Legal Alert: Beware! Compliance Issues with State Unclaimed Property Laws Can Have a Devastating Impact on Your Business - Voluntary Disclosure May Reduce Exposure
Did you know that compliance issues with unclaimed property laws can create more than just potential exposure with the state taxing authorities? Failure to comply can also create regulatory problems that could dwarf the state liability exposure. Unclaimed property laws are intended to prevent a business from realizing a windfall if the business holds the property of another party. States have specific rules about how this property must be handled, reported, and transferred to the states. If these rules are not followed completely, the consequences can be significant and, for publicly traded companies, may lead to a Securities & Exchange Commission investigation or other collateral consequences.