Topic: Unclaimed Property
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We have an automatically renewing certificate of deposit (CD) with a 30-month term. The CD was set to mature at the end of April in 2019, and it automatically renewed for another 30-month term. The customer’s last indication of interest was in mid-April of 2019. When would the CD be considered abandoned?
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If there has been no indication of interest since the CD’s first automatic renewal term, we believe the CD would be considered abandoned at the end of October 2024. The Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA) provides that an automatically renewable time deposit will be presumed abandoned “3 years after the date of…
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A deceased customer named their daughter as the payable on death (POD) beneficiary for two certificates of deposit (CDs). We have the daughter’s name, but not her contact information or social security number, and the CDs are continuing to earn interest. We have been cutting interest checks in the name of the deceased customer and holding them. Instead of cutting these checks, can we capitalize the interest on the CDs, and can we deposit the interest checks we have already issued into the principal balance of the CDs?
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No, we do not recommend capitalizing the interest on the CDs and unilaterally depositing the interest checks that have been issued into the principal balance of the CDs, unless the CDs’ account agreements expressly grant you this authority. If you have not been granted this authority, we believe you should continue holding the CDs and…
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Can we charge a fee when submitting the following items as unclaimed property: individual retirement accounts, certificates of deposit (CDs), CD interest checks, money orders, and cashier’s checks?
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We believe you generally may charge “escheat fees” on abandoned property if your customers previously have agreed to such fees in valid contracts. However, you may not charge escheat fees if you do not have agreements in place expressly authorizing such fees, and in the case of money orders and cashier’s checks that have been…
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We issued a cashier’s check to a customer for an escrow overage in 2018. The customer has not cashed the check and did not respond to a letter we sent notifying them of the outstanding check in June 2020. The customer also has a demand deposit account (DDA) with a negative balance that we charged off in October 2020. Can we apply the outstanding cashier’s check to the negative balance on the DDA instead of sending it to the State Treasurer? The amount of the check is beneath the threshold requiring customer notice under the Illinois Revised Uniform Unclaimed Property Act (RUUPA).
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No, we do not believe you may apply the cashier’s check to the negative balance on the customer’s DDA to avoid remitting it to the Illinois Treasurer. Additionally, although you are not required to notify your customers of abandoned property valued at less than $50, you still must report and remit such property to the…
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To deter money orders and certified checks from being abandoned, may we print “VOID AFTER 120 DAYS” on them? We want to encourage payees to cash them as soon as possible.
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We do not recommend placing expiration dates on money orders and certified checks. As to certified checks, the Illinois Uniform Commercial Code (UCC) requires banks to honor certified checks they have issued and subjects them to potential liability for wrongful dishonor. While a bank generally is not obligated to pay a check presented six months…
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We have a dormant checking account that needs to be delivered to the State Treasurer this year. The account holder died in June of 2018 without a beneficiary on the account, and we previously tried contacting the account holder’s daughter but did not receive a response. The account holder’s daughter recently passed away, and her son has inquired about the account. Can we consider this an indication of interest that resets the abandonment period, and can we proceed in resolving this matter with the son?
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The son’s inquiry may qualify as an indication of interest in the account if he has a legal, beneficial, or equitable right in the account, for example as executor or administrator for the account holder’s estate. You likely will need more information to determine whether the son has a legal or equitable interest in the…
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We have an unclaimed cashier’s check, very low-value, payable to a customer whose last-known address is in Missouri. Do we need to report the cashier’s check to Missouri?
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The Illinois Treasurer’s office has advised us that a best practice is to report unclaimed property to the state that has priority in the property. In this case, that would mean reporting and delivering the property directly to Missouri. However, the Treasurer’s office does regularly remit unclaimed property to states with which it has reciprocity…
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We have an auto-renew certificate of deposit (CD) that we have identified as unclaimed property, but it will not mature until mid-2022. Should we submit a report once the CD matures in 2022 so that the owner does not miss out on interest? Should we submit it as a cashier’s check?
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Yes, we believe that you may wait before reporting and delivering the CD as unclaimed property until the next applicable reporting date after it matures in 2022. Under the Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA), an automatically-renewable CD would be presumed abandoned three years after the most recent indication of interest “following the…
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Our main office is located in Illinois, but we have offices in Iowa and Wisconsin as well. We believe those states have reciprocal agreements with Illinois for the reporting of unclaimed property. Are we required to file a negative abandoned property report if we report property to Illinois?
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While we caution that we are not experts in the unclaimed property laws of states outside of Illinois, we recommend filing negative reports (i.e., filing an unclaimed property report even when you have no property to report) when required by a particular state’s law. For example, we believe that Wisconsin requires financial institutions with a…
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We have a four-year auto-renew certificate of deposit (CD) that opened in 2002. A beneficiary was added in 2017. Should we report the CD as unclaimed property based on the date of last contact in 2017, or should we wait until the start of a new initial term (in 2022)?
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We recommend delaying the reporting and delivery of the CD until the next reporting date after it matures in 2022, as permitted under the Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA). Under the Illinois RUUPA, an automatically-renewable CD is presumed abandoned three years after the most recent indication of interest “following the completion of…