Delaware and a coalition of 30 states have reached a settlement concluding the damages phase of a long-running unclaimed property dispute involving MoneyGram Payment Systems, Inc. The U.S. Supreme Court had previously ruled that unclaimed official checks issued by MoneyGram are subject to the Federal Disposition Act. As part of the settlement, Delaware will transfer over $102 million to the coalition states, based on where the unclaimed checks were purchased. Additionally, approximately $89 million from an escrow account will be distributed among all 50 states. The states will now take responsibility for returning the unclaimed funds to their rightful owners, bringing nearly eight years of litigation to a close. Delaware officials expressed their commitment to improving compliance with state unclaimed property laws and reuniting owners with their assets.
Additional Information from the Office of Unclaimed Property:
Officials from the state of Delaware, and officials from the states of Arkansas, Pennsylvania, California, Texas, and Wisconsin on behalf of a bipartisan coalition of 30 states, announced that they have agreed to a settlement ending the outstanding damages phase of an unclaimed property dispute before the U.S. Supreme Court. In 2023, a unanimous U.S. Supreme Court sided with Arkansas and its coalition partners in holding that unclaimed official checks issued by MoneyGram Payment Systems, Inc. (“MoneyGram”) are governed by the Federal Disposition Act.
The settlement effectively ends the remaining damages phase of the consolidated actions of State of Delaware v. Commonwealth of Pennsylvania et al., No. 145 Original, and State of Arkansas, et al. v. State of Delaware, No. 146 Original.
Under the terms of the settlement, Delaware will transfer more than $102 million of the property that MoneyGram reported to Delaware from 2011 to 2017 to the coalition states, based on each monetary instrument’s place of purchase. Delaware’s transfer represents roughly half of the report years disputed in the litigation.
In addition, approximately $89 million deposited by MoneyGram in a litigation escrow account from 2018 to 2022, plus interest earned, will be distributed among all 50 states based on each instrument’s place of purchase. The coalition states will receive nearly $55 million, plus earned interest, from the escrow account.
States will assume custody and responsibility to return any property received under the terms of the settlement or from the escrow account to owners, including paying any claims for the property.
The settlement agreement ends the outstanding parts of the ongoing litigation before the U.S. Supreme Court.
“Delaware is pleased to bring this matter to a close with the signing of this historic interstate settlement agreement,” said Brenda R. Mayrack, Delaware State Escheator and Director of the Office of Unclaimed Property. “Going forward, we look forward to working cooperatively and constructively with our sister states to focus on reuniting owners with their property and improving holder compliance with state unclaimed property laws.”
“This settlement brings to an end nearly eight years of litigation over unclaimed Official Checks and returns to the people of Arkansas, our coalition partners, and other states more than $190 million dollars,” Arkansas Attorney General Tim Griffin said. “I’m proud of our work on this important case, and I’m grateful to our coalition partners—particularly the Attorneys General of California, Texas, and Wisconsin, and attorneys for Pennsylvania—for their hard work on this matter. I look forward to reuniting the people of Arkansas with their money.”
“The Pennsylvania Treasury Department first questioned the reporting of this type of property by MoneyGram to Delaware nine years ago, leading the way on this important issue,” said Pennsylvania Treasurer Stacy Garrity. “Under this settlement, Pennsylvania residents will be able to claim their unclaimed funds directly from the state treasury. I’m pleased to finally conclude this case and eager to start returning this money.”
“This settlement is an important step towards clarifying the proper disposition of abandoned official checks, which prior to today have improperly been delivered to Delaware,” stated California State Controller Malia Cohen. “The owners of these checks can now claim them directly from the state where they were purchased rather than a state that had no connection to their sale.”
“This settlement is a great result for the State of Wisconsin and Wisconsin consumers,” said Wisconsin Attorney General Josh Kaul. “Thanks to the coalition’s hard work, which culminated in this important settlement, Wisconsin will receive millions of dollars and have the opportunity to reunite some of these funds with their rightful owners.”
“I am pleased that we have been able to reach an agreement with Delaware to release money wrongfully withheld from Texas in violation of federal law,” Texas Attorney General Ken Paxton said. “Texas worked diligently with Arkansas and all of our coalition partners to ensure that unclaimed funds wrongly delivered to Delaware were released to the states with rightful claims.”
In addition to Arkansas, Pennsylvania, California, Texas, and Wisconsin, the original action in the Supreme Court against Delaware was joined by the States of Alabama, Arizona, Colorado, Florida, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Michigan, Montana, Nebraska, Nevada, North Dakota, Ohio, Oklahoma, Oregon, South Carolina, Utah, Virginia, Washington, West Virginia, and Wyoming.
