Consumer Protection
Legislation Introduced
(From the Treasurer's Office)
Illinois State Treasurer Alexi
Giannoulias is introducing a
consumer protection bill that
will prohibit companies from
charging outrageous fees for
reuniting Illinois residents
with their own unclaimed
property, something they can do
themselves for free.
These so-called "finder" or
"tracer" firms try to locate the
owners of lost Illinois bank
accounts and other funds before
they are turned over to the
Treasurer's Office and listed on
its free, searchable, online
Cash Dash database.
Under current law, finder
firms are not required to
provide any details about the
lost funds - such as the amount
or location of the money - and
are known to charge up to 50
percent of the amount to return
it, Giannoulias said. In many
cases, finder firms wrongly
imply that if the consumers do
not act immediately, they will
lose any chance of recovering
their cash.
Finder firms typically
solicit consumers by phone,
postal mail and e-mail during
the five-year period before
businesses and financial
institutions are obligated to
turn over lost, abandoned and
forgotten funds commonly known
as "unclaimed property" to the
Treasurer's Office for
safekeeping and distribution,
Giannoulias said.
"These firms scam consumers
by demanding a fee but never
disclosing who has their money,
which makes it impossible for
the rightful owners to track it
down themselves," Giannoulias
said. "They're essentially
saying, 'There's a pile of money
that is owed to you but the only
way you're going to see a nickel
of it is by paying us.' It's a
no-win for consumers."
Giannoulias' proposed
legislation would:
- Require finder firms to
disclose in writing the name
of the institution holding
the unclaimed property to
make it easier for consumers
to find.
- Place a 10 percent cap
on the fees that a finder
company can charge, even if
the property has not hit the
statutory abandonment period
of five years. (Currently
there is 10 percent fee
limit only on abandoned
property that has been in
the possession of the State
Treasurer's Unclaimed
Property Division for a
minimum of two years. In
many cases, finder firms
solicit consumers to locate
unclaimed property before it
gets turned over to the
state, which allows them to
charge a higher percentage.
This cap would close the
loophole.)
- Require finder companies
to include that the
Treasurer's Office does not
charge fees for recovery of
any unclaimed property.
The
bill is also designed to alert
homeowners who mistakenly
overpay their property taxes.
Often times, mortgages are
transferred among mortgage
companies, resulting in a double
payment. Although the
overpayments are reflected in
subsequent tax bills, homeowners
often overlook the notice. After
five years, that money is
collected by the county and the
property owner is unable to
retrieve it.
One of bill's sponsors, State
Sen. Don Harmon (D-Oak Park),
received a letter last summer
from a finder firm that sought
to charge him 50 percent of what
he was owed.
"The written solicitation
that I received created the
impression that I might lose my
money if I didn't quickly retain
the finder firm, offered what I
would consider to be misleading
references, and included a
contract assigning 50 percent of
any amount recovered to the
finder firm," Harmon said.
"In subsequent telephone
calls, representatives of the
company only added to the veil
of mystery," he continued.
"Illinois residents have a right
to know how they can retrieve
their unclaimed property for
free and not be stuck up by
for-profit companies trying to
take advantage of a wrinkle in
the current law."
The bill's other sponsor,
State Rep. Harry Osterman
(D-Chicago), noted that finder
firms often prey on seniors and
employ scare tactics to get
consumers to pay.
"Consumers should not be
bullied into having to pay a
third party to retrieve money or
property that is rightfully
theirs and claimable free of
charge," Osterman said.
Giannoulias recommended
consumers find out if they are
owed unclaimed property by
following the Cash Dash link on
the Treasurer's website,
www.treasurer.il.gov, and
typing in their name. He also
suggested that consumers keep
their information current and
contact the financial
institutions they do business
with to verify that their
accounts are active.
