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Delaware will pay $102 million in unclaimed property funds to a coalition of states, including Pennsylvania, as part of a recent legal settlement.
Pennsylvania and Arkansas led the bloc of states that sued Delaware for its collection of unclaimed property outside of its borders.
Unclaimed property includes uncashed checks, gift cards, utility security deposits, abandoned bank accounts and orphaned refunds. If there’s no activity with these financial products for a year or more, the property is considered “unclaimed” and turned over to the government, under a power called “escheatment.” In June, Delaware’s revenue forecast showed the state collected more than $400 million in unclaimed property for the fiscal year that ended in July.
Delaware is the incorporation destination for millions of businesses, receiving orphaned financial instruments from across the country. Because of that, the First State takes in more than its share of unclaimed property, relative to size and population, and adds it to its general revenue fund.
Pennsylvania sued Delaware in 2016 over its claim to MoneyGram agent and teller’s checks. Although MoneyGram is incorporated in Delaware, the company conducts little operations there. MoneyGram is physically headquartered in Texas. Pennsylvania successfully argued against Delaware’s claim that it was entitled to hold the unclaimed property of companies registered in the state by saying the checks should be viewed as money orders or traveler’s checks and go to the state where they were cut.
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Publish date : 2024-09-03 08:31:00
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