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Delaware Has Been Busy


Delaware has been quite busy of late:

1. The state recently named a new head of its unclaimed property program, a position it officially calls the “State Escheator”. Sounds very 15th century, we know, but that’s what they call it. Jennifer Noel, Esq. has been named to that official position effective October 3, 2017. See the announcement here

2. A few weeks ago Secretary of State Jeffrey Bullock issued a statement to holder advocates like JMS, announcing that his office would begin sending notices to holders that state agencies identify as being out of compliance with Delaware’s unclaimed/abandoned property laws. Those notices read in pertinent part as follows:

“As an unclaimed property professional who has represented Holders in the Delaware unclaimed property audit and/or SOS VDA Program, you should be aware of an important update about the Delaware SOS VDA Program.

In two weeks, my office will begin mailing notices to Holders who have been identified as likely being out of compliance with Delaware law as it relates to reporting dormant abandoned or unclaimed property. Holders that do not enroll in the SOS VDA Program within 60 days of the mailing of this notice will be referred to the State Escheator for examination. If an audit notice is issued, the Department of State will have no legal ability to accept a Holder into the SOS VDA Program.

The SOS VDA Program was put in place to respond to concerns about Delaware’s ongoing audit program, and to encourage more companies to come into compliance with their legal responsibilities as they relate to abandoned property. Through recent changes in the law, Delaware is providing every company with an opportunity to voluntarily comply prior to being issued an examination notice. We urge you, your clients and potential clients to take advantage of this opportunity to enroll in the SOS VDA Program."

This shot across the bow was a warning to the holder community that more Delaware unclaimed property audits are forthcoming – and if you receive one of these letters from the Secretary of State, you have 60 days to enter the VDA Program or your company will be audited. Under current Delaware law, a company must be invited to participate in the Delaware VDA Program before they can be referred to the Division of Revenue for audit. However, once you receive the notice/invitation, you have 60 days to act. Based on the timing of the Secretary’s message, these most recent notifications should have already been sent and received by several companies. Any company receiving such a notice should contact an experienced advocate immediately to discuss options and plan a course of action.

3. After considerable delay, Delaware finalized its regulations as it pertains to estimations of liability pursuant to an audit. These regulations we formally put into effect on October 11, which means holders presently under audit have 60 days to take action in this regard as well. JMS has posted a separate blog entry on this development as well – which provides essential details to holders considering their options under the law.

If you are concerned about Delaware audits, Delaware unclaimed property compliance, or any matter as it pertains to escheat, the time to act is now. JMS is here to help with pragmatic and cost-effective solutions. Contact us with your inquiry and we’d be happy to discuss any issue with you at any time.

Tagged: unclaimed property, escheat, delaware regulations, escheat compliance, delaware escheat audit, unclaimed property audit