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Unclaimed Property Focus
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UNCLAIMED PROPERTY FOCUS is a blog written by and for UPPO members, featuring diverse perspectives and insights from unclaimed property practitioners across the U.S. and Canada. We welcome your submissions to Unclaimed Property Focus. Please contact Tim Dressen via tim@uppo.org with any questions about submitting a blog post for consideration and refer to our editorial guidelines when writing your blog post. Disclaimer: Information and/or comments to this blog is not intended as a substitute for legal advice on compliance or reporting requirements.

 

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Wanted: Individual to Lead UPPO On-Demand Webinar Subcommittee

Posted By Emily Lee, UPPO, Thursday, July 16, 2015

The UPPO On-Demand Webinar Subcommittee is seeking a leader.

The subcommittee is tasked with creating the digital education for UPPO’s new certificate program, which will be offered both digitally and at in-person events. The certificate program will shape the profession by developing knowledge standards and requirements of practicing unclaimed property professionals. 

You’d be an ideal candidate if you can check off each of these (if you don’t have all these it’s not a deal breaker):

  • Have a passion for the advancement of the profession, and interest in seeing the certificate program come to life
  • Served on a board of directors or advisory group
  • Project-management experience 

Chair responsibilities:

  • Meeting deadlines and ensuring the digital curriculum of the certificate program is shaping into a quality, robust offering.     
  • Leading the on-demand webinar subcommittee’s monthly meeting
  • Attending the Education Council’s quarterly meeting

Why consider the position?

  • You’d be leading a dedicated and enthusiastic group of individuals that are excited to get to work
  • An ability to shape the profession and UPPO in a positive way
  • Greater involvement within UPPO
  • Grow your leadership and management skills

If you’re interested, apply by July 31. To apply fill out this quick survey.

 

Questions? Contact Ashley Hennig, 763.253.4342 or ashley@uppo.org.

Tags:  education  leader  UPPO  volunteer 

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Louisiana expands acceptable indications of interest with H.B. 692

Posted By Emily Lee, UPPO, Wednesday, July 15, 2015
Updated: Wednesday, July 15, 2015

Effective immediately, the following types of activity will be considered acceptable in the eyes of the Louisiana unclaimed property program:

1) The making of a deposit to or withdrawal from a bank account, including any one-time or recurring automatic clearing house transaction, or any other electronic transaction that is owner-directed or otherwise authorized by the account owner.

 

2) The accessing of a deposit account by the owner through the website or other restricted electronic access point of the banking or financial organization.

 

This legislation gives owners greater protection of their assets by expanding the list of contact to reflect the modern way many financial institutions interact with their customers. “UPPO is pleased to see Louisiana modernize its unclaimed property statute to better protect consumers, and is hopeful that other states will also consider doing the same,” says, Dana Terry, UPPO president.


For more information about the bill or other legislative activity important to you, visit the UPPO
govWATCH website.

 

Want more information?

Members receive weekly, emails updating them of legislative changes like this. If you’re not a member, join today!

 

Delaware S.B. 141 intends to reduce look-back period and permanently establish Delaware VDA program

 

2015 unclaimed property legislative season in review

Tags:  indication of owner interest  Louisiana legislation H.B. 692  unclaimed property 

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2015 unclaimed property legislative season in review

Posted By Administration, Tuesday, July 7, 2015

The 2015 legislative session in most states has come to a close. Overall, most legislative changes this year were related to the escheatment of U.S. Savings Bonds or the Death Master File search requirement. The most promising changes came out of Delaware – through Delaware S.B. 11 and Delaware S.B. 141, which codifies some of the recommendations made by the Delaware Unclaimed Property Task Force to increase transparency and fairness in the Delaware enforcement environment. 

Listed below are the bills that have been signed into law in 2015.  


Dormancy Periods

Arkansas H.B. 1782

Date signed: 04/04/2015; date effective: 09/01/2015
Synopsis: Lowers dormancy for demand, time deposit accounts, demutualization, mineral proceeds, and catch-all property to three years from five years.  Amends some mineral proceeds reporting requirements. Read more here.

Arkansas S.B. 356
Date signed: 03/24/2015; date effective: 09/01/2015
Synopsis: Requires U.S. Savings Bonds to be escheated five years after dormancy, and permanently escheated to state two years later.

Florida H.B. 887
Date signed: 06/11/2015; date effective: 07/01/2015
Synopsis: Provides for escheatment to state of unclaimed U.S. savings bonds; provides for judicial determination of escheatment; provides procedures for challenging escheatment; provides for deposit of proceeds of escheatment; provides that person claiming a U.S. Savings Bond may file claim.


Georgia H.B. 322

Date signed: 05/06/2015; date effective: 07/01/2015
Synopsis: Requires U.S. Savings Bonds to be escheated three years after dormancy.


Indiana S.B. 282

Date signed: 04/23/2015; date effective: 07/01/2015
Synopsis: Includes provision that U.S. Savings Bonds are presumed abandoned three years after the date the bonds stop earning interest.


Maine S.B. 320

Date signed: 06/17/2015 (became law without Governor’s signature); date effective: 06/17/2015
Synopsis: Requires U.S. Savings Bonds to be escheated three years after final maturity date.


New Hampshire S.B. 134

Date signed: 06/12/2015; date effective: 08/11/2015
Synopsis: Requires U.S. Savings Bonds with last known owner addresses of New Hampshire to be escheated five years after final maturity.


South Carolina H.B. 3852
Date signed: 06/11/2015; date effective: 06/11/2015
Synopsis: Provides for escheatment to the state of unclaimed U.S. Savings Bonds, provides for judicial determination of escheatment, and provides for procedures for challenging escheatment.


South Dakota S.B. 18

Date signed: 02/25/2015; date effective: 06/13/2015
Synopsis: Requires unclaimed lottery prizes to be escheated to the state 180 days after notice to winner.


Tennessee S.B. 1216

Date signed: 05/08/2015; date effective: 06/16/2015
Synopsis: Requires remaining excess proceeds from tax sales proceeds to be escheated to the state after final determination of all filed motions for redemption and excess proceeds or one year following the expiration of the redemption period for that parcel, whichever is later.


Washington S.B. 5538

Date signed: 05/14/2015; date effective: 07/24/2015
Synopsis: Creates procedures for disposing property in the leased premises of a deceased tenant.  Requires excess income from sales of property to be escheated after one year from sale date.


Due diligence
Texas S.B. 1454
Date signed: 06/18/2015; date effective: 09/01/2017
Synopsis: Pertaining to mutual fund shares - requires  holders, if an owner has designated a representative for notice under the bill's provisions, to mail or email the written notice required upon presumption of abandonment to the representative in addition to mailing the notice to the owner.
Read more here.

Enforcement-related
Delaware S.B. 11
Date signed: 01/29/2015; date effective: 01/29/2015
Synopsis: This bill addresses various aspects regarding the administration of the abandoned or unclaimed property law of the State of Delaware, and implements certain recommendations of the Task Force to Study and Make Findings and Recommendations to Improve Fairness and Compliance in Delaware’s Unclaimed Property Program established under the provisions of Delaware Senate Concurrent Resolution No. 59.

It also limits the total number of audits anyone outside contract can be assigned and requires all contracts with such contract auditors to assure that they will not employ or compensate senior officials from the department involved with their work for two years after such officials leave state employment.

It also amends the administrative appeal process regarding the assessment of unremitted abandoned or unclaimed property to provide that the determination of the independent reviewer shall be binding on the Secretary of Finance unless properly appealed to the Delaware Court of Chancery.

Amends the statutory provision regarding the period of limitations to assess additional unclaimed property liability in connection with a filed annual unclaimed property report to provide that in the case of a filed report the state escheator must make a specific finding of fraud before the State is entitled to an unlimited period of limitations with respect to assessment.

Section 2 directs the Secretary of Finance to prepare and promulgate a detailed manual containing procedural guidelines for the conduct of Delaware unclaimed property examinations and to update its regulations accordingly.


Delaware S.B. 141

This bill hasn’t been signed by the governor as of the date of publish but has passed the Delaware House and Senate and is likely to be signed.
Synopsis: Permanently establishes the VDA program. The state escheator cannot initiate new audit examinations unless the holder has received notice that they can enter into a VDA. Shortens the look back periods allowed during an audit and a VDA.  Read more here.


Exemptions
Colorado H.B. 1371
Date signed: 05/29/2015; date effective: 05/29/2015
Synopsis: Creates an exemption from the "Unclaimed Property Act" for funds held in Colorado lawyer trust account foundation trust accounts, commonly known as lawyer COLTAF trust accounts.

Nevada S.B. 348
Date signed: 06/09/2015; date effective: 07/1/2015
Synopsis:  1. Except as otherwise provided in this subsection, any credit memoranda, overpayments, credit balances, deposits, unidentified remittances, non-refunded overcharges, discounts, refunds and rebates due or owing from a holder that is a business association to another business association shall not be presumed abandoned if the holder and such business association have an ongoing business relationship. The provisions of this subsection do not apply to outstanding checks, drafts or other similar instruments.

2. For the purposes of subsection 1, an ongoing business relationship shall be deemed to exist if the holder has engaged in at least one commercial, business or professional transaction involving the sale, lease, license or purchase of goods or services with the business association or a predecessor-in-interest of the business association within each three year period that follows the date of the transaction giving rise to the property interest that shall not be presumed abandoned pursuant to subsection 1.

Life insurance
Arkansas S.B. 768
Date signed: 04/02/2015; date effective: 09/01/2015
Synopsis: Enacts Death Master File search for life insurance companies.

Idaho S.B. 1023
Date signed: 03/20/2015; date effective: 07/01/2016
Synopsis: Requires life insurance companies to conduct a comparison between the policies, annuities, retained asset accounts, and federal Social Security Administration's Death Master File or similar document. It provides guidelines for conducting the comparison.

Indiana S.B. 425
Date signed: 05/05/2015; date effective: 07/01/2015
Synopsis: Specifies policies, annuities, and retained asset accounts to which the law concerning unclaimed life insurance benefits applies. Repeals a requirement for insurer procedures related to Death Master File search data.

Texas S.B. 1021
Date signed: 05/23/2015; date effective: 08/31/2015
Synopsis: Lowers aggregate value for life insurance companies to $25 from $50.

Utah H.B. 168
Date signed: 03/27/2015; date effective: 07/01/2015
Synopsis: Enacts Death Master File index search for life insurance companies.


Miscellaneous
Louisiana H.B. 666
Date signed: 06/05/2015; date effective: 08/15/2015
Synopsis: Allows the articles of incorporation for banks or bank holding companies to provide for events that allow ownership rights over cash, property, or share dividends, shares issuable to shareholders in connection with a reclassification of stock, or the redemption price of redeemed shares to revert in full to the bank or bank holding company in certain circumstances. Limits those reversion events to circumstances in which the entitled shareholder or property owner has not claimed the shares once they have become issuable or the dividend or redemption price once they have become payable within a reasonable time.

Reporting
Arkansas H.B. 1782
Date signed: 04/04/2015; date effective: 09/01/2015
Synopsis: Lowers dormancy for demand, time deposit accounts, demutualization, mineral proceeds, and catch-all property to three years from five years.  Amends some mineral proceeds reporting requirements. Read more here.

Texas S.B. 1589
Date signed: 06/15/2015; date effective: 01/01/2016
Synopsis: Requires that a holder of unclaimed mineral proceeds include information related to the well, lease, and property from which the unclaimed mineral proceeds were generated in the unclaimed property report attached to the proceeds.

North Carolina H.B. 291
Date signed: 06/11/2015; date effective: 10/01/2015
Synopsis: Provides the Department of State Treasurer authority in the handling of unclaimed property determined to be of a hazardous nature or which is otherwise regulated, illegal, or which has no substantial commercial value and provides guidance for the proper handling and disposition of these materials on the part of financial organizations.

 

State administration
Arizona S.B. 1469
Date signed: 03/12/2015; date effective: 07/01/2015
Synopsis: If the total dollar value of properties retained by unclaimed property contract auditors exceeds $1,218,500, the excess amount is transferred from the state general fund to the Arizona Department of Revenue administrative fund established by section 42-1116.01, Arizona Revised Statutes, and appropriated to the department for contract auditor fee.

Kansas S.B. 240
Date signed: 04/29/2015; date effective: 04/29/2015
Synopsis: Requires Banking Commissioner to furnish to the state treasurer a copy of any or all examination information relating specifically to apparent violations of the Uniform Unclaimed Property Act.

Michigan S.B. 133
Date signed: 06/18/2015; date effective: 06/18/2015
Synopsis: Allows the state to appropriate funds to contract with private auditing firms to audit for and collect unclaimed property. 


Stored value cards/gift cards
Tennessee H.B. 547
Date signed: 04/17/2015; date effective: 06/13/2015
Synopsis: Requires an entity that processes certain payment card transactions for a merchant to disclose certain details about the fees charged to the merchant in a periodic statement; provides for a civil penalty of up to $2,000 per violation.

Tennessee S.B. 911
Date signed: 04/20/2015; date effective: 05/30/2015
Synopsis: Requires a payment processor that contracts with a merchant to provide a device for the processing of payment card transactions to print certain information prominently in the written contract.

Texas H.B. 2391
Date signed: 6/17/15 (Filed without Governor's signature); date effective: 09/01/2015
Synopsis: Establishes de minimus for low value stored value cards (initial value of $5 or less that cannot  add value and balances of $2.50 or less remaining following redemption). Seller may refund balance in cash if requested.

Texas S.B. 641
Date signed: 05/23/2015; date effective: 08/31/2015
Synopsis: Relates to debit card or stored value card surcharges. “Surcharge” means an increase in the price charged for goods or services imposed on a buyer who pays with a debit or stored value card that is not imposed on a buyer who pays by other means. The term does not include a discounted price charged for goods or services to a buyer who pays with cash.

 

More information
Visit the govWATCH website to read the full text of each bill

Tags:  2015  bill  escheatment  legislation  unclaimed property 

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UPPO is heading to the ULC Annual Meeting & reviews RUUPA

Posted By Administration, Monday, June 29, 2015
Updated: Friday, June 26, 2015

Since the February 2015 Uniform Law Commission (ULC) Drafting Committee to Revise the Uniform Unclaimed Property Act (drafting committee) meeting, UPPO has kept busy preparing for the second  Revised Uniform Unclaimed Property Act (RUUPA) draft release and its consideration at the ULC Annual Meeting on July 14; Williamsburg, Va.

In preparation for the upcoming meeting, UPPO has thoroughly reviewed the RUUPA to analyze the areas that will be embraced by UPPO members and those that still need work. Here’s the analysis:

Overall opinion
The second draft of the RUUPA embraces change, fairness, modernization, and clarity and incorporates many of the positions UPPO and various industry-specific stakeholders have been advocating from the beginning. “UPPO is pleased with the work that has been done by the ULC drafting committee to support fairness for all stakeholders, and the willingness of the reporter and co-chairs to embrace significant change,” says Dana Terry, UPPO president. Though there are many positive developments for the holder community, UPPO will remain fully engaged in the process to ensure the areas of concern can be improved, and the RUUPA is an act that the holder community encourages state legislatures to adopt in full.

Highlights of the provisions that UPPO supports


Specific definitions that promote clarity – Section 2

  • Address: The definition of address currently included in the RUUPA is practical and two-fold. The first part identifies that there may be an address that is separate than priority and can be used to direct mail to. The second part identifies which state is able to make claim and establish priority of the property.
  • Securities-related property has been defined by like characteristics including: restricted securities, non-freely transferable securities, and worthless securities.

Holder due diligence to the owner - Section 10
Though there are some consistency issues with this language in other areas of the RUUPA that need to be fixed, currently the required timing of the due diligence notice is drafted as “not less than 60 days before filing the report”. In addition, due diligence letters don’t need to be sent if the amount of the property is less than $50 and the address is known to be incorrect. The RUUPA also provides general language to include in a due diligence letter. 

 

Record retention – Sections 19(c) and 21(a)
The record retention requirement and statute of repose are capped at 10 years.


Encouraging transparent audit practices – Section 20

Section 20 still has provisions that UPPO would like to see fleshed out in greater detail and/or altered but there are many positive inclusions within the RUUPA that encourage transparency and fairness within the audit environment, such as:

  • Requiring state administrators to make third-party auditor contracts public
  • A  provision that requires state administrators ensure that conducting audits internally isn’t economically feasible
  • Requiring administrators to produce audit income reports annually to individuals overseeing the program

Highlights of the areas that need further consideration

Derivative Rights Doctrine – Sections 2(22)(a)(ii), 3(g), 19(a)
UPPO considers the Derivative Rights Doctrine to be a critical component of these laws and urges the ULC to formally recognize the Derivative Rights Doctrine as a very real limitation on the extent of states’ legal authority. 


Business to Business Transactions – Section 3(c)

Currently, there are two alternatives that exempt B2B property. Alternative A is narrower only exempting property that is generated through the normal course of business. Whereas, Alternative B is broader, exempting all B2B property regardless of when the property was generated. UPPO supports the inclusion of Alternative B in the RUUPA.


Indication of Owner’s Interest (Contact) - Section 3(e)(i - viii)

UPPO supports a comprehensive list of activities that constitute indications of interest by an owner.  Additionally, UPPO would support affirmative inclusion of the provisions concerning automatic transactions without brackets.


Administrative Appeals – Section 22
Holders deserve an unbiased arbiter to whom they can present their disagreements with audit results, as an alternative to formal litigation. Alternatives A and B presented in the RUUPA do not remove the state administrator as the decision-maker in this process. An administrative appeals process overseen by a truly independent decision-maker (i.e., not selected by or accountable to the state administrator) is essential to a fair and balanced result. UPPO advocates reconsideration of including the two alternatives provided.

 

Foreign Transactions/Property - Section 26 and Section 23 Comment
UPPO urges the ULC to remove the brackets from Section 26 and to exclude all foreign address property from the RUUPA as supported by principles of comity and the Supremacy Clause, the Due Process Clause, and the Foreign Commerce Clause of the U.S. Constitution.  UPPO further urges the ULC to restore the prior phrasing of Section 26 which did not premise such exclusion on the foreign country or non-US location having “laws which entitle it to take and hold unclaimed property of its citizens” – this condition essentially renders most foreign property subject to states’ claims, as the reporter’s Comment to Section 23 acknowledges. Hence, the Comment to Section 23 should be revised to ensure consistency with Section 26 as revised.

 

More information

Check out UPPO’s advocacy page to view the past submissions to the ULC

Tags:  compliance  draft  reform  revised uniform unclaimed property act  ULC  unclaimed property  Uniform Law Commission  UPPO 

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Wisconsin prepares for implementation of new owner matching program

Posted By Administration, Thursday, June 25, 2015

On July 1, 2015, the law which requires the Wisconsin Department of Revenue (DOR) to match unclaimed property owners with Wisconsin income tax filings will take effect. This new matching program crafts a proactive approach to unclaimed property owner outreach, and provides the state with the authority to settle owners’ unpaid debts to a Wisconsin government agency using unclaimed property.

Overview of the program

Every year, before July 1, the unclaimed property administrator is required to send a list of unclaimed property owners with any available social security numbers, to the DOR to match against Wisconsin tax returns filed during the same year. The DOR matches the unclaimed property list against income tax returns, and notifies the unclaimed property administrator if any of the owners have filed a tax return along with the owners’ addresses listed on the tax return. In addition, the DOR notifies the unclaimed property administrator if any of the owners holds a debt to a state agency, county, or municipality that DOR may collect under the tax refund intercept program. If there is an unpaid debt, the administrator will use the owner’s unclaimed property to pay the unpaid debt. In the case that there is money left over after the debt has been paid, the administrator will either send a notice or send the remaining balance to the owner.

Owners of property valued at $2,000 or less, do not need to file a claim to the property, but rather will receive the property automatically from the administrator if their information matches against tax return records.

For property valued over $2,000, the administrator will send a written notice to the owner informing them of their property and the instructions the owner can follow to claim it.

Regardless of the value, to qualify for the automatic matching program, the property owner must have filed an income tax return within the last two years, be the owner to not more than one piece of unclaimed property, and is not deceased.

This new matching program allows Wisconsin to use existing data and proactively give back unclaimed property, rather than waiting to receive claim notices. “This does significantly increase efficiency, as my staff no longer has to process claims manually for these properties,” says Erin Egan, director, bureau of tax operation, DOR.

For more information about the matching program, visit the DOR’s website.

Tags:  compliance  matching program  owner  unclaimed property  Wisconsin DOR 

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