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Unclaimed Property: Compliance Obligations and Challenges for Broker Dealers

In 2011 (the latest year for which there is complete data), the 50 states and the District of Columbia took in $5.8 billion and paid out $2.0 billion in unclaimed property. Noncompliance with unclaimed property rules and law risks potential assessments of liability for non-reporting or alleged late reporting of property.

This whitepaper, “Unclaimed Property Compliance Obligations and Challenges for Broker-Dealers,” seeks to inform our members and investors of the current unclaimed property regulatory landscape, including the following:

  • Identifying current issues that result from the evolution in business models and practices; 
  • Highlighting the static nature of unclaimed property laws, and the risks that these issues pose; 
  • Stimulating dialogue internally about the best means of addressing these issues and modernizing/improving the regulatory and compliance landscape; and
  • Providing a touchstone for an unclaimed property discussion with customers and clients.  
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Excerpt

Introduction

The Securities Industry and Financial Markets Association (SIFMA) brings together the shared interests of hundreds of securities fi rms, banks and asset managers. These companies are engaged in communities across the country to raise capital for businesses, promote job creation and lead economic growth. SIFMA’s members work together to promote industry and investor awareness of federal and state regulatory requirements that impact securities fi rm services and products, including state abandoned and unclaimed property (also called “escheat”) laws.

Why has SIFMA published this paper? To inform SIFMA members and others of the current unclaimed property regulatory landscape; to identify current issues that result from the evolution in business models and practices, the static nature of unclaimed property laws, and the risks that these issues pose; and to stimulate dialogue about the best means of addressing these issues and modernizing/improving the regulatory and compliance landscape.