after the property becomes distributable."  (Section 2(a)(11)).  Just like private entity holders, government entities have an obligation to report and remit unclaimed property to the appropriate state agency, and, just like private entities, government organizations can be audited. According to an article in the Albany Times-Union , one recent audit by the New York State Comptroller's Office of Columbia County, New York discovered nearly $50,000 in unclaimed property that should have been, but was not, reported and remitted to the state.  According to the article , most of the property c

Friday Lost + Found: Lone Star Gift Cards, Wisconsin Auction, Delaware Followup

Texas Announces $12M in Unclaimed Gift Cards Available -- NBC 5 (Dallas/Fort Worth) is reporting that the Texas State Controller's office has about $12 million in abandoned gift cards awaiting reclaim at state offices.  The article even has a document from the Controller's office indicating the businesses that have reported such funds. Wisconsin Dept. of Revenue Unclaimed Property Auction -- People deposit all kinds of stuff in safe deposit boxes -- jewelry, stamps, coins, collectibles -- and sometimes they abandon them.  That stuff eventually makes its way to state unclaimed property offices.  But what does the state do with those items?  In some cases, the answer is auction the items to the public.  The Wisconsin Department of Revenue is currently running an online auction until January 20.  Items can be viewed and bid upon online. Delaware Legislation Proposed With Task Force Recommendations -- Our last  post talked about the recommendations of the Delaware Aband

New Year, New Delaware?

Happy New Year from the staff here at Escheatable.  In case you missed it over the holidays, the Delaware Unclaimed Property Task Force recently issued its recommendations on making the Delaware audit process more fair, efficient and transparent.  Delaware Online has a copy of the complete (and annotated) report and it is well worth a read for those with Delaware audits in progress or looming.  Highlights include recommendations to shorten the look-back period for audits, increase audits done by state employees (as opposed to third-parties), and to modify certain audit and appeal procedures. Note that while the Task Force's recommendations are generally a positive development, they are in no way binding on the State, the Department of Finance, or the third-party audit firms employed by the state.  Instead, the report will be shared with state legislators and officials in the hope of spurring a legislative solution.