California holds a substantial $15 billion in unclaimed property, but faces challenges in returning these assets to their rightful owners. While the state aims to reunite residents, businesses, and nonprofits with their funds, it lags behind other states in proactive measures like automatic check distribution. This report highlights the current system's reliance on individuals searching for funds, the impact on organizations like food banks, and potential reforms to expedite the return process.
California holds approximately $15 billion in unclaimed property , representing a significant sum of money and valuables legally belonging to its residents, businesses, and nonprofits. A recent investigation by CBS News California revealed that several large charities and hospitals were unaware that the state was holding tens of thousands of dollars that rightfully belonged to them.
While state leaders express their intention to return these billions in unclaimed assets, the investigation highlights that California lags behind other states in actively reuniting individuals and organizations with their funds. Currently, California primarily relies on individuals and organizations to actively search for unclaimed funds, a process that other states have begun to streamline through automatic check distribution. \The Yolo County Food Bank, for example, is owed $2,500 in unclaimed funds, which could significantly benefit their operations, especially given the current high need. The director, Karen Baker, expressed surprise and disappointment that the state does not proactively notify nonprofits of their unclaimed funds, suggesting that sending information or checks automatically would be a more efficient approach. The CBS News California investigation also found that California food banks are owed at least $95,000, children's hospitals are owed at least $1.3 million, and the Make-A-Wish Foundation is owed more than $46,000. Many organizations are unaware of these funds, underscoring the challenges in returning unclaimed property. State Controller Malia Cohen emphasizes the state's commitment to returning the $15 billion of unclaimed property and spearheaded the declaration of February as 'Unclaimed Property Month' in California. However, many residents remain unaware of the unclaimed property program. The Controller's office reports that one in three people who search the state's database find money or property, stemming from various sources like old bank accounts, overpayments, or family heirlooms. \Advocates of unclaimed property reform suggest that California's system places too much responsibility on owners to search for their funds. Ron Lizzi, who has worked to reform unclaimed property programs in Connecticut and Colorado, believes the state should take a more proactive role in returning what it reasonably can. Across the country, several states have adopted programs to automatically return smaller amounts of unclaimed money once ownership is verified. North Dakota, Pennsylvania, South Carolina, New York, Mississippi, Washington, Oregon, Connecticut, and Virginia have implemented proactive systems. Pennsylvania's 'Money Match' program and South Carolina's 'Palmetto Payback' utilize data verification to send payments for qualifying claims. These programs rely on modern data matching tools to verify identities and addresses before mailing checks. While California has not implemented a comparable statewide automatic return program, Controller Cohen says that is something she and her team are 'actively working on' as the state modernizes its computer systems. Current state law requires the controller to mail a notice for property valued at $50 or more, but it faces limitations in tracking people down. A bill that could have facilitated this process stalled last year but is expected to move forward soon. The State Controller's Office recently began pre-screening and sending notices to individuals with unclaimed property between $500 and $5,000, having sent out nearly 100,000 letters and returning over $25 million to more than 22,000 individuals
Unclaimed Property California State Government Financial Regulations Asset Recovery
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