What Happens to Unclaimed Assets?

Understanding How Funds Are Reported, Held, and Protected Until Claimed

Every year, billions of dollars in unclaimed assets are reported and held for safekeeping under state law. But what happens between the moment a financial account becomes dormant and when the rightful owner submits a claim?

This guide explains the journey of unclaimed assets, from the moment they are flagged as inactive to the point they are claimed—helping individuals understand the process and their rights.

When Does an Asset Become Unclaimed?

An asset is considered unclaimed when there has been no owner-initiated activity or contact for a legally defined period—typically three years in California. During this time, banks, insurance companies, employers, and other financial institutions are required to attempt contact with the owner.

If no contact is made, and the owner does not respond to outreach, the institution is legally obligated to classify the funds as abandoned and report them.

How Institutions Report Unclaimed Assets

The reporting process follows a strict timeline and is governed by California Code of Civil Procedure Title 10, Chapter 7. Key steps include:

Due Diligence Contact Attempt

Before reporting, the institution must attempt to contact the owner via mail or other means. If mail is returned undelivered, or there is no response, the institution moves forward with reporting.

Annual Reporting Deadline

Each year, holders submit unclaimed asset reports, listing:

• Owner’s name
• Last known address
• Type and value of the asset
• Date of last activity

Transfer for Safekeeping

Once reported, the asset is transferred into safekeeping, where it is securely held until a valid claim is submitted and approved.

Safeguarding Unclaimed Assets

Unclaimed assets are not forfeited. They are held in trust until the rightful owner or legal heir initiates and completes a valid claim. These funds are safeguarded and remain available indefinitely, regardless of how much time has passed.

The system exists to ensure that no eligible funds are lost and that individuals can reclaim assets whenever they are ready, provided they can verify ownership.

Common Types of Unclaimed Assets That Are Reported

Assets commonly reported include:

• Dormant bank accounts
• Uncashed checks (e.g., payroll, refunds)
• Insurance payouts
• Trust disbursements
• Escrow balances
• Utility or rental deposits
• Stock dividends and mutual funds

All of these are subject to mandatory reporting after a period of inactivity.

Why This System Exists

The unclaimed asset system is designed to protect consumers and ensure that financial institutions do not retain dormant funds indefinitely. By requiring these funds to be reported and held securely, the law ensures that:

• Consumers have a path to recover their money
• Institutions are held accountable for dormant accounts
• Funds remain accessible to heirs in cases of death or lost contact

What Happens If No Claim Is Made?

Funds remain in safekeeping indefinitely. There is no expiration or forfeiture. Claimants or legal heirs may submit claims at any time in the future.

Summary

Once an asset is flagged as abandoned, it follows a structured and regulated path to secure safekeeping. The purpose of this process is to ensure that every person has the opportunity to recover funds that rightfully belong to them.

If you have received a Notice of Abandoned Assets, it means assets in your name have been reported and are currently being held for you to claim.

For more information or to begin your claim, visit ClaimNotify.org.