Another Round of Delaware Invitation Letters Go Out

It has come to PEACC’s attention that another round of Delaware (“DE”) Unclaimed Property Voluntary Disclosure Agreement (“VDA”) Invitation letters have been mailed out by Secretary of State Office to various Holders throughout the Country incorporated in DE, in most cases.

The scheduled mailing date of these invitaion letters is mid-August. If your company happens to receive one of these letters from Delaware, it is in the Holder’s best interest to respond to the State within 90 days of the letter date. If the Holder does not respond within the 90 days the letter recipient will be selected for an Unclaimed property audit be the Delaware Department of Finance. Therefore, PEACC advises all Holders who receive the VDA Invitation letter to come forward, voluntarily and
participate in the Delaware VDA. Participants in the DE VDA are provided numerous benefits from the State that outweigh going through an unclaimed property audit and may save the Holder money.

To hear more about the Pro’s and Con’s of participating in a State VDA or fir help in navigating the process, whether formal or not, please reach out to a professional at PEACC.com by calling 410.303.5510 or email us at info@peacc.com

Call PEACC for Compliance
Call PEACC for Compliance 410.303.5510

How Are States Enforcing Their Unclaimed Property Compliance?

–  Through State or State sponsored Compliance Reviews
–  Through formal State audit notices.
–  Self-Audit notices, including those conducted/sponsored by third party firms.
–  State reminder letters regarding Compliance with reporting obligations.
–  State VDA (“Voluntary Disclosure Agreement”) Invitations.
–  Automatic penalty & interest assessment for non-compliance.
– If you are contacted by a State regarding your compliance efforts, it is best to respond right away!

To discuss these State enforcement steps or any other issues relating to unclaimed property reporting compliance, please reach out to a professional at PEACC by calling 410.303.5510, or email us at
info@peacc.com

Unclaimed Property Reporting Steps

In order to get in and remain compliant with the State reporting requirements Holders must:

– Identify all unclaimed property on an annual basis
– Calculate dormancy periods based on the State property is due to; and depending on type of property and whether it would be reportable in 1,3, 5, 7 or 15 years
– Determine if any property may be exempt from State reporting
– Send State required Due Diligence/Search Letters out approximately 60 to 90 days prior to the State report due date
– Prepare and generate State reports in the required State format
– Update Holder records as to whether dormant property was reported/remitted to the State, paid to Owner or was an error in records

For additional information on how to track & comply with your State unclaimed property reporting obligations please contact PEACC at 410.303.5510 or email at info@peacc.com

Unclaimed Property Audits & Reviews

Who has the ability to audit Holders? Most State jurisdictions have the ability/authority to preform the dreaded Unclaimed Property Audit. Most States have their own audit staff conducting their own various State Audits. But most States still contract with third-party auditors. These third-party auditors have, in the past, conducted contingency fee Unclaimed Property Audits. Where these firms get a percentage of what they uncover from the Holder. Now, most States pay an hourly rate to perform Audits on behalf of a State. The third-party auditors under contract with most States, include the following firms:

• Kelmar Associates, LLC
• Specialty Audit Services (SAS)
• Kroll (was Versus Financial)
︎• Treasury Services Group, LLC (TSG)
• Innovative Advocates Group, LLC
• Discovery Audit Services (DAS)
• Escheatment Expertise Consulting Services (EECS)
• Faegre, Drinker, Biddle & Reath (FDBR)
• KDAC, LLC • Barnes & Thornburg
For further help in navigating the complexities of third-party unclaimed property auditors, please contact PEACC at 410.303.5510 or email us at info@peacc.com

Call PEACC for Compliance
Call PEACC for Compliance 410.303.5510

Minimize UP Exposure

How Does a Company Minimize Their Unclaimed Property Exposure & Implement Best Practices?

– Ensure you are abiding to all State reporting deadlines and compliance calendars.
– Understand and abide to the various compliance rules and regulations along with your industry requirements.
– Establish and implement unclaimed property liability accounts. Update them monthly.
– Perform all State mandated due diligence/search letter mailings.  Stay on top of rules & requirements.
– Investigate and implement any possible outsource solutions.
– File reports annually & consistently as required. Maintain copies of reports.
– Document and maintain support of what you DO NOT owe the States.
– Maintain a log of State’s offering Voluntary Disclosure Agreements (“VDA”) and all specifics.
– Conduct periodic reviews of all functions.
– Assign personnel and define rolls.

Call PEACC for Compliance
Call PEACC for Compliance 410.303.5510

UP Compliance Reviews

States Performing Formal Unclaimed Property Reviews –

There are currently only a handful of States conducting Formal Unclaimed
Property Reviews. To successfully complete one of these Reviews, the
following areas should be investigated and analyzed:

–  Any written Unclaimed Property policies & procedures.
–  Expectations about how certain Property types are handled/reported.
–  Reporting history of all entities including acquisitions & divestitures.
–  How are outstanding/uncashed checks treated on closed bank accounts?
–  Any De Minimus policies or rulings?

Call PEACC for Compliance
Call PEACC for Compliance 410.303.5510

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