Unclaimed Property: Claim Yours

by Dianne Molvig

If someone walked up to you and offered to give you $200, no doubt you'd ask, "What's the catch?" Exhibit that same healthy skepticism when you run across an online pitch offering to help you find unclaimed property that belongs to you. It may be a scam.

That's not to say genuine unclaimed property isn't out there. State treasurers and other agencies are safeguarding nearly $33 billion in lost or forgotten assets while searching for the rightful owners, according to the National Association of Unclaimed Property Administrators (NAUPA).

What is unclaimed property?

Unclaimed property includes such items as abandoned savings accounts, checking accounts, share certificates/certificates of deposit, stocks, uncashed payroll checks, insurance payments or refunds, life insurance payments or refunds, utility security deposits, contents of safe deposit boxes, and even tax refunds.

These are considered "unclaimed" if there's been no account activity and the owner has had no contact with the financial institution or other company for a period of time, which varies by state and type of property. The average range is three years to five years, according to John Gabriel, NAUPA's vice president and director of the Division of Unclaimed Property of the State of Tennessee Treasury Department in Nashville, Tenn.

All states have escheat laws stipulating that companies cannot keep abandoned assets, for a requisite number of years, that belong to someone with whom they've lost contact. They must relinquish the unclaimed property to the state of the owner's last known address.

But first, the company must do its own due diligence. "That means they have to take steps to try to find the owner themselves before turning the property over to the state," Gabriel explains.

The state then holds the property and tries to locate the owner or heirs. Some assets—such as safe deposit box contents—may be difficult to store, so the state may sell these and hold the proceeds for the owner.

"Occasionally someone has unclaimed property worth a huge dollar amount, and that makes the news," Gabriel says. "But the average claim amount we see is around $200."

Claiming what belongs to you

It's easy to find out if you have unclaimed property. A good place to start is MissingMoney.com, a Web site officially endorsed by NAUPA. To date, 40 participating states—plus the District of Columbia; Puerto Rico; and Alberta, Canada—pool their information to create one single database you can search for free. Two more states—Illinois and Rhode Island—will join soon. MissingMoney.com also has links to the unclaimed property sites of all nonparticipating states plus the Virgin Islands, Guam, and the Canadian provinces of British Columbia and Quebec.

Another resource is the NAUPA Web site, which has links to the Web sites of unclaimed property programs in all 50 states and the other government entities listed above. NAUPA searches also are free.

Government officials make concerted efforts to find owners. They also try to raise public awareness of how easy it is to find out if you have unclaimed property. Consumers who find themselves listed in a database can fill out a simple claim form and mail it in along with proof of identity to the appropriate unclaimed property department.

"When holders send property to us," Gabriel says, "they give us a list of names and addresses and perhaps dates of birth, Social Security numbers—whatever they have. We compare information we have about the owner to what the holder gave us."

Once the state is satisfied you're the rightful owner, it sends you a check. Most states charge no fee for this service, Gabriel says, although a few have a small processing fee. "And for the majority of states, there is no time limit ," he adds. "The money is held in perpetuity, until either you or your heirs claim it."

Sizing up offers of "help"

Some businesses post ads on the Internet offering a "free" search to locate unclaimed property that belongs to you. You type in your name and get back a list—showing only that surname and a first initial—of people who have unclaimed property. The list includes no addresses or property descriptions, so you may not be able to tell if a property is indeed yours.

To obtain more detailed information, you must become a "member" for a fee of, say, $30. "All you'll get," Gabriel says, "is a list of the 50 states' unclaimed property departments"—information that's easily available online for free.

Other businesses, called finders or locators, try to connect legitimate unclaimed property to its rightful owner, for a fee. Some of these businesses simply buy unclaimed property lists from the states, according to Gabriel. They cherry-pick the bigger accounts and start searching for the owners.

Or these businesses may be working for the holders of unclaimed property. Because holders must try to find owners before relinquishing property to the states, they may opt to hire someone to do the searching for them. "The majority of companies will do the work in-house," Gabriel explains. "Typically the only place you'll see a third party involved is in the securities industry."

The upshot is that someone might contact you about legitimate unclaimed property. But to get it, you must sign a contract agreeing to pay the finder a percentage of what the property is worth—usually ranging from 10% to 35%.

If you're approached with such an offer, first check to see if the property already is in MissingMoney.com, so you could claim it yourself. You'd have no luck, of course, if the finder is working for a holder who hasn't yet turned over the asset to the state.

In that case, Gabriel suggests trying to track down the property on your own. You may be able to search your memory and personal records and figure out what the property might be. Then you could contact the holder directly to reclaim your property.

Another option, he adds, is to wait until the holder relinquishes the asset to the state, when you'll find it in MissingMoney.com. You'll pay nothing, or at worst a small processing fee to the state, to recover your property.

If you can't determine on your own what the property is, and you don't want to wait for it to get to the state, you could opt to pay a percentage to a finder. "If you're OK with that, so be it," Gabriel says. "But know that you could do this yourself and pay nothing."

Before signing a contract with any finder or locator, check it out first. "Go to the NAUPA Web site," Gabriel advises, "and find out how to contact your state's unclaimed property department. They're familiar with the different companies, and they can tell you who's legitimate and who's not."

Published October 19, 2009

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