Date: February 20, 2008
Melissa Jones
(916) 319-2008
Wolk bill aims to reunite owners with lost property
Extends time to claim property before it is turned over to the state
Existing state law requires that if property is unclaimed three years beyond the date of the last account transaction, or beyond the date upon which an account became payable or reached maturity, that the property be turned over to the State and is eventually transferred to the state’s general fund. Under Wolk’s bill, AB 2221, California would extend the dormancy period from three years to five years, thereby allowing property owners more time to claim their property before it is transferred to the state.
“Unfortunately, the short time limit of three years before that ‘lost or abandoned’ determination is made has proven totally insufficient for far too many Californians,” said Wolk. “This bill would give rightful owners more time to claim their lost property from the business holder, while also requiring these financial institutions to triple their efforts to locate property owners before turning dormant accounts over to the state.”
In addition to providing owners more time to claim their property, AB 2221 specifies that the notices banks and other businesses must provide owners shall state clearly, in 14 point bold typeface, that their property may be turned over to the State if they do not reinstate their accounts.
“This legislation will benefit consumers by lengthening the period of account inactivity from three years to five in order to give owners more time to notify businesses of their intent to maintain their accounts, while balancing the impact of storage fees and penalties on the value of their property,” said State Controller John Chiang, whose office is sponsoring the bill.
According to the controller’s office, in the past fiscal year (06-07) more than 742,000 lost, forgotten, or abandoned accounts worth an estimated $522 million were sent to the state for safekeeping. During that year, the state was able to return $336 million in property to the rightful owners. Approximately $200 million in property was transferred to the state’s general fund.
