Finder's Fees and Unclaimed Property
Last week, a variety of news sources in Ohio reported that the Ohio Department of Commerce (the government entity responsible for the Buckeye State's unclaimed property program) issued a "cease and desist" order to a company that was allegedly charging Ohioans for unclaimed property claim forms. In addition, the claim section of Ohio's "Treasure Hunt" website has been revised to display a prominent disclaimer at the top:
While the relevant section of the Ohio Unclaimed Property Act does not, strictly speaking prohibit private "finder" firms from charging a fee to assist private citizens with the recovery of unclaimed property from the Department of Commerce, it does strictly limit such activities. For example, the Act provides that no agreement to assist with claiming property is valid within the first 2 years after the property has been reported to the state, and the "finder fee" must be registered with the state. In addition, the law has a number of disclosure requirements that specify certain terms that must be in the finder contract.
While we often write about the state's interest in using "unclaimed funds" that it holds to balance budgets and make expenditures, it should perhaps come as no surprise that a number of private parties are also looking to grab a piece of the pie. Agreements with so-called "finder firms" are allowed in many states, pursuant to which the finder agrees to assist a claimant with obtaining his or her money from the state in exchange for a percentage fee. Indeed, in Escheatable's home state of New Jersey, the Unclaimed Property Act allows for a fee of up to 35% of the value of the property. (see N.J.S.A. 46:30B-106).
Of course, states generally charge no fees for searching, claiming and receiving unclaimed property that they hold for the benefit of the rightful owner. That does not mean that all finder firms are shady -- indeed, there are a variety of situations where most of us will gladly pay another to provide a service that we don't have the time, patience or expertise to do ourselves -- but it does mean that a consumer should only enter into such an agreement if he or she understands exactly what he or she is paying for. In the case of unclaimed funds, a finder fee firms (might) provide you with expertise or time (i.e., the they will deal with the the claim process so you don't have to). They are NOT, however, providing you with access to the money; the money is yours. The finder is not "giving" you anything; the relationship is more akin to letting the finder firm mine for gold on land that you own; except, of course, in the case of unclaimed property there are two important caveats:
1. First, if the finder is contacting you, there's money being held for you (in other words, there is likely something of value on your land in our mining example);
2. Second, and more saliently, what is backbreaking and dangerous work in our mining example is usually just filling out a form and sending it to the state.
Everyone is free to spend their time and money how they wish, and everyone has their own individual balance. Just know what you are paying for. In the case of unclaimed funds and finder firms, it is (maybe) time and expertise, not access, that you are buying.
A Claimant may file a claim WITHOUT the assistance of a paid professional finder.The website has also been revised to bar unclaimed property "finder" firms from printing claim forms from the Department of Commerce's website. Apparently, these finder firms operated by searching for and printing claim forms from Ohio's website (a free service provided by the Department) and then "selling" those (free) forms to the individuals identified.
While the relevant section of the Ohio Unclaimed Property Act does not, strictly speaking prohibit private "finder" firms from charging a fee to assist private citizens with the recovery of unclaimed property from the Department of Commerce, it does strictly limit such activities. For example, the Act provides that no agreement to assist with claiming property is valid within the first 2 years after the property has been reported to the state, and the "finder fee" must be registered with the state. In addition, the law has a number of disclosure requirements that specify certain terms that must be in the finder contract.
While we often write about the state's interest in using "unclaimed funds" that it holds to balance budgets and make expenditures, it should perhaps come as no surprise that a number of private parties are also looking to grab a piece of the pie. Agreements with so-called "finder firms" are allowed in many states, pursuant to which the finder agrees to assist a claimant with obtaining his or her money from the state in exchange for a percentage fee. Indeed, in Escheatable's home state of New Jersey, the Unclaimed Property Act allows for a fee of up to 35% of the value of the property. (see N.J.S.A. 46:30B-106).
Of course, states generally charge no fees for searching, claiming and receiving unclaimed property that they hold for the benefit of the rightful owner. That does not mean that all finder firms are shady -- indeed, there are a variety of situations where most of us will gladly pay another to provide a service that we don't have the time, patience or expertise to do ourselves -- but it does mean that a consumer should only enter into such an agreement if he or she understands exactly what he or she is paying for. In the case of unclaimed funds, a finder fee firms (might) provide you with expertise or time (i.e., the they will deal with the the claim process so you don't have to). They are NOT, however, providing you with access to the money; the money is yours. The finder is not "giving" you anything; the relationship is more akin to letting the finder firm mine for gold on land that you own; except, of course, in the case of unclaimed property there are two important caveats:
1. First, if the finder is contacting you, there's money being held for you (in other words, there is likely something of value on your land in our mining example);
2. Second, and more saliently, what is backbreaking and dangerous work in our mining example is usually just filling out a form and sending it to the state.
Everyone is free to spend their time and money how they wish, and everyone has their own individual balance. Just know what you are paying for. In the case of unclaimed funds and finder firms, it is (maybe) time and expertise, not access, that you are buying.