Bill Text: CA SB1066 | 2025-2026 | Regular Session | Amended
Bill Title: Unclaimed property.
Sponsorship: Partisan Bill (Republican 1)
Status: (Engrossed) 2026-08-13 - August 13 hearing: Held in committee and under submission. [SB1066 Detail]
Download: California-2025-SB1066-Amended.html
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Amended
IN
Senate
May 18, 2026 |
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Amended
IN
Senate
April 13, 2026 |
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Amended
IN
Senate
March 25, 2026 |
CALIFORNIA LEGISLATURE—
2025–2026 REGULAR SESSION
Senate Bill
No. 1066
| Introduced by Senator Niello |
February 12, 2026 |
An act to amend Sections 1513, 1513.5, 1514, 1515, 1515.5, 1516, 1516.5, 1517, 1518, 1518.5, 1519, 1519.5, 1520, 1521, 1540, and 1563 of the Code of Civil Procedure, relating to unclaimed property.
LEGISLATIVE COUNSEL'S DIGEST
SB 1066, as amended, Niello.
Unclaimed property.
The Unclaimed Property Law prescribes the circumstances under which property escheats to the state. Existing law provides different requirements for escheatment of various types of property, including the time period for escheatment to the state. Existing law provides that the Controller may liquidate various forms of property after escheatment. Existing law prohibits interest from being paid on claims for escheated property.
This bill would increase the time for escheatment of all forms of property to seven 7 years from the last contact with the owner, as specified. This
bill would require the Controller to maintain the property in the form in which it was escheated, as specified. This bill would also provide that the owner of escheated property would receive interest on their escheated property starting on the day they filed their claim for
the property and continuing until their property was returned to them, as specified.
Digest Key
Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NOBill Text
The people of the State of California do enact as follows:
SECTION 1.
Section 1513 of the Code of Civil Procedure is amended to read:1513.
(a) Subject to Sections 1510 and 1511, the following property held or owing by a business association escheats to this state:(1) (A) Except as provided in paragraph (6), any demand, savings, or matured time deposit, or account subject to a negotiable order of withdrawal, made with a banking organization, together with any interest or dividends thereon, excluding, from demand deposits and accounts subject to a negotiable order of withdrawal only, any reasonable service charges that may lawfully be withheld and that do not, where made in this state, exceed those set forth in schedules filed by the banking organization from time to time with the Controller, if the
owner, for more than seven years, has not done any of the following:
(i) Increased or decreased the amount of the deposit, cashed an interest check, or presented the passbook or other similar evidence of the deposit for the crediting of interest.
(ii) Corresponded electronically or in writing with the banking organization concerning the deposit.
(iii) Otherwise indicated an interest in the deposit as evidenced by a memorandum or other record on file with the banking organization.
(B) A deposit or account shall not, however, escheat to the state if, during the previous seven years, the owner has owned another deposit or account with the banking organization or
the owner has owned an individual retirement account or funds held by the banking organization under a retirement plan for self-employed individuals or a similar account or plan established pursuant to the internal revenue laws of the United States or the laws of this state, as described in paragraph (6), and, with respect to that deposit, account, or plan, the owner has done any of the acts described in clause (i), (ii), or (iii) of subparagraph (A), and the banking organization has communicated electronically or in writing with the owner, at the address to which communications regarding that deposit, account, or plan are regularly sent, with regard to the deposit or account that would otherwise escheat under subparagraph (A). For purposes of this subparagraph, “communications” includes account statements or statements required under the internal revenue laws of the United States.
(C) No banking organization may discontinue any interest or dividends on any savings deposit because of the inactivity contemplated by this section.
(2) (A) Except as provided in paragraph (6), 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 or any deposit made therewith, and any interest or dividends thereon, excluding, from demand deposits and accounts subject to a negotiable order of withdrawal only, any reasonable service charges that may lawfully be withheld and that do not, where made in this state, exceed those set forth in schedules filed by the financial organization from time to time with the Controller, if the owner, for
more than seven years, has not done any of the following:
(i) Increased or decreased the amount of the funds or deposit, cashed an interest check, or presented an appropriate record for the crediting of interest or dividends.
(ii) Corresponded electronically or in writing with the financial organization concerning the funds or deposit.
(iii) Otherwise indicated an interest in the funds or deposit as evidenced by a memorandum or other record on file with the financial organization.
(B) A deposit or account shall not, however, escheat to the state if, during the previous seven years, the owner has owned another deposit or account with the financial organization
or the owner has owned an individual retirement account or funds held by the financial organization under a retirement plan for self-employed individuals or a similar account or plan established pursuant to the internal revenue laws of the United States or the laws of this state, as described in paragraph (6), and, with respect to that deposit, account, or plan, the owner has done any of the acts described in clause (i), (ii), or (iii) of subparagraph (A), and the financial organization has communicated electronically or in writing with the owner, at the address to which communications regarding that deposit, account, or plan are regularly sent, with regard to the deposit or account that would otherwise escheat under subparagraph (A). For purposes of this subparagraph, “communications” includes account statements or statements required under the internal revenue laws of the United States.
(C) No financial organization may discontinue any interest or dividends on any funds paid toward purchase of shares or other interest, or on any deposit, because of the inactivity contemplated by this section.
(3) Any sum payable on a traveler’s check issued by a business association that has been outstanding for more than 15 years from the date of its issuance, if the owner, for more than 15 years, has not corresponded in writing with the business association concerning it, or otherwise indicated an interest as evidenced by a memorandum or other record on file with the association.
(4) Any sum payable on any other written instrument on which a banking or financial organization is directly liable, including, by way of
illustration but not of limitation, any draft, cashier’s check, teller’s check, or certified check, that has been outstanding for more than seven years from the date it was payable, or from the date of its issuance if payable on demand, if the owner, for more than seven years, has not corresponded electronically or in writing with the banking or financial organization concerning it, or otherwise indicated an interest as evidenced by a memorandum or other record on file with the banking or financial organization.
(5) Any sum payable on a money order issued by a business association, including a banking or financial organization, that has been outstanding for more than seven years from the date it was payable, or from the date of its issuance if payable on demand, excluding any reasonable service charges that may lawfully be withheld and that
do not, when made in this state, exceed those set forth in schedules filed by the business association from time to time with the Controller, if the owner, for more than seven years, has not corresponded electronically or in writing with the business association, banking, or financial organization concerning it, or otherwise indicated an interest as evidenced by a memorandum or other record on file with the business association. For the purposes of this subdivision, “reasonable service charge” means a service charge that meets all of the following requirements:
(A) It is uniformly applied to all of the issuer’s money orders.
(B) It is clearly disclosed to the purchaser at the time of purchase and to the recipient of the money order.
(C) It does not begin to accrue until three years after the purchase date, and it stops accruing after the value of the money order escheats.
(D) It is permitted by contract between the issuer and the purchaser.
(E) It does not exceed 25 twenty-five cents ($0.25) per month or the aggregate amount of twenty-one dollars ($21).
(6) (A) Any funds held by a business association in an individual retirement account or under a retirement plan for self-employed individuals or similar account or plan established pursuant to the
internal revenue laws of the United States or of this state, if the owner, for more than seven years after the funds become payable or distributable, has not done any of the following:
(i) Increased or decreased the principal.
(ii) Accepted payment of principal or income.
(iii) Corresponded electronically or in writing concerning the
property or otherwise indicated an interest.
(B) Funds held by a business association in an individual retirement account or under a retirement plan for self-employed individuals or a similar account or plan created pursuant to the internal revenue laws of the United States or the laws of this state shall not escheat to the state if, during the previous three years, the owner has owned another such account, plan, or any other deposit or account with the business association and, with respect to that deposit, account, or plan, the owner has done any of the acts described in clause (i), (ii), or (iii) of subparagraph (A), and the business association has communicated electronically or in writing with the owner, at the address to which communications regarding that deposit, account, or plan are regularly sent, with regard to
the account or plan that would otherwise escheat under subparagraph (A). For purposes of this subparagraph, “communications” includes account statements or statements required under the internal revenue laws of the United States.
(C) These funds are not payable or distributable within the meaning of this subdivision unless either of the following is true:
(i) Under the terms of the account or plan, distribution of all or a part of the funds would then be mandatory.
(ii) For an account or plan not subject to mandatory distribution requirement under the internal revenue laws of the United States or the laws of this state, the owner has attained
701/2 years of age.
(7) Any wages or salaries that have remained unclaimed by the owner for more than seven years after the wages or salaries become payable.
(b) For purposes of this section, “service charges” means service charges imposed because of the inactivity contemplated by this section.
(c) A holder shall, commencing on or before January 1, 2018, regard the following transactions that are initiated electronically and are reflected in the books and records of the banking or financial organization as evidence that an owner has increased or decreased the amount of the funds or deposit in an account, for purposes of
paragraphs (1) and (2) of subdivision (a):
(1) A single or recurring debit transaction authorized by the owner.
(2) A single or recurring credit transaction authorized by the owner owner.
(3) Recurring transactions authorized by the owner that represent payroll deposits or deductions.
(4) Recurring credits authorized by the owner or a responsible party that represent the deposit of any federal benefits, including social security benefits, veterans’ benefits, and pension
payments.
SEC. 2.
Section 1513.5 of the Code of Civil Procedure is amended to read:1513.5.
(a) Except as provided in subdivision (c), if the holder has in its records an address for the apparent owner, which the holder’s records do not disclose to be inaccurate, every banking or financial organization shall make reasonable efforts to notify any owner by mail or, if the owner has consented to electronic notice, electronically, that the owner’s deposit, account, shares, or other interest in the banking or financial organization will escheat to the state pursuant to clause (i), (ii), or (iii) of subparagraph (A) of paragraph (1), (2), or (6) of subdivision (a) of Section 1513. The holder shall give notice either:(1) Not less than six years nor more than six and one-half years after
the date of last activity by, or communication with, the owner with respect to the account, deposit, shares, or other interest, as shown on the record of the banking or financial organization.
(2) Not less than 6 nor more than 12 months before the time the account, deposit, shares, or other interest becomes reportable to the Controller in accordance with this chapter.
(b) The notice required by this section shall specify the time that the deposit, account, shares, or other interest will escheat and the effects of escheat, including the necessity for filing a claim for the return of the deposit, account, shares, or other interest. The face of the notice shall contain a heading at the top that reads as follows: “THE STATE OF CALIFORNIA REQUIRES US TO NOTIFY YOU THAT YOUR UNCLAIMED
PROPERTY MAY BE TRANSFERRED TO THE STATE IF YOU DO NOT CONTACT US,” or substantially similar language. The notice required by this section shall, in boldface type or in a font a minimum of two points larger than the rest of the notice, exclusive of the heading, (1) specify that since the date of last activity, or for the last six years, there has been no owner activity on the deposit, account, shares, or other interest; (2) identify the deposit, account, shares, or other interest by number or identifier, which need not exceed four digits; (3) indicate that the deposit, account, shares, or other interest is in danger of escheating to the state; and (4) specify that the Unclaimed Property Law requires banking and financial organizations to transfer funds of a deposit, account, shares, or other interest if it has been inactive for seven years. It shall also include a form, as prescribed by the
Controller, by which the owner may declare an intention to maintain the deposit, account, shares, or other interest. If that form is filled out, signed by the owner, and returned to the banking or financial organization, it shall satisfy the requirement of clause (iii) of subparagraph (A) of paragraph (1), clause (iii) of subparagraph (A) of paragraph (2), or clause (iii) of subparagraph (A) of paragraph (6) of subdivision (a) of Section 1513. In lieu of returning the form, the banking or financial organization may provide a telephone number or other
electronic means to enable the owner to contact that organization. The contact, as evidenced by a memorandum or other record on file with the banking or financial organization, shall satisfy the requirement of clause (iii) of subparagraph (A) of paragraph (1), clause (iii) of subparagraph (A) of paragraph (2), or clause (iii) of subparagraph (A) of paragraph (6) of subdivision (a) of Section 1513. If the deposit, account, shares, or other interest has a value greater than two dollars ($2), the banking or financial organization may impose a service charge on the deposit, account, shares, or other interest for this notice in an amount not to exceed the administrative cost of mailing or electronically sending the notice and form and in no case to exceed two dollars ($2).
(c) Notice as provided by subdivisions (a) and (b) shall not
be required for deposits, accounts, shares, or other interests of less than fifty dollars ($50), and, except as provided in subdivision (b), no service charge may be made for notice on these items.
(d) In addition to the notices required pursuant to subdivision (a), the holder may give additional notice as described in subdivision (b) at any time between the date of last activity by, or communication with, the owner and the date the holder transfers the deposit, account, shares, or other interest to the Controller.
(e) At the time a new account is opened with a banking or financial organization, the organization shall provide a written notice to the person opening the account informing the person that his or her
their property may be transferred to the appropriate state if no activity occurs in the account within the time period specified by state law. If the person opening the account has consented to electronic notice, that notice may be provided electronically.
SEC. 3.
Section 1514 of the Code of Civil Procedure is amended to read:1514.
(a) The contents of, or the proceeds of sale of the contents of, any safe deposit box or any other safekeeping repository, held in this state by a business association, escheat to this state if unclaimed by the owner for more than seven years from the date on which the lease or rental period on the box or other repository expired, or from the date of termination of any agreement because of which the box or other repository was furnished to the owner without cost, whichever last occurs.(b) If a business association has in its records an address for an apparent owner of the contents of, or the proceeds of sale of the contents of, a safe deposit box or other safekeeping repository described
in subdivision (a), and the records of the business association do not disclose the address to be inaccurate, the business association shall make reasonable efforts to notify the owner by mail, or, if the owner has consented to electronic notice, electronically, that the owner’s contents, or the proceeds of the sale of the contents, will escheat to the state pursuant to this section. The business association shall give notice not less than 6 months and not more than 12 months before the time the contents, or the proceeds of the sale of the contents, become reportable to the Controller in accordance with this chapter.
(c) The face of the notice shall contain a heading at the top that reads as follows: “THE STATE OF CALIFORNIA REQUIRES US TO NOTIFY YOU THAT YOUR UNCLAIMED PROPERTY MAY BE TRANSFERRED TO THE STATE IF YOU DO NOT
CONTACT US,” or substantially similar language. The notice required by this subdivision shall specify the date that the property will escheat and the effects of escheat, including the necessity for filing a claim for the return of the property. The notice required by this section shall, in boldface type or in a font a minimum of two points larger than the rest of the notice, exclusive of the heading, do all of the following:
(1) Identify the safe deposit box or other safekeeping repository by number or identifier.
(2) State that the lease or rental period on the box or repository has expired or the agreement has terminated.
(3) Indicate that the contents of, or the proceeds of sale of the contents of, the
safe deposit box or other safekeeping repository will escheat to the state unless the owner requests the contents or their proceeds.
(4) Specify that the Unclaimed Property Law requires business associations to transfer the contents of, or the proceeds of sale of the contents of, a safe deposit box or other safekeeping repository to the Controller if they remain unclaimed for more than seven years.
(5) Advise the owner to make arrangements with the business association to either obtain possession of the contents of, or the proceeds of sale of the contents of, the safe deposit box or other safekeeping repository, or enter into a new agreement with the business association to establish a leasing or rental arrangement. If an owner fails to establish such an arrangement prior to the
end of the period described in subdivision (a), the contents or proceeds shall escheat to this state.
(d) In addition to the notice required pursuant to subdivision (b), the business association may give additional notice in accordance with subdivision (c) at any time between the date on which the lease or rental period for the safe deposit box or repository expired, or from the date of the termination of any agreement, through which the box or other repository was furnished to the owner without cost, whichever is earlier, and the date the business association transfers the contents of, or the proceeds of sale of the contents of, the safe deposit box or other safekeeping repository to the Controller.
(e) The contents of, or the proceeds of sale of the contents of, a
safe deposit box or other safekeeping repository shall not escheat to the state if, as of June 30 or the fiscal yearend next preceding the date on which a report is required to be filed under Section 1530, the owner has owned, with a banking organization providing the safe deposit box or other safekeeping repository, any demand, savings, or matured time deposit, or account subject to a negotiable order of withdrawal, which has not escheated under Section 1513 and is not reportable under subdivision (d) of Section 1530.
(f) The contents of, or the proceeds of sale of the contents of, a safe deposit box or other safekeeping repository shall not escheat to the state if, as of June 30 or the fiscal yearend next preceding the date on which a report is required to be filed under Section 1530, the owner has owned, with a financial organization providing the
safe deposit box or other safekeeping repository, 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 or any deposit made therewith, and any interest or dividends thereon, which has not escheated under Section 1513 and is not reportable under subdivision (d) of Section 1530.
(g) The contents of, or the proceeds of sale of the contents of, a safe deposit box or other safekeeping repository shall not escheat to the state if, as of June 30 or the fiscal yearend next preceding the date on which a report is required to be filed under Section 1530, the owner has owned, with a banking or financial organization providing the safe deposit box or other safekeeping repository, any funds in an individual retirement account or
under a retirement plan for self-employed individuals or similar account or plan pursuant to the internal revenue laws of the United States or the income tax laws of this state, which has not escheated under Section 1513 and is not reportable under subdivision (d) of Section 1530.
(h) In the event the owner is in default under the safe deposit box or other safekeeping repository agreement and the owner has owned any demand, savings, or matured time deposit, account, or plan described in subdivision (e), (f), or (g), the banking or financial organization may pay or deliver the contents of, or the proceeds of sale of the contents of, the safe deposit box or other safekeeping repository to the owner after deducting any amount due and payable from those proceeds under that agreement. Upon making that payment or delivery under this
subdivision, the banking or financial organization shall be relieved of all liability to the extent of the value of those contents or proceeds.
(i) For new accounts opened for a safe deposit box or other safekeeping repository with a business association on and after January 1, 2011, the business association shall provide a written
notice to the person leasing the safe deposit box or safekeeping repository informing the person that his or her their property, or the proceeds of sale of the property, may be transferred to the appropriate state upon running of the time period specified by state law from the date the lease or rental period on the safe deposit box or repository expired, or from the date of termination of any agreement because of which the box or other repository was furnished to the owner without cost, whichever is earlier.
(j) A business association may directly escheat the contents of a safe deposit box or other safekeeping repository without exercising its rights under
Article 2 (commencing with Section 1630) of Chapter 17 of Division 1 of the Financial Code.
SEC. 4.
Section 1515 of the Code of Civil Procedure is amended to read:1515.
(a) Subject to Section 1510, funds held or owing by a life insurance corporation under any life or endowment insurance policy or annuity contract which has matured or terminated escheat to this state if unclaimed and unpaid for more than seven years after the funds became due and payable as established from the records of the corporation.(b) If a person other than the insured or annuitant is entitled to the funds and no address of that person is known to the corporation or if it is not definite and certain from the records of the corporation what person is entitled to the funds, it is presumed that the last known address of the person entitled to the funds is the same as the last
known address of the insured or annuitant according to the records of the corporation. This presumption is a presumption affecting the burden of proof.
(c) A life insurance policy not matured by actual proof of the death of the insured according to the records of the corporation is deemed to be matured and the proceeds due and payable if:
(1) The insured has attained, or would have attained if he or she they were living, the limiting age under the mortality table on which the reserve is based.
(2) The policy was in force at the time the insured attained, or
would have attained, the limiting age specified in paragraph (1).
(3) Neither the insured nor any other person appearing to have an interest in the policy has, within the preceding seven years, according to the records of the corporation (i) assigned, readjusted, or paid premiums on the policy, (ii) subjected the policy to loan, or (iii) corresponded in writing with the life insurance corporation concerning the policy.
(d) Any funds otherwise payable according to the records of the corporation are deemed due and payable although the policy or contract has not been surrendered as required.
SEC. 5.
Section 1515.5 of the Code of Civil Procedure is amended to read:1515.5.
Property distributable in the course of a demutualization or related reorganization of an insurance company is deemed abandoned as follows:(a) On the date of the demutualization or reorganization, if the instruments or statements reflecting the distribution are not mailed to the owner because the address on the books and records for the holder is known to be incorrect.
(b) Seven years after the date of the demutualization or reorganization, if instruments or statements reflecting the distribution are mailed to the owner and returned by the post office as undeliverable and the owner has done neither of the following:
(1) Communicated in writing with the holder or its agent regarding the property.
(2) Otherwise communicated with the holder or its agent regarding the property as evidenced by a memorandum or other record on file with the holder or its agent.
(c) Seven years after the date of the demutualization or reorganization, if instruments or statements reflecting the distribution are mailed to the owner and not returned by the post office as undeliverable and the owner has done neither of the following:
(1) Communicated in writing with the holder or its agent regarding the property.
(2) Otherwise communicated with the holder or its agent regarding the property as evidenced by a memorandum or other record on file with the holder or its agent.
SEC. 6.
Section 1516 of the Code of Civil Procedure is amended to read:1516.
(a) Subject to Section 1510, any dividend, profit, distribution, interest, payment on principal, or other sum held or owing by a business association for or to its shareholder, certificate holder, member, bondholder, or other security holder, or a participating patron of a cooperative, who has not claimed it, or corresponded in writing with the business association concerning it, within seven years after the date prescribed for payment or delivery, escheats to this state.(b) Subject to Section 1510, any intangible interest in a business association, as evidenced by the stock records or membership records of the association, escheats to this state if (1) the interest in the
association is owned by a person who for more than seven years has neither claimed a dividend or other sum referred to in subdivision (a) nor corresponded in writing with the association or otherwise indicated an interest as evidenced by a memorandum or other record on file with the association, and (2) the association does not know the location of the owner at the end of the seven-year period. With respect to the interest, the business association shall be deemed the holder.
(c) Subject to Section 1510, any dividends or other distributions held for or owing to a person at the time the stock or other security to which they attach escheats to this state also escheat to this state as of the same time.
(d) If the business association has in its records an address for the apparent
owner, which the business association’s records do not disclose to be inaccurate, with respect to any interest that may escheat pursuant to subdivision (b), the business association shall make reasonable efforts to notify the owner by mail or, if the owner has consented to electronic notice, electronically, that the owner’s interest in the business association will escheat to the state. The notice shall be given not less than 6 nor more than 12 months before the time the interest in the business association becomes reportable to the Controller in accordance with this chapter. The
face of the notice shall contain a heading at the top that reads as follows: “THE STATE OF CALIFORNIA REQUIRES US TO NOTIFY YOU THAT YOUR UNCLAIMED PROPERTY MAY BE TRANSFERRED TO THE STATE IF YOU DO NOT CONTACT US,” or substantially similar language. The notice required by this subdivision shall specify the time that the interest will escheat and the effects of escheat, including the necessity for filing a claim for the return of the interest. The notice required by this section shall, in boldface type or in a font a minimum of two points larger than the rest of the notice, exclusive of the heading, (1) specify that since the date of last activity, or for the last six years, there has been no owner activity on the deposit, account, shares, or other interest; (2) identify the deposit, account, shares, or other interest by number or identifier, which need not exceed four digits; (3)
indicate that the deposit, account, shares, or other interest is in danger of escheating to the state; and (4) specify that the Unclaimed Property Law requires business associations to transfer funds of a deposit, account, shares, or other interest if it has been inactive for seven years. It shall also include a form, as prescribed by the Controller, by which the owner may confirm the owner’s current address. If that form is filled out, signed by the owner, and returned to the holder, it shall be deemed that the business association knows the location of the owner. In lieu of returning the form, the business association may provide a telephone number or other electronic means to enable the owner to contact the association. With that contact, as evidenced by a memorandum or other record on file with the business association, the business association shall be deemed to know the location of the owner.
The business association may impose a service charge on the deposit, account, shares, or other interest for this notice and form in an amount not to exceed the administrative cost of mailing or electronically sending the notice and form, and in no case to exceed two dollars ($2).
(e) In addition to the notice required pursuant to subdivision (d), the holder may give additional notice as described in subdivision (d) at any time between the date of last activity by, or communication with, the owner and the date the holder transfers the deposit, shares, or other interest to the Controller.
(f) The interest that escheats pursuant to subdivision (b) shall not be reportable pursuant to Section 1530 unless and until the per share value, as set forth in Section 1172.80 of Title 2 of the California
Code of Regulations, is equal to or greater than one cent ($0.01) or the aggregate value of the security held exceeds one thousand dollars ($1,000).
SEC. 7.
Section 1516.5 of the Code of Civil Procedure is amended to read:1516.5.
(a) Pursuant to Section 1510, any digital financial asset held or owing by a business association escheats to the state if unclaimed by the owner for more than seven years from either of the following:(1) The date a written or electronic communication to the owner is returned undelivered by the United States Postal Service or by electronic mail or other electronic messaging method, as applicable.
(2) The date of the last exercise of an act of ownership interest by the owner in the digital asset account if the owner does not receive written or electronic communications from the holder or the holder does not have the means of
systematically tracking or monitoring the nondelivery of those communications.
(b) The running of the seven-year period under paragraph (1) of subdivision (a) shall cease immediately upon the exercise of an act of ownership interest in the digital asset account or written, oral, or electronic communication with the holder as evidenced by a memorandum or other record on file with the holder or its agents.
(c) For purposes of this section, an “exercise of an act of ownership interest” includes any of the following actions by the owner regarding the digital asset account:
(1) Conducting a transaction regarding the digital asset account, including buying or selling digital assets, depositing into or withdrawing from the
account fiat currency or other property whether by a one-time transaction or a recurring transaction previously authorized by the owner.
(2) Electronically accessing the digital asset account.
(3) Conducting any activity with respect to another digital asset account or any other property owned by the owner with the same holder.
(4) Taking any other action that reasonably demonstrates to the holder that the owner knows that the property exists.
(d) (1) The last known address of an apparent owner, for the purpose of determining the jurisdiction over property subject to escheat pursuant to this section, is either of the following:
(A) The address used for purposes of delivering first-class United States mail.
(B) Any description, code, or other indication of the location of the apparent owner that identifies the state of last known address, even if the description, code, or indication of the location is not sufficient to direct the delivery of first-class United States Postal Service mail to the apparent owner.
(2) If there is a conflict between the address identified in subparagraph (A) of paragraph (1) and any description, code, or other indication identified in subparagraph (B) of paragraph (1), the address identified in subparagraph (A) shall be deemed as the last known address of the apparent owner.
(e) If the business association has a mailing address for the apparent owner of a digital financial asset in its records, which is not known to be inaccurate, the business association shall send a notice to the owner via certified mail, return receipt requested.
(f) If the business association does not have a mailing address for the apparent owner of a digital financial asset in its records, and the apparent owner has consented to electronic service, the notice may be sent electronically.
(g) Notice pursuant to this subdivision shall be sent not less than 6 nor more than 12 months before the time the digital financial asset becomes reportable to the Controller under this chapter.
(1) The notice shall state at the top
of the communication: “THE STATE OF CALIFORNIA REQUIRES US TO NOTIFY YOU THAT YOUR UNCLAIMED PROPERTY MAY BE TRANSFERRED TO THE STATE IF YOU DO NOT CONTACT US,” or substantially similar language.
(2) The notice shall specify the time when the digital financial asset will escheat and the effects of escheat, including the need to file a claim for the return of the digital financial asset.
(3) The notice shall do all of the following, in boldface type or in a font a minimum of two points larger than the rest of the notice, exclusive of the heading:
(A) Specify that since the date of last interest, or for the last six years, there has been no indication of owner interest in the digital financial asset.
(B) Identify the digital financial asset by number or identifier, which need not exceed four digits.
(C) Indicate that the digital financial asset is in danger of escheating to the state.
(D) Specify that the Unclaimed Property Law requires business associations to transfer a digital financial asset if it has been unclaimed for seven years.
(4) The notice shall include a form, prescribed by the Controller, by which the owner may confirm the owner’s current address. If that form is completed, signed by the owner, and returned to the holder of the digital financial asset, or other device in which the owner’s property is being held, it is no longer considered
inactive
and the escheat period restarts. In lieu of returning the form, the holder may provide a telephone number or electronic means to enable the owner to contact the holder. If a holder is contacted by a presumed owner by telephone or electronic means, the holder shall document that contact in a memorandum which the holder is required to keep on file. That contact serves to indicate owner interest in the digital financial asset and restarts the escheat period.
(h) In addition to the notice required pursuant to subdivision (b) or (c), the holder may give additional notice at any time between the date of last owner interest and the date the holder transfers the digital financial asset to the Controller.
(i) The holder of any partial key to any digital financial asset that is
subject to Section 1516.5 shall attempt to obtain the minimum number of keys required to transfer the digital financial assets within 60 days of determination that the digital financial assets are eligible for escheatment.
SEC. 8.
Section 1517 of the Code of Civil Procedure is amended to read:1517.
(a) All property distributable in the course of a voluntary or involuntary dissolution or liquidation of a business association that is unclaimed by the owner within seven years after the date of final distribution or liquidation escheats to this state.(b) All property distributable in the course of voluntary or involuntary dissolution or liquidation of an insurer or other person brought under Article 14 (commencing with Section 1010) of Chapter 1 of Part 2 of Division 1 of the Insurance Code, that is unclaimed by the owner after seven years of the date of final distribution, shall be transferred to the Department of Insurance, with any proceeds of sale of property and other funds to
be deposited in the Insurance Fund for expenditure as provided in Section 12937 of the Insurance Code.
(c) This section applies to all tangible personal property located in this state and, subject to Section 1510, to all intangible personal property.
SEC. 9.
Section 1518 of the Code of Civil Procedure is amended to read:1518.
(a) (1) All tangible personal property located in this state and, subject to Section 1510, all intangible personal property, including intangible personal property maintained in a deposit or account, and the income or increment on such tangible or intangible property, held in a fiduciary capacity for the benefit of another person escheats to this state if for more than seven years after it becomes payable or distributable, the owner has not done any of the following:(A) Increased or decreased the principal.
(B) Accepted payment of principal or income.
(C) Corresponded in writing concerning the property.
(D) Otherwise indicated an interest in the property as evidenced by a memorandum or other record on file with the fiduciary.
(2) Notwithstanding paragraph (1), tangible or intangible property, and the income or increment on the tangible or intangible property, held in a fiduciary capacity for another person shall not escheat to the state if the requirements of subparagraphs (A) and (B) are satisfied.
(A) During the previous seven years, the fiduciary took one of the following actions:
(i) Held another deposit or account for the benefit of the owner.
(ii) Maintained a deposit or account on behalf of the owner in an individual retirement account.
(iii) Held funds or other property under a retirement plan for a self-employed individual, or similar account or plan, established pursuant to the internal revenue laws of the United States or the laws of this state.
(B) During the previous seven years, the owner has done any of the acts described in subparagraph (A), (B), (C), or (D) of paragraph (1) with respect to the deposit, account, or plan described in subparagraph (A), and the fiduciary has communicated electronically or in writing with the owner at the address to which communications regarding that deposit, account, or plan are regularly sent, with regard to the deposit, account, or plan that would otherwise
escheat under this subdivision. “Communications,” for purposes of this subparagraph, includes account statements or statements required under the internal revenue laws of the United States.
(b) Funds in an individual retirement account or a retirement plan for self-employed individuals or similar account or plan established pursuant to the internal revenue laws of the United States or of this state are not payable or distributable within the meaning of subdivision (a) unless either of the following is true:
(1) Under the terms of the account or plan, distribution of all or part of the funds would then be mandatory.
(2) For an account or plan not subject to mandatory distribution requirement under the internal revenue laws of the
United States or the laws of this state, the owner has attained 701/2 years of age.
(c) For the purpose of this section, when a person holds property as an agent for a business association, he or she is they are deemed to hold the property in a fiduciary capacity for the business association alone, unless the agreement between him or her them and the business association clearly provides the contrary. For the purposes of
this chapter, if a person holds property in a fiduciary capacity for a business association alone, he or she is they are the holder of the property only insofar as the interest of the business association in the property is concerned and the association is deemed to be the holder of the property insofar as the interest of any other person in the property is concerned.
SEC. 10.
Section 1518.5 of the Code of Civil Procedure is amended to read:1518.5.
(a) Subject to Section 1510, funds maintained in a preneed funeral trust or similar account or plan escheat to the state if, for more than seven years after the funds became payable and distributable pursuant to subdivision (b), as established from the records of the funeral establishment or trustee, the beneficiary or trustor has not corresponded electronically or in writing concerning the property or otherwise indicated an interest, as evidenced by a memorandum or other record on file with the funeral establishment or trustee.(b) For the purposes of this section, the corpus of a preneed funeral trust or similar account or plan, together with any income accrued, less a
revocation fee not to exceed the amount reserved pursuant to Section 7735 of the Business and Professions Code, becomes payable and distributable under any of the following circumstances:
(1) The beneficiary of the trust attained, or would have attained if living, 105 years of age.
(2) Forty-five years have passed since execution of the preneed funeral agreement.
(3) The holder received notification of the death or presumed death of the beneficiary and has not provided the contracted funeral merchandise or services.
(4) The preneed funeral trust is a preneed installment trust and the amount due to the funeral establishment from the trustor has not been paid
during the seven preceding years and neither the trustor nor the beneficiary has communicated with either the funeral establishment or the trustee about the preneed funeral installment trust during that seven-year period.
(c) For purposes of this section, except subdivision (d), the funeral establishment obligated to provide preneed funeral services under the trust or similar account or plan is the holder. For purposes of subdivision (d), the trustee is the holder.
(d) (1) All funds, including accrued income and revocation fees reserved pursuant to Section 7735 of the Business and Professions Code, maintained in a preneed funeral trust or similar account or
plan held by a trustee for a funeral establishment that has been dissolved, closed, or had its license revoked shall escheat to the state if unclaimed by the funeral establishment, beneficiary, trustor, or legal representative of either the beneficiary or trustor within six months after the date of final distribution or liquidation.
(2) Notwithstanding paragraph (1), the revocation fee pursuant to Section 7735 of the Business and Professions Code shall not be retained by the funeral establishment.
(e) Escheatment of preneed funeral trust funds to the Controller shall release the funeral establishment from the obligation of furnishing the personal property, funeral merchandise, or services originally arranged in the preneed funeral agreement associated with the trust.
However, if the funeral establishment provided personal property, or funeral merchandise or services to the
beneficiary after funds have escheated, the funeral establishment shall be entitled to recover the escheated funds upon submission to the Controller of a death certificate and a statement detailing the personal property or funeral merchandise or services provided pursuant to Section 1560.
(f) Nothing in this section, or any other law or regulation, shall require escheatment of any funds received by a funeral establishment, cemetery, or other person from property or funeral merchandise or services provided under Chapter 4 (commencing with Section 8600) of Part 3 of Division 8 of the Health and Safety Code.
(g) A trustee or a funeral establishment shall not charge the trust, a trustor, or a beneficiary any fees or costs associated with a search or verification conducted
pursuant to this section. However, a trustee or funeral establishment may incorporate fees or costs associated with a search or verification as part of the administration of the trust pursuant to Section 7735 of the Business and Professions Code.
(h) Delivery of the corpus of the trust, and the income accrued to the trust, to the funeral establishment, the trustor, the beneficiary, or the Controller pursuant to this article shall relieve the trustee of any further liability with regard to those funds.
(i) This section shall become operative on January 1, 2023.
SEC. 11.
Section 1519 of the Code of Civil Procedure is amended to read:1519.
All tangible personal property located in this state, and, subject to Section 1510, all intangible personal property, held for the owner by any government or governmental subdivision or agency, that has remained unclaimed by the owner for more than seven years escheats to this state.SEC. 12.
Section 1519.5 of the Code of Civil Procedure is amended to read:1519.5.
Subject to Section 1510, any sums held by a business association that have been ordered to be refunded by a court or an administrative agency including, but not limited to, the Public Utilities Commission, which have remained unclaimed by the owner for more than seven years after becoming payable in accordance with the final determination or order providing for the refund, whether or not the final determination or order requires any person entitled to a refund to make a claim for it, escheats to this state.It is the intent of the Legislature that the provisions of this section shall apply retroactively to all funds held by business associations on or after January 1, 1977, and which remain undistributed by the
business association as of the effective date of this act.
Further, it is the intent of the Legislature that nothing in this section shall be construed to change the authority of a court or administrative agency to order equitable remedies.
SEC. 13.
Section 1520 of the Code of Civil Procedure is amended to read:1520.
(a) All tangible personal property located in this state and, subject to Section 1510, all intangible personal property, except property of the classes mentioned in Sections 1511, 1513, 1514, 1515, 1515.5, 1516, 1516.5, 1517, 1518, 1518.5, 1519, and 1521, including any income or increment thereon and deducting any lawful charges, that is held or owing in the ordinary course of the holder’s business and has remained unclaimed by the owner for more than seven years after it became payable or distributable escheats to this state.(b) Except as provided in subdivision (a) of Section 1513.5, subdivision (b) of Section 1514, subdivision (d) of Section 1516, and subdivisions (b) and (c) of
Section 1516.5, if the holder has in its records an address for the apparent owner of property valued at fifty dollars ($50) or more, which the holder’s records do not disclose to be inaccurate, the holder shall make reasonable efforts to notify the owner by mail or, if the owner has consented to electronic notice, electronically, that the owner’s property will escheat to the state pursuant to this chapter. The notice shall be mailed not less than 6 nor more than 12 months before the time when the owner’s property held by the business becomes reportable to the Controller in accordance with this chapter. The face of the notice shall contain a heading at the top that reads as follows: “THE STATE OF CALIFORNIA REQUIRES US TO NOTIFY YOU THAT YOUR UNCLAIMED PROPERTY MAY BE TRANSFERRED TO THE STATE IF YOU DO NOT CONTACT US,” or substantially similar language. The notice required by this subdivision
shall specify the time when the property will escheat and the effects of escheat, including the need to file a claim in order for the owner’s property to be returned to the owner. The notice required by this section shall, in boldface type or in a font a minimum of two points larger than the rest of the notice, exclusive of the heading, (1) specify that since the date of last activity, or for the last six years, there has been no owner activity on the deposit, account, shares, or other interest; (2) identify the deposit, account, shares, or other interest by number or identifier, which need not exceed four digits; (3) indicate that the deposit, account, shares, or other interest is in danger of escheating to the state; and (4) specify that the Unclaimed Property Law requires holders to transfer funds of a deposit, account, shares, or other interest if it has been inactive for seven years. It shall also
include a form, as prescribed by the Controller, by which the owner may confirm the owner’s current address. If that form is filled out, signed by the owner, and returned to the holder, it shall be deemed that the account, or other device in which the owner’s property is being held, remains currently active and recommences the escheat period. In lieu of returning the form, the holder may provide a telephone number or other electronic means to enable the owner to contact the holder. With that contact, as evidenced by a memorandum or other record on file with the holder, the account or other device in which the owner’s property is being held shall be deemed to remain currently active and shall recommence the escheat period. The holder may impose a service charge on the deposit, account, shares, or other interest for this notice in an amount not to exceed the administrative cost of mailing or
electronically sending the notice and form, and in no case to exceed two dollars ($2).
(c) In addition to the notice required pursuant to subdivision (b), the holder may give additional notice as described in subdivision (b) at any time between the date of last activity by, or communication with, the owner and the date the holder transfers the property to the Controller.
(d) For purposes of this section, “lawful charges” means charges that are specifically authorized by statute, other than the Unclaimed Property Law, or by a valid, enforceable contract.
SEC. 14.
Section 1521 of the Code of Civil Procedure is amended to read:1521.
(a) Except as provided in subdivision (b), and subject to Section 1510, all employee benefit plan distributions and any income or other increment thereon escheats to the state if the owner has not, within seven years after it becomes payable or distributable, accepted the distribution, corresponded in writing concerning the distribution, or otherwise indicated an interest as evidenced by a memorandum or other record on file with the fiduciary of the trust or custodial fund or administrator of the plan under which the trust or fund is established. As used in this section, “fiduciary” means any person exercising any power, authority, or responsibility of management or disposition with respect to any money or other property of a retirement system or plan, and “administrator” means the person specifically so designated by the plan, trust agreement, contract, or other instrument under which the retirement system or plan is operated, or if none is designated, the employer.(b) Except as provided in subdivision (c), an employee benefit plan distribution and any income or other increment thereon shall not escheat to this state if, at the time the distribution shall become payable to a participant in an employee benefit plan, the plan contains a provision for forfeiture or expressly authorizes the administrator to declare a forfeiture of a distribution to a beneficiary thereof who cannot be found after a period of time specified in the plan, and the trust or fund established under the plan has not terminated prior to the date on which the distribution would become forfeitable in
accordance with the provision.
(c) A participant entitled to an employee benefit plan distribution in the form of residuals shall be relieved from a forfeiture declared under subdivision (b) upon the making of a claim therefor.
(a)Any person, excluding another state, who claims to have been the owner, as defined in subdivision (d), of property paid or delivered to the Controller under this chapter may file a claim to the property or to the net proceeds from its sale. The claim shall be on a form prescribed by the Controller and shall be verified by the claimant.
(b)The Controller shall consider each claim within 180 days after it is filed to determine if the claimant is the owner, as defined in subdivision (d), and may hold a hearing and receive evidence. The Controller shall give written notice to the claimant if the Controller denies the claim in whole or in part. The notice may be given by mailing it
to the address, if any, stated in the claim as the address to which notices are to be sent. If no address is stated in the claim, the notice may be mailed to the address, if any, of the claimant as stated in the claim. A notice of denial need not be given if the claim fails to state either an address to which notices are to be sent or an address of the claimant.
(c)(1)Interest shall not be payable on any claim paid under this chapter. The Controller shall add interest to the amount of any claim paid to the owner under this section for the period from the date the rightful owner filed a claim pursuant to subdivision (a) through the date the property is returned. Any interest required to be paid by the state pursuant to this section shall be computed as simple interest, not as compound interest.
(2)The interest paid on successful claims shall be at the rate of 5 percent per year or the bond equivalent rate of 13-week United States Treasury bills, whichever is lower.
(3)The bond equivalent rate of 13-week United States Treasury bills shall be defined as:
(A)The bond equivalent rate of 13-week United States Treasury bills established at the first auction held during the month of January shall apply for the following July 1 to December 31, inclusive.
(B)The bond equivalent rate of 13-week United States Treasury bills established at the first auction held during the month of July shall apply for the following January 1 to June 30, inclusive.
(d)Notwithstanding subdivision (g) of Section 1501, for purposes of filing a claim pursuant to this section, “owner” means the person who had legal right to the property before its escheat, the person’s heirs or estate representative, the person’s guardian or conservator, or a public administrator acting pursuant to the authority granted in Sections 7660 and 7661 of the Probate Code. An “owner” also means a nonprofit civic, charitable, or educational organization that granted a charter, sponsorship, or approval for the existence of the organization that had the legal right to the property before its escheat but that has dissolved or is no longer in existence, if the charter, sponsorship, approval, organization bylaws, or other governing documents provide that unclaimed or surplus property shall be conveyed to the granting organization upon
dissolution or cessation to exist as a distinct legal entity. Only an owner, as defined in this subdivision, may file a claim with the Controller pursuant to this article.
(e)Following a public hearing, the Controller shall adopt guidelines and forms that shall provide specific instructions to assist owners in filing claims pursuant to this article.
(f)Notwithstanding any other provision, property reported to, and received by, the Controller pursuant to this chapter in the name of a state agency, including the University of California and the California State University, or a local agency, including a school district and community college district, may be transferred by the Controller directly to the state or local agency without the filing of a claim. Property transferred pursuant to
this subdivision is immune from suit pursuant to Section 1566 in the same manner as if the state or local agency had filed a claim to the property. For purposes of this subdivision, “local agency” means a city, county, city and county, or district.
SEC. 16.SEC. 15.
Section 1563 of the Code of Civil
Procedure is amended to read:1563.
(a) Except as provided in subdivisions (b) and (c), all escheated property delivered to the Controller under this chapter shall be maintained in its escheated form.(b) Digital financial assets held by the Controller may be converted to fiat currency at prevailing prices by any method that the Controller may determine to be advisable. The Controller shall convert such digital financial assets no sooner than 18 months, but no later than 20 months, after the actual date of filing of the report required by Section 1530. If digital financial assets delivered to the Controller remain in the custody of the Controller, a person making a valid claim for those assets under this chapter shall be
entitled to receive the digital financial assets from the Controller. If the digital financial assets have been converted, the person shall be entitled to receive the net proceeds received by the Controller from its sale.
(c) (1) All escheated property consisting of military awards, decorations, equipment, artifacts, memorabilia, documents, photographs, films, literature, and any other item relating to the military history of California and Californians that is delivered to the Controller is exempt from subdivision (a) and may, at the discretion of the Controller, be held in trust for the Controller at the California State Military Museum and Resource Center, or successor entity. All escheated property held in trust pursuant to this subdivision is subject to the applicable regulations of the United States Army governing Army museum activities as described in Section 179 of the Military and Veterans Code. A person claiming an interest in the escheated property may file a claim to the property pursuant
to Article 4 (commencing with Section 1540).
(2) The California State Military Museum and Resource Center, or successor entity, shall be responsible for the costs of storage and maintenance of escheated property delivered by the Controller under this subdivision.
(d) The purchaser at any sale conducted by the Controller pursuant to this chapter shall receive title to the property purchased, free from all claims of the owner or prior holder thereof and of all persons claiming through or under them. The Controller shall execute all documents necessary to complete the transfer of title.
