States scooping up assets from millions of americans (pdf)

Claim your assets or the states will (pdf)

What you should know about escheating

For Your Information

Government agencies are holding tens of billions of dollars in unclaimed funds. Last year alone, states collected $22.8 billion in missing money and unclaimed property, of which less than $1 billion was claimed by owners or rightful heirs.

Assets are considered unclaimed in the eyes of the law when contact with the owner is lost - typically due to a name change after marriage or divorce, an unreported change of address or expired postal forwarding order, incomplete or illegible records, and clerical errors.

When owners fail to communicate an interest in an asset over a specified number of years known as the dormancy period, those left holding unclaimed assets: banks, stock brokers and transfer agents, utilities, employers and life insurance companies - remit the funds to the protective custody a government trust account in a legal process known as escheat.

Here this money awaits your claim, along with billions of unclaimed dollars held by government agencies themselves, including the IRS (tax refunds - $73 million), Bureau of Public Debt (savings bonds - $9 billion), Social Security Administration (benefit checks - $478 million), HUD (mortgage refunds - $500 million), PBGC (pension benefits - $80 million), FDIC (bank accounts - $200 million) and others.

It's important to note that in addition to those that have neglected to claim assets to which they are directly entitled, millions of family members are unaware they're eligible to collect unclaimed assets owed deceased relatives, who passed on without leaving an updated will or complete financial road map for their heirs. For example, more than one-quarter of all life insurance policies go unclaimed, because it is generally up to family members to notify the insurance company when a policyholder dies. The vast majority of life insurance companies lack the specialized resources and expertise necessary to locate lost beneficiaries.

Although states receive these death benefits, they don't necessarily keep them in a reserve fund. In Texas, for example, the money is transferred into a general fund used to pay for state services. State lawmakers then allocate money to the Unclaimed Property Division to pay claims in case the beneficiaries step forward. The amount allocated is based on "past experience" in paying claims, not the actual value of the claims, says Sheila Clancy, a spokesperson for the Texas comptroller. That's because not all property is claimed.

States are required to hold these funds until the owners can be found. Meanwhile the state treasuries, which hold an estimated $22 billion in unclaimed assets, have come to increasingly rely on these forgotten funds. Since the states typically return about 20% to 25% of the assets, they usually keep that much in the reserve in case someone comes forward to claim the money. The rest of the funds are often placed in the state's General Fund and used for state programs.                                      ~Excerpt from "Claim Your Assets – or the States Will" Wall Street Journal.  Nov. 2003

Peter DeVries, an administrator for unclaimed property in Florida's Banking and Finance Department, says his department keeps only about 5% to 8% of what comes in. If that money runs out, he borrows money from the Education Department.                                     ~ Excerpt from How to Find Lost Life Insurance Policies, Insure.com