2020 has been quite the year! As with all aspects of our lives, the unclaimed property world was significantly impacted by this year’s events. We have had to learn to operate our businesses, meet our unclaimed property obligations and effectively function amid office shut downs and virtual workspaces.
The first unclaimed property challenge of 2020 came with the filing of the spring reports. Recognizing the operational difficulties caused by COVID 19, states were very generous in providing filing extensions. While that was a great help in getting the spring reports filed, it delayed the due diligence work efforts needed for the fall reports. Unfortunately, the states assumed that holders were able to reboot their unclaimed property protocols remotely and were not as willing to provide general extensions for fall. This is consistent with the pattern we have been seeing of states becoming increasingly reluctant to approve extensions, except in the case of unexpected circumstances.
As with the private sector, states have adjusted their operations to the “new normal” as demonstrated by a resurgence of new audits being issued, which had been paused due to COVID19. Further, we expect to see an increase in audits to continue into 2021. Third party auditors also picked up where they left off and expect holders to be able to access historical documents, despite continued work from home orders and personnel cuts experienced across most industries. They also like to reference the “extended” period of time that was so graciously given by them to research the populations that they deemed to be potentially escheatable, without taking into consideration the limitations and hardships being experienced by many.
One positive development seen in 2020, is the introduction of enhancements being implemented by States to improve their use of technology to increase efficiency in all aspects of their programs including owner location, claims payments, holder report processing and compliance.
In the compliance realm, we’re seeing states expand their contracting with third party auditors to assist with voluntary compliance. The early indications are that these new auditor assisted voluntary compliance initiatives resemble a self audit more than they do a traditional VDA. We will keep you updated as we learn more about these new compliance initiatives.
While the struggles related to COVID were many, 2020 saw another state adopt a version of RUUPA (Revised Uniform Unclaimed Property Act). Colorado’s new unclaimed property law went into effect July 1, 2020. Consistent with the other states that have adopted RUUPA, Colorado’s version includes provisions specific to that state which are not included in the uniform act. As with the other RUPPA states, Colorado is bringing its policies and procedures in line with the new law.
Learn more about how to manage unclaimed property compliance here.