Minnesota is right to join other states in seeking money that should have gone to consumers.
At issue is mail-in rebates consumers use to save money on certain products. Sometimes, for whatever reasons, consumers don’t end up cashing their rebate checks. The unclaimed money, up until the early part of the decade, has been kept by retailers, manufacturers and the companies that processed the rebates.
Now, Minnesota and 42 other states claim the money belongs to consumers. And if it goes unclaimed, it belongs to the states. More than 400 million checks, worth up to $8 billion, are sent to consumers every years. From 3 to 5 percent go uncashed.
Officials from Iowa, which has taken the lead on the lawsuit, say consumers have a right to the money forever, because the company has admitted an obligation. The lawsuit claims that Minnesota-based Young America took uncashed checks totally nearly $43 million from 1995 to 2002 and didn’t report it.
Clearly, consumers must take responsibility for cashing these rebate checks. However, this money should not simply go to the company that processes the rebates.
Instead, we agree with the lawsuit that at some point, unclaimed rebate checks should be handled like a bank account or insurance policy that has gone unclaimed — states should try to find the rightful owner.
In Minnesota, unclaimed property laws typically cover abandoned checking and savings accounts, uncashed payroll checks, unclaimed safe deposit box contents and stocks and bonds. States have three years to find owners or beneficiaries and after that, the money goes to the general fund. In 2007, Minnesota paid $20.5 million of the $56 million in unclaimed property it collected. That’s a pretty good job of getting property back to its rightful owners.
When people seek and are provided a rebate check, they certainly ought to cash it. If they don’t, we believe the states should get the money and try to find the owner. But the money should not go to the rebate processor.