What is unclaimed property?

Unclaimed or abandoned property is simply property that has been turned over to the states after financial institutions and companies (holders) have lost track of the rightful owners. The rightful owner is considered lost when there has been no activity on the property for an extended period of time.

Forms of unclaimed property include outstanding / uncashed checks (of any kind - payroll, AP, loan etc), bank accounts (savings, checking, money market etc), stocks. Even non financial assets are remitted to the states as unclaimed/abandoned, examples of these assets gift certificates, annuities, certificates of deposit, mineral royalty payments, and contents of safe deposit boxes.

Companies are required by law to turn over unclaimed property after a certain amount of time. The length of time until the asset is considered abandoned is definition by each state, most states define Abandoned as 3 to 5 years, a few states use 7 years for this definition. Once the states have this property, this property becomes an interest free loan to the States until the property is recovered by the rightful owner(s).

The Problem:

Each year millions of dollars are turned over to the various States as unclaimed property, often unnecessarily.

The States are holding billions of dollars of unclaimed property in trust for people and businesses.

More often than not companies turn over property that should never be turned over, and secondly, companies are unaware that property belonging to them is available for collection from the states.

The states are all too happy to keep this property on their books, as it is an interest free loan to them. And if companies do not collect this property, the state will hold the property indefinitely.

The Solution:

The solution to this problem is quite simple. Establish and follow a strong multi-tiered Unclaimed Property strategy.

RBO Financial Solutions does just this, helps companies to develop and implement well organized Unclaimed Property strategy.

There are four distinct steps involved in establishing this process, from collecting property from the States, to setting up ongoing due diligence to prevent remittance in error, to training of company staff to eventually running and taking ownership of the process.

Please contact Bing Owens, MBA, for more information.