Unclaimed Property: Can You Cash In?

Listening to Good Morning America has put what will soon total more than $5,000 into the pockets of my family.

One morning a few summers ago while listening to a segment on found money, I learned about the unclaimed property fund maintained by each of the 50 states (as well as the District of Columbia, Puerto Rico, the U.S. Virgin Islands and some parts of Canada).

The National Association of Unclaimed Property Administrators explains that “unclaimed property refers to accounts in financial institutions and companies that have had no activity generated or contact with the owner for one year or a longer period. Common forms of unclaimed property include savings or checking accounts, stocks, uncashed dividends or payroll checks, refunds, traveler's checks, trust distributions, unredeemed money orders or gift certificates, insurance payments or refunds and life insurance policies, annuities, certificates of deposit, customer overpayments, utility security deposits, mineral royalty payments, and contents of safe deposit boxes.”

Much of the current inventory of unclaimed property, and the applicable property in the case of my family members, is the result of the recent demutualization of insurance companies. Companies are required by law to turn "abandoned" funds over to the state, which then makes an effort to find the owner or heirs. Unclaimed funds are held until the owner or current heir is found — the money does not revert to the State Treasury after a period of time. In most cases you will not necessarily receive the actual property.  The State will sell the stocks, bonds or other property and return the proceeds to the owner.

Unclaimed property laws have been around since the 1940s, but have become much broader and more enforced in the past 15 years.  The NAUPA tells us that $1.754 billion in funds were returned to the rightful owners in 2006, and at least $32.877 billion is currently being held by states.

Following the instructions provided on GMA, I went to the New Jersey Division of Taxation website where a link to "Unclaimed Property" eventually took me to a search. I did a search for "Flach" and found results for Robert Flach (my father, not me) and Theodore Flach (my father’s brother, who had passed away in 1991).