Financial Resource Center


Fee Money or Free Money? Claiming Unclaimed Assets

by Jeremiah Tucker / October 21st, 2013

A distant relative you've never met dies, leaving behind a tidy sum of money that you stand to inherit. It's the kind of unexpected bolt of good luck that opens a Victorian novel or graces a Community Chest card in Monopoly, but it happened to Joplin, Mo., resident Gabe and his family. Unfortunately, the family quickly learned that in the competitive—and often confusing—multibillion dollar industry of unclaimed money and assets, what you're potentially owed and what you get can be wildly different. Gabe's family didn't learn his mother's distant aunt had died until nearly three years after her death. Of the aunt's $250,000 estate, she left $100,000 to a university. For the remaining $150,000, there was no clear heir. The probate court hired an Ohio law firm to administer the estate and find the closest living relative. Gabe found the aunt's probate records online and contacted the law firm. Based on some research, he believed his mother and her two sisters were the closest heirs, but after some back and forth with the law firm, he discovered it didn't matter. The fees associated with the long search and administering the estate had drained her assets to nearly zero. "The genealogy search took roughly 18 months, cost $25,000, and wasn't even correct," Gabe says. For instance, he says it listed his mother's sister as her mother. Mark Tofal, an unclaimed-property expert, says this isn't uncommon. Tofal is author of the book "Unclaimed Assets: Money the Government Owes You," and administrator of the site "In a long search, there could be all kinds of costs and changes in valuation of assets," he says. If there's no clear heir, what's left of Gabe's great aunt's estate likely will end up in Ohio's unclaimed property program. Currently, there is more than $41.7 billion in unclaimed money sitting in state coffers nationally. Tofal says only a small percentage of that money will be returned to its rightful owners. A survey by the National Association of Unclaimed Property Administrators (NAUPA) found that states returned $2.25 billion to consumers in 2011—a relatively small amount of their overall holdings. But there are many companies happy to track down lost money for you—for a fee. So the $150,000 question is how do you find the money owed to you while avoiding finder's fees? Diligence, old-fashioned sleuthing, and knowing where to look on the Internet.

From your pockets to the state

You might think misplacing money—especially lots of it—would be uncommon. It's not. People move, last names change, relatives die, natural disasters occur, and assets such as insurance policies, bonds, retirement plans from three jobs ago, stocks, and old accounts can get misplaced. "It's crazy what can end up at the state," Tofal says. Anything from something as simple as a CD (certificate of deposit/share certificate) to as unusual as recurring payments for the mineral rights to a relative's land can all wind up in state coffers as unclaimed property. To prevent an asset from going missing in the first place, it helps to understand what triggers the financial equivalent of a missing-person's alert. States can claim private assets only after they've sat inactive for an established dormancy period—between one and five years for most assets. If during that time the financial institution holding the asset can't contact you or your rightful heir, and there is no "owner-directed" activity, the state takes custody of it. The dormancy clock starts ticking when you don't make a deposit to or withdrawal from a checking account, pay the rental fee for a safety-deposit box, or a financial institution sends a letter to an address where you no longer reside.
Keep good records of all your assets including insurance policies, securities, and retirement accounts.
In recent years, the amount of unclaimed property flowing into state coffers has grown. But not necessarily because more people are losing money. Rather, states are putting more pressure on businesses to turn over unclaimed property. "We view unclaimed property as an important consumer protection issue. It is a matter of fairness that missing moneys are returned to their rightful owners," Beth Pearce, the treasurer of Vermont and president of NAUPA, says. "This attitude is not limited to Vermont—more and more states take this position, and it is reflected in the number of assets returned to individuals." Pearce says many states are shortening the dormancy periods, so businesses have to remit unclaimed assets to the states more quickly, while simultaneously enforcing their compliance measures. "I will say that shorter dormancy periods are good for the consumer," Pearce says. "The sooner we report the property, the greater chance we have of finding the rightful owners and returning their money to them." But while the money sits in state coffers awaiting its rightful owner, the states can use it as revenue to plug shortfalls or collect interest. Recently, many states have begun requiring businesses to turn over unused gift cards, billions of which go unspent every year. "Many gift cards are remitted as owner unknown, so there's virtually no chance of the right owner coming forward," Tofal says. "On the one hand, it's just a money grab by the state, but at least you have a prayer of getting the gift card back instead of it just being service charged to death."

Where and what to look for

If your money is in a state's unclaimed property database, it's relatively easy to find and claim. You also don't have to worry about it disappearing again. Aside from Indiana, where the statute of limitations for claiming property is 25 years, Pearce says states hold the money in trust in perpetuity. You can contact your state's individual unclaimed property office or visit its site online and search for any money listed under your name or the name of a relative. Then follow the directions for submitting a claim. In most cases, you'll need to present photo identification, a Social Security number (SSN), and possibly proof of previous addresses. If you're claiming on the behalf of a deceased family member, you'll likely need a death certificate and a document proving your standing, such as a court letter stating that you're the executor of the estate. You should search the unclaimed property database of every state where you've lived, worked, or conducted business. And, because in some cases the money ends up in the state where the business is incorporated, it's worth searching the unclaimed property database of Delaware where, for tax reasons, more than half of the Fortune 500 companies are incorporated. You can use to search multiple state property databases at once, but many states, including the three largest holders—New York, California, and Delaware—don't participate. Other places worth looking: Federal government. Any unclaimed money due you that originated from the federal government won't show up in state databases. This includes uncashed Social Security checks, Internal Revenue Service refunds, unclaimed insurance refunds for mortgages secured by a government loan from Housing and Urban Development, and any funds held by federal bankruptcy courts. To claim them, you'll need to contact each department individually.
Never agree to a locator company's offer without first doing some research and negotiating the fee.
Federal Deposit Insurance Corporation and National Credit Union Administration. If a bank or credit union was liquidated, and you didn't close your account, it's possible your funds are being held by the federal insurers. Treasury Department. There are $17 billion worth of unclaimed Series E Savings Bonds. If you dimly recall grandma sending you a U.S. Savings Bond that you didn't cash, check the Treasury Department's Treasury Hunt website. Enter your Social Security number (SSN), click "search," and you'll know if the department is holding fully matured bonds in your name. To claim a lost savings bond, you'll need to fill out and submit a form. Insurance companies. In recent years, nearly two dozen insurance companies have "demutualized," meaning they transferred ownership of the company from policyholders to shareholders. In addition to their policy benefits, policyholders are owed compensation for the sale. Tofal says there is around $20 billion in unclaimed demutualization payouts, many of them valued in the five-figure range. If the dormancy period has elapsed—usually one to three years—the money should be in state unclaimed property databases. However, if you can't find it, Tofal recommends contacting the insurance company directly for help locating the demutualization payment or tracking down lost policies. "If you or your parents had a policy there, the wise thing to do is to contact the company or the agent," Tofal says. "If you've had the policy since around 2000 or before, chances are you're owed this money. You do want to talk to them, and make sure you got your share."

Your money...for a fee

Most states limit how much a company can charge to locate unclaimed funds that already are in their custody—usually 10% to 15%. However, during the dormancy period, when assets are inactive and likely lost but not yet in state custody, there is little regulation. Locator companies regularly charge 35% or more of the asset's value for their services. How this generally works is the company will contact you claiming it has found money owed to you that it can return for a fee. While there are scam artists out there, many of these locator companies are perfectly legal. Tofal says locator companies often have a relationship with financial institutions to track down the owners of inactive accounts. "The fees can seem outrageous, but sometimes they have to do an awful lot of work," Tofal says, offering as an example time-consuming genealogy research. "But at 35%, I think the fees are probably a lot higher than they need to be." Before agreeing to a locator company's terms, Tofal recommends doing your own research.
    When searching for unclaimed money, check the unclaimed property databases of every state where you've ever lived, worked, or done business.
  • Check the state unclaimed property databases. If the asset already is in state custody, you won't need any assistance to claim it.
  • Ask the locator company for the type and value of the asset. Tofal says if they won't tell you what type of asset it is, then its value can give you a hint. For instance, a specific amount, such as $35,487.15, indicates a fixed asset like a savings account. If it's an estimate, then it's likely a security, such as a stock or bond, because the cash value isn't fixed. This gives you a starting point.
  • If the asset is from a deceased relative, contact the executor of the estate to see if there are any unclaimed assets. Go through their tax returns looking for leads.
  • For lost securities begin by contacting the transfer agent of the likely security. Transfer agents are in charge of all shares of the stock, and can perform a search with an SSN and a name. "The caveat is they may not own shares in your name, but in the name of your broker," also known as the "street name" Tofal says. "In that case, you want to contact the last broker you dealt with."
  • At Tofal's website,, for a flat fee ranging from $10 to $25 his company will search databases for 25 different types of assets. Tofal says if you have an idea of what you're looking for, they usually can find a financial history of the asset. Tofal's company won't make a claim on your behalf, but he says, "It can give you a pretty good idea of the next steps you need to take."
After taking these steps, even if you can't locate the asset yourself, you'll likely be in a better position to negotiate the finder's fee downward. And, as a last resort, you always can wait for the asset to show up in a state's unclaimed property database. "It is up to the individual to determine how they would like to receive their unclaimed property, and whether or not they are willing to pay a fee to an asset location firm in order to receive funds sooner than through a state program," Pearce says. "State unclaimed property programs provide a cost-effective alternative. They allow individuals to receive the full value of their property, without incurring fees." Tofal cautions that most—but not all—assets eventually will be reported and remitted to the state. The downside, Tofal says, is the asset may not be worth as much by then. States sell nonliquid assets, such as securities and gold. By waiting, you'll only be entitled to the value of the asset at the time the state took ownership. "If you know something is out there and you can't find it, it might be expedient to pay someone to do the search," Tofal says. "Most of the time these locator companies handle the paperwork and can expedite the recovery of the asset, which might be worth something for you."

Don't lose it in the first place

The soundest advice is to never lose track of your assets in the first place.
  • Keep good records of all your assets including insurance policies, securities, and retirement accounts.
  • Don't let accounts sit dormant.
  • Update your contact information with all your financial institutions so it's current.
  • Create a will and communicate with your family members, so they know where to find all the appropriate documentation for your holdings.
  • Talk to your parents about their estate, so, when the time comes, you know the location of their assets.
But, if something goes missing, don't panic. You usually can find it. And, sometimes, if you're lucky, it will find you. Gabe, while missing out on a share of the $150,000 estate, did get some welcome news. "About six months ago I got a postcard from the state treasurer saying I had unclaimed money," Gabe says. "I sent them a copy of my driver's license and they sent me a check for $388 two months later."
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