Finders Keepers: Companies Demand Big Fees For Lost Property

By Lisa Parker

NBC Channel 5, Chicago IL

Published Thursday, March 13, 2008

Watch the NBC Channel 5 Video

CHICAGO -- The following is a verbatim transcript of Lisa Parker's March 13 report, Finder's Keepers.

Now to an exclusive Target 5 report, Finder's Keepers.

They're in the business of locating your unclaimed property, but now finder firms are finding themselves in an uncomfortable spot. Why Illinois lawmakers are now considering a crackdown. Here is Lisa Parker.

Parker: The person on the other end of the phone says you have unclaimed property, and she knows where it is. She'll tell you, but not until you agree to give her company a cut of the money. That much may sound reasonable, but it's the amount she's asking for that has some consumers and legislators up in arms.

Baldwin: This is a picture of my dad and my daughter."

A year and a half after losing his father ...

Baldwin: "He was a great guy. I miss him."

... Chicagoan Daniel Baldwin Jr. opened one letter.

Baldwin: "It says please contact us immediately."

And suddenly had a mystery on his hands.

Baldwin: "They had located an asset of my father's that was not part of the settled estate ... they wouldn't tell me what it was."

A $12,000 windfall with a hitch.

Baldwin: "They would find it for us and give us the amount for a finder's fee of 35 percent, and I mean, I thought that was outrageous."

Somehow a New York-based finder's firm, the kind of company that locates owners of unclaimed property, knew something about his dad's estate that he, the executor, did not.

Baldwin: "I said, 'Well, can you give me a hint? Is it life insurance? Is it a stock?'"

Equally as frustrated:

Higgins: "Wrong, wrong, wrong."

Attorney Jim Higgins, who says he was first approached by phone.

Higgins: "One to two calls a day."

And then in the mail, with a contract from a Chicago finder's firm asking for 50 percent of an unclaimed asset about which they would tell him nothing.

Higgins: "What I tried to find out is to pin them down as close as I could to fact and that was impossible."

Controversial but legal. Here's how it works in Illinois:

Let's say you forget all about a savings account. The bank deems it abandoned. By law, they can hold onto it for five years -- that's the window when finder's firms, working with the financial companies, step in and make their money by finding you.

When the five years is up, the finders firms are out because the unclaimed asset must be turned over to the state of Illinois, where you can get it back for free.

Giannoulias: "It's been something my administration has taken very seriously."

State Treasuer Alexi Giannoulias, reacting to complaints from consumers, is pushing for reform.

Giannoulias:"Essentially, these companies are duping consumers for substantial amounts of money on property that is already theirs."

Giannoulias acknowledges finders firms perform a service, but says their fees are out of line.

A proposed law he supports would cap finder firm fees at 10 percent of the asset in question and ...

Giannoulias:"We also want these companies to be required to give these consumers information about where the property is located."

It is an industry that no doubt pleases some but irks others: people on blogs and plaintiffs in class action lawsuits have taken aim at finder's firms, accusing them of concealing information and misrepresenting the facts.

But the firms deny that and tell Target 5 they provide a valuable service, reuniting consumers with lost funds and doing it, they say, more effectively than state governments ever could.

With more than $35 billion of unclaimed property out there, it's a business that begs the question: Should there be a fee for forgetting?

Giannoulias:"The alarming percent profit they're taking is something we're aiming to get rid of."

Parker: Major finder firms Equisearch and Keane, and Chicago-based Kensington Research all say the proposed Illinois law would be bad for consumers, and accuse the state of wanting to control the unclaimed assets for its own financial benefit. The treasurer's office doesn't see it that way, and says the law would level the playing field for consumers.