When property is abandoned in the US and the rightful owner is nowhere to be found, the funds are remitted to the government and held there until a claimant comes forward. The concept is simple enough, however, there are often scenarios where it is unclear which government should get the funds! Is it the state where the transaction took place, the state where the owner is believed to be located, the state where the holder is incorporated, or the state where the holder’s primary business location resides?
The U.S. Supreme Court established two unclaimed property priority rules with its Texas v. New Jersey decision in 1965:
- First Priority Rule: Abandoned property must be escheated to the state of the owner’s last known address, as determined by the holder’s books and records.
- Second Priority Rule: The property is paid to the state of corporate domicile if the owner’s address is incomplete or unknown, or if the owner’s last known address is in a state that does not provide for escheat of the property owed.
The definition of “corporate domicile” has been a source of confusion for how to handle unincorporated holders. The state of “corporate domicile” can be interpreted as the state of organization or formation of the entity, on the other hand it could be its principal place of business.
This confusion can often make it difficult for owners to determine where their assets are, and in some cases they may end up somewhere other than they expect!
To make things slightly more complicated, there are exceptions to these rules for some asset types:
- Following a 1972 decision in Pennsylvania v. New York prompting the Disposition of Abandoned Money Orders and Traveler’s Checks Act of 1974 (Act), money orders, traveler’s checks and similar written payment instruments other than third-party bank checks are escheated to the state where the money order or traveler’s check was purchased. If that information is not available, it escheats to the state where the holder’s primary place of business is located.
- In the 1993 case of Delaware v. New York concerning unclaimed securities distributions held by intermediary banks, brokers and depositories, it was determined that the intermediary—not the issuer—is considered the holder. Thus, under the second priority rule, the intermediary’s state of corporate domicile receives the unclaimed property.
Although there are many great organizations out there that are sincerely working to reunite lost assets with their rightful owners, there are also many fraudsters out there in the world of unclaimed property. It’s best to be aware of the various unclaimed property scams that are out there in order to avoid them. Consumers should be diligent and carefully review letters or emails they receive regarding unclaimed property.
The most common form of unclaimed property scam comes in the form of email. Various states in the US have heard reports from citizens who received false emails notifying them that they are owners of unclaimed assets and luring them into calling an overseas toll telephone number to retrieve their supposed funds, then using various schemes to keep them on the line as long as possible.
A more recent scam involved fraudulent letters telling consumers that they are entitled to unclaimed sweepstakes and need to send money to purchase “the necessary Federal State Registration Stamp” to claim the so-called award. This particularly deceptive message is written on fake NAUPA (National Association of Unclaimed Property Administrators) letterhead and requests money be sent to claim the property.
Other scams out there are aimed at getting your personal information, most likely to get bank account numbers or other financial information in order to commit identity theft.
The following is a list of tell-tale signs that you may be dealing with an unclaimed property scam artist:
• It comes as an email. State unclaimed property offices do not use email to contact you.
• It claims to be from the National Association of Unclaimed Property Administrators. NAUPA is an organization that unclaimed property administrators belong to. NAUPA does not reunite people with their missing money.
• You’re asked for your bank account information. You may have to supply personal information such as your social security number to make a legitimate unclaimed money claim, but you will NEVER be asked for your bank account information.
• There is an upfront fee to file the claim. State governments do not charge money for searching their database of unclaimed accounts or for making a claim.
There is a chance that the US government might be holding unclaimed money in your name and waiting for you to claim it. Throughout a person’s lifetime, the chances of inadvertently leaving a trail of unclaimed property is higher than one might think, even among those who are particularly financially organized. Opening a bank account, purchasing an insurance policy, paying taxes, changing jobs, paying into retirement programs or pensions, purchasing stocks, moving addresses – these are things we all do that could result in unclaimed property.
Suppose your last payroll cheque is issued to an old or incorrect address after a career change. Perhaps a bank account is forgotten or left dormant with no activity for many years. Or maybe an insurance policy was not redeemed upon the death of a family member, or a tax refund cheque was never cashed or sent to the wrong address.
Experts estimate that 1 in 10 Americans is owed unclaimed property by one or more government entities around the world. Visit our Inquiries and Database Searches page to submit your name for a free global search.
From Treasure Island to Storage Wars, one thing can be said for certain – everyone loves a good treasure hunt! There’s nothing more thrilling than the prospect of becoming instantly rich. Here’s 5 reasons why embarking on your own treasure hunt for unclaimed property with AssetMine can be incredibly exciting!
- The Stakes Are High – Currently the AssetMine database holds an estimated 150 assets over $1 million dollars. There are 28,000 assets totaling $2 billion with a value of at least $30,000! The highest known value asset is currently worth $5,279,789.70!
- Better Odds – approximately 1 in every 10 people in the US has unclaimed property. That’s much better odds than finding a lost treasure from a map!
- Easy to Search – the AssetMine proprietary global database enables clients to quickly and efficiently search anywhere in the world for their unclaimed property. The database is constantly being updated with new unclaimed assets as they become available.
- Easy To Claim – if ownership can be proven with the right documentation, and especially with the help of unclaimed property recovery professionals such as AssetMine, it can be relatively simple to initiate a claim. No fumbling through storage lockers, or digging holes on desert islands!
- Anyone Can Do It – Get in touch with AssetMine today. Searches are free and payment is only due upon the successful recovery of your assets!
The AssetMine database contains nearly 150 million assets worth an estimated $55 billion being held by governments globally. The database lists thousands of different unclaimed property asset types for which an asset type category is assigned.
So what are the most common types of assets that are lost and unclaimed? Most people would presume bank accounts.
Brokerage Accounts and Dividends are the most common lost and unclaimed financial asset type making up about 15% of all unclaimed property.
In second place are Refunds and Rebates.
Although slightly lower in record count, the bulk of high value assets are bank accounts and insurance policies.
With millions of lost and unclaimed financial assets there may be a windfall for you, your family or business. Better odds than purchasing a lottery ticket!
*As of January 2016
AssetMine maintains the largest global database of unclaimed financial assets consisting of approximately 150 million assets valued at $55 billion.
Finding and recovering unclaimed property in any one of the nearly 100 global databases has become increasingly complex and inefficient without the assistance of a professional asset locator and recovery service firm that knows where to look, can aggregate the data using technology, and is experienced in navigating the claim process. And time can be of the essence where fees are charged by the government for maintenance of the asset records thereby continually eroding their value. Some Government agencies provide searchable websites for unclaimed property but these sites don’t always yield expected search results when they should. Here are a few reasons:
- Online searches can be limited by the functionality of the websites. They were not designed for complex or multiple name searches, only for individuals looking for a specific name. Thus they only allow a single search at a time and often require an exact name match to return any results.
- Listings which contain misspellings, non-standard punctuation, abbreviations or acronyms will be missed with standard search techniques. This type of human data entry error is the biggest impediment to finding lost assets and is often the same reason that the asset was initially lost.
- A complete and comprehensive search would require identifying and accessing nearly 100 government databases in many jurisdictions, most of which are unknown or not easily accessible.
Once lost assets have been identified, the recovery process can be administratively difficult and time consuming. Each jurisdiction has its own paperwork and claim processing system, there could be multiple types of forms for various types of assets, and they have very stringent thresholds for proof of ownership. Legislation imposes strict responsibility for proper disbursement of the funds held, so government employees are very careful about making sure the money goes to the rightful owners. This can be frustrating and inefficient for owners when making single claims or in multiple jurisdictions. Engaging a professional asset location and recovery firm is the most efficient and effective method of finding unclaimed dormant financial assets – and recovering them – in today’s economic climate.
There are many reasons why financial assets become lost, and legislation governs what happens to them when, after a period of inactivity, they become dormant. Legally, attempts must be made by businesses or organizations holding these assets to contact the rightful owners, to make them aware that the assets are approaching dormancy. Contact attempts can be unsuccessful because:
- Human error such as a simple typographical error in an address makes the mail undeliverable
- Heirs and beneficiaries from life insurance policies cannot be located
- People move and businesses relocate and mail is not properly redirected
- Personal and corporate names can be misspelled
- Punctuation can become non-standard and acronyms and trade names can be varied
- Name, address, city or country abbreviations can be introduced inconsistently
- Corporate names change through merger/acquisition activity
- Staff changes can disrupt continuity of information
- Corporations may prematurely write-off assets at quarterly and annual reporting.
Banks, insurance companies, and other businesses and organizations can find themselves in possession of money that belongs to another company, government or person who has never received or claimed the funds.
Perhaps a bank draft or corporate dividend cheque was not cashed, or the owner of a brokerage account has moved without a forwarding address, or a life insurance claim was not received by the beneficiaries, or someone forgot about transferring a bank account after a merger or acquisition; all of these circumstances can result in unclaimed, or lost, financial assets. There are over 30 different types of unclaimed financial assets out there; here are a few:
- Orphan bank accounts after individuals or companies move or due to death of the account holder
- Bank drafts, uncashed cheques, certified cheques
- Bankruptcy claim settlements (called dividends)
- Certificates of deposit, brokerage accounts, mutual funds
- Tax refunds or insurance proceeds
Many people find it hard to believe that financial assets can be lost or forgotten, and eventually deemed unclaimed property. The reality is that very simple mistakes or acts of carelessness can be the culprit. Some owners become ill or die without alerting family members to the existence of bank accounts, savings bonds or insurance policies. They may change their address without making arrangements to have mail forwarded. Or perhaps a gift card is not redeemed, a lottery prize goes unclaimed, or a rebate cheque is never cashed. Being human after all, some of us simply forget about our assets, leaving them dormant for years.
There are several initiatives you can take in order to prevent your assets from becoming dormant, including:
- Keeping a list of all your family’s assets and their whereabouts – bank accounts, e-commerce accounts, retirement plan savings, layaways, stocks, bonds, mutual funds, life insurance policies, security deposits, safe deposit boxes etc.
- Maintaining your accounts as current by initiating activity
- Notifying everyone necessary when your name or address has changed, especially holders of your assets, and making arrangements to have your mail properly redirected
- Being careful to properly and legibly fill out personal information forms required by asset holders
- Making sure that you receive all your pay cheques and unused paid leave if you cease employment
- Updating and confirming your beneficiary information on insurance policies
- Recording all stock certificates and being sure to cash all dividends received
- Remembering to collect your utility deposits if you move
- Cashing every cheque promptly when received, eliminating the chance of it being misplaced
- Remembering your digital assets such as Paypal, eBay, Amazon accounts
- Never allowing errors in your contact information to go uncorrected if they occur on bank statements or any other official or financial documents
While following these initiatives can help prevent you from losing track of your assets, it is very possible for your assets to become dormant or unclaimed for reasons beyond your control. Human error, for example typographical errors with names or contact information, is the most common example of this and can often make it difficult or near impossible to draw a connection to rightful owners of dormant funds. When this happens, the best course of action is to contact unclaimed property experts who specialize in tracking down unclaimed property for their clients.