Relates to reports of unclaimed amounts of money or other property

Summary of provisions

Section 1 of this bill would amend Paragraph a of subdivision 3 of section 402 of the abandoned property law to conform language to 2011 amendments removing the preliminary reporting requirements.

Section 2 amends Paragraph c of subdivision 3 of section 501of the abandoned property law to eliminate the requirement of the return of undelivered mail to the holder prior to wages becoming abandoned.

Section 3 amends Subdivision 1-a of section 1315 of the abandoned property law to clarify language relating to checks issued on behalf of a corporation.

Section 4 amends Paragraph a of subdivision 1 of section 1405 of the abandoned property law to authorize the payment of interest for life insurance policy claims and funds received directly from Surrogate's Court.

Section 5 amends the opening paragraph of paragraph a of subdivision 1 of section 1406 of the abandoned property law to raise the threshold for claims to abandoned property from 3 dollars to twenty dollars.

Section 6 amends Subdivision 2 of section 1422 of the abandoned property law to raise the threshold on the requirement of certified mailings from 1 thousand to 3 thousand dollars.

Section 7 adds a new section 1423 to the abandoned property law expressly authorizing the promulgation of rules and regulations related to electronic contact that would toll the dormancy period.

Section 8 amends Subdivision 2 of section 2222 of the surrogates court procedure act to provide for the payment of interest on monies from the Surrogate's Court paid into the Abandoned Property Fund.

Section 9 provides for an immediate effective date.

Prior legislative history

New bill.

Justification

It is the policy of the State of New York that while protecting the interest of the owners thereof, to utilize escheated lands and unclaimed property for the benefit of all the people of the state. In furtherance of this policy, the State Comptroller, as custodian of the Abandoned Property Fund, is diligent with respect to updating and correcting the provisions of the Abandoned Property Law (APL) as, from time to time, may be necessary.

Reporting by Utilities: The technical amendment relating to the publication requirement. for utilities is intended to conform language to changes made in 2011 to the APL by removing language related to the preliminary reporting requirement that was previously, but is no longer, required prior to publication.

Undelivered Mail: The elimination of the requirement that undelivered mail be returned to the holder prior to wages becoming abandoned is intended to increase consistency with respect to the treatment of wages and other uncashed checks. Additionally, this change recognizes the increased use of direct deposit. Due diligence mailings will still be required under other provisions of the APL.

Clarification of Property Types: The amendment to the relating to outstanding checks clarifies that a check held on behalf of a corporation, (other than a public corporation), joint stock company, individual, association of two or more individuals, committee or business trust in this state, and which has remained unclaimed by the owner of such amount for three years, shall be deemed abandoned property.

Payment of Interest; Life Insurance: The authorization for payment of interest for life insurance policy claims and funds received directly from Surrogate's Court is intended to create consistency/fairness with respect to the payment of claims. Currently, certain accounts that bear interest prior to being reported to the Office of Unclaimed Funds (OUF) receive interest from OUF for up to five years when claimed. However, insurance death benefits do not receive interest and this amendment would correct that inequity.

Payment of Interest; Surrogate's Court Monies: Authorizing the payment of interest on monies received directly from surrogate's court and held by the State Comptroller as abandoned property allows the distributees of estates whose decedent died a resident of a county outside of the City of New York to receive the same interest that the distributees of estates whose decedent died a resident of a county within the City of New York presently receive

Increase Threshold for Return of Property: Raising the threshold for mandated return of property from 3 dollars to twenty dollars is intended to bring the statute up to date with inflation. The APL's 3

dollar minimum claim amount was set in 1952. According to the consumer price index (CPI), 3 dollars in 1952 was equal to twenty-six dollars in 2014. This change will significantly reduce the cost to the State of processing claims which cost more to process than is returned to the claimant and alleviate the potential for frustration of claimants at having to invest time and money to recoup small dollar values.

Increase Threshold for Certified Mailings: Raising the threshold on certified mailings from one thousand dollars to three thousand dollars is intended to reduce the burden on holders of having to perform such mailings.

Electronic Communication as Written Contact: The ability of the State Comptroller to promulgate rules and regulations establishing when an electronic communication from the apparent owner of amounts or securities shall constitute "written contact" for purposes of tolling the dormancy period recognizes that individuals frequently access their financial accounts through electronic means. However, the current statute does not recognize electronic communication as customer contact sufficient to prevent property from becoming abandoned. This change to the APL would recognize electronic communication from the owner as written contact under the APL, thereby tolling the dormancy period.

The State Comptroller urges the passage of this proposed legislation.

Fiscal implications for state

Certain provisions of this proposal may result in modest increases in receipts, while others would result in modest increases in amounts paid to claimants. Overall, the fiscal impact of this proposal would be negligible.

Effective date

This act shall take effect immediately.