AB 2258, as amended, Eggman. Unclaimed property.
Existing law prescribes the circumstances under which property held or owing by a business association escheats to the state. Existing law specifies that any demand, savings, or matured time deposit, or account subject to a negotiable order of withdrawal, made with a banking organization escheats to the state if the owner, for more than three years, has not increased or decreased the amount of the deposit. Existing law specifies that any demand, savings, or matured time deposit, or matured investment certificate, or account subject to a negotiable order of withdrawal, or other interest in a financial organization, escheats to the state when the owner, for more than three years, has not increased or decreased the amount of the funds or deposit.
This bill wouldbegin delete provide that,end deletebegin insert
require, commencing on or before January 1, 2018,end insert for purposes of determining whether the above-described property escheats to the state,begin insert that a holder, as defined in existing law, regardend insert specified transactions that are initiated electronically and are reflected in the books and records of a banking or financial organizationbegin delete would constituteend deletebegin insert as evidence ofend insert an increase or decrease in the amount of the funds or depositbegin insert
in an accountend insert held by the banking or financial organization.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 1513 of the Code of Civil Procedure is
2amended to read:
(a) Subject to Sections 1510 and 1511, the following
4property held or owing by a business association escheats to this
5state:
6(1) (A) Except as provided in paragraph (6), any demand,
7savings, or matured time deposit, or account subject to a negotiable
8order of withdrawal, made with a banking organization, together
9with any interest or dividends thereon, excluding, from demand
10deposits and accounts subject to a negotiable order of withdrawal
11only, any reasonable service charges that may lawfully be withheld
12and that do not, where made in this state, exceed those set forth in
13schedules filed by the banking organization from time to time with
14the Controller, if the
owner, for more than three years, has not
15done any of the following:
16(i) Increased or decreased the amount of the deposit, cashed an
17interest check, or presented the passbook or other similar evidence
18of the deposit for the crediting of interest.
19(ii) Corresponded electronically or in writing with the banking
20organization concerning the deposit.
21(iii) Otherwise indicated an interest in the deposit as evidenced
22by a memorandum or other record on file with the banking
23
organization.
24(B) A deposit or account shall not, however, escheat to the state
25if, during the previous three years, the owner has owned another
26deposit or account with the banking organization or the owner has
27owned an individual retirement account or funds held by the
28banking organization under a retirement plan for self-employed
29individuals or a similar account or plan established pursuant to the
30internal revenue laws of the United States or the laws of this state,
31as described in paragraph (6), and, with respect to that deposit,
32account, or plan, the owner has done any of the acts described in
P3 1clause (i), (ii), or (iii) of subparagraph (A), and the banking
2organization has communicated electronically or in writing with
3the owner, at the address to which communications regarding that
4deposit, account, or plan are
regularly sent, with regard to the
5deposit or account that would otherwise escheat under
6subparagraph (A). For purposes of this subparagraph,
7“communications” includes account statements or statements
8required under the internal revenue laws of the United States.
9(C) No banking organization may discontinue any interest or
10dividends on any savings deposit because of the inactivity
11contemplated by this section.
12(2) (A) Except as provided in paragraph (6), any demand,
13savings, or matured time deposit, or matured investment certificate,
14or account subject to a negotiable order of withdrawal, or other
15interest in a financial organization or any deposit made therewith,
16and any interest or dividends thereon, excluding, from demand
17deposits and accounts subject to a
negotiable order of withdrawal
18only, any reasonable service charges that may lawfully be withheld
19and that do not, where made in this state, exceed those set forth in
20schedules filed by the financial organization from time to time
21with the Controller, if the owner, for more than three years, has
22not done any of the following:
23(i) Increased or decreased the amount of the funds or deposit,
24cashed an interest check, or presented an appropriate record for
25the crediting of interest or dividends.
26(ii) Corresponded electronically or in writing with the financial
27organization concerning the funds or deposit.
28(iii) Otherwise indicated an interest in the funds or deposit as
29evidenced by a memorandum or other record on file with the
30financial
organization.
31(B) A deposit or account shall not, however, escheat to the state
32if, during the previous three years, the owner has owned another
33deposit or account with the financial organization or the owner
34has owned an individual retirement account or funds held by the
35financial organization under a retirement plan for self-employed
36individuals or a similar account or plan established pursuant to the
37internal revenue laws of the United States or the laws of this state,
38as described in paragraph (6), and, with respect to that deposit,
39account, or plan, the owner has done any of the acts described in
40clause (i), (ii), or (iii) of subparagraph (A), and the financial
P4 1organization has communicated electronically or in writing with
2the owner, at the address to which communications regarding that
3deposit, account, or plan are regularly sent,
with regard to the
4deposit or account that would otherwise escheat under
5subparagraph (A). For purposes of this subparagraph,
6“communications” includes account statements or statements
7required under the internal revenue laws of the United States.
8(C) No financial organization may discontinue any interest or
9dividends on any funds paid toward purchase of shares or other
10interest, or on any deposit, because of the inactivity contemplated
11by this section.
12(3) Any sum payable on a traveler’s check issued by a business
13association that has been outstanding for more than 15 years from
14the date of its issuance, if the owner, for more than 15 years, has
15not corresponded in writing with the business association
16concerning it, or otherwise indicated an interest as evidenced by
17a
memorandum or other record on file with the association.
18(4) Any sum payable on any other written instrument on which
19a banking or financial organization is directly liable, including, by
20way of illustration but not of limitation, any draft, cashier’s check,
21teller’s check, or certified check, that has been outstanding for
22more than three years from the date it was payable, or from the
23date of its issuance if payable on demand, if the owner, for more
24than three years, has not corresponded electronically or in writing
25with the banking or financial organization concerning it, or
26otherwise indicated an interest as evidenced by a memorandum or
27other record on file with the banking or financial organization.
28(5) Any sum payable on a money order issued by a business
29association, including a
banking or financial organization, that has
30been outstanding for more than seven years from the date it was
31payable, or from the date of its issuance if payable on demand,
32excluding any reasonable service charges that may lawfully be
33withheld and that do not, when made in this state, exceed those
34set forth in schedules filed by the business association from time
35to time with the Controller, if the owner, for more than seven years,
36has not corresponded electronically or in writing with the business
37association, banking, or financial organization concerning it, or
38otherwise indicated an interest as evidenced by a memorandum or
39other record on file with the business association. For the purposes
P5 1of this subdivision, “reasonable service charge” means a service
2charge that meets all of the following requirements:
3(A) It is uniformly applied to all of the issuer’s money orders.
4(B) It is clearly disclosed to the purchaser at the time of purchase
5and to the recipient of the money order.
6(C) It does not begin to accrue until three years after the
7purchase date, and it stops accruing after the value of the money
8order escheats.
9(D) It is permitted by contract between the issuer and the
10purchaser.
11(E) It does not exceed 25 cents ($0.25) per month or the
12aggregate amount of twenty-one dollars ($21).
13(6) (A) Any funds held by a business association in an
14individual retirement account or under a retirement plan for
15self-employed
individuals or similar account or plan established
16pursuant to the internal revenue laws of the United States or of
17this state, if the owner, for more than three years after the funds
18become payable or distributable, has not done any of the following:
19(i) Increased or decreased the principal.
20(ii) Accepted payment of principal or income.
21(iii) Corresponded electronically or in writing concerning the
22property or otherwise indicated an interest.
23(B) Funds held by a business association in an individual
24retirement account or under a retirement plan for self-employed
25individuals or a similar account or plan created pursuant to the
26internal revenue laws of the United
States or the laws of this state
27shall not escheat to the state if, during the previous three years,
28the owner has owned another such account, plan, or any other
29deposit or account with the business association and, with respect
30to that deposit, account, or plan, the owner has done any of the
31acts described in clause (i), (ii), or (iii) of subparagraph (A), and
32the business association has communicated electronically or in
33writing with the owner, at the address to which communications
34regarding that deposit, account, or plan are regularly sent, with
35regard to the account or plan that would otherwise escheat under
36subparagraph (A). For purposes of this subparagraph,
37“communications” includes account statements or statements
38required under the internal revenue laws of the United States.
39(C) These funds are not payable or distributable within
the
40meaning of this subdivision unless either of the following is true:
P6 1(i) Under the terms of the account or plan, distribution of all or
2a part of the funds would then be mandatory.
3(ii) For an account or plan not subject to mandatory distribution
4requirement under the internal revenue laws of the United States
5or the laws of this state, the owner has attained 701⁄2 years of age.
6(7) Any wages or salaries that have remained unclaimed by the
7owner for more than one year after the wages or salaries become
8payable.
9(b) For purposes of this section, the following terms have the
10following
meanings:
11(1) “Increased or decreased the amount of the deposit” and
12“increased or decreased the amount of the funds or deposit”
13includes the following transactions that are initiated electronically
14and are reflected in the books and records of the banking or
15financial organization:
16(A) A single or recurring debit transaction authorized by the
17owner.
18(B) A single or recurring credit transaction authorized by the
19owner.
20(C) Recurring transactions authorized by the owner that
21represent payroll deposits or deductions.
22(D) Recurring credits authorized by the owner or a responsible
23party that represent the deposit of any federal benefits, including
24social
security benefits, veterans’ benefits, and pension payments.
25(2) “Service charges” means service charges imposed because
26of the inactivity contemplated by this section.
27
(b) For purposes of this section, “service charges” means
28service charges imposed because of the inactivity contemplated
29by this section.
30
(c) A holder shall, commencing on or before January 1, 2018,
31regard the following transactions that are initiated electronically
32and are reflected in the books and records of the banking or
33financial organization as evidence that an owner has increased
34or decreased the amount of the funds or deposit in an account, for
35
purposes of paragraphs (1) and (2) of subdivision (a):
36
(1) A single or recurring debit transaction authorized by the
37owner.
38
(2) A single or recurring credit transaction authorized by the
39owner
P7 1
(3) Recurring transactions authorized by the owner that
2represent payroll deposits or deductions.
3
(4) Recurring credits authorized by the owner or a responsible
4party that represent the deposit of any federal benefits, including
5social security benefits, veterans’ benefits, and pension payments.
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