Amounts owed to you (unclaimed property) can go unclaimed for a myriad of reasons. Your company could have moved locations. They could have changed their process or contact point for payment receipt. A check could literally be lost in the mail. Once those items are lost and go unreconciled they turn in to unclaimed property. Unclaimed property can be funds held by a state/jurisdiction resulting from statutory escheat requirements or they can be outstanding balances held by a government entity (that will never be escheated) until you or your organization come forward.
Whether your unclaimed property is held by a state unclaimed property department or government entity, it is important to know there are two ways to get your property; search and claim it yourself or utilize a Third-Party Recovery Firm.
A Third-Party Recovery Firm is a company who assists owners in the identification and recovery of unclaimed property. For the most part, Third-Party Recovery Firms will contact your organization about funds they have located. If you or your organization has decided to utilize a third-party to recover unclaimed property it is important to consider the following checklist:
1). Is the Third-Party Recovery Firm properly licensed in the state where your funds are located?
Many states have statutes stating firms assisting in the recovery of abandoned property must be registered with the state unclaimed property department or licensed with the state agency who handles private investigator licensure.
2). Is the Third-Party Recovery Firm charging a contingency fee compliant with state laws?
Most states have language about the contingency fee a recovery firm can charge for their services. Make sure you are not being over-charged by the company assisting with your recovery efforts.
3). Are you currently aware of the items identified by the Third-Party Recovery Firm?
Ensure the properties identified by the recovery firm are not items you or your team are currently working. A recovery firm should be able to provide you exact amount, check number, issue date, or other details that help you avoid entering into a contract for items you are working or have knowledge of.
4). What are the terms of payment?
Make sure the language in the contract states checks for recovered amounts will be made payable to your organization and fees will not be collected by the third-party firm until successful recovery AND return of the items to you. Never pay upfront for services that have not been rendered.
The recovery of unclaimed property can be an exciting and rewarding activity. When utilizing a Third-Party Recovery Firm to claim unclaimed property, it is important to verify who you are partnering with in order to protect the assets that are rightfully owed to your company.
To learn more about Corporate Asset Recovery, visit MarketSphere’s Knowledge Vault and down load this free White Paper: A Guide To Uncovering And Recovering Unclaimed Funds.