How to Protect Yourself from Unclaimed Property Scams?

  Unclaimed Property Scams:

Property scams, particularly unclaimed property scams, are an ever-growing threat to unsuspecting individuals.

The rise of fraud in the realm of unclaimed property and real estate scams continues to be a significant concern. In 2024, the Federal Trade Commission (FTC) reported that fraud complaints have increased notably, with property-related scams still among the top consumer grievances. These scams often exploit individuals by promising access to unclaimed funds or property, such as life insurance policies or old bank accounts, for a fee. Fraudsters have been using increasingly sophisticated methods, including text messages, emails, and fake websites that appear legitimate​.

Source: KIRO 7 News Seattle, Consumer Advice

Important Notes:

Additionally, imposter scams, including those related to government or business impersonations, have surged. So, Scammers use tactics like fake notices about suspicious account activity or false threats of legal action to trick people into transferring money, often through bank transfers or even cryptocurrency​

Source: Consumer Advice

The Better Business Bureau (BBB) also warns about scams involving unclaimed property, urging individuals to avoid paying upfront fees to locate or claim funds​

Source: KIRO 7 News Seattle

It’s important to be vigilant and check any claims of unclaimed property through official, free state databases like MissingMoney.com, and to report suspected fraud to authorities like the FTC.

In this post, we’ll discuss five essential strategies you can use to protect yourself from property scams, focusing on unclaimed property scams and related schemes. We’ll break down each strategy, providing actionable tips and real-world examples to help you stay safe.

1. Stay Informed 

Mostly Scammers often use sophisticated tactics to lure individuals into fraudulent property deals. Recognizing these tactics is the first line of defense against becoming a victim. Many scams involving unclaimed property operate under the guise of offering unclaimed funds or real estate that you may be entitled to, but they’re simply trying to steal your money or personal information.

Implementation Tips:

1. Educate yourself on common scams, such as fake prize notifications, “lost property” notifications, or fake companies claiming to help you recover unclaimed funds. Understanding these scams helps you spot red flags early.
2. Be wary of unsolicited communication from companies or individuals offering to “find” your unclaimed property for a fee. Legitimate state agencies or government departments never charge upfront fees for these services.
3. Research the company that’s contacting you. If they claim to be government representatives or legitimate companies, check their official websites and verify their contact information before engaging with them.

Real-World Example:

A person in Florida was contacted by a company claiming to have information about unclaimed property in their name. The company asked for an upfront fee to “release” the funds. After paying the fee, the individual received no funds and found that the company was a front for a fraudulent operation.

2. Verify the Legitimacy of Unclaimed Property Sources

There are many legitimate resources for finding unclaimed property, including government websites. However, scammers often mimic these sources, creating fake websites that appear official. One of the best ways to avoid falling victim to unclaimed property scams is to ensure that you’re dealing with trusted, verified sources.

Implementation Tips:

1. Check official state websites for unclaimed property databases. For example, the National Association of Unclaimed Property Administrators (NAUPA) provides a list of verified state-run websites where unclaimed property can be searched for free.
2. Look for HTTPS in the website URL. Secure websites are indicated by “https” at the start of the URL, while fraudulent websites may have poor security or unusual domain names.
3. Confirm the website’s contact details. Look for a physical address and a customer service number that you can call directly to verify the legitimacy of the offer.

Real-World Example:

An individual in California received an email from a “government agency” claiming they were owed unclaimed property. Upon visiting the provided link, the site seemed legitimate but was not an official government website. After entering personal information, the individual’s identity was compromised. 

3. Avoid Paying Upfront Fees for Unclaimed Property Recovery

One of the most significant red flags of unclaimed property scams is being asked to pay a fee upfront for property recovery services. Legitimate state agencies do not require any fees to claim unclaimed property, and any organization that asks for money to help you claim funds is likely a scam.

Implementation Tips:

1. Never pay a fee upfront. Legitimate unclaimed property programs do not charge fees for claiming property. If you’re asked to pay in advance, this is a warning sign of a scam.
2. Request written agreements. If a company offers to help you recover unclaimed property for a fee, ensure you receive a clear, written contract with detailed terms. If the offer seems too good to be true, it probably is.
3. Contact state or government agencies directly. Instead of trusting third-party recovery companies, contact the relevant state agency directly. They can provide guidance on how to recover your property without any fees.

Real-World Example:

A Texas resident was contacted by a company claiming they could recover unclaimed property on their behalf for a 10% fee. After paying the fee, they discovered the company had no connection to the legitimate state agency, and the property was never recovered.

4. Use Secure Payment Methods

Scammers will often try to convince victims to make payments using methods that are hard to trace, such as wire transfers, gift cards, or cryptocurrency. Protect yourself by always using secure payment methods and avoiding transactions that seem suspicious.

Implementation Tips:

1. Use credit cards or bank transfers for payments, as these offer protection through fraud prevention policies. Avoid using wire transfers, gift cards, or cryptocurrency, which are difficult to reverse once the transaction is made.
2. Double-check payment instructions. If you receive payment instructions that seem unusual or ask for payment in untraceable forms, like gift cards or wire transfers to a private individual, stop the transaction immediately.
3. Monitor your financial accounts. Regularly check your credit card and bank statements for unauthorized transactions, especially after engaging in property-related dealings.

Real-World Example:

A woman from New York paid $1,000 to a company promising to recover unclaimed funds from her deceased relative’s estate. The company insisted on a wire transfer, and once the payment was made, the company disappeared, and she was unable to recover the funds.

5. Trust Your Instincts and Be Skeptical

Scammers prey on individuals who are in vulnerable positions, such as those seeking to recover lost or unclaimed property. Trusting your instincts and being skeptical about unsolicited offers can be the most effective strategy in protecting yourself from falling into a scam.

Implementation Tips:

1. Listen to your gut. If an offer seems too good to be true, it probably is. Scammers often offer large sums of money or easy solutions that are unrealistic.
2. Get a second opinion. If you’re unsure about an offer or a deal, consult with a trusted friend or family member. It’s always better to get another perspective before making decisions that could affect your finances or personal security.
3. Check reviews and ratings. Look for customer feedback or complaints on review websites or forums to determine whether others have had positive or negative experiences with a company before proceeding.

Real-World Example:

A man in Ohio received a phone call claiming that he was eligible to claim $50,000 in unclaimed property. After a brief chat, the caller requested a deposit of $500 for “processing fees.” The man felt uneasy and decided to consult with a family member. After a quick online search, he discovered that the number was linked to a known scam.

Conclusion

So, Unclaimed property scams continue to be a significant threat to consumers. By staying informed about common scams, verifying the legitimacy of sources, avoiding upfront fees, using secure payment methods, and trusting your instincts, you can protect yourself from falling victim to fraudulent schemes.

As you consider your options for finding and claiming unclaimed property, remember that scammers are always looking for new ways to exploit people. Ask yourself: Are the offers you’re receiving legitimate? Have you checked the sources thoroughly? And most importantly, could you be unknowingly falling for a scam?

By following these five strategies, you can significantly reduce your risk and ensure that you don’t lose money or personal information to unclaimed property scams. Stay safe, stay skeptical, and always double-check before taking action.