Unclaimed property laws, also known as “escheat” laws, require financial institutions to report when personal property (for example, money) has been abandoned or unclaimed after a period of time under state law—often five years. Before assets can be considered abandoned, the institution must make a diligent effort to try to locate the owner. After the property is abandoned, the state keeps record of the asset and the owner may make a claim to retrieve the property. The National Association of Unclaimed Property Administrators maintains databases to search for unclaimed property and state law may have special restrictions. Diligently drafted agreements and up-to-date records (as well as making sure that bank accounts and other types of financial accounts are not closed due to inactivity) may prevent the loss of these assets, though citizen children, custodians, and those with power of attorney should be aware that escheated property may be retrieved if later discovered.
