Escheatment

Title Research can assist with the administration of US and Canadian shareholdings 

If a US asset is considered dormant, which can take between 3-5 years, then it can escheat to a State Comptroller’s Office where it is liquidated and the resulting funds held on an unclaimed asset register. 

A US asset can be considered dormant if no new activity is registered on an account. This can include no changes to account ownership or the registered address, no new investment e.g. through the purchase of additional shares , or when dividends remain uncashed. 

If a US asset holder has deceased then it can be challenging to register activity on an account and as a result, escheatment can often occur. This is especially the case when the UK estate must first obtain tax clearance from the IRS, which can take over 2 years. 

Escheatment can cause several challenges to UK estate practitioners as it can make valuing an asset difficult. Whilst asset companies can confirm when escheatment has occurred, they cannot confirm the value as it is the purview of the relevant state to liquidate an escheated asset at a time of its choosing. In addition, once liquidated, the original asset no longer exists and can no longer either depreciate or appreciate in value. 

If escheatment does occur, Title Research can assist with reclaiming funds from the relevant state on behalf of the estate.