Unclaimed Property: Can You Cash In?

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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).

I submitted two Unclaimed Property Claim Inquiry Forms providing copies of the required identification information.

Within a month I received a response to the inquiry for my father that included an Unclaimed Property Declaration/Release, an Indemnification Agreement and a listing of the property, which consisted of shares of MetLife and resulting dividends. As requested, I submitted a completed, signed and notarized Declaration/Agreement, a copy of a driver’s license or other federal or state-issued identification card and verification of the Social Security number. In about four weeks a check arrived for close to $2,200! The shares of MetLife stock had been sold by the state and he got the cash plus the unclaimed dividends and some interest.

A week later I received a similar package for my uncle's claim. Because he was deceased, I had to provide different kinds of documentation. Eventually a check for more than $2,300, also the result of the liquidation of shares of MetLife, was received. But the story continues.

My mother passed away in 2009. We discovered she had a paid-up $500 insurance policy with Prudential taken out in the late 1940s, prior to her marriage. The beneficiary was originally my grandmother, but was changed to my father in the 1950s. When my mother passed away, the funeral director called Prudential to cash in the policy and was told that my mother had been given shares in Prudential due to demutualization, and that these shares had been turned over to the Unclaimed Property Administration two years earlier. Prudential provided the funeral director with the exact date of transfer.

I went back to the NJ Division of Taxation website and did another search for Helen Flach, with no results. My father wrote to the NJ Unclaimed Property Administration providing the information that had been received from Prudential, but received no reply.

My father passed away early this year. As his Executor I decided to follow up on the Unclaimed Property for my mother. I again did an online search, with no result for Helen Flach or to a search using her maiden name. I printed out a claim form and submitted it, receiving a letter stating that there was no unclaimed poroperty being held for Helen Flach.

I e-mailed the person whose name was on the letter explaining the fact that we were specifically told that the Prudential shares had been turned over to the UPA. I received an e-mail reply in which the person admitted that N.J. did receive funds from Prudential Financial in the amount of $739.44. I am currently awaiting receipt of a Claim Form from the UPA.

I have no idea why the money in the name of Helen Flach did not show up in the online searches. Once the check is finally received I'll ask.

To find you're own unclaimed property, here is what you should do. Go to the Unclaimed Property page of your state’s website. If you do not find a link on your state’s Division of Taxation or Department of Revenue site go to the state’s home page and do a search for “unclaimed property.” Perform a search on your name and the names of your family members, both living and deceased. You may find that somewhere out there someone is holding money that belongs to you or your family!

If you have reason to believe there is Unclaimed Property due to your family, as I did, but nothing shows up in the online search, do not stop there. Write or call the unclaimed property office, file a claim and continue to pursue the issue until the property has been found.

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