2017 Legislative Changes

2017 Legislative Changes to NC Unclaimed Property Laws which Affect Holder Reporting

House Bill 294 Amended N.C.G.S. §§ 116B-53, 116B-59, 116B-77

The amendment clarifies the type of notice to be provided by a holder of property which is presumed to be abandoned and is 1) a security or other equity interest in a business association valued at $25.00 or more or, 2) property which is not a security or other equity interest in a business association and which is valued at $50.00 or more.

Under the clarified provisions, holders of such property must send written notice via first-class mail to the apparent owner/s at least 60 days prior to filing the annual report and no more than 120 days before filing the annual report. In sending the notice, holders must use reasonable care to ensure that the notice is sent to the appropriate address.

In addition to prior notice requirements, holders must now include in the notice to apparent owners:

       1)      the contact information of the holder; and

       2)     a statement that after the property is in the custody of the Treasurer, any interest, dividends, income or gains earned on the property shall remain with the Treasurer and will not be transferred to the owner once the owner reclaims the property.

The changes further establish that the dormancy period for a security or other equity interest in a business association is three years after the earlier of, 1) the date a cash dividend or other distribution is unclaimed by the apparent owner or 2) the date a second consecutive mailing or other communication via first-class mail from the holder to the apparent owner is returned to the holder as unclaimed or undeliverable; or 3) the date when the holder ceases mailings and other notifications to the apparent owner.

Finally, the amendment clarifies that willful failure to perform the preceding notice requirements in the holder duties shall lead to the assessment of interest and penalties against a holder.

The preceding provisions are effective October 1, 2017. Accordingly, these provisions apply to property presumed abandoned on or after that date.
A full copy of enacted House Bill 294 can be found at the following link:  http://www.ncga.state.nc.us/Sessions/2017/Bills/House/PDF/H294v6.pdf .