Greenberg Traurig, LLP

Unclaimed property laws require the remittance or escheat of certain types of tangible and intangible property to the state for safekeeping if the holder of such property is unable to contact the owner of that property after a specified period, known as the dormancy period. Each of the 50 states has its own unique set of laws that defines the types of property subject to escheat, sets a dormancy period for each category of property, determines the timeframe for reporting, and establishes penalties, fines, interest (and even criminal liability) for the failure to report. Examples of items that can constitute unclaimed property include unused gift cards, uncashed payroll checks, uncashed stock dividend checks, abandoned corporate stock, abandoned trust funds, unused bank accounts and safe deposit boxes (see a more comprehensive list on the next page). States have the ability to audit companies to determine their compliance with unclaimed property laws.

Many states look to unclaimed property as a source of “revenue” in the face of budget shortfalls. In part due to the fact that there is no applicable statute of limitations, the failure to comply with these laws can mean millions of dollars in interest and penalties for a holder. This can negatively impact a company’s bottom line, as well as have an effect on the accuracy of a company’s financial reporting. As a result of states’ increased focus on unclaimed property, companies need to be proactive in monitoring and, if necessary, improving their unclaimed property compliance practices. It is believed that a significant percentage of businesses are not currently in compliance with unclaimed property laws. Attention to unclaimed property compliance now can save valuable company resources later.

Greenberg Traurig’s Unclaimed Property and Escheat Practice Group offers clients a multidisciplinary approach to unclaimed property/escheat matters. The group includes lawyers from our corporate and securities, litigation, governmental affairs, and tax practices to provide comprehensive solutions. Greenberg Traurig attorneys are experienced in the full spectrum of unclaimed property issues, from counseling clients in unclaimed property law compliance to providing legal support for audit defense. Several of our attorneys are members of a national organization of unclaimed property practitioners.

Our attorneys are experienced:

• Counseling clients on compliance with the unclaimed property/escheat laws of all 50 states.
• Drafting unclaimed property policies and procedures.
• Defending single-state and multi-state audits.
• Negotiating voluntary disclosure agreements, confidentiality agreements, and settlement agreements.
• Advising clients on complex legal issues pertaining to unclaimed property/escheat laws, including emerging trends and changing laws.
• Counseling clients in planning and restructuring of business operations, especially with respect to gift card operations.
• Litigating unclaimed property/escheat matters.
• Advocating to further clients’ unclaimed property policy objectives.
• Assisting buyers in analyzing and mitigating unclaimed property liabilities in acquisitions and mergers.
• Assisting sellers in limiting indemnity obligations and managing unclaimed property liabilities in sale transactions.
• Recovering unclaimed property held by states on behalf of clients.
• Counseling clients on whether federal law preempts state unclaimed property laws.

Types of Unclaimed Property

• Uncashed travelers checks and money orders
• Uncashed rebate checks and other customer credits
• Unused gift certificates and gift cards
• Uncashed employee payroll checks
• Uncashed vendor checks
• Uncashed dividend checks and the underlying stock or other evidence of an ownership interest in the business
• Abandoned trust funds
• Amounts due and payable under insurance policies or annuities
• Amounts distributable from employee benefit plans
• Certain pre-payments, credit balances, deposits and layaway items