(The Center Square) – Illinois Treasurer Michael Frerichs is working with U.S. Rep. Danny Davis, D-Chicago, to urge the U.S. Treasury to make it easier for states to facilitate the return of mature U.S. Savings Bonds.
Freichs said at a news conference in Chicago that the Illinois Treasurer’s Office has an unclaimed property and missing money department where they take money that was maybe forgotten in an old savings account, and they put that money back into the pockets of those who may claim the assets.
"When we put that money back into people’s pockets, they’re able to use that money to maybe go out and take their family to dinner or go shopping,” said Frerichs. “When we get that money circulating throughout our economy, it does a lot more good for our state than it does sitting in a bank vault somewhere.”
Freichs said the Illinois Treasurer’s Office is aware that there are other forms of money out there that have gone uncashed, like U.S. Saving bonds. The federal government sells savings bonds that are exempt from being turned over to the Illinois Treasurer’s unclaimed property department. Freichs said that’s a problem.
"There are people out there, grandparents, parents, aunts and uncles who purchase savings bonds as gifts for people. Maybe they bought them for a birthday, graduation, bar mitzvah, but I don’t know anyone who bought a savings bond in someone’s name because they wanted to help pay off federal debt,” said Frerichs.
Freichs said his agency has returned $2 billion of missing money to Illinoisans. His last two predecessors combined returned about $750 million.
Frerichs said a lot of U.S. Savings Bonds are owned by African Americans because in the 1940s, 50s and 60s, Blacks weren’t able to participate fully in the banking system.
"Many African Americans would invest their money in U.S. Savings Bonds, and so the fear is that these unclaimed U.S. Savings Bonds, totaling an estimated $30 billion, an estimated $1 billion here in the state of Illinois, are disproportionately owed to African Americans,” said Frerichs.
Davis said the missing money should be returned to Illinoisans. Davis has worked with the Illinois Treasurer's Office to pass a law that would require the federal government to work with state treasurers to try and find the bond holders and/or their heirs and return the funds to their owners.
"We’re not talking about money that belonged to someone else, or money that’s not available. We’re talking about money that was invested,” said Davis. “It’s theirs and they should in fact have access to it.”
Davis said he shares concern with Frerichs that African Americans were excluded from banks decades ago and that means Blacks could represent a high percentage of the $30 billion in unclaimed bonds. Davis has concerns that the U.S. Treasury’s proposal for how to work with the states will limit the state’s ability to help more people. Davis urged the U.S. Treasury to revise their proposal.
“The U.S. Treasury must make it easier for states to use bond information to find bond owners and beneficiaries,” said Davis.
According to Frerichs, the federal government is concerned about fraudsters using information released on the Illinois Treasurer's website to claim the unclaimed property.
“We won’t list the exact dollar amount on our website, but we’ll give a range. So we’ll say, ‘you have unclaimed property less than $10, less than $100, or more than $100," he said. "I can tell you identity thieves aren’t wasting their time claiming $50 savings bonds."
Frerichs said his office has also put in a quarter of a million dollars for anti-fraud software.
In 2016, former Florida Chief Financial Officer Jeff Atwater sued the federal government for over $1 billion, the amount of all the bonds he held as unclaimed property.
He said the U.S. Treasury refused to make good on those bonds.
