The last major revision to the Uniform Law Commission's Unclaimed Property Model Act was in 1995. Since then, there have been major changes in how businesses operate, the financial products offered, and how they communicate with customers, employees, vendors, and other related parties. For example, many businesses operate solely on the internet, using email addresses to communicate with customers and even remote employees. This change in communication style should be reflected in the unclaimed property statutes, permitting businesses to send due diligence notices electronically through email instead of through US Mail. There have even been new property types since the last revision. There has been some discussion about whether loyalty rewards are unclaimed property or if they should be. Gift certificates are now gift cards which are now moving beyond the physical card to codes to be used online.
The Uniform Law Commission has formed a drafting committee to revise the 1995 Model Act. Drafting committees are made up of commissioners, but have input from observers and other advisors. A new draft model act will be submitted to the ULC after extensive committee consideration. The final decision on whether the draft will be accepted as a model act comes from the ULC annual meeting, where at least twenty states must give final approval.
Patricia Barganier Thorn and Kimberly DeCarrera continue to provide thought leadership in unclaimed property and advocating for our corporate clients by joining the model act revision as official observers. Observers are invited to participate in the drafting committee's discussions and receive full copies of various documents. As official observers, Barganier is able to suggest changes that would benefit the holder community. In addition to email due diligence, Barganier suggests that the model act, and subsequently all reporting jurisdictions, have a consistency of definitions, record retention rules, and audit procedures and appeals functions. Attention should also be paid to de-conflict the state unclaimed property law with various federal laws, especially as they pertain to securities and the CARD Act.
Barganier knows that unclaimed property is not going away for our corporate clients. Our goal is to make compliance easier and to lessen the burden of unclaimed property audits.
Barganier will keep you informed of major developments, as the model act revision process continues.