Month: September, 2018

Developing: Jury Finds Against Gift-Card Issuer in Delaware Qui Tam Litigation

Delaware ex rel French v. Card Compliant, et al, has been one of the most closely-watched unclaimed property cases in recent memory.  The case involves a whistleblower claim by a former executive of a so-called “GiftCo” structuring entity, alleging that the “giftco” structure (whereby a company issues gift cards through a subsdiary incorporated in a state that exempts gift cards from the scope of unclaimed property laws) amounts to an improper avoidance of Delaware’s escheat laws.

According to a press release issued by the Plaintiff’s attorneys, the jury unanimously found that the card issuer violated Delaware law by using a “giftco” structure to circumvent the state’s escheat laws.  More information when it becomes available.

Illinois State Treasurer Announces “Money Match” Reunification Program

The office of the Illinois State Treasurer, Michael Frerichs, recently announced a new program called “Money Match” which is intended to reunite more Illinois residents with their unclaimed funds.  Under the new program, the state will send written notification to all apparent owners of property held by the state where:

  • the value of the property is $2,000 or less;
  • the property is not either tangible (i.e., physical) property or securities;
  • the last-known address for the person is verified by records from the state Department of Revenue which are less than 12 months old; and
  • the Treasury department has “evidence sufficient to establish” that the person appearing in the Department of Revenue records is the owner.

This program was developed pursuant to legislation that was adopted as part of last year’s amendments to the state unclaimed property laws.  The State Treasury estimates that it will be sending 63,000 such notification letters this month.  Once the recipient verifies that his/her address is correct, the state will issue a check for the proceeds (without the need to complete the paperwork and processes generally needed for the recovery of property).  Unclaimed property owner advocates have long argued that states can and should do more with the information at their disposal to reunite owners with their missing property.  The Money Match program is a good step forward in that regard.

While the program’s affirmative notification efforts are certainly laudable, one should always be cautious when receiving correspondence out of the blue (whether by regular mail or by e-mail) concerning unclaimed property.  If the correspondence requires you to disclose personal financial information or pay a “search” or “recovery” fee, it likely is not genuine. When looking for or claiming abandoned property, keep the following tips in mind:

  • Don’t Pay to Search — States do not charge a fee for allowing you to search for unclaimed funds, or in most cases, even to collect unclaimed funds.
  • Don’t Trust Links — If you receive an email purporting to be from your state unclaimed property office with a link, don’t trust the link.  Instead, go to the site directly.  A link to every states’ unclaimed property office can be found on the website of the Nat’l Association of Unclaimed Property Administrators.
  • Don’t Trust Phone Numbers — Similarly, don’t call the number provided to you in an unsolicited email or voicemail.  Look up (using NAUPA or some other source) the phone number for your state unclaimed property office yourself, and call them directly.  Some scams seek to trick victims into calling an international phone number and incurring high fees for those calls.
  • Don’t Provide Financial Information — You do not have to provide any financial or bank account information to perform a search or to learn if a state is holding unclaimed funds on your behalf.