Unclaimed Property Due Diligence Letters: Timing and Content

9/21/2026

The due diligence letter is the last step between a dormant account and the state. It is the bank's final attempt to reach the owner before reporting, and it does two jobs at once. It gives the customer a chance to keep the account, and it creates the evidence the bank needs if a state auditor or a returning customer later asks whether the bank tried.

Most states require some form of owner notice before a holder reports unclaimed property, but they differ on almost every parameter: the window, the minimum value, the delivery method, the wording and whether a second notice or publication is required. This post explains the common structure, uses the model act and two state examples to show how the details vary, and covers how to assemble and document a notice program that holds up.

Why the Letter Matters

It reduces what you report. A meaningful share of owners respond to a well-timed letter, and every response is an account the bank keeps rather than sends to the state.

It is evidence. Under the Revised Uniform Unclaimed Property Act, the 2016 model act from the Uniform Law Commission, the holder's report must state that the holder complied with the notice requirements. A state's audit file will look for proof.

It supports the bank's protection after remittance. The 2016 model act relieves a holder that pays or delivers property in good faith, and substantially complies with the notice provisions, of liability arising afterward, and requires the state to defend and indemnify that holder against claims resulting from the remittance. A bank that skipped the notice may be in a weaker position when a customer claims it should not have reported the account.

When the Escheat Notice Goes Out

The model act window

The 2016 model act requires the holder to send notice by first-class U.S. mail not more than 180 days nor less than 60 days before filing the report, if:

the holder has an address for the owner that its records do not show to be invalid and that is sufficient to direct first-class mail, and
the property is worth $50 or more (the dollar figure is bracketed in the act, meaning states may choose their own).

If the owner has consented to receive email from the holder, the notice must go by both first-class mail and email, unless the holder believes the email address is invalid. The commentary notes that this extended the outer window from the 120 days used in earlier model acts.

How states depart from it

Two published state examples show how much the details move:

New York requires a first-class mail notice at least 90 days before the final report to each owner expected to appear on it, and a second notice by certified mail, return receipt requested, at least 60 days before the report for property valued above $1,000, unless the owner has made contact, the first notice came back undeliverable or the address is outside the United States. For banks, the state's reference sheet sets the cycle around a June 30 cutoff, an August 10 first-class mailing date, a September 10 certified mailing date and a November 10 report. New York also requires banks to publish a newspaper notice of owners with property of $50 or more by September 1, subject to its own rules and waivers.
Texas requires holders to send due diligence notices by mail or email no later than 60 days before its July 1 report date, with a March 1 cutoff for abandonment periods.

The lesson is not the specific dates. It is that the notice calendar has to be built state by state from each administrator's current guidance, because two states can require opposite timing in the same month.

Building the calendar

Work backward from each state's report date:

Cutoff date: the date as of which dormancy is measured.
Population run: identify every item that will be reportable, by state and property type.
Address review: confirm the address is usable and not known to be bad.
First notice window: open and close dates under that state's rule.
Second notice or publication, if required.
Response deadline: the date by which an owner reply removes the item from the report.
Final report and remittance date.

Put the dates on the compliance calendar, alongside the other annual items on the year-end bank compliance checklist.

What the Letter Must Say

The model act content

The 2016 model act requires the notice to carry a heading substantially as follows: "Notice. The State of [state] requires us to notify you that your property may be transferred to the custody of the [administrator] if you do not contact us before [a date 30 days after the date of the notice]." It must also:

identify the nature of the property and, unless it has no fixed value, its value;
state that the property will be turned over to the administrator;
state that after it is turned over, the owner must file a claim with the administrator to get it back;
state that property that is not U.S. legal tender may be sold by the administrator; and
tell the owner what to do to prevent the holder from reporting and remitting the property.

What states may add

States may prescribe their own wording, require a form, ask the owner to return a signed statement, or set a response deadline. New York's reference sheet, for example, tells banks to request a signed written statement from the owner acknowledging the property's existence. Use the state's exact wording when it prescribes one, and keep a version of the letter for each state.

Sample letter for unclaimed property: a structure

The following is a structure, not a substitute for any state's prescribed text. Fill each element from the state's requirements.

Heading in the form the state requires, naming the state and the response date.
Account identification: account type, the last four digits of the account number or the check number for an official check, and the amount where it has a fixed value.
Plain statement of what happens: the bank is required to transfer the property to the named state office if the customer does not respond.
What the customer can do: visit a branch, call a stated number, sign and return the enclosed form or reply through a stated channel, with the deadline.
What happens if they do not: the property goes to the state, and the customer can claim it from the state afterward, with the administrator's name.
Sale of non-cash property: where relevant, such as safe deposit box contents, the statement that the state may sell it.
Response form: a tear-off or enclosure the owner signs and returns, with a line for a corrected address.
Fraud reassurance: a sentence telling the customer the bank will never ask for full account credentials by email or text, and a branch phone number from the bank's public directory. Unclaimed property letters are a favorite template for impostors.

Keep the letter short and avoid language that reads like a collection notice. The customer should understand in the first two lines that they have money at the bank and what to do to keep it there.

One letter per owner, per address

Where the bank holds several reportable items for the same owner, one letter covering all of them is easier for the customer and reduces mailing cost. New York's guidance encourages this where feasible. Where an item has several owners at different addresses, New York requires a notice to each owner. That is a sensible default elsewhere unless the state says otherwise.

Handling Responses

A response turns a reportable item back into an active account, but only if it is handled correctly.

Verify the responder. Compare signatures on returned forms against the bank's records. New York treats a certified-mail return receipt as owner contact only if it bears the owner's signature and tells holders to verify it.
Reactivate and record. Update the owner-generated activity date, note the type of contact and remove the item from the report population.
Update the address where the owner provides a new one, through the bank's normal change-of-address controls.
Handle returned mail. An undeliverable notice generally does not reset dormancy. Record the return; in some states it changes what further notice is required.
Brief the front line. Customers often bring the letter to a branch. Staff should recognize it, know the response deadline and know how to record the contact so that operations removes the item. The branch side is covered in our bank teller training guide.

Watch for claims that do not fit. A caller who knows the account number but cannot pass identification, or a request to send funds somewhere other than the owner, should be treated as a possible fraud attempt. Our post on elder financial exploitation covers related warning signs, since many dormant account owners are older customers.

Documenting the Mailing

The notice is only as good as the evidence that it went out on time to the right address with the right content. Keep, for each cycle and each state:

the population of items and owners selected for notice, with the selection criteria and cutoff date;
the letter template used, with its version date;
mailing proof: vendor job tickets, postal records, certified mail receipts and email transmission logs where electronic notice is used;
the date each notice was sent, and any second notice or publication;
returned mail and responses received, with the action taken on each;
the final list of items removed because of a response and items reported.

Retention matters because unclaimed property audits look back over many years. The 2016 model act requires holders to keep records for ten years after the later of the date a report was filed or the last date a timely report was due, unless the state sets a shorter period by rule, and limits state enforcement actions to within ten years after the duty arose.

The NAUPA III electronic reporting format also asks for the date that statutorily required owner notification was first performed, and the dates of any supplemental notifications, at the property level. A bank that cannot produce those dates per item will struggle to complete the file.

Common Mistakes

Sending too early or too late. A letter mailed before the window opens may not count. One mailed after it closes cannot be fixed.
Using a stale address when a better one exists elsewhere in the bank's records.
One template for every state, ignoring prescribed wording.
Ignoring email consent where the state requires electronic notice in addition to mail.
Dropping responses on the floor. The owner replied, but the item was still reported because nobody updated the activity date.
Deducting costs the state does not allow. New York, for example, allows certified-mail costs to be deducted per item but not first-class mailing costs, and does not allow a bulk deduction against the remittance.

Training for the Staff Who Run It

Due diligence mailings are usually run by deposit operations with support from compliance, and they depend on accurate account data and responsive branches. The Certificate in Deposit Compliance is aimed at staff who own deposit-side compliance, and the deposit compliance training and account management pages list related courses.

Next Step

Before your next cycle, lay each state's notice window, threshold and wording requirement next to the template and calendar you used last year, and fix any gap before letters go out. For compliance staff who own that work, the Certificate in Deposit Compliance provides the broader deposit compliance foundation.

Frequently Asked Questions

What is an unclaimed property due diligence letter?

It is the notice a holder, such as a bank, sends to the owner of property that is about to be reported to a state as unclaimed. It tells the owner the property will be transferred to the state unless they respond, and explains how to keep it. Most states require it before reporting, within a defined window and above a minimum value. The letter also serves as the bank's evidence that it attempted to reach the owner.

When must due diligence letters be sent?

Each state sets its own window, measured back from its report date. The 2016 model act requires first-class mail notice not more than 180 days nor less than 60 days before the report is filed. New York requires a first-class notice at least 90 days before the report and a certified notice at least 60 days before for items over $1,000. Texas requires notice no later than 60 days before its July 1 deadline.

What must an escheat notice say?

Under the 2016 model act, the notice must carry a heading stating that the state requires the holder to notify the owner that the property may be transferred to the state if the owner does not respond by a date 30 days after the notice. It must describe the property and its value, explain that it will be turned over, that the owner must then claim it from the state, and how to prevent the transfer. States may prescribe their own wording.

Is there a minimum amount for sending a due diligence notice?

Usually yes, but the amount is set by each state. The 2016 model act requires notice for property worth $50 or more, with the figure bracketed so states can choose. Some states also require a second notice by certified mail above a higher value, such as New York's requirement for items over $1,000. Items below the threshold may still need to be reported, often in the aggregate.

Can due diligence notices be sent by email?

In some states. The 2016 model act requires first-class mail and, where the owner has consented to electronic delivery, email in addition. Texas allows notices by mail or email. Other states require mail only. Check each state's rule, and record the email address used and the transmission evidence if you rely on electronic notice.

What happens if the owner responds to the letter?

If the owner responds before the deadline in a way the state recognizes, the bank removes the item from the report and treats the account as active again, updating its last owner-generated activity date. The bank should verify the responder's identity and signature, record the contact and update the address if needed. If the owner responds after the property has been remitted, they must claim it from the state.