Topic: Unclaimed Property
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Over two years ago, we received a non-wage garnishment summons and sent a response stating the amount of funds we were holding for the customer named in the summons. To date, we have not been asked to turn over the funds. Is there a maximum amount of time we must hold these funds before returning them to the customer’s account? We have contacted the court and the creditor’s counsel regarding the status of the garnishment proceeding but have not received a response.
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We believe you must continue to hold the funds until further order of the court — with the caveat that you may eventually have to remit them to the State Treasurer if they become abandoned. The lien created by a garnishment summons does not expire after a set length of time, unlike the lien created…
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We have a safe deposit box that has been unpaid for the last five years, and we are preparing to drill the box and remit the contents to the Illinois Treasurer as unclaimed property. However, we learned that the sole owner of the safe deposit box is on active duty military service. Would this customer fall under the protection of the Servicemembers Civil Relief Act (SCRA)?
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We do not believe that the SCRA would prevent your bank from fulfilling its obligation to remit abandoned property in a safe deposit box to the Illinois Treasurer in accordance with the Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA). While the SCRA would prevent the foreclosure or enforcement of a lien on items contained…
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Under the Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA), we are not required to notify customers about abandoned cashier’s checks, money orders, or certificate of deposit interest checks with values below $50. If the payee on one of these types of checks has an active deposit account at our bank, may we credit the amount of the abandoned item to the deposit account, or must it escheat to the state?
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We do not believe that the Illinois RUUPA would allow a bank to credit amounts due under abandoned items to the customer’s deposit account in order to avoid remitting those items to the Treasurer, and we do not recommend this practice for the reasons discussed below. While you are correct in stating that you are…
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Is it permissible to charge both a dormancy fee and a service fee if they are disclosed to the customer as separate fees? Our dormancy fees are charged every month an account goes unused, provided that the account balance is under a certain level and the account has been inactive for at least a year. Our service fees vary based on the account type. For example, we charge a service fee on certain checking accounts if they do not have at least one ACH credit during a statement cycle and charge a service fee on certain savings accounts if the account balance falls below a certain level. We disclose the dormancy fees on our fee schedule and our service fees on our Truth in Savings Act disclosure.
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We are not aware of any Illinois or federal laws that would generally prohibit you from charging both a dormancy fee and a service fee if they are disclosed to the customer as separate fees and agreed to by the customer. Under the Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA), dormancy fees may be…
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What are “stored-value cards” under the Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA)? We used to issue Visa gift cards and are unsure whether they would be considered stored-value cards.
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We believe Visa gift cards would be considered “stored-value cards” under the Illinois RUUPA, since they are redeemable at multiple unaffiliated merchants — unlike “gift cards,” which are redeemable at a single merchant or affiliated merchants. Under the Illinois RUUPA, a “stored-value card” is a “card . . . issued on a prepaid basis primarily…
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Are we required to notify named beneficiaries of a payable on death (POD) account after learning of a customer’s death? Would a POD account beneficiary become an “apparent owner of property presumed abandoned” under the Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA)?
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We are not aware of any law that would require you to notify POD account beneficiaries after learning of a customer’s death. However, we recommend reviewing your account agreements to determine whether they require notification to the POD account beneficiaries. Further, such beneficiaries would be considered “apparent owners” under the Illinois RUUPA. The Illinois Trust…
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We have a dormant account and are unable to reach the accountholder. The only transactions on the account are social security deposits. Are we required to return the social security deposits?
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No, we do not believe you are required to return social security deposits solely because they are being deposited into a dormant account, provided that the recipient has not died (to your knowledge) and your bank has not yet closed or frozen the account. The Treasury Department’s Guide to Federal ACH Payments (the Green Book)…
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Customer A is the sole owner on a dormant account. Customer A also is a co-owner on a joint account that has activity — but the activity is from Customer B, the other co-owner, not Customer A. Is Customer B’s activity an indicator of interest for Customer A’s dormant account? Does it matter if Customer A is the primary tax reporting owner of the joint account?
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No, we do not believe that Customer B’s activity on the joint account should be treated as activity on Customer A’s dormant account. Under the Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA), an inactive deposit account is considered active if “any other accounts” sharing the same mailing address have qualifying activities “directed by an…
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Are we required to retain a copy of the signed “indication of interest in property” letter we receive from a customer whose account was previously or about to be presumed abandoned? Once we receive a signed copy of such a letter, we return the customer’s account to an active status. Since the Illinois Revised Uniform Unclaimed Property Act (Illinois RUUPA) allows customers to verbally communicate interest in an account that is presumed abandoned, we are unsure as to the record retention requirement for such letters.
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We recommend retaining copies of any letters signed by your customers indicating their interest in any account, including an account that was dormant but not yet reported as unclaimed property, for at least ten years. These records may be retained in either physical or electronic form. Under the Illinois RUUPA, property holders must retain certain…
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Can we charge a dormancy fee on any account that falls dormant, or are these fees only allowed if the account balance is over a certain amount? Our new processor told us we can charge a dormancy fee only if the account balance is over $10,000.
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We are not aware of any law or regulation requiring a minimum account balance (such as $10,000) to charge a dormancy fee. Whether a bank is authorized to charge a fee on a dormant account depends on the terms of your deposit account agreement with the customer. The Illinois RUUPA requires that dormancy fees be…