In a previous blog post we discussed how in times of economic downturn, unclaimed property has historically been a way for the states to fill budget gaps through various measures. Recent activity by Illinois and Washington D.C., detailed below, lends credit to this theory by indicating that IL and DC will soon be increasing audit activity to fill their budget gaps.
On Friday, July 17, 2020, the Office of the Illinois State Treasurer issued an Examination Services to Identify Holders Request for Proposal (RFP). This RFP is for assistance in identifying companies not in compliance with Illinois’ unclaimed property regulations. This RFP is not a good sign for holders as whoever it is awarded to will help Illinois identify out of compliance holders. In other words, this is an RFP seeking to award one or more contracts to an unclaimed property audit firm, leading us to believe that an increase in IL audits is forthcoming.
On Tuesday, July 21, 2020, Washington D.C. passed three resolutions DC R 854, DC R 857 and DC R 858. These resolutions approve multi-year contracts with three unclaimed property audit firms: Discovery Audit Services, LLC, Kelmar Associates LLC, and Verus Analytics LLC. With this action, these three audit firms will begin searching for companies that they believe are out of compliance with Washington D.C.’s unclaimed property regulations and initiating audits; or joining Washington D.C. to other multi-state audits that the firm is already conducting.
As noted in our prior blog post there are steps holders should take to check for compliance. If you believe you have property out of compliance, you may want to consider enhanced remediation efforts and/or enrolling in a state voluntary disclosure program. As always, if you need help with any of the activities described above, Keane’s consulting team is here to help.