DELAWARE ALL EYES ON. Senate Bill 13 Transforms Delaware Unclaimed Property Law IN THIS ISSUE: Spring 2017: Volume 15, Issue 1

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1 Spring 2017: Volume 15, Issue 1 The first unclaimed property compliance newsletter, published exclusively by Keane since Keane is the country s leading provider of unclaimed property compliance solutions. ALL EYES ON DELAWARE Senate Bill 13 Transforms Delaware Unclaimed Property Law IN THIS ISSUE: All Eyes on Delaware: DE SB 13 Update 2-3 After the Reports Have Been Filed Now What? 4 Legislative Update 5-7 Unclaimed Property as a Profit Center 8-9 Litigation Update Unclaimed Property Considerations The Financial Technology Industry and Unclaimed Property Industry Updates Newly Appointed Directors 24 1

2 All Eyes on Delaware: DE SB 13 Update By Heather Gabell, J.D., Director, Unclaimed Property Compliance Introduced on January 12, 2017 and signed into law on February 2, 2017, DE Senate Bill 13 substantially revises and restructures Delaware s unclaimed property law. Below are particular areas of interest for holders. The items below are listed in the order in which they appear in the statute. Owner Interest: No provision for automatic deposit/withdrawal No catchall provision for owner interest Specifically excludes application of an automatic premium loan provision or other nonforfeiture provision contained in an insurance policy An unreturned 1099 or an executed W-8 BEN (for foreign address accounts) dated within 3 years of the end of any calendar year on file are provided as examples of indication of interest If an owner has more than one account, an indication of owner interest with respect to one account with that holder is an indication of owner interest in all accounts Knowledge of Death Knowledge of death may be identified through any source, including declaration of death, death certificate, DMF searches, or other equivalent sources Retirement Accounts A retirement account is presumed abandoned upon the earlier of a) 3 years after the owner s last indication of interest in the account following the date specified i the federal income tax laws by which distribution of the property must begin in order to avoid a tax penalty, or b) 3 years after the knowledge of death of the account owner that has been confirmed by the holder in its ordinary course of business, unless a beneficiary has indicated an interest in the account within 3 years after the date of death Last Known Address Any description, code or other indication of location of owner on the holder s books and records, which identifies the state of the last known address of owner No zip code provision Holder Reports Beginning on 3/1/18, all reports must be in a web-based record If a holder contracts with a third party to make the report, the holder is responsible for complete, accurate and timely reporting and payment or delivery of the property Holder must identify a designated individual to serve as the contact for all correspondence with the State related to the reporting and remittance of unclaimed property No reporting is required solely by virtue of holding property constituting consideration paid for unredeemed gift cards, which, in the aggregate, for the reporting period having a face value of less than $5,000 or for gift cards having a face value of $5.00 or under issued by a holder whose business is described in Sec of Title 30, whether or not it conducts business in this state When to File Reports Holders and business associations (other than banking organizations and insurance companies): on or before 3/1 Banking Organizations: on or before 11/10 Insurance Companies: on or before 12/20 Due Diligence First class mail must be sent by holders not more than 120 days nor less than 60 days before filing. Threshold amount is $50.00, but holders must mail on securities regardless of value Notice by the Administrator to Owner The State Escheator will send written notice prior to liquidation for securities or other property that is not money to the last known address in the records of the holder unless it determines that notice would not be receive or if the State Escheator determines that the total value of the security or other property that is not money does not exceed $50 The State Escheator and the State of Delaware shall not be liable to an owner based upon the liquidation of a security or other property that is not money if the State Escheator did not act unreasonably in determining that mailed notice would not be received or for an amount that exceeds that which was actually received upon liquidation 2

3 Record Retention Holders shall retain records for 10 years after the report was filed Statute of Limitations: 10 years, which is tolled by the State Escheator s delivery of a notice of examination to a holder, or if the State Escheator reasonably concludes that the holder has filed a report containing a fraudulent or willful misrepresentation Look Back Period 10 years (plus the 5 year dormancy period) Compliance Review If a holder does not file a report as required or if the State Escheator believes a holder may have filed an inaccurate, incomplete or false report, the State Escheator may authorize a compliance review of the report and notification requirements do not apply. The review is limited to the contents of the report filed If a deficiency is found due and payable to the State, the holder shall be notified in writing within 1 year of the authorization of the compliance review. If the holder fails to pay the amount of the deficiency within 90 days, the State Escheator may seek to enforce the assessment or may refer the holder to the Department of State to request that the holder enter into a VDA Conversion to VDA Holders currently under audit authorized by the State Escheator on or before 7/22/15 may notify the State Escheator and Secretary of State of their intent to convert the audit to a VDA. Such notification must occur within 60 days of the Secretary of Finance s adoption of the new estimation regulations If Delaware joins a multi-state audit already initiated by another state, Delaware is no longer required to provide notice to holders that they may elect to enter into a VDA prior to an audit Expedited Audit Holders currently under audit may notify the State Escheator of its intent to expedite the completion of the pending examination by providing written notification within 60 days of the Secretary of Finance s adoption of the estimation regulations. The State Escheator has 2 years from the date of receipt of written notice to complete the exam and shall waive interest and penalties Estimation The Secretary of Finance shall, within 60 days, promulgate regulations regarding the method of estimation that shall apply to both audits and VDAs Judicial Review The Court of Chancery shall review errors of law de novo 3

4 After the Reports Have Been Filed Now What? By Laurie Andrews, Technical Director, Unclaimed Property Reporting Let s assume you ve undergone a rigorous risk assessment process, performed meaningful remediation efforts, entered into VDA s with the appropriate states, and filed initial compliance reports with all the others. Sigh of relief, right? So what should you do next to help ensure that you remain in compliance so that all of your hard work wasn t all for naught? Step One Establish written policies and procedures If you haven t already drafted policies and procedures as part of your initial compliance efforts, it s important to document the steps needed to identify, research, monitor, remediate and then report transactions that are considered to be reportable properties. The procedures should be detailed to include timelines, key personnel, data sources, and steps to be taken to help ensure full compliance. Step Two Forecast for the Future Identify property that may be considered potentially escheatable and due to be reported with the next cycle. Property may have been tagged as being potentially due at a future date as part of the initial compliance efforts. If yes, review the tagged transactions to verify that they remain unclaimed and conduct outreach efforts to reunite the property with the rightful owner. If not, review your accounting cycles with unclaimed property risk to identify those transactions that have remained outstanding for three to five years (depending on state dormancy periods for those states for which you have exposure). As a best practice, the sooner you can identify transactions that remain outstanding, the better your chances to get the property into the right hands. Step Three Stick to the Timeline If you ve elected to utilize Keane s unclaimed property reporting services, follow the provided timeline closely to ensure files are delivered in a timely manner. Prompt delivery of files to Keane will allow sufficient time to analyze liabilities, prepare due diligence letters, prepare reports and deliver them to the States on time, if not earlier! If you feel you are unable to meet the benchmarks on the timeline, engage your assigned reporting team as soon as possible. If you ve decided to take on the unclaimed property reporting responsibilities internally, start preparing for the next cycle by setting up a time line with deadlines and stick to them! Know when due diligence has to be mailed. Many states have strict deadlines for mailing. For example, Connecticut has to be mailed by December 31 once you ve completed your fall reports, you need to identify your spring population and get the due diligence ball rolling! Know the reporting deadlines. The fall states are easy, they are all October 31 or November 1. But what about those spring and summer states? Those dates are all over the map and may be different depending on your industry. Make sure you know the deadlines and adhere to the appropriate ones. If you fall behind, determine if you can file on time. If not, reach out to the State Administrator and file for an extension. No matter which path you ve elected, numerous situations will arise that may cause you concern in the future. Some common situations include those listed below: What happens if you find new property that is past due? Whether you determined there is a pocket of property that has been unreported or you have acquired another entity with a shaky unclaimed property reporting history, once discovering past due property, you need an action plan. Some states have Voluntary Disclosure Programs, for which you may be able to apply. What if you reported something that you should not have? If, after reporting and remitting the property, you determine that you made an error, you can submit a claim to the state to recover the misreported funds. Generally, you will need to complete the appropriate paperwork and provide the reason it was reported in error (i.e. recent customer activity). In some situations the customer will want you to pay them back, but you ve already sent their money to the state. How do you get your funds back? Similar to above, you can submit a claim for reimbursement to the state. However, it will be necessary to first pay your customer and then submit the forms with the proof of payment, reimbursement or account reactivation. Ongoing compliance is important and requirements constantly change. As such, you need to re-evaluate your policies and procedures at least annually. After you completed your annual reporting, validate that the policies and procedures you have established continue to match your actual practices. The policies and procedures should be a robust, dynamic document which will help ensure compliance and leave less room for fraud. As you can see from above, initial compliance efforts including a risk analysis to identify reportable property and filing of VDA s are the first steps toward achieving ongoing compliance. Your organization needs to stay informed and on top of the everchanging state requirements. You also have to stay organized and one step ahead of pending deadlines. If you fall behind or a situation arises that causes a lapse in compliance, Keane is always here to answer questions and to help get you back on track. 4

5 Unclaimed Property as a Profit Center By Brian Adams, Manager Unclaimed Property Reporting & Bob Murray, Executive Consultant Unclaimed property is typically viewed as a nuisance or just another thing to get in the way of the month end close. As a result of this often myopic perspective, many managers are blind to a potential revenue source that is sitting right under their nose. Many companies do not have the time or expertise to properly analyze their unclaimed property file and identify assets that do not need to be remitted to the states. With a bit of know-how and some in-depth research, these retained assets can become a recurring source of revenue. This revenue can be used to fund operations making unclaimed property a profit center instead of a liability. Keane s Pre-Escheatment Remediation Service can help you recognize the potential revenue in your company s unclaimed property file. Areas of Opportunity In the course of reviewing client escheatment files we encounter a number of conditions that are usually indicative of opportunities to reduce the dollars remitted to states through pre-escheat remediation. Some examples are: Records that will likely meet statutory exemption criteria in those states that offer Business-to-Business and De Minimis exemptions from reporting Large dollar vendor checks or customer credits with corporations that are not lost owners. One would normally expect these transactions to have been resolved between the parties Transactions with affiliates of the holder Payments that appear to be political or charitable contributions Outstanding liabilities from recently acquired companies Our experience has shown that these situations normally exist for a few basic reasons such as: There is always a degree of processing error in any accounting system Duplicate payments stemming from timing of payment and receipt of invoices Lack of systematic controls to identify questionable disbursements or customer credits Insufficient time to follow up on outstanding AR credits and customer refunds Insufficient review of apparent reportable unclaimed property before it is submitted for reporting Knowledge gap regarding unclaimed property statutes As a result, reportable unclaimed property liabilities can be reversed through an ongoing remediation process. Depending on company size or number of transactions, these reversals can be substantial enough to offset or exceed the cost of an unclaimed property compliance program. Keane s Pre-Escheat Remediation Process It must be recognized that remediation is not a simple undertaking. Exemptions, accounting errors and anomalies cannot be assumed. Claiming exemptions requires a thorough understanding what qualifies based on the unclaimed property statutes of each state. Accounting errors and anomalies must be identified through a review of supporting documentation for each transaction. Also, the work must be performed in advance of due diligence mailing dates because not all records being reviewed will result in a reversal or reissuance of the check or credit. 8

6 The remediation process normally starts by establishing a dollar threshold for the transaction review. This threshold may vary based on the type of transaction. Accounting systems are then leveraged to examine supporting documentation for all selected transactions. The objective is to establish the reason a transaction remains outstanding based upon the company s books and records. This review may immediately qualify a transaction for reversal. Some common reasons are: Duplicate Payment Outstanding credit not matched against debit taken by customer Payment or credit to the wrong vendor or customer Payment or credit that involves no consideration received from the other party such as donations or credits issued as customer accommodations Payment of an invoice sent by a customer in error Transaction with an affiliated entity To the extent the reason a transaction remains outstanding cannot be established from the company s books and records, it is necessary to reconcile the items with vendors or customers. The process here involves outreach to the other party by telephone, letter, or that requests the status of the transaction on the books of the vendor or customer. Although internal research provides immediate explanations to reverse a check or credit, outreach will result in both reversals and requests for payment. In all cases, the results of internal research or outreach to vendors or customers should be fully documented to support the resulting accounting entry. In the event of a state unclaimed property audit, the auditor will likely challenge the removal of the check or credit from the reporting database. Our experience remediating unclaimed property liabilities for clients has been positive. Statutory exemptions will be available to almost any holder that does not have an existing program for B2B or DeMinimis transactions. Reversal rates based on dollars reviewed have historically been around 50% for vendor checks and 10-15% for customer credits where internal research and outreach are employed. Interested in learning how much untapped revenue lies within your unclaimed property records? Contact us for an initial consultation at Questions@KeaneUP.com. 9

7 Litigation Update By Heather Gabell, J.D., Director, Unclaimed Property Compliance The Time Has (Almost) Come Justice Alito saw it coming last year. Though the Supreme Court declined to hear Taylor v. Yee, an unclaimed property case involving an alleged violation of due process on the part of California in providing owners with adequate notice prior to the escheatment of their property, Justice Alito voiced his concerns in his concurring opinion with Justice Thomas.¹ Taking note of the trend towards shorter dormancy periods combined with the states doing less and less to meet [their] constitutional obligations to provide adequate notice, he predicted that these trends may merit review in a future case. ² Echoes of the Past On September 16, 2016, Plains All American Pipeline L.P. appealed to the Third Circuit Court of Appeals after a Delaware court dismissed its claim that the information requested by Kelmar, as auditor for the state, including for information regarding its out of state subsidiaries, constituted an illegal search and seizure and also challenged Kelmar s use of estimation.³ The lower court held that the case was not ripe, as Kelmar had merely threatened the use of estimation. Marathon Petroleum Corp. also filed an appeal on November 2, 2016 in the Third Circuit, alleging, among other things, that a 2007 audit request by Kelmar of 26 years worth of records and its use of estimation was overreaching and constituted an illegal search and seizure. 4 Score One for the State On January 23, 2017, the Minnesota Court of Appeals ruled in Marathon Petroleum Corp. v. Cook that the escheatment of unclaimed funds did not violate due process rights, nor did it constitute an unconstitutional taking. 5 In this case, a group of property owners claimed that the state had violated their rights to due process by failing to provide them with adequate notice. The court disagreed, stating that notice was reasonably calculated as set forth by the Supreme Court in Mullane v. Cent. Hanover Bank & Tr. Co. 6 The holder had provided notice by mail and the state by publication and posting on the Internet. 7 The state had additionally maintained a record of property owners that the public had the right to inspect. The Minnesota Court of Appeals also cited Dani v. Miller, 8 in which the Supreme Court rejected an argument that the state s seizure of property constituted a taking, declaring that the assumption of custody by the state was attributable to the inattention or abandonment of the owners. 9 MoneyGram Looks to Bow Out In October 2016, the United States Supreme Court agreed to hear the MoneyGram cases, 10 which, as consolidated, pit Delaware against a grand total of 23 states. MoneyGram Payment Systems, Inc., caught in the middle of an interstate dispute over which state is entitled to the $162 million in uncashed official checks it originally remitted to Delaware, recently petitioned the United States Supreme Court to allow it to bow out of the dispute and allow the states to fight it out to free it from liability funds already escheated under the priority rules set forth in Texas vs. New Jersey

8 Because the addresses of the purchasers of the official checks were not recorded, MoneyGram had escheated the funds to Delaware, as its state of incorporation. MoneyGram had previously sought guidance from Delaware, alerting the state to the fact that other states were treating the checks as money orders and other similar written instruments expecting that they be escheated to the state of purchase, pursuant to the requirements of the Disposition of Abandoned Money Orders and Traveler s Checks Act of MoneyGram was instructed by Delaware to escheat them to Delaware. Citing the increased aggressiveness of the states in their enforcement of unclaimed property laws and their reliance on the resulting increased revenue streams, MoneyGram maintains that it is the holders that are caught in the middle as the states fight amongst themselves to earn the right to assert themselves as custodians of the unclaimed funds. 13 Delaware Developments Perhaps in response to the volume of litigation, and as the Revised Uniform Unclaimed Property Act ( RUUPA ) gains steam, Delaware sought to overhaul its unclaimed property law and provide holders with guidance with respect to record retention and audit enforcement with the introduction of Senate Bill 13 on January 12, 2017 (refer to our complete breakdown of DE SB 13 on p.2 for greater detail). An amended version of the bill passed both houses and was signed into law on February 2, 2017, effective immediately. How Delaware s new unclaimed property act will affect the outcome of the cases outlined above and other future claims by holders remains to be seen. The new law provides for a 10 year lookback period for audits based on the year an audit notice is mailed to the holder and requires that holders retain their records for 10 years. The state can continue its use of estimation techniques, including extrapolation and statistical sampling. However, by July 1, 2017, the Secretary of State and Secretary of Finance must promulgate new regulations regarding these estimation techniques. Under the new law, holders are able to convert existing audits to voluntary disclosure agreements or seek expedited audits, though they would need to opt in within 60 days of the adoption of the estimation regulations. 1 Taylor v. Lee, 136 S. Ct. 929 (2016) 2 Id at 929, Plains All American Pipeline, L.P., Plaintiff, v. Cook and Kelmar 2016 WL Marathon Petroleum Corp. v. Cook, No LPS (D. Del. Sept. 23, 2016) 5 Timothy Hall, Jr., et al v. State of Minnesota, et. al 62-CV , 2017 WL , p U.S. 306, 314, 70 S. Ct. 652, 657 (1950) 7 Hall at P. 3d Id. at Delaware v. Pennsylvania and Wisconsin, Supreme Court Docket No. 22O145 (May 31, 2016) and Arkansas, et al. v. Delaware, Supreme Court Docket No. 22O146 (June 13, 2016) 11 Brief of MoneyGram Payments Systems, Inc. in Opposition to Motion for Leave to File Bill of Third Party Complaint, Supreme Court Docket No. 22O145 (filed December 28, 2016), Texas v. New Jersey, 379 US 674 (1965). 12 Brief of Amicus Curiae of MoneyGram Payment Systems, Inc., Supreme Court Docket No. 22O145 (filed July 6, 2016) at p Id. at p

9 Unclaimed Property Considerations for Companies with Large Subscriber Populations By Sara Lima and Freda Pepper, Reed Smith LLP Companies with large subscriber populations are faced with their own unique set of unclaimed property challenges, often due to the sheer volume of transactions, regulatory bureaucracy, and complex merger activity. Telecommunications companies, utility companies, cable and satellite companies, streaming media organizations; broadband providers, music downloading companies and software providers are all examples of entities with a high customer base. The population of subscribers as well as the number of transactions associated with them is often so voluminous that compliance becomes burdensome and difficult. Several issues are commonplace among these companies. Due to the large volume of customers, all experience the administrative burden of tracking down customers that move residences and do not notify the company of updated address information, thus leading to a high volume of potentially escheatable property. Further, companies with numerous subscribers tend to have a multiple sources of unclaimed funds including unclaimed rebates, refunds, prepayments, credits, or deposits which make both compliance and responding to audits complicated and onerous. In some industries, the consolidation and regulation history causes significant decentralization and merger and acquisition activity is typically high. Managing the integration of the new company into the existing unclaimed property reporting process can be burdensome and difficult to do as well. And there is also the ever-increasing landscape of federal and state regulation, which can oftentimes appear to conflict with state unclaimed property concepts. While there is a wealth of topics available, this article focuses on issues involving particular types of property those either especially prevalent among or unique to largesubscriber companies. Unidentified payments Not surprisingly, companies with a large subscriber or customer base receive large volumes of payments. Payments typically flow through a specified work process, such as through a lock-box and processing center, in order to be applied to the correct customer account. Inevitably, however, these companies will receive some payments that cannot be readily identified to any given invoice or account. Such payments are often designated unidentified or unapplied payments and may be booked to a specified general ledger receivables account. Several state statutes delineate unidentified remittances as a type of property that could be subject to escheat. 14 As a result, states may claim on audit that all amounts booked to an unidentified or unapplied payments general ledger account constitute unclaimed property. These receipts will often find their way onto a remediation schedule, simply because the company cannot match the payment received to a specific invoice or obligation. The very nature of these unidentified transactions means it is usually very difficult to find information regarding the amounts. Though an unidentified remittance may constitute unclaimed property, companies may be entitled to the presumption that it does not. Courts have held that the payor of a check is presumed to owe the funds to the payee. That is, where a check is made payable to the company under audit, the check itself constitutes prima facie evidence of a liquidated and certain obligation owed to the company. 15 Indeed, auditors routinely rely on this rule to their benefit. Auditors claim that the burden is on companies that write checks to prove that any unpresented payments that they themselves issue are not owed that the payments were 12

10 issued in error. The states may cite the rule that if a check has been issued, it is presumed to represent a debt owed. Where the company under audit is the payee, therefore, the funds must be considered to have been received in payment for goods or services rendered. That is, the burden is on the state to prove that the payment is not owed to the company, and that it was received in error. For this reason, companies who routinely escheat unidentified remittances as unclaimed property should consider filing for a refund of those amounts, and companies under audit should defend against any requests for information concerning such accounts. 16 Another strategy to handle unidentified remittances involves comparing the unidentified amounts to bad debt write offs for the same period, to compute a more accurate net amount of payments potentially received in error. Finally, companies should revisit their Accounts Receivable policies to ensure that any process related to unidentified payments appropriately considers potential unclaimed property consequences. Rebates and Incentives While much has been written concerning whether promotional property should be subject to escheat at all, often the most cumbersome issue when it comes to unclaimed rebates involves who is responsible to report them, to the extent they are reportable. Companies, especially those with a large volume of consumers, often contract with rebate fulfillment companies to manage all aspects of the rebate process. In a typical third-party rebate fulfillment situation, the funds associated with the rebate process are transferred to a third party administrator (TPA). The TPA becomes responsible for paying out all rebates to rebate claimants, and rebate checks to claimants are made out and drawn from TPAs own bank account. The sums represented by uncashed rebate checks are retained by the TPA. And, often the TPA takes on all responsibilities with respect to escheatment including reporting the uncashed rebate checks (known as slippage) as unclaimed property. States and auditors all but assume that the original issuer of the rebate the rebate sponsor is the holder of any unclaimed property. But this question is far from settled law. Courts have skirted the issue of which holder is obligated to report property in multi-party arrangements. In Fitzgerald v. Young America Corporation, et al., No., CV 6030, Jan. 5, 2009, for example, in interpreting Iowa law, the court found that there was an issue of fact as to whether the rebate sponsors could be considered the Holder of the unclaimed rebate liability merely because they were in possession of the funds from the uncashed checks. As the parties settled the matter, the issue was left open and unanswered. Similarly, in A.W. Financial Servs., S.A. v. Empire Resources, Inc., No. 07 Civ (SHS)., 2010 BL (S.D.N.Y. Sept. 30, 2010), in interpreting Delaware Escheats Law to determine whether the issuer of stock or the transfer agent was afforded immunity for escheating stock in good faith, the District Court indicated that Delaware s statutory scheme left open the possibility that multiple holders may have a duty to escheat property, but did not address which one. Finding an issue of fact, Defendant s Motion to Dismiss was denied and the issue as to which party was the holder was not addressed. Once the rebate program is transferred to a TPA, it may more appropriately be the TPA who should be considered the holder for purposes of unclaimed property pursuant to both a statutory and policy perspective. For example, the 1981 version of the Uniform Unclaimed Property Act defines the holder as the entity (1) in possession of property that belongs to another, (2) a trustee, or (3) indebted to another on an obligation. One party in the arrangement may be in possession of the property, while another may be indebted on the obligation. 14 See Revised Uniform Unclaimed Property Act (RUUPA) of 1995 at Sec. 1(13); RUUPA of 2016 at Art 1, Section 102(24). 15 See e.g., Revenue Cabinet v. Blue Cross & Blue Shield of Kentucky, Inc., 702 S.W.2d 433, 435 (Ky. 1986); Blue Cross of Northern Cal. v. Corey, 120 Cal.App.3d 723, 174 Cal.Rptr. 901 (1981); Treas. and Rec. Gen. v. John Hancock Mut. Life, 446 N.E.2d 1376 (1983); and Louisiana Hospital Service, Inc. v. Collector of Rev., 293 So.2d 663 (La.App.1974). 16 There may be risks associated with taking this legal position, and for that reason, we recommend companies consult with legal counsel prior to asserting it. 13

11 The Supreme Court, in Delaware v. New York, 507 U.S. 490 (1993), made it clear that determining the precise debtorcreditor relationship is the fundamental consideration in deciphering who is the holder for purposes of unclaimed property as the property interest in any debt belongs to the creditor, making the debtor the holder. In that case, securities had been transferred from the issuing corporations to intermediaries who held the securities in their names on behalf of the stockholders who could not be identified. Because the intermediaries were in possession of the securities, they were determined to be the debtors and therefore deemed the holder in the matter. The Court held the issuers could not be considered debtors once distributions were made to the intermediaries since payment to a record owner discharges all of an issuer's obligations to the beneficial owner. While Delaware v. New York indicates that the party indebted on the obligation should be considered the holder, the Court has not yet addressed the situation where the indebted party is not in possession of the funds. Further, under some states laws, parties are permitted to transfer certain rights and duties under a contract, without the other party s consent, such that the TPA may be the appropriate debtor under applicable law. 17 As a matter of policy, it would make sense for the party in possession of both the funds and the information to be responsible for unclaimed property reporting. In many TPA engagements, it is the TPA that is both in possession of any amounts attributable to uncashed rebate checks and the only party who can readily identify claimants and unclaimed amounts. And usually, the TPA is the party who can most easily reunite claimants with their uncashed rebate sums. Thus, the TPA can be considered to have fulfilled the requirements of a holder as defined by the Act, and this construction would also further the policy goal of reuniting consumers with their property. In short, it is not a given that the sponsor of a rebate program is the holder of unclaimed property. That said, many states certainly treat this issue as settled, and thus companies that use TPAs to issue rebates should revisit their contracts to ensure that they are adequately protected in case the TPA underreports. Refund Cards Companies with many subscribers often accept prepayments either in the form of deposits, monthly access fees, or other charges. Due to cancelled or dormant accounts, refunds are a necessary property type encountered by these companies. Similar to rebate programs, companies often enlist a third party to undertake the refund process. While many companies issue refund checks, there recently has been a transition to prepaid refund cards issued by banks. Banks that serve as third-party vendors may offer to issue prepaid cards for no cost, eliminating the internal expense of processing checks for those amounts. However, where banks charge fees or provide expiration terms on the cards, this could create a risk for the company issuing refunds. States could view the company as the obligor on the debts, even where the card itself is issued by a third-party bank, especially where the consumer does not expressly consent to the transfer of the obligation. Certain federal and state laws limit or prohibit expiration dates and dormancy fees that can be charged on prepaid cards. Many states seek the escheatment of the full purchase price of the card, despite the dormancy fees or expiration dates. As a result, the mere imposition of expiration or dormancy fees on a refund issued in the form of a prepaid card may not reduce the amount of property that the states consider escheatable. While federally-chartered banks are subject to various federal regulations, and thus may be permitted to charge fees on cards that they issue, states may not respect such charges where the funds are originally owed by non-bank entities. Stated differently, administrators are unlikely to accept a reduction in unclaimed property just because a bank has become involved in the process of issuing the refunds. Delaware takes the position, both in litigation and in recent legislation, that a transfer of an obligation to a third-party will not relieve the transferor of its unclaimed property obligation and may even subject the transferor to severe penalties. 18 Before finalizing third-party card arrangements, companies must consider that a state would take the position that the company itself would be held responsible for any amount that its third-party vendor fails to remit as unclaimed property (plus penalties and interest). Most importantly, companies need to address indemnity issues associated with a bank taking over unclaimed property compliance and the risk of a state pursuing the company despite the transition of the program to the bank. Other issues to consider involve clarifying the terms for providing refunds with consumers, understanding legal restrictions on transferring obligations, and consistently reevaluating the engagement in light of legal developments. 14

12 Prepaid Phone Cards Prepaid phone cards are not specifically addressed in most state unclaimed property laws, but can fall under several different broad property types such as prepayments or gift certificates. The few states that do address prepaid phone cards expressly do so by excluding them in the definition of gift certificate. In several states, gift certificates are exempt from unclaimed property, such that prepaid phone cards may be removed from escheatable populations as well. Alternatively, issuers could argue that only the services offered by the prepaid phone cards are escheatable based on the derivate rights doctrine. Under the derivative rights doctrine, a state s right to property cannot be greater than the right of the owner. 19 Prepaid phone cards are redeemable for services only. Therefore, since the owner is not entitled to cash, there is no obligation to escheat cash. If anything, there may be an obligation to escheat only the services (minutes) left on the card. 20 Prepaid phone card issuers likely have several other arguments in defense of escheating the face value of such cards, including that such escheatment is prohibited by the Takings and Contract Clauses of the United States Constitution, and that escheat of certain telecommunications services is preempted by federal law. 21 In short, even in those states where prepaid phone cards are not expressly addressed, arguments exist for excluding them from escheat. For example, relying on gift card exemptions could be a strong basis for withholding prepaid calling cards from escheat. Furthermore, the reasoning applied in Grayson is available, although the facts of the case were limited to California law. In addition, while generally not accepted by the states, the derivative rights doctrine should prevent escheatment of cash where customers are only entitled to access to particular services. At the very least, holders may not need to escheat the full face value of the unused balance on the card, but some lesser amount that incorporates the holder s right to profit. In short, while companies with a large subscriber base have much to think about in the unclaimed property context, particular property types deserve additional focus. This is especially true in the context of contracting with third-party vendors. In the audit context, companies should consider the nuances of escheat law the burden of proof, the definition of holder, and the derivative rights doctrine for example before agreeing to any auditor-determined liability. Sara Lima Freda Pepper 17 See Smith v. Cumberland Grp., Ltd., 687 A.2d 1167, 1172 (Pa. Super. 1997). 18 State of Delaware ex rel. French v. Card Compliant LLC, et al., C.A. No.: N13C FSS [CCLD] (Del Sup. Ct. Nov. 23, 2015); Delaware Senate Bill 13 signed 19 Delaware v. New York, 507 U.S. 490 (1993); Blue Cross of Northern Cal. v. Corey, 120 Cal.App.3d 723, 174 Cal.Rptr. 901 (1981). 20 See State ex rel. Grayson v. Pacific Bell Telephone Co., No. 02-AS (Cal. Super. Sacramento County, Dec. 10, 2004), aff d, No. C (Cal Ct. App., Aug. 31, 2006) (holding phone card breakage not escheatable where customers have no right to refund). See also, District of Columbia v. AT&T Corp., Case No CA B (D.C. Super. 2009) (permitting settlement whereby defendant transferred phone card minutes themselves to the District of Columbia to satisfy purported escheat obligation. 21 See e.g., Service Merchandise Co., Inc. v. Adams, No III, 2001 WL (Tenn. Ch. Ct. June ) (it is unconstitutional to require an issuer of gift certificates redeemable for merchandise only, to report cash in lieu of merchandise). 15

13 The Financial Technology Industry and Unclaimed Property: A New Industry with New Challenges By Ann Fulmer, Director, Consulting With an increased reliance on electronic communications and internet-based applications to conduct financial activities, the Financial Technology (or also known as FinTech) industry has been growing by leaps and bounds since the early to mid-2000 s. Given the relative newness of the industry and the intrinsic dormancy periods associated with unclaimed property, those in the FinTech industries are just now learning the potential exposures related to unclaimed property the hard way. As many know, the FinTech industry is defined as an industry that conducts the vast majority of its business through electronic communications, with a focus on providing financially related services, such as investments, payment facilitation services, lending, and banking. Challenges are most apparent in two areas, the lack of traditional outstanding checks and the lack of traditional mail. Throughout this past year, Keane noted several third-party audit organizations focusing their efforts on companies that operate within the FinTech industry. This can create many unknowns for both the auditors and the companies given the FinTech industry doesn t have the traditional records and exposures auditors and states are accustomed to seeing. Challenges are most apparent in two areas, the lack of traditional outstanding checks and the lack of traditional mail. In order to address these two concerns, FinTech companies need to employ proactive measures so that, when the auditors come knocking, they re prepared to answer their questions and have the ability to defend their clients assets from being considered reportable property. Establish a Sound Foundation First and foremost, FinTech companies should document the procedures surrounding their disbursement activities. If the company maintains strong positions against the issuance of checks and requires all distributions to be made through ACH, EFT s, or wires, it should be documented within its unclaimed property procedures. While electronic distributions of funds could pose a very narrow risk for unclaimed property, they re typically resolved as soon as the delivery failure is identified. Companies should document the steps taken to identify and research failed deliveries and maintain records to support such activities. 16

14 Is a Bounce the New RPO? The second risk could have a material impact on FinTech companies that offer financially-related services. Most state unclaimed property rules include language linking the identification of unclaimed property to owners that are considered to be lost, as defined by the return of mail from the US Postal Service. This could be especially cumbersome for companies that rely solely on the delivery of account owner communications through and customers logging onto online accounts. To address this concern, Keane recommends that FinTech companies develop procedures to monitor accounts for bounced s. If an communication is returned as undeliverable, communications to the account owner should revert to traditional mail. If the traditional mail is returned as undeliverable the account should then be considered potentially lost. Keane also recommends employing pop-up messages or other prominent calls to action, which would appear when an account owner logs into their account, on all accounts for which was not delivered successfully. Account owners would be required to update their addresses and confirm their contact information before gaining access to their account information. If an account owner fails to update their address and fails to log onto their account during the prescribed state dormancy periods, auditors may consider the accounts to be potentially lost. It is important to remember to continuously monitor client accounts for online activities and to update client accounts so that active accounts are not improperly tagged as reportable. While Keane agrees that bounced s could represent accounts at risk of being considered lost, some third party auditors are also challenging the premise that successful delivery of communications confirms that an account owner is NOT lost. To help support the position that the successful delivery of to a client is indicative of an account owner not being considered lost, Keane recommends that FinTech companies also track client activities resulting from the , such as downloading documents or following a link to a company website. This additional activity could provide adequate support to contend that the account owner is aware of their accounts and that they re actively monitoring account activity. While the third party auditors may be challenging this premise, many states are starting to recognize the importance and predominance of communications. For example, Pennsylvania recently implemented revisions to it unclaimed property statute that allow for the electronic delivery of state mandated due diligence for those clients that indicated that was their preferred method of communication with the company. With more and more customers electing electronic communications, third party auditors should also recognize the successful delivery of electronic communications as an indication that the account is not lost. The FinTech industry represents a new frontier for both financial services firms and auditors. As with any industry facing the scrutiny of an unclaimed property audit for the first time, the auditors will be looking to survey the landscape and gain a greater understanding of how these organizations operate. Because this is a new industry for them, they may look to learn on the job to see what potential areas of unclaimed property exposure or liabilityexist and thus, how they can apply traditional tactics and methods to a non-traditional organization. FinTech firms that have not yet received an audit notice should be aware and begin to get their houses in order. 17

15 Industry Updates Broker Dealer-Mutual Fund Industry Update Ann Fulmer Director, Consulting What did we see in 2016? As Keane anticipated, strong compliance initiatives continued throughout the Broker-Dealer and Mutual Fund industries in Companies continued to expand and solidify their policies and procedures to capture account owner generated activities to protect accounts from being considered escheat eligible, while at the same time the states and third party auditors continued to expand and modify their definition of what they considered to be reportable accounts. As a result, Keane expects compliance initiatives to remain a significant concern for the broker-dealer and mutual fund industries throughout With the expanded mandates of SEC Rule 17Ad-17 now well established within most organizations, companies are focusing on steps to ensure that the information yielded by the 17Ad-17 search and notice process is integrated with their unclaimed property considerations to prevent accounts from being considered escheatable. Accounts, for which returned mail was received, are being actively researched to identify current addresses; and outreach is being conducted to verify the validity of those addresses, thus resulting in fewer accounts being considered lost. Companies are also taking steps to identify account owners with outstanding uncashed checks in a timelier manner. Outreach efforts are being conducted to contact inactive account owners to reestablish activity on their accounts as demonstrated by actual check cashing or establishing procedures to automatically deposit the distributions directly into the client accounts. In addition to the integration of expanded 17Ad-17 procedures with those for escheatment, companies are continuing to develop and implement systems to capture all forms of client initiated contact through automated processes. Though cumbersome and expensive due to the integration of data points from multiple and often disparate systems and lines of business, the outcome of the process in most cases has proven extremely successful in protecting and preserving client accounts. Despite the efforts taken by companies to ensure the proper identification of lost and inactive account owners, the states continue to change the rules of the game regarding escheatment. For example, the state of Minnesota is actively departing from its own statutory language regarding accounts coded for dividend reinvest. Delaware, as another example, recently indicated that the non-return of 1099 s mailed to account owners with a foreign address (with social security numbers) would not constitute activity on an account in the same manner as it would for an account owner with a last known address in the domestic United States. Disparities and incongruities such as these continue to make it extremely difficult for companies to build reliable and predictable systems to identify and research at-risk accounts. 18

16 What do we expect for 2017? While 2016 was a very challenging year, Keane expects to see the third party auditors expand their presence even more in the mutual fund, broker-dealer and transfer agent sectors. We ve already seen evidence of third party auditors initiating mutual fund audits on behalf of the state of Maryland. This is extremely significant given that many mutual funds are incorporated in Maryland, along with Massachusetts and Delaware, with unknown address accounts considered to be reportable according to the fund s state of incorporation. We also expect to see the states continue to challenge the requirements defined in their own state laws in an effort to expand their reach into accounts previously protected by dividend reinvest provisions. While many state laws currently link the escheat eligibility of dividend reinvest accounts to lack of activity in a non-dividend reinvest account, the states still consider them to be reportable mostly on the premise of inactivity only. The states are also expected to continue to modify how broker-dealers should report customer accounts. For example, most broker-dealers now report client accounts considered at the account level rather than by the individual positions that comprise each account. In light of the unique features of broker-dealer accounts, we continue to see evidence that some states are increasingly advocating that brokerdealer accounts should be considered within the catch-all provisions of their laws in broader attempts to enforce inactivity-only dormancy criteria. The states are also expected to continue their emphasis on the identification of deceased account owners in an effort to claim IRA accounts prior to age 70.5, and to identify nonretirement accounts they consider to be inactive as a result of death. With the establishment of strong procedures to capture client activity, the identification of inactive deceased account owners will likely become an anticipated and expected aspect of compliance. It is also important to note that while death, in and of itself, is not a stated trigger for escheatment in any current state laws or regulations regarding securities, the states continue to advocate in favor of DMF matching as a means to identify deceased-inactive and reportable accounts. Keane s recommendations for 2017 conduct a full scale risk assessment to verify that the criteria utilized to identify at-risk accounts as inactive or lost is based on parameters generally accepted by the states across all account types, including those historically considered as exempt from reporting. This effort will ensure that client accounts are protected from escheatment in the event of an audit, as well as the result of the ever-changing statutory landscape. Debbie L. Zumoff, J.D. Chief Compliance Officer & National Consulting Practice Leader 19

17 Industry Updates Insurance Industry Update Paul MacCready Director, Insurance Solutions What did we see in 2016? Given the vast unclaimed property turmoil through the insurance industry in recent years, 2016 was relatively quiet. Although 60 Minutes made an attempt in April to restart a fire from the smoldering coals of the DMF debate, the most interesting thing to come of the segment was the statement that $7.5 billion in payments to beneficiaries had been made. Countless numbers of bills were introduced in 2016 within state legislatures and at least twenty-one of them had some association with unclaimed property and insurance. As of the end of 2016, 24 states had passed UP regulations regarding life insurance benefits, with 4 leaving bills pending. Nebraska, Oklahoma, Texas, and Hawaii all introduced new legislation impacting insurance since the start of What had become common place in the insurance arena has now become rare: California press releases. California now lists twenty-seven agreements on its website ( Protecting Life Insurance Beneficiaries ) and also makes note on that same page of the three lawsuits over records that were filed in The point being that discussion about unpaid policies and the use of the DMF has moved far off the front page and almost out of the news entirely (CBS not withstanding). There are still disputes, especially for companies engaged in an active audit, but the industry isn t facing the same kind of public relations pressure and scrutiny as in past years. The focus is shifting to the act of compliance rather than its perception. The insurance industry s interest in the Revised Uniform Unclaimed Property Act (RUUPA) came mainly in the definition of dormancy. The provisions of the new model act mainly follow those of the 1981 version stipulating knowledge of death as the dormancy trigger date. What do we expect for 2017? The future? At one point it seemed a foregone conclusion that every state would enact some version of DMF matching. While the list continues to grow and with it being clear that the majority of states will eventually have some form of requirement, there is less of a hurry by the remaining twenty-one to join in. The issue that could attract greater attention in the future is the quality of the compliance mandated beneficiary outreach. Most new statutory wording requires a good faith effort be made where companies must go beyond their books and records in their attempt to identify and then contact beneficiaries. We know that states have asked questions about success rates, but there are no explicit requirements about success rates yet! 20

18 Banking Industry Update What did we see in 2016? As expected, 2016 brought additional audit activity to the banking industry. There continued to be an increased focus on what does or does not constitute customer generated activity and on how that activity can be sufficiently documented. Generally, the states focused on the dormancy triggers in their statutes in a manner that causes property to become eligible for reporting and remitting earlier. Depending upon property type and state, dormancy can begin on the date of last customer contact or the date mail is retuned from the post office (RPO). As a result, auditors typically looked into how information about both customer activity and RPO were tracked and documented. The most ambiguity surrounding activity is related to electronic activity. Most state laws do not specifically address recurring debit or credit transactions. California amended its unclaimed property law in 2016, effective 1/1/2017, to add some clarity on this issue. Specifically, the amended law allows the following transactions that are initiated electronically and are reflected in the books and records of the banking or financial organization as evidence that an owner has increased or decreased the amount of the funds or deposit in an account, to serve as activity: 1. A single or recurring debit transaction authorized by the owner Pamela Wentz Director, Consulting 2. A single or recurring credit transaction authorized by the owner 3. Recurring transactions authorized by the owner that represent payroll deposits or deductions 4. Recurring credits authorized by the owner or a responsible party that represent the deposit of any federal benefits, including social security benefits, veterans benefits, and pension payments There was also increased usage of the death master file (DMF), especially in audits of IRAs. The auditors matched social security numbers from the owners of the IRAs to the death master file so they could start the dormancy clock prior to the owner reaching the age of mandatory distribution (i.e. age 70.5). For other types of deposit accounts those matches were used to identify potentially inactive accounts. Some states also showed a renewed interest in financial institution service charges. The focus was on ensuring there was a valid contract in place, the fees were reasonable, and dormant accounts were not being discriminated against (e. g. Fees assessed only against accounts that were reported/remitted to the states as unclaimed property). What do we expect for 2017? We expect the number of audits to increase in 2017 as more third party auditors expand into the banking industry; this will likely result in more challenges about the types of transactions that can be considered customer generated activity. It is possible that some states may follow California s lead in regard to allowing recurring electronic activity; but it is not likely as that is the type of activity that many auditors are challenging. It is also likely that there will be an increase in the usage of the DMF file as auditors continue to expand its application to additional property types and industries. Even though there is still much debate as to whether it is appropriate to use the DMF in unclaimed property audits, auditors have discovered its use can produce faster and more robust results while streamlining testing. 21

19 Industry Updates Oil & Gas Industry Update Quin Moore Senior Consultant What did we see in 2016? As was the case with 2015, 2016 continued to be a busy unclaimed property year for oil and gas companies. Many companies are continuing to work through the Delaware Secretary of State s voluntary disclosure (VDA) process, while others have completed the process, and still others are just getting started. Most companies under audit by Delaware saw a slow down as the state worked through several issues raised by the Temple Inland decision; however, audits conducted by states other than Delaware remained steady and may have even increased. Notably, Texas appears to be taking advantage of the high number of oil and gas companies within its borders by initiating a number of audits. Oil and gas companies adjusted to new reporting requirements in Texas, Arkansas and Oklahoma, which require holders to report additional property-specific well information (legal description, county, section, range, township, etc.) on their annual unclaimed property reports. Generally, more companies started paying attention to past due royalties held in suspense during the due diligence phase of an acquisition. Companies were more apt to ask for accommodations or adjustments for past due suspense and potential interest that could be assessed by states as a result of reporting the property late. Other companies have refused to include past due suspense in the acquisitions. What do we expect for 2017? In 2017, we expect to see more activity in the state of Delaware. We are already seeing the return of audit activity, as the state is trying to close old audits by either putting them on a fast track or moving them into the Secretary of State s VDA program. We are also expecting a rise in the number of VDAs and audits as the state invites more companies to sign up for its VDA program. We expect other states to remain active in the audit arena as well. Auditors typically have some success in identifying old unclaimed royalties in suspense accounts. As long as this is the case, we expect to see audit activity increase. More states may adopt the new reporting requirements which require holders to report additional well-specific information. While it is not necessarily an easy requirement for oil and gas companies to comply with, it can help royalty owners claim royalties from the states and potentially better allocate the funds for the public s benefit. For example, Virginia recently introduced a bill on January 20, 2017, that would make presumed abandoned proceeds of certain oil and gas wells available to the school board nearest the drilling unit. Companies will likely continue to pay closer attention to past due suspense during acquisitions. As more states start assessing interest on unclaimed property that is reported late, past due suspense will become more of a liability to acquiring companies. As oil and gas companies continue to become better educated in unclaimed property, they would be well advised to implement more comprehensive reporting procedures that include all potential types of unclaimed property in addition to the focus on suspended royalties. 22

20 VDA & Enforcement Industry Update What did we see in 2016? As predicted, there was much in the way of audit activity in While many Delaware audits stalled or had open audit requests temporarily rescinded due to the Temple Inland decision, other state audits did not slow down. Additionally, many of the smaller firms continued to grow by adding auditors and by signing contracts with additional states. In spite of the growth, it was still not uncommon for a company to be audited by a third party auditor representing one or two states; nor was it uncommon for a company to be under audit by more than one third party auditor representing different states. The year 2016 also saw more questions than answers. While the Delaware response to the Temple Inland decision slowed the speed of the Delaware audits, the state did not alter its estimation methodology. Voluntary compliance initiatives continued to be fluid. While most states still offered some type of voluntary compliance initiative, the requirements for acceptance into voluntary compliance programs became more stringent. With more audit firms has come the onset of varied methodologies. An increasing number of audit firms attempted to use the practice of death matching, or comparing customer social security numbers against the DMF, in unclaimed property testing. There was also renewed focus on different types of owner generated activity. What constitutes Activity was, and continues to be, scrutinized and debated. Pamela Wentz Director, Consulting What do we expect for 2017? In 2017 we are already seeing the return of audit activity in the state of Delaware. The changes to the Delaware statute have made Delaware more consistent with other states in some regards, such as reach back and record retention. However, the estimation methodology will remain in flux through 2017 based on the requirements outlined in SB 13. We also expect to see continued inconsistency among the states. As the saying goes, the only constant is change. As various states consider changing portions of state law based in part on the latest Uniform Unclaimed Property Act, these changes may most likely impact enforcement efforts and voluntary compliance initiatives. As a result, voluntary compliance initiatives will continue to be fluid. Watch for changing rules and more stringent guidelines about which companies are eligible to participate in state VDA programs. There is also the potential for more fallout from the Temple Inland decision. Many have argued the Temple Inland decision opened the door for all states to estimate liability based on addressed property. To date, there has been no indication if or when states will be increasing their utilization of estimation during audits; but stay tuned! 23

21 Alex Formariz Managing Director, Unclaimed Property Reporting Division Laurie Andrews Technical Director, Unclaimed Property Reporting Division Newly Appointed Directors in Keane s Unclaimed Property Reporting Group We are happy to announce the recent appointment of two new Directors in our Unclaimed Property Reporting Group. Alex Formariz serves as the Managing Director of Keane s Unclaimed Property Reporting division, overseeing annual compliance reporting services for Keane s 400+ reporting clients. Mr. Formariz joined Keane mid-2016, and brings international experience in Public Accounting as well as a focus on Business Development. A native from Spain, Mr. Formariz started his professional career at Deloitte, where he spent 6 years serving global customers in both Europe and America, specializing in Financial Audits and Internal Control over Financial Reporting Compliance projects. Prior to his arrival at Keane, he was the Director of Finance for the US and Canada subsidiaries of Gamesa Technology Corporation, a leading publicly-traded global company in the renewable energy industry. Additionally, Laurie Andrews was recently promoted to the role of Technical Director in the Unclaimed Property Reporting Division of Keane. You may remember Laurie as a Manager in our Consulting and Advisory Services Group, where she previously serviced clients with Risk Assessments, Audit Defense and Initial Compliance Services. Laurie has an extensive background in Unclaimed Property, with over 20 years of experience. In addition to her time with Keane, Laurie was a Division Manager with the State of Pennsylvania s Unclaimed Property Bureau. As Keane s Technical Director, her wide-ranging experience in multiple areas of Unclaimed Property affords her the opportunity to serve our clients in an efficient and effective manner. Spring Unclaimed Property Reporting Reminders As we enter the spring months, Keane would like to provide a brief list of jurisdictions that have unclaimed property reporting deadlines in March and April. Please note, many jurisdictions have separate deadlines for specific property types, such as life insurance proceeds. Be sure to consult your internal compliance staff or contact Keane to ensure the appropriate properties are filed by the required due date. Delaware March 1st New York March 10th Connecticut March 31st Pennsylvania April 15th Florida April 30th Illinois April 30th (Corporations Only) Tennessee April 30th Vermont April 30th Corporate Offices 450 Seventh Avenue, Suite 905 New York, NY P: F: Operations Center 640 Freedom Business Center Drive Suite 600 King of Prussia, PA P: F: E: questions@keaneup.com The content presented in this newsletter represents Keane s understanding of evolving legislation and case law governing unclaimed property compliance up to its publishing date. The content is provided for informational purposes only and should not be considered legal advice or legal opinion. For more information, please contact Debbie L. Zumoff, Chief Compliance Officer, at or via at dzumoff@keaneup.com. Keane 2017 Unclaimed Property. Uncompromising Performance. 24