Lawmakers in Connecticut are considering a legal change to enable the state to automatically return so-called unclaimed property to hundreds of individuals every year.
From 2000 to 2021, the state treasurer’s office collected more than $2.3 billion in unclaimed property — in the form of forgotten bank accounts, insurance payments and more — but returned less than 37% percent of that amount to its rightful owners, according to a Connecticut Mirror investigation published earlier this year.
In response, Connecticut Treasurer Shawn Wooden announced several changes to the unclaimed property program in February, which made it easier for people to find and reclaim their money.
But Wooden, who was elected to the office in 2018 and is in his first term, is also pushing for legislation this year to enable his office to automatically cut checks to people.
The state’s Finance, Revenue and Bonding Committee held a public hearing this week on SB 379, which would give the Connecticut Treasurer’s Office the ability to track down the owners of uncashed checks, missing insurance policies and forgotten security deposits and reunite those people with their missing money.
The legislation, for the first time, would offer the treasurer’s office access to governmental data from state agencies such as the Department of Revenue Services, the Department of Motor Vehicles and the Department of Labor.
The treasurer’s staff would then use that information to locate any individual with unclaimed property valued at less than $2,500, verify their identity and send them checks.
Anyone with unclaimed property valued above that amount would still need to file paperwork with the state to certify they are the rightful owners.
Still, the change would be a dramatic advancement for Connecticut’s unclaimed property program, which the state has operated in a similar fashion since the 1930s.
The program requires banks, utilities, insurance companies and other financial institutions to turn over assets to the state if they lose track of the individual or entity the money belongs to for more than three to five years.
That happens frequently. People move and forget to update their contact information with a company, or they are unaware they are listed as a beneficiary on an insurance policy.
The state is meant to safeguard that money until the owners can be found.
For most of the program’s history, the treasurer’s office listed the owners of the unclaimed property in newspaper ads. That notification process transitioned in 2016 to an online database, which is referred to as the CT Big List.
The current system, however, still relies on individuals, businesses, nonprofits and local governments to seek out their missing money on their own.
That has not always resulted in the best outcomes.
“We are working to have as many property owners as possible put their cash back in their pockets. These enhancements make the process of reuniting rightful owners with their unclaimed property easier and faster than ever before. And by authorizing automatic payments, many families may be receiving some much-needed and unexpected money back,” Wooden said at a press conference this week.
Wooden’s support for the bill should provide some momentum in the legislature, unlike past years, when his staff opposed other reform efforts.
Democrats and Republicans voiced support for the legislation during the committee hearing this week, arguing the state needed to make it much easier for people to reclaim their lost money.
Rep. Leslie Zupkus, R-Prospect, said the legislation was a big step in the right direction for the unclaimed property program and the millions of people, businesses and other entities with missing money.
“Hopefully, we can get it across the finish line,” Zupkus said.
Rep. Mary Mushinsky, D-Wallingford, agreed and explained her frustrating experience with the unclaimed property program.
In past years, Mushinsky tried to reclaim a security deposit that was collected by an electric utility, she said, but she was never able to get that money back from the treasurer’s office, despite filing repeated claims.
“The amount of time I was spending was not worth the amount of money I would get back,” she said.
While many lawmakers voiced appreciation for the new bill, there were a few people who advocated for several tweaks to the draft legislation.
Ron Lizzi, who has advocated for reforms to Connecticut’s unclaimed property program for several years, told lawmakers that the legislation could be improved with a couple of simple changes.
Lizzi, a Bethany resident, asked lawmakers to ensure that businesses, nonprofits and local governments with unclaimed property can benefit from the automatic payments too. As written, he warned, the legislation may limit the automatic payments to individuals.
Under the current legislation, the treasurer’s office also might not be required to automatically return money that was collected by the state before 2023 — even if it can identify those individuals and businesses.
Those types of issues, Lizzi argued, would limit the effectiveness of the proposed legislation.
Some lawmakers are also concerned, however, with the security of issuing checks to people through the mail.
Sen. John Fonfara, D-Hartford, said he wanted to have “greater certainty” that the unclaimed property would be returned to the right people.
As a result, he argued that lawmakers should review the legislation so they could have more confidence that the checks would go to the right addresses.
Even with those reservations, Fonfara argued it was past time for the treasurer’s office to improve the unclaimed property program.
“I think the treasurer’s office needs to be much more proactive than they are,” he said.