California's State Treasurer's comments Unclaimed Money in the State

California's State treasurer made the following statement regarding the process of reuniting people with their missing and unclaimed money in Cali:

Fellow Californians:

Since taking office in 2007, returning property to their rightful owners has been one of my top priorities, so I wanted to share with you the significant improvements that my office has made to the program in the last three years:

Notifying Owners Before Their Property Is Sent To The State: For two decades, misguided state laws restricted the State Controller's Office from contacting the owners of more than 80% of all unclaimed property accounts sent to the State. In August 2007, the Legislature passed and the Governor signed legislation I sponsored that allows the State Controller to send property owners notices before their property is transferred to the State. In Fiscal Year 2007-08, those notices resulted in 225,752 properties being claimed before they were even sent to the State. From January 2007 through the end of 2009, my office sent out 3.17 million notices -- 1.27 million warning owners their property was about to be sent to the State, and another 1.89 million notifying owners their property had been sent to State.

Established A Locator Unit: We re-established a unit that aggressively finds and tracks down owners to reunite them with their property. Our priority is to notify owners who had never received a notice due to the previous restrictions on our ability to notify owners.

Upgraded The Claims Processing System: The new database system allows staff to more easily search for properties and process claims more efficiently. We also have begun posting properties to our unclaimed property search page on the Internet within weeks after they are reported by businesses transferring the property, rather than taking a year before posting the properties.

In just the first year after these reforms, we were able to send out 2.5 million notices; more than double the 1.2 million notices we sent during the past decade.

Last year, I successfully sponsored legislation to protect owners by prohibiting financial institutions from sending the contents of "abandoned" safe deposit boxes to the State if the owner has other active accounts. It also prohibits the transfer of other “inactive” accounts if the owner has an active IRA. Finally, the bill requires businesses seeking to avoid liability for wrongly sending property to the State, to prove they sent due diligence notices informing owners that their property was about to be sent to the State. This provision gives property owners an important legal remedy against the business should they suffer a loss due to the business' failure to properly notify the owner.

I want Californians to know that I am putting them first. I realize there is much more work to do, and I will continue to improve the State's ability to put property back in the rightful owners' hands.

Reforms I Am Pursuing:

• Restore interest paid on claims.
• Impose strict penalties on banks, utility companies, and other businesses that fail to comply with the law and notify their customers of unclaimed property they are holding.
• Allow the State to keep property deemed as having no commercial value for seven years, instead of the current 18 months, which would provide more time for owners to claim family heirlooms, photos, and other items that may have special value to them.

I will continue to pursue reforms to the Unclaimed Property Program and invite your suggestions and support along the way. My intent is to restore the public's confidence that their lost property will be safeguarded by the State until property owners can claim what is rightfully theirs.

Sincerely,

JOHN CHIANG
California State Controller