July 30, 2007

Check your assets every year

The San Francisco Chronicle on "unclaimed assets" seized under California state law, unbeknownst to its owners:

Years ago, Carla Ruff stored her grandmother's jewelry and a file of personal documents in a safe-deposit box at her bank in San Francisco's Noe Valley, thinking they would always be there when she wanted them.

Not so. Without giving her notice or acting on evidence that she'd forgotten about her cache, the bank's staff, under the auspice of the state, determined the contents of her box to be unclaimed property.

In July 1997, bank records show, the pearl necklace and diamond-encrusted pin, real estate and insurance documents as well as her birth certificate were all removed. The paperwork was shredded and thrown away. Her jewelry was auctioned off on eBay -- for a fraction of its $80,000 value.

Ruff said she didn't know what had happened until January 2006, when an illness in the family sent her to the Bank of America branch looking for the deed to her house. Weeks later, the bank manager told Ruff that her property had been seized by the state under a law that requires the government to take control of lost or abandoned assets.

Elaborate privacy arrangements can discourage us from checking up on our assets as frequently as we should. Sometimes it's difficult to verify financial arrangements while maintaining strict privacy procedures such as mail drops, or depositing cash into accounts in person in lieu of automated transfers (to avoid creating a paper trail linking the accounts together through the transaction).

Nonetheless, it behooves anyone with assets held by an outside institution or with agreements with business associates to check their status occasionally. It's something we should plan for when setting up privacy arrangements:

  • U.S. Post Office box fees can usually only be paid a year in advance -- a renewal notice should come 30 days before payment is due.
  • Safe deposit boxes should be visisted at least yearly.
  • Financial accounts should be checked monthly for evidence of unauthorized access or identity theft.
  • Many types of insurance contracts must be renewed yearly.
  • LLC costs may be due after the first three years depending on provider.
  • Trusts and attorneys should be contacted yearly or more frequently.
  • Financial accounts with tax implications must be verified at the required tax intervals.

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