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State Spotlight: Utah Unclaimed Property Division Focuses on Communication and Collaboration

Posted By Administration, Thursday, September 14, 2017

Engagement and cooperation with unclaimed property holders are central to the work of the Utah Unclaimed Property Division. Not only does working closely with holders help achieve the division’s primary mission of returning funds to their rightful owner, but it also helps reduce potential confusion throughout the unclaimed property process.

 

Utah was one of the first states to pass a version of the Revised Uniform Unclaimed Property Act. S.B. 175, which became effective on May 8, 2017, was the first substantial update to the state’s unclaimed property statute since 1981. A companion law effective at the same time, H.B. 42 updated the state’s life insurance laws, including provisions related to unclaimed life insurance benefits. As part of these changes, the state administrator is responsible for rules regarding administration of the law—a new responsibility for Utah’s administrator.

 

“In Utah, we’ve never had a robust administrative rules function, so that was brand new for us, said Unclaimed Property Administrator Dennis Johnston. “One of the things I’m really engaged in is reaching out to industry and others who are interested in these issues, so we can circulate drafts of proposed rules for comment well before we go through the formalized process of adopting rules.”

 

Working with the insurance and banking industries has been essential to understanding the issues important to those key stakeholders. 

 

“We may not agree with everything, but if we can understand each other and collaborate more on how the wording comes out, we can have less confusing wording and make it more clear and understandable for the people who need to abide by the rules,” Johnston said.

 

Communication is also central to the goals of Utah’s revised unclaimed property statute. Utah’s revised law specifies that owner access of an online account is a valid form of contact. With more transactions and communication occurring electronically, modernizing the state’s statutes to recognize current practices was important.

 

The increasing move to electronic communication also affects how holders file their reports with the state. The statute, rather than policy, now dictates that holder data must be transferred electronically and encrypted. Reports are not accepted in any other format. 

 

“Keeping personal information private was one of the big issues I used to promote passage of the law in our state,” Johnston said. “Privacy is a very important issue. In fact, it’s gotten so much attention that we now sometimes face a credibility gap with owners trying to get them their money back.”

 

When visiting a legitimate website aimed at reuniting property owners with their funds, consumers often think it is the work of a fraudster posing as an unclaimed property administrator. Because the site seeks to confirm their identity by asking for personal information, including names, Social Security numbers and addresses, they worry they are at risk for identity theft.

 

“We have processes in place that are somewhat automated, allowing us to turn around money to those folks within 10 days,” Johnston said. “That’s hard to do if they aren’t willing to share their identifying information. So, we’re trying to build people’s confidence that they’re using a legitimate website.”

 

In addition to clearing up skepticism from property owners, the Utah Unclaimed Property Division hopes to remove misperceptions about the office’s role within the state.

 

“There are rumors of states leaning on unclaimed property to fill budget deficits,” Johnston said. “That has never been the case in Utah, and it won’t be for the foreseeable future. I have never had any pressure from anyone to reduce the amount of money I’m paying out to claimants or to accelerate my collection from holders to satisfy a budget shortfall. I think that’s probably been a misnomer in many states. Our mission is to receive, manage and return unclaimed property to the rightful owner, and that’s how we approach our work.”

 

Johnston maintains policies aimed at encouraging holder compliance without being heavy-handed. If a holder routinely reports information clearly and accurately but experiences a reasonable need to file late, the office is willing to grant an extension. Likewise, if a company realizes an area of the organization hasn’t been reporting properly and comes forward to work through it, Johnston is open to waiving penalties and interest. The state offers a voluntary disclosure agreement to help holders come into compliance.

 

“We want to get the money to the right place,” he said. “We encourage holders through outreach and education about what they need to do and to follow the law. That works well for everyone in the long run, so that’s our approach here in Utah.”

 

Tags:  unclaimed property  Utah 

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