Colorado’s Unclaimed Property Division has significant problems in its claims system.
That was the conclusion of the Office of the State Auditor after reviewing the last five years of claims records. The deep dive found hundreds of thousands of claims that were duplicated, incomplete, inaccurate or questionable. Those problematic claims represented $271.5 million that sits in the fund.
Examples of the problems included properties converted from the old system in 2017 that did not have any owner name listed in the new system. Properties that had owners with incomplete or inaccurate names, including names listed as symbols or numbers. The audit found that the division accepts unclaimed property with owners’ names of “unknown” or “unidentified,” making it difficult to match property with owner.
It also found that the division often failed to meet the 90 day requirement to pay out claims — thousands took nearly two years.
The results were released to the Legislative Audit Committee on Monday. Committee Chair Sen. Nancy Todd gave a nod to the work that the new administration has done over the past year but said there are still plenty of improvements to be made.
“There has been some remedy, but obviously still very concerned about the backlog,” said Todd, a Democrat from Arapahoe County. “And there was also a real genuine concern of, just the process, of how long and how cumbersome it is for people to get their property back.”
Bianca Gardelli has been the director of the division for just over a year and in that time she has taken the backlog of claims from more than 12,000 to less than 2,000 claims — a reduction of over 80 percent.
According to State Treasurer Dave Young, this was all done while processing the more than 16,000 new claims — within the required 90 days — that came in this year.
“There’s real evidence that we are already on the way to make sure that we’re addressing these concerns that were raised by the auditor,” Young said. “We have a real mission to reunite owners with their property.”
The committee made four recommendations of the division:
- Process claims within 90 days and eliminate the backlog of claims
- Notify unclaimed property owners that the state has their property by mail or email.
- Developing, implementing and enforcing written policies that outline how to handle tangible (not cash) property.
- Implement a review process that accurately reports the transfer of funds.
The division was created in 1987 and handles unclaimed property that ranges from cash and checks, to the contents of safe deposit boxes, including items such as precious metals, gift cards and baseball cards. According to the division, it has returned $452 million in unclaimed property to its rightful owners since its creation.