Total hit $606 million after Minnesota cut back its efforts to find assets’ rightful owners.
The state of Minnesota is holding lost money for Prince, U.S. Sen. Amy Klobuchar, state Human Services Commissioner Lucinda Jesson and a sports columnist so legendary there’s a statue of him outside the Target Field in Minneapolis.
They and 50,000 other Minnesotans are due a piece of the growing mass of unclaimed property held by the state Department of Commerce. The stash includes funds from dormant bank accounts, uncashed death benefits, untouched shares of stock, old utility deposits and treasures from inactive safe-deposit boxes, all of which companies were required to turn over to the state. And, partly because of Commerce’s increased efforts to get companies to turn over inactive assets, the mysterious lost and found has more than doubled since 2005 to a record $606 million.
Most of the money goes directly into the state’s general fund with no strings attached, save for the responsibility to return it if owners are found.
Klobuchar can’t be too hard to find. Jesson works a few blocks away from Commerce in downtown St. Paul. Sports personality Sid Hartman regularly shuffles into the Star Tribune.
So why can’t Commerce find them? It’s not really looking.
“We don’t, as a matter of normal course, go through a list of people that we have and try to find them,” said Emily Johnson Piper, Commerce’s chief of staff and deputy commissioner. “Presumably, people have already tried to find these people and they can’t.”
In a later interview, Johnson Piper said the state is trying to find owners via publicity about unclaimed property and through the website MissingMoney.com.
Notification rules changed
Not everyone thinks that’s enough; in fact, the Legislature has pressed Commerce to do more. William Palmer, a Sacramento attorney who specializes in unclaimed property, thinks states improperly use unclaimed property to prop up their budgets, while violating the due process rights of unknowing owners.
Palmer successfully sued the state of California in 2001 for failing to directly notify owners via a letter and newspaper listings. A federal injunction in 2007 shut down the state’s unclaimed property program and forced the state to rewrite its laws.
“What Minnesota is doing is a feel-good dog and pony show,” Palmer said. “There’s a fundamental constitutional requirement that you notify people before you touch their property.”
Johnson Piper, at Commerce, said she won’t comment on someone’s legal opinion.
“We are a consumer protection agency,” Johnson Piper said. “We take that duty very seriously.”
Commerce is following state law, which places the burden on companies to find customers and business partners who have left money behind. The state used to notify Minnesotans by letter about unclaimed property in their name. Lawmakers changed the mailing requirement from “shall” to “may” in 1986, and then repealed it altogether in 2005, the same year they eliminated the requirement to publish the names of owners of unclaimed property in newspapers.
Commerce is required to spend at least 15 percent of its $725,000 annual budget for unclaimed property on public notification. A key effort involves staffers bringing laptops to events so people can search MissingMoney.com. They hold about three such events a year at grocery stores, the Mall of America and during the Minnesota State Fair, Johnson Piper said.
The department has also sent e-mail alerts to lawmakers to get the word out, she said, and has begun using the Accurint database service to find owners due unusually large sums.
It pays $10,300 a year to link with MissingMoney.com. The national database is run by Xerox State & Local Solutions, a unit of Xerox Corp. that most states use. Xerox makes money on it via website ads although some states, including Minnesota, pay a fee for fast-tracking claims and features such as automatic Social Security number checks, it said.
57,000 people due
While MissingMoney.com features the most up-to-date information for lookups, Commerce provided the Star Tribune with the most recent available copy of the entire Minnesota database, current to the end of 2011. Commerce holds on to the most recent data to give property owners time to find it. The database shows 57,000 people and companies that are owed money in amounts ranging from six figures to a single penny.