Can South Dakota's State Treasurer proactively find owners of small unclaimed property holdings and mail them a check, without waiting for the owner to file a claim?

Plain-English summary

South Dakota holds millions of dollars in unclaimed property — forgotten bank accounts, uncashed paychecks, insurance refunds, dormant stocks. The State Treasurer is the legal custodian under the Uniform Unclaimed Property Act (SDCL ch. 43-41B). Traditionally, the burden was on the property owner to know that the State held their money and to file a claim to get it back. Most owners never knew.

State Treasurer Josh Haeder asked the AG whether his Unclaimed Property Division could use a data matching system to find owners proactively and just send them a check, without waiting for them to claim it. The Division had actually started doing this during COVID for small dollar amounts ($10 to $5,000) where the records had a full tax ID number and a South Dakota address. A verification step confirmed the match, then the Division mailed a check. Any undeliverable checks were canceled and re-recorded.

AG Marty Jackley said yes. The statute that governs claims (SDCL 43-41B-25) says an owner "may file a claim." Under standard statutory construction (Matter of Gronseth International, Inc. gives the leading South Dakota rule), "may" is permissive, not exclusive. The Act does not say owners "must" file claims to get their property back. It just creates a claim process for those who want to use it.

Combined with the Treasurer's general duty to safekeep public moneys (SDCL 1-10-1) and his role as administrator under the Act, the Treasurer has authority to actively return property when he can confirm ownership through the records he already has. The opinion specifically blesses the Division's COVID-era data matching protocol.

This is a strong consumer-protection opinion: it puts the State on the hook (operationally) to find people rather than waiting for them to find the State.

What this means for you

If you are running a state Treasurer's unclaimed property division

The opinion validates the proactive-return approach. You can:

• Build or expand data-matching capability against the Unclaimed Property database.
• Define qualifying properties (the South Dakota Division uses $10-$5,000 with a complete federal tax ID number on file plus a last-known South Dakota address; you can choose different thresholds).
• Run verification before mailing — a confirmed identity match is essential, both to avoid fraud and to satisfy the Treasurer's safekeeping duty.
• Handle returned mail correctly: cancel the check, re-record the unclaimed status, and document the failed delivery.

Build audit trails. The opinion approves the practice because the Treasurer is the property's safekeeper; that role implies accountability for what happens to the money. Detailed logging protects you in case of any future claim against the program (an owner alleging the wrong person received their property, for example).

If you are a state Treasurer in another state

This opinion is South Dakota-specific but its reasoning generalizes. Most states have adopted the Uniform Unclaimed Property Act with similar permissive-claim language. The SDCL § 43-41B-25 "may file a claim" language tracks the uniform act. If your state's framework reads the same way, an AG opinion or internal legal analysis along these lines could authorize a similar proactive-return program in your state.

A few states (notably California, Oregon, Illinois) have moved aggressively in this direction. The AG opinion adds South Dakota to the list of states that have explicitly endorsed proactive return.

If you have unclaimed property in South Dakota

You may receive a check from the State Treasurer without ever having submitted a claim. This is real, not a scam. To verify before depositing:

• Cross-check the sender against the official Treasurer's office contact info on sd.gov.
• Verify the property listed on the check against the South Dakota Unclaimed Property database (search by your name).
• The amount will be between $10 and $5,000 under the current Division thresholds.

If you have unclaimed property over $5,000 or your records don't include a tax ID, the proactive program may not cover you. File a claim through the Treasurer's website to recover it.

If you are a property holder (bank, employer, insurer) required to remit unclaimed property

Your obligations under SDCL 43-41B-18 and 43-41B-20 to remit unclaimed property to the State Treasurer are unchanged. The proactive-return program only affects what the Treasurer does with property after she or he receives it. Your reporting should continue as required.

The opinion is a reminder of why the holder reporting matters: the more complete your records when you remit (full owner name, address, tax ID), the more likely the Treasurer can return the property without burden on the owner. Inaccurate or incomplete remittance data effectively traps the property in the State's general fund.

If you advise nonprofit charities or estates

When a deceased person's estate has an unclaimed-property claim, the proactive-return program may simplify recovery. Heirs can:

• Check the Unclaimed Property database for the decedent's name.
• If a check has already been issued and returned (because the decedent's last-known address is no longer valid), the property will be back in the general fund — but the matching record still exists, and the heirs can submit a claim with letters testamentary or other estate documentation.

The opinion does not change estate-claim procedures, but the increased data-matching activity may accelerate recovery for many estates.

Common questions

Q: How much unclaimed property does South Dakota hold?
A: The opinion does not give a total, but unclaimed property programs nationally hold tens of billions of dollars; South Dakota's share is in the tens or hundreds of millions. The Treasurer's office publishes annual reports with current totals.

Q: How does the data matching process work?
A: The Division's software searches the Unclaimed Property database for properties between $10 and $5,000 that have a complete federal tax identification number on file and a last-known South Dakota address. Matches are verified, then a claim is created and a check mailed. Undeliverable checks are canceled and recorded.

Q: Will I be charged for the return?
A: No. The State does not charge owners to return their own property. The Act provides for the return of "property or the amount the administrator actually received or the net proceeds if the property has been sold" (SDCL 43-41B-25(c)), plus any additional amount required by SDCL 43-41B-22.

Q: What if my property has been sold by the State?
A: SDCL 43-41B-23 allows the Treasurer to sell unclaimed property at public sale after a specified period. If your property was sold, you receive the net proceeds of the sale rather than the property itself (SDCL 43-41B-25(c)). For property presumed abandoned under SDCL 43-41B-10 (which includes specific categories like stocks) and sold within 180 days of the State's receipt, the amount payable is the net sale proceeds.

Q: What stops the State from misidentifying an owner and sending them someone else's money?
A: The verification step before issuing a check. The Division uses a complete federal tax identification number plus a last-known South Dakota address. The match has to clear both criteria. The opinion implicitly relies on this verification standard to protect the program from misrouting.

Q: Could the Treasurer expand the program to larger amounts or different property types?
A: The opinion authorizes proactive return generally; it does not set a statutory cap. The $10-$5,000 range and the tax-ID-and-address verification standard are operational choices by the Division, not statutory limits. The Treasurer could adjust them.

Q: Does this opinion bind future Treasurers?
A: AG opinions are not binding precedent, but they are persuasive guidance for state constitutional officers. A future Treasurer could continue, expand, or modify the program. A future AG could revisit the opinion.

Q: What if I never lived in South Dakota?
A: The current data-matching program only acts when the last-known address is in South Dakota. If you have unclaimed property in South Dakota but your last-known address was elsewhere, you would need to file a claim through the Treasurer's website.

Background and statutory framework

The Uniform Unclaimed Property Act (SDCL ch. 43-41B) is South Dakota's adoption of model legislation drafted by the Uniform Law Commission. The framework:

1. Presumption of abandonment. Property held by a business and unclaimed for a specified period is presumed abandoned. The specific periods vary by property type (SDCL 43-41B-5 through -17): typically 3-5 years for bank accounts, shorter for paychecks, longer for some insurance products.
2. Holder remittance. When property is presumed abandoned and meets statutory connection-to-state criteria (SDCL 43-41B-3), the holder pays or delivers it to the State Treasurer (SDCL 43-41B-18, -20). The Treasurer then assumes custody and responsibility for safekeeping (SDCL 43-41B-21).
3. Notice and publication. The Treasurer publishes notices identifying unclaimed property and apparent owners (SDCL 43-41B-19). This is the traditional discovery mechanism.
4. Claim process. SDCL 43-41B-25 sets the framework for owners to file claims. The administrator has 180 days to consider claims and either pay them or deny them with notice.
5. Public sale. Property unclaimed for a further specified period may be sold at public sale (SDCL 43-41B-23). Proceeds are deposited in the State's general fund (SDCL 43-41B-24).

The Treasurer's general duty under SDCL 1-10-1 to "safely keep all public moneys ... and pay out the same as directed by law" applies to unclaimed property held by the office. The Treasurer is a constitutional officer (S.D. Const. Art. IV § 7), independently elected, with duties partly defined by statute and partly inherent to the office.

The opinion's key move is the textual reading of "may" in SDCL 43-41B-25. South Dakota courts have held that "may" creates permissive or discretionary authority (Matter of Gronseth International, Inc., 442 N.W.2d 229, 231 (S.D. 1989)). Permissive language about owner action does not implicitly forbid the Treasurer from taking other lawful action consistent with the Act's purposes. The Act's purpose is to return abandoned property to its rightful owners; proactive return advances that purpose; nothing in the Act prohibits it.

The COVID-era origin of the data-matching program is significant: the Division began the program when in-person filing of claims became difficult. The opinion essentially confirms what the Division was already doing was lawful, with a sufficiently rigorous verification process to avoid misrouting.

Citations and references

Statutes:
- S.D. Const. Art. IV § 7 (Treasurer's office)
- SDCL 1-10-1 (Treasurer's duties)
- SDCL 4-6-22 (Treasurer's accounting)
- SDCL 43-41B-1 et seq. (Uniform Unclaimed Property Act)

Cases:
- Matter of Gronseth International, Inc., 442 N.W.2d 229 (S.D. 1989) ("may" is permissive or discretionary)
- Olson v. Butte County Comm'n, 2019 S.D. 13, 925 N.W.2d 463 (plain-language interpretation)

Source

• Landing page: https://atg.sd.gov/OurOffice/OfficialOpinions/opinions.aspx
• Original PDF: https://atg.sd.gov/OfficialOpinions/Official%20Opinion%2025-01%20.pdf

Original opinion text

OFFICIAL OPINION No. 25-01

Re: Official Opinion Concerning the Use of a Data Matching Process to Locate Owners of Unclaimed Property

Dear Treasurer Haeder,

In your capacity as State Treasurer for South Dakota, you have requested an official opinion from the Attorney General's Office on the following question:

QUESTION:

Whether the State Treasurer's Unclaimed Property Division ("Division") can use a data matching process to locate owners of unclaimed property and attempt to return that property without the owner initiating a claim for the property.

ANSWER:

Yes. The Division can use a data matching process to locate owners of unclaimed property and attempt to return that property without the owner initiating a claim.

FACTS:

During COVID, the Division began using a data matching process to locate owners of unclaimed property held by the State Treasurer under the Uniform Unclaimed Property Act (SDCL ch. 43-41B). Under this process, the Division's software provider searches the Unclaimed Property database for qualifying unclaimed properties between $10.00 and $5,000.00. Qualifying properties are those that have a complete Federal Tax Identification number on file and a last-known address in South Dakota. After a verification process, a claim is created and a check is issued and mailed to the property owner. Any checks returned as undeliverable are canceled and recorded in the database.

IN RE QUESTION:

The State Treasurer is an independently elected Constitutional officer. S.D. Const. Art. IV § 7. SDCL § 1-10-1 provides that the Treasurer "shall have charge of and safely keep all public moneys which shall be paid into the state treasury, and pay out the same as directed by law, and perform such other duties as are required of him by law." In addition, the Treasurer "shall account to the state for all money and funds directly or indirectly received by him by virtue of his office, or as interest or compensation for the use, deposit, or forbearance of any state money in his hands or under his control." SDCL § 4-6-22.

The Treasurer also acts as the administrator under the Uniform Unclaimed Property Act ("the Act"). SDCL ch. 43-41B. Under the Act, all intangible property that is held, issued, or owing in the ordinary course of a holder's business and has remained unclaimed by the owner for a certain amount of time after it became payable or distributable is presumed abandoned. SDCL § 43-41B-2 and SDCL §§ 43-41B-5 to 43-41B-17, inclusive. Intangible property includes, but is not limited to, money, checks, interest, income, unpaid commissions, royalties, credit balances, refunds, stocks, insurance policy payouts, benefit plan distributions, and United States savings bonds. SDCL § 43-41B-1(10).

Intangible property is subject to the custody of the State as unclaimed property if it meets the statutory requirements for the presumption of abandonment and certain requirements connecting the property to this state. SDCL § 43-41B-3. The holder of any unclaimed property is required to pay or deliver the unclaimed property to the Treasurer. SDCL §§ 43-41B-18 and 43-41B-20. Upon payment or delivery of the property, "the state assumes custody and responsibility for the safekeeping of the property." SDCL § 43-41B-21. The Treasurer is required to publish notice of unclaimed property and the names of persons appearing to be the owners of the property. SDCL § 43-41B-19. If the property remains unclaimed for the specified period of time after payment or delivery to the Treasurer, it shall be sold at a public sale. SDCL § 43-41B-23. All unclaimed property paid or delivered to the Treasurer shall be deposited in the general fund of this state, including the proceeds from the sale of such property. SDCL § 43-41B-24.

SDCL § 43-41B-25 sets out the process for the owner of unclaimed property to seek its return:

Filing claim with administrator — Handling of claims by administrator.

(a) A person, excluding another state, claiming an interest in any property paid or delivered to the administrator may file a claim on a form prescribed by the administrator and verified by the claimant.

(b) The administrator shall consider each claim within one hundred eighty days after it is filed and provide notice to the claimant if the claim is denied in whole or in part. The notice may be sent by mail to the last address of the claimant stated in the claim for the receipt of notices. In the alternative, the notice may be sent electronically to the last e-mail address of the claimant or to the e-mail address stated in the claim for the receipt of notices.

If no address for notices is stated in the claim, the notice may be mailed to the last address, or emailed to the last e-mail address of the claimant, as stated in the claim. No notice of denial need be given if the claim fails to state either the last mailing or e-mail address to which notices are to be sent or the mailing or e-mail address of the claimant.

(c) If a claim is allowed, the administrator shall pay over or deliver to the claimant the property or the amount the administrator actually received or the net proceeds if the property has been sold by the administrator, together with any additional amount required by § 43-41B-22.

If the claim is for property that is presumed abandoned under § 43-41B-10 and that was sold by the administrator within one hundred eighty days of confirmed receipt of the property, the amount payable for that claim is the net proceeds of sale. When property is paid or delivered to the administrator under this chapter, the owner is not entitled to receive income or other increments accruing thereafter.

You ask whether the Division can use the data matching process described above to locate owners of unclaimed property and pay out claims without the owners themselves initiating the claims process?

The Act does not require owners to initiate the process to claim property; rather it states that an owner "may file a claim." SDCL § 43-41B-25. When interpreting statutes, "'the language expressed in the statute is the paramount consideration.'" Olson v. Butte County Comm'n, 2019 S.D. 13, ¶ 5, 925 N.W.2d 463, 464 (quoting Goetz v. State, 2001 S.D. 138, ¶ 15, 636 N.W.2d 675, 681). "When the language in a statute is clear, certain and unambiguous, there is no reason for construction[.]" The use of the term "may" in SDCL § 43-41B-25 implies a permissive or discretionary act by the owner, not a mandatory or obligatory act. Matter of Gronseth International, Inc., 442 N.W.2d 229, 231 (S.D. 1989) (The use of "may" in a statute gives permissive or discretionary meaning). It is my opinion that the plain language of the statute does not establish owner-initiated claims as the exclusive avenue for the return of unclaimed property held by the Treasurer. I conclude the Treasurer has authority to return unclaimed property to its owners without the owners themselves initiating the process.

Again, the Treasurer has the duty to "have charge of and safely keep all public moneys which shall be paid into the state treasury, and pay out the same as directed by law…" SDCL § 1-10-1. This duty applies to unclaimed property paid or delivered to the Treasurer under the Act. The Treasurer holds the property in trust and is responsible for its safekeeping, and while deposit of the unclaimed property into the general funds benefits the public, the State does not take legal title to the property without further legal process under the Act. The Treasurer has the obligation under the Act to return property to the rightful owner, and even if the property itself has been already sold at a public sale, the Treasurer is required to pay the net proceeds of the sale. SDCL § 43-41B-25.

Importantly, by virtue of the statutory requirements, the Treasurer is in possession of all information needed to verify a claim. Under the Act, the Treasurer must publish notice of unclaimed property with the name of all persons appearing to be owners. SDCL § 43-41B-19. In addition, the Treasurer is required to record the name and last known address of each person appearing to be entitled to the unclaimed property before it is deposited into the general fund. SDCL § 43-41B-24. I find nothing in the Act that prohibits the Treasurer from using the available information to return unclaimed property absent an affirmative act by the owner. Rather, it logically follows that as safekeeper of the property, the Treasurer can and should use the best means available to return unclaimed property to its rightful owner. The technology and information available through the data matching process allows the Treasurer to verify claims and return property in an efficient manner, which is the primary purpose of the Act.

CONCLUSION:

I conclude that based upon the statutory duties and responsibilities of the State Treasurer, including those imposed by the Act, the Treasurer has the authority to use a data matching process to locate owners of unclaimed property and attempt to return that property to the owner without the owner initiating the claim.

Sincerely,

Marty J. Jackley

ATTORNEY GENERAL

MJJ/AS/SRB/dd