There is a $659.01 check with actress Angelina Jolie's name on it sitting on California's unclaimed-property list. Former New York City Mayor Rudolph Giuliani has at least two unclaimed checks in his state. And prominent bioethicist Ezekiel Emanuel, brother of Chicago Mayor Rahm Emanuel, has under $100 lingering in unclaimed property with of Illinois.
At a time when states are criticizing insurance companies for not doing enough to find beneficiaries for unclaimed life-insurance policies, it appears that the states aren't always doing a terrific job of uniting funds with the parties owed them, either: Somehow, over the course of several years, it's been too hard to locate Ms. Jolie and Messrs. Giuliani and Emanuel and return their money, despite the fact that they are well known.
That doesn't provide much hope for the thousands of other people with names like John Smith who have unclaimed property held by the states where they lived at one time.
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Many states are looking at whether insurers have violated laws by using a Social Security death database to cut off retirement-income checks while failing to use it to determine if death benefits should be paid to dead policyholders' survivors or turned over to states as abandoned property. Insurance industry executives maintain that fewer than 1% of policies have gone unpaid.
Insurers and other companies that fail to find the owners of dormant accounts or uncashed paychecks eventually turn those funds over to the state with the last known address for the person, usually after two to five years. But unclaimed-property laws vary from state to state, as does their success rates in reuniting owners with their money.
Many states don't pay interest on the money they hold, keeping it for themselves; had those unclaimed accounts stayed with their original banks or insurance issuers, they'd still be earning interest for their owners.
"The issue is whether states are taking property to return it to its rightful owners or if they are just trying to make a money grab," says Doug Lindholm, president of the Council on State Taxation, or COST, a trade association that represents major corporations. "Some states really make an effort, and some states just give it lip service."
In Delaware, unclaimed property has become the third-largest source of revenue for the state, behind personal income taxes and corporate franchise taxes. In California, the property goes into the state's general fund until it is claimed; during the state's 2009 fiscal crisis, anyone seeking that money was issued an IOU, as were taxpayers who were owed refunds.
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All of which begs the question: are states any better than companies at reuniting people with their lost property?
"The answer is, not really. In fact, some states can be even worse," says Brendan Bridgeland, director of the Center for Insurance Research, a nonprofit consumer group.
However, the major difference between companies and states is the ability of consumers to find their lost accounts, Mr. Bridgeland says. It is easier for a resident to locate money through searchable websites once it is turned over to a state. Besides states' proprietary sites, a centralized site, missingmoney.org, allows consumers to run searches across many states.
While most states don't spend much money or time tracking down missing account owners, corporations don't provide online tools that consumers can use to find out whether they have a dormant account or uncashed check, Mr. Bridgeland says.
To be sure, by the time unclaimed property finds its way to the state level, the original holder—be it a bank or utility company—has often tried to find the owners and struck out. States aren't eager to spend tax dollars hunting down individuals and tend to rely on mass outreach at state fair booths or staged media events to raise awareness of their online claims sites.
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New York, Mr. Giuliani's home state, does pay interest on its roughly $11 billion in unclaimed property, and has arranged some particularly high-profile events. During a visit by state Comptroller Thomas DiNapoli to Tioga County that was featured on Good Morning America in December, a check for nearly $7,000 was presented at a flood-damaged school in an area that was hit hard by Hurricane Irene. The office went on to identify money owed to teachers and families in the community.
California, a state that consumer advocates say has improved greatly in its unclaimed-funds practices, now sends out letters to every person owed $50 or more before that property is turned over to the state; before that change, it was only notifying about 20% of property owners. The state, which has more than $6.1 billion in unclaimed funds, has also created a special unit dedicated to locating owners with no valid address, using public databases.
Illinois, which has Mr. Emanuel sitting on its database, has increased the amount of money it has returned to people in 2011 by 23%, to nearly $102 million, compared with 2010; about $1.5 billion remains unclaimed. State Treasurer Dan Rutherford runs "Cash Dash" events where the he and staffers show up at town halls or chambers of commerce and invite residents to see if they are owed any money.
So why can't Illinois find Mr. Emanuel, the Chicago mayor's brother and a bioethicist who has worked at the Hastings Center, the National Institutes of Health, and now, as a professor at University of Pennsylvania?
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"The fact is, we have tens of thousands of people" on the state's database, Mr. Rutherford says. "The reality is, we don't have the staff to go through and see who may be high-profile personalities."
New York state says it can't use tax dollars to "hunt down people of notoriety" like Mr. Giuliani, while the appearance of a celebrity name on California's list doesn't mean the state hasn't tried to contact the person; it just means the owner hasn't filed a claim, says a spokesman.
So for a happy Hollywood ending, Ms. Jolie needs to fill out a claim form to get back the money that Walt Disney Co. turned over to the state after the company gave up trying to find her.
- Ezekiel Emanuel