Posted on Wednesday, 21st September 2011 by Keane Unclaimed Property Team

On Monday, September 12, 2011, the Third Circuit United States Court of Appeals heard oral arguments in the case of New Jersey Retail Merchants Association v. Sidamon-Eristoff.  The litigation concerns the New Jersey gift card law passed in 2010 which, among other things, altered the unclaimed property jurisdictional priority rules for the reporting of gift cards in New Jersey.  The new law required that holders collect zip codes from purchasers, and in the absence of information concerning the owner, the presumed address would be the place of purchase.

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Posted on Thursday, 15th September 2011 by Keane Unclaimed Property Team

The following is the second part of our two part piece about unclaimed property audits and the Oil & Gas Industry. View the first part here

Oil & Gas Industry Factors

In addition to the common red flags listed in the previous article, there are some risk factors specific to the oil and gas industry — specifically with mineral proceeds, suspense accounts and credit balances.

Mineral Proceeds

The payment of mineral proceeds provides very unique challenges related to unclaimed property. For example, the large volume and small dollar amounts for some royalty payments can make them hard to track and more likely to go unclaimed. Additionally, many states have special rules around reporting unclaimed royalties. For example, in excess of 20 states have some form of a current pay rule, which generally requires payment of certain mineral proceeds before the expiration of a complete dormancy period. Once the abandonment period for the first such payment has run, all subsequent payments due, held, or owing for that owner become reportable as unclaimed property – despite the fact that the dormancy period for all payments in the series has not been satisfied.

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Posted on Wednesday, 29th June 2011 by Keane Unclaimed Property Team

Please be advised that on June 16, 2011, SB 136 was passed and became Nevada unclaimed property law. This bill introduces dramatically new and unique unclaimed property provisions for the state. Specifically, the bill includes a provision that reduces certain dormancy periods to two years.

The dormancy change was added by a Committee amending the bill shortly before it was sent to the Governor to be signed. The new law became effective immediately on June 16, 2011. Read More »

Posted on Wednesday, 29th June 2011 by Keane Unclaimed Property Team

Please be advised that on June 23, 2011, the Governor of North Carolina signed HB 692 into law reducing dormancy periods and amending the requirements of the North Carolina unclaimed property report. The changes are as follows:

1. The dormancy period for “wages and other compensation for personal services” has been reduced from 2 years to 1 year.
2. This bill makes the following North Carolina unclaimed property reporting changes:

1. Removes the NAUPA reference from the statute so that electronic formats are now simply "prescribed by the Treasurer."

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Posted on Wednesday, 1st June 2011 by Keane Unclaimed Property Team

As reported earlier, the New York State abandoned property laws changed recently when the Legislature passed its budget bill for 2011-2012 via Senate Bill 2811.

The bill includes multiple changes to the New York Abandoned Property Law that affect holders required to file with New York for the next reporting cycle.   The New State Comptroller’s Office of Unclaimed Funds has also added an alert to its website summarizing the recent changes.

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Posted on Friday, 20th May 2011 by Keane Unclaimed Property Team

Recently, Keane appeared in Disclosures Magazine, and on the radio show Marketplace Money.

What role does a CPA play in the compliance process? How can CPAs ensure that their clients’ organizations are not at risk of audit? Laura Lane, Vice President of Keane’s National Consulting and Advisory Services group, recently answered these types of questions in an article titled, “Money Pit: How to Track and Ensure Unclaimed Property Compliance,” featured in the May/June 2011 issue of Disclosures Magazine.

In the article, Lane explains the basics of unclaimed property and addresses the fact that in light of the fiscal crisis, most states are increasing audit intensity in an effort to raise revenue without imposing tax hikes on residents. Furthermore, Lane states that because this has become a commonality among states, CPAs should become familiar with and learn about unclaimed property so that they can help their clients make better financial decisions for their organizations.

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Posted on Thursday, 7th April 2011 by Keane Unclaimed Property Team

Please be advised that on March 31, 2011, New York passed the budget bill S2811, which replaced the identical New York Abandoned Property Law A4011. The new law, effective immediately and due with the next reporting cycle, provides the following:

New York S2811 lowered the dormancy periods from 5 years to 3 years for the following property types:

• Money or securities held in escrow, but excluding escrow accounts for which the duty or obligation for which such amount was deposited has not been performed and such performance is still required.

• Amounts due on deposits held by a banking organization or any amount to which a shareholder of a savings and loan or a credit union is entitled.

• Accumulations of interest or other increments held by a bank for payment of an interest in a bond and mortgage apportioned or transferred by it.

More New York Abandoned Property Law Updates

In addition to adjusting dormancy periods, S2811 also amended New York’s reporting provisions. There following are major changes to keep in mind for your next report to New York:

1. Publication requirements: Every banking organization must publish on or before September 1st of each year a notice naming potential owners of unclaimed property being held by the banking organization. Every insurance company must publish on or before May 1st of each year a notice naming potential owners of unclaimed property being held by the company. These provisions provide a little more flexibility in that the previous requirement mandated publication within 30 days of filing a report.

2. Negative and Preliminary reports no longer required: Negative and preliminary reporting requirements are removed for banks, utility companies, insurance companies and condemnation awards reports. The bill further confirms the reporting deadlines and cut-off dates.  Once the statutory due diligence and publication requirements have been satisfied, the report and remittance would be due for banking institutions by November 10th and for life insurance companies by September 10th.

3. Miscellaneous:  The Verification and Checklist (AC2709) notarization requirement was lifted.  NY State law still mandates that all unclaimed funds valued at $20 and higher follow the statutory due diligence requirements.  The State Controller’s Office posts all owners entitled to property valued at $20 and higher on their website for at least one year. Gift cards remain at a 5 year dormancy period.  

Please note we will continue to track any changes regarding new legislation in our unclaimed property blog and our quarterly unclaimed property newsletter, Keanotes.

Should you have any questions or require additional information, you may also contact me directly via email at dzumoff@KeaneUP.com.

Sincerely,

Debbie L. Zumoff
Chief Compliance Officer
Keane

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Posted on Wednesday, 30th March 2011 by Keane Unclaimed Property Team

Proposed on February 17, 2011 and passed on March 25, 2011, HB 174 marks the first major unclaimed property legislation passage of 2011. The bill makes two major changes to securities reporting in Idaho: (1) the dormancy trigger will now be a combination of inactivity and RPO, instead of pure inactivity, and (2) the requirements for reporting dividend reinvestment program accounts (DRP accounts) are now clearly spelled out.. More details are provided below.

Previously, Idaho only recognized pure inactivity as a dormancy trigger for securities. Under HB 174, any stock, shareholding or other intangible ownership interest in a business association is “considered” abandoned if the owner of such interest (1) fails to either claim a dividend, distribution, or other sum payable or communicate with the association regarding the interest or a dividend, distribution; and (2) the location of the owner is unknown at the end of the five (5) year dormancy period.

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Posted on Wednesday, 23rd March 2011 by Keane Unclaimed Property Team

Kelmar Associates, LLC has recently (first few months of 2011) been demanding significantly more information from holders with an emphasis on potential equity and debt related properties during its escheatment audits. Previously, Kelmar’s Initial Document Requests (IDRs) commonly asked some limited scope questions about the Holder’s contractual relationship, experience or history with their transfer agent. Kelmar’s auditing procedures are now requesting more detailed and comprehensive information concerning the Holder’s securities-related property types.

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Posted on Monday, 21st March 2011 by Keane Unclaimed Property Team

Last week, the Seattle Post-Intelligencer reported that Costco is suing the State of Washington over $3.2 million in unclaimed rebates. The lawsuit is in response to an order mandated by the state in February that Costco owed more than $3 million in unused rebates. The state says the funds belong in a state-managed program for consumers who want to claim the rebates. In Costco’s suit, however, the company alleges it should not have to turn over the requested funds as it engaged a third party rebate house to manage its rebate program. Because the company does not retain the amounts at issue, it doesn’t believe it owes the state anything.

The $3.2 million represents unclaimed Costco rebate from 2004 to 2010, plus interest.

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