Kenny Malone
Appearances
Planet Money
Escheat show (Update)
Hello, Planet Money listeners. This is Kenny Malone. We have a story today, one of our absolute favorite episodes that originally aired a few years back. But since then, there have been a few significant updates. So stick around to the end of the story to hear those. Here's the episode. This is Planet Money from NPR.
Planet Money
Escheat show (Update)
We've learned some disconcerting things about this from Walter Schramm's Amazon case.
Planet Money
Escheat show (Update)
But the state still deems a bank account abandoned after five years and investments abandoned after just three years.
Planet Money
Escheat show (Update)
We figured that Brenda wouldn't be able to talk about individual cases, but gave it a shot anyway. Audrey told her about Walter and his Amazon bet.
Planet Money
Escheat show (Update)
As for Walter, here's where his case stands. Walter initially looked for an attorney to help him get the current value of his Amazon stock from Delaware, more than $100,000. A ton of money, but apparently not enough for a lawyer to take the case on, Walter says.
Planet Money
Escheat show (Update)
So for now, Walter is stuck with the original deal from Delaware. The state offered to pay him back the value of his stock from when they cashed it out in 2008, which is about $8,000.
Planet Money
Escheat show (Update)
The hope is that at that point, it'll be worth it for a lawyer to take on the Schramm descendants case and they'll get Delaware to settle, which does happen sometimes.
Planet Money
Escheat show (Update)
Okay, so it has been about five years now since this episode originally ran, and there is a fair amount of news to share. So let us begin with Walter Schramm, who did, in fact, find a lawyer and is now the lead plaintiff in a class action lawsuit essentially against Delaware's unclaimed property office.
Planet Money
Escheat show (Update)
That suit alleges that people like Walter were not given appropriate notice before their property, or their stock in his case, were seized and then liquidated. Now, that case is still ongoing, and since we first talked to Walter, the price of his now long-ago liquidated Amazon stock... has more than doubled.
Planet Money
Escheat show (Update)
And our final update, and I just want you to picture like a rainstorm of cash coming down for this one. Since our episode originally ran, Planet Money listeners like you have found over $38,000 in unclaimed property at their various states. And And that is just those of you who got in touch to tell us about it.
Planet Money
Escheat show (Update)
So listen, if you go to your state's unclaimed property website and you find lost money, please do tell us about it. We have a spreadsheet. We love updating that thing. You can email us. We are planetmoney at npr.org. You can also tag us and show the world that you found money on all the social medias. That is generally at planetmoney.com.
Planet Money
Escheat show (Update)
And I mean, you know, listen, if you suddenly find yourself with some unexpected cash and a lot of gratitude for your favorite economics show, well, I will remind you that the best way to support our journalism at Planet Money is to become a regular NPR Plus supporter. You can do that by going to plus.npr.org.
Planet Money
Escheat show (Update)
This is a way to help us stay independent and a way for you to get sponsor free versions of our episodes. And right now we've got a special series from the Planet Money archives that include a behind the scenes look at the time Planet Money bought a toxic asset that we named Toxie. Lots of incredible details about how that project came together.
Planet Money
Escheat show (Update)
That is for our Planet Money Plus subscribers, and thank you so much if you are already one of them. Today's episode was produced originally by Alexi Horowitz-Ghazi with editing from Nick Fountain. The update today was produced by James Sneed. Our executive producer is Alex Goldmark.
Planet Money
Escheat show (Update)
So Walter does just that. He waits until 2015, about 20 years, to finally cash in his Amazon stock. At that point, the stock he'd bought for around $6,000 should be worth around $100,000. And so after years and years of not looking, Walter finally logs back into his E-Trade account.
Planet Money
Escheat show (Update)
A very Walter Schramm way of saying he was terrified. He wanted to retire. He was counting on this money and now it was gone.
Planet Money
Escheat show (Update)
And E-Trade tells him, yeah, you're going to need to speak to the state of Delaware. That's where E-Trade is incorporated.
Planet Money
Escheat show (Update)
And E-Trade says, yeah, specifically you should ask for the Delaware Unclaimed Property Office.
Planet Money
Escheat show (Update)
This terrible, unpronounceable word. It was the first sign that Walter had stumbled onto something huge. An obscure government program that depending on how you look at it, is either a brilliant way to protect you from greedy corporations or a way for state governments to literally reach into your accounts and take your money. Hello and welcome to Planet Money. I'm Kenny Malone.
Planet Money
Escheat show (Update)
Today on the show, we bring you a classic episode from 2020, one that is, in hindsight, a kind of bit of a public service. It's about how the government gets this stuff, this unclaimed property, how you can get it back, and why Walter Schramm may never see his stock again.
Planet Money
Escheat show (Update)
Jennifer Borden runs an escheat law practice. Escheat, by the way, E-S-C-H-E-A-T.
Planet Money
Escheat show (Update)
The concept has been updated pretty dramatically and is now employed in the United States. And the way that this works now is that each state, like each actual state government, has an unclaimed property department because we, the people, are forgetful.
Planet Money
Escheat show (Update)
We got Walter on the phone to ask him about his missing money, and he was angry. But you should know that the angry version of Walter Schramm sounds like this.
Planet Money
Escheat show (Update)
Think of it as like a giant state run lost and found. And this used to be Jennifer Borden's job. She worked at the Massachusetts Division of Unclaimed Property.
Planet Money
Escheat show (Update)
Every state in the country does some version of a sheet. And the way it used to work in the past was the state would take control of your stuff on your behalf, of course. And then they would take out a newspaper ad saying like, hey, Joe Smith, we have your stuff. Come get it.
Planet Money
Escheat show (Update)
Yes, Audrey has made me promise not to do this until we are recording. We are now recording. So, okay, what do I do here?
Planet Money
Escheat show (Update)
All right, here's Florida's sheeting site, I guess. It has a better name than I would have thought. FloridaTreasureHunt.gov.
Planet Money
Escheat show (Update)
Okay. There is a Kenneth D. Malone. That is my old address. Like a pretty old address, though. All right. Property type. Vendor checks. Reported by National Public Radio.
Planet Money
Escheat show (Update)
From NPR? Yeah. This is great. I'm 100% taking a vacation if this is enough money. Oh. It's $40. Which is fine. Which is fine. But, yes, I happen to know, Audrey, that you did this and had much better luck than I did.
Planet Money
Escheat show (Update)
And you could see the argument for why this is a good thing the state does on your behalf. Like, you know, companies don't... necessarily have the most incentive to get that money back to you. Like, I love NPR, but you've heard our fun drives. I don't know how hard NPR was going to try to get that check back into my hand.
Planet Money
Escheat show (Update)
And so what happened in that case instead is that NPR is required to tell the state of Florida, Kenny never cashed his check. And then Florida says, great, cut that check to us. We're going to hold on to the money for him. And now he can file a claim for it.
Planet Money
Escheat show (Update)
For years, this was a big part of Jennifer Borden's job. She was working for the Massachusetts government trying to connect people with their abandoned stuff. And she loved that. But the more time she spent thinking about as she has like a system, the more she started to notice problems.
Planet Money
Escheat show (Update)
Here's what happened. Walter is Italian, and in the late 90s, he had the brilliant idea to start a company selling Italian specialty products online largely to Americans.
Planet Money
Escheat show (Update)
And it is a lot of money. States are taking in about $8 billion a year of unclaimed property. And about two-thirds of that money stays unclaimed. So in most states, it just gets folded into the state's budget.
Planet Money
Escheat show (Update)
Now, Jennifer is careful to say the people at unclaimed property offices want to get unclaimed property back to the rightful owners. It is the best part of the job, she says. But maybe there is a systemic problem. Like this Ishit system is supposed to stop companies from turning your forgetfulness into their profit. It's possible states are now just doing a version of that same thing.
Planet Money
Escheat show (Update)
The more Jennifer considered all of this, the more she thought maybe my Eshit talents would be better spent elsewhere. She still thinks that Eshit is on the whole a great system, but she now helps people and businesses protect their money from Eshit.
Planet Money
Escheat show (Update)
For example, it used to be that an account was deemed abandoned only after a piece of mail was sent to the account holder, then got returned by the post office. The person couldn't be reached.
Planet Money
Escheat show (Update)
But now in a lot of states, property gets labeled abandoned just because a person didn't check into their account or access the account within a certain length of time, which I don't know, like that feels like a sneakier kind of standard.
Planet Money
Escheat show (Update)
And all of this brings us back to Walter Schramm, the very chill but actually quite mad investor who bought a bunch of Amazon stock back in the 90s.
Planet Money
Escheat show (Update)
So, great. Problem solved. The state of Delaware was holding on to Walter's Amazon stock. No, that is not what happened. See, one of the problems with a sheet is that it's not always clear how it would work with different kinds of things people forgot about. So for like, you know, a check or a bank account that someone forgot, like that's pretty straightforward.
Planet Money
Escheat show (Update)
The state can assume control of that money. It was just sitting there. Now it can sit in the state's account.
Planet Money
Escheat show (Update)
Obviously, the state cashing out your stocks could work in your favor if the government cashes you out right before your stock takes a dive. Or it could totally screw you, which is what happened to Walter.
Planet Money
Escheat show (Update)
After the break, we call the state of Delaware and ask, does Walter really need to take this a sheet? Boo. It's bad. You wrote it, Audrey. It's not a coincidence that Walter's stock was taken by Delaware. That is where two-thirds of all Fortune 500 companies are incorporated, and that's a lot of potentially lost accounts to keep track of.
Planet Money
Escheat show (Update)
But this is not where things go south for Walter, really. It was unfortunate, sure, but to him, the Amazon thing was just another great investment opportunity.
Planet Money
Escheat show (Update)
The first was about this idea that unclaimed property has become a huge source of revenue for states. For the last few years, Delaware's general fund has gotten a lot of money from a sheet, around $550 million a year.
Planet Money
Escheat show (Update)
Again, if you take nothing else from this episode, it is that you should go and make sure you've not left abandoned money somewhere that is now in a state coffer. I am $40 of living proof that you should do that. And in that regard, it is a good system. I never would have found that money. It probably never would have found me. On the other hand, a sheet clearly has some flaws.