San Francisco resident Carla Ruff’s safe-deposit box was drilled, seized, and turned over to the state of California, marked “owner unknown.” “I was appalled,” Ruff said. “I felt violated.”
Unknown? Carla’s name was right on documents in the box at the Noe Valley Bank of America location. So was her address — a house about six blocks from the bank. Carla had a checking account at the bank, too — still does — and receives regular statements. Plus, she has receipts showing she’s the kind of person who paid her box rental fee. And yet, she says nobody ever notified her.
To make matters worse, Ruff discovered the loss when she went to her box to retrieve important paperwork she needed because her husband was dying. Those papers had been shredded.//
And that’s not all. Her great-grandmother’s precious natural pearls and other jewelry had been auctioned off. They were sold for just $1,800, even though they were appraised for $82,500.
“These things were things that she gave to me,” Ruff said. “I valued them because I loved her.”
Okay, okay. So the bank made a mistake, right? A horrible one. But a mistake. Right? Huh, not right?
California law used to say property was unclaimed if the rightful owner had had no contact with the business for 15 years. But during various state budget crises, the waiting period was reduced to seven years, and then five, and then three. Legislators even tried for one year. Why? Because the state wanted to use that free money.
“That’s absolutely correct,” said California State Controller John Chiang, who inherited the situation when he came into office. “What we’ve done here over the last two decades has been dead wrong. We’ve kept the property and not provided owners with the opportunities — the best opportunities — to get their property back.”
Chiang now faces the daunting task of returning $5.1 billion worth of unclaimed property to people. Some states keep their unclaimed property in a special trust fund and only tap into the interest they earn on it. But California dumps the money into the general fund — and spends it.
“It’s supposed to be segregated and protected,” Palmer said. “California has taken all of that $5.1 billion and has used it as a massive loan.”
Awesome! Go California!