Can we send the due diligence letter required under the Illinois Revised Unclaimed Property Act (RUUPA) to the remitter of an abandoned cashier’s check instead of the payee since the payee is not our client and we do not have their contact information? Also, can we place a stop on the cashier’s check if the remitter signs an indemnity bond and reimburse them for the check instead of having it escheat?

We believe that sending a due diligence letter to the remitter of an abandoned cashier’s check would fulfill the Illinois RUUPA’s notice requirement if the cashier’s check has not yet been delivered to the payee.

Under the Illinois RUUPA, holders of abandoned property must send due diligence letters as notice to the property’s apparent owner that the property may be transferred to the State Treasurer as abandoned property. “Apparent owner” is defined in the Illinois RUUPA as “a person whose name appears on the records of a holder as the owner of property held, issued, or owing by the holder.” An “owner” is a person with a legal, beneficial or equitable interest in property, including a payee on an instrument. Consequently, we believe that the “owner” of a cashier’s check would include both the remitter as well as the payee of the check.

However, the Illinois RUUPA does not require a holder to notify an apparent owner if it does not have in its records an address for that owner sufficient for delivery of first-class U.S. mail. As your institution does not have contact information for the cashier’s check’s payees, we do not believe you would be required to send notice (in the form of due diligence letters) to such payees.

If a remitter is willing to sign an indemnity bond for a cashier’s check, we do not believe that it should be treated as abandoned property. Under the Illinois RUUPA, a cashier’s check is not presumed abandoned until three years after its issuance or the apparent owner’s most recent indication of interest in the property.

There are several ways for the remitter, who is an apparent owner, to indicate an interest in the cashier’s check, which would prevent it from being presumed abandoned. Indications of interest include written and oral communications with the remitter. For example, if a bank employee has a conversation with the remitter, that communication is considered an indication of interest if contemporaneously recorded and preserved. Also, if a remitter sends a signed indemnity bond to your bank, we believe that communication could be considered a written communication that is an indication of interest.

One caveat is that if your bank has knowledge that the cashier’s check has already been delivered to the payee (for example, if you contact the remitter and learn that they have sent the cashier’s check to the payee), the remitter would no longer be considered an “apparent owner” of the cashier’s check. At that point, the payee would be the only apparent owner of the cashier’s check, and only the payee’s indication of interest would prevent it from being considered abandoned.

For resources related to our guidance, please see:

Illinois RUUPA, 765 ILCS 1026/15-501(a) (“Subject to subsections (b) and (c), the holder of property presumed abandoned shall send to the apparent owner notice by first-class United States mail that complies with Section 15-502 in a format acceptable to the administrator not more than one year nor less than 60 days before filing the report under Section 15-401 if:

(1) the holder has in its records an address for the apparent owner which the holder’s records do not disclose to be invalid and is sufficient to direct the delivery of first-class United States mail to the apparent owner; and

(2) the value of the property is $50 or more.”)

Illinois RUUPA, 765 ILCS 1026/15-102 (“‘Apparent owner’ means a person whose name appears on the records of a holder as the owner of property held, issued, or owing by the holder.”)
Illinois RUUPA, 765 ILCS 1026/15-102(21) (“‘Owner’, unless the context otherwise requires, means a person that has a legal, beneficial, or equitable interest in property subject to this Act or the person’s legal representative when acting on behalf of the owner. The term includes: . . . (C) a creditor, claimant, or payee, for other property; . . .”)
Illinois RUUPA Administrative Rules, 74 Ill. Adm. Code 760.460(c) (“A holder does not need to send notice by first-class U.S. Mail if any of the following are true:

1) the property is valued at less than $50;

2) the holder does not have in its records an address for the apparent owner that is sufficient for delivery of first-class U.S. Mail;

3) the holder’s records indicate that the address for the apparent owner is invalid; or,

4) the holder sends notice by certified U.S. Mail.”)

Illinois RUUPA, 765 ILCS 1026/15-210(a) (“The period after which property is presumed abandoned is measured from the later of:

(1) the date the property is presumed abandoned under this Article; or

(2) the latest indication of interest by the apparent owner in the property.”)

Illinois RUUPA, 765 ILCS 1026/15-210(b) (“Under this Act, an indication of an apparent owner’s interest in property includes:

(1) a record communicated by the apparent owner to the holder or agent of the holder concerning the property or the account in which the property is held;

(2) an oral communication by the apparent owner to the holder or agent of the holder concerning the property or the account in which the property is held, if the holder or its agent contemporaneously makes and preserves a record of the fact of the apparent owner’s communication. . . .”)