Protecting Investors from Premature Account Seizures
ICI supports commonsense unclaimed property laws that protect investors from having their securities accounts wrongly deemed abandoned.
Millions of Americans invest for the long term through mutual funds, ETFs, brokerage accounts, and other investment products. Many are buy-and-hold investors who may purposefully not log in, trade, or otherwise interact with their accounts for long periods of time.
But some states are changing or interpreting their unclaimed property laws in ways that treat ordinary investor behavior as abandonment.
When that happens, an investor’s securities are often transferred to the state through a process known as escheatment, liquidated, and later returned only as cash after a lengthy claims process—depriving investors of future market appreciation, dividends, interest, and the benefits of long-term compounding.
Key Takeaways
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Long-term investors should not be treated as lost, and their property treated as abandoned, simply because they do not frequently access or transact in their accounts.
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Unclaimed property laws should not penalize ordinary long-term investing and deprive investors of future market gains, dividends, interest, and the benefits of compounding.
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States should not transfer and liquidate securities accounts unless there is meaningful evidence that an investor is truly lost.
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Inactivity standards can harm buy-and-hold investors, seniors, retirement savers, and others who may be following a prudent long-term strategy.
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ICI supports commonsense unclaimed property laws that protect retirement savers and long-term investors from having their investment accounts wrongly deemed abandoned.
Premature Escheatment and Subsequent Liquidation Can Harm Investors
The consequences of premature escheatment can be severe. When a securities account is transferred to a state, the state will typically liquidate the securities. If the owner later files a claim for the property, the owner may receive only the cash value of the account at the time of escheatment—not the dividends, interest, or market gains that would have accrued afterward.
For investors, this can mean losing years of growth. For many investors who thought they were doing the right thing, the impact can be a devastating blow to their financial security.
Why Investors Need Protection
State unclaimed property laws cover all types of property, from bank accounts and gift cards to real property and safe deposit boxes.
But investment accounts are different from many other forms of property. Investors often hold securities for many years as part of a long-term savings plan. They may reinvest dividends automatically, rely on a financial adviser for account decisions, or simply leave an account alone because that is the strategy they chose. Lack of account activity is not the same as abandonment.
Inactivity Should Not Equal Abandonment
States are increasingly updating unclaimed property statutes to address electronic communications, digital assets, and other changes in the financial marketplace. Modernization is appropriate, but it must not come at the expense of investors.
Events in Florida from 2024 to 2026 demonstrate clearly why these protections matter. After the state changed its unclaimed property law in 2024 and moved to an inactivity standard for securities, more than $1 billion in additional assets escheated to the state, much of it prematurely. Lawmakers corrected course: In June 2026, the state enacted legislation replacing the strict inactivity standard with a hybrid framework that incorporates successful communications, objective indicators of owner engagement, and a 10-year dormancy period when determining whether an owner’s location is known. Florida lawmakers’ actions underscore the need for clear protections before investor assets are escheated and liquidated.
A sound unclaimed property framework should be based on whether an investor is truly lost—not whether the investor has logged in, traded, updated an account, or otherwise interacted with a financial institution on a state-mandated schedule. An investor can be alive, reachable, and following an intentional long-term investment strategy while still demonstrating little or no account activity.
Modernization Should Protect Investors
Policymakers should ensure that unclaimed property laws work as intended: to escheat property to the state that is genuinely lost—not to punish responsible investors for saving and investing for the future.
ICI is advocating for policies that will stop escheatment from harming investors. At the state level, ICI made significant progress for investors in Florida and Maine, and it is currently working with the California legislature on a commonsense compromise. ICI has also called on Congress to pass H.R. 8338, the Safeguarding Americans’ Fairly Earned Retirement Act of 2026 (SAFER Act), which would establish baseline federal protections against premature escheatment.
ICI will continue working with state and federal policymakers to support unclaimed property laws that result in appropriate escheatment of lost property while protecting retirement savers, preserving long-term investment growth, and preventing the premature liquidation of investment accounts.
Key Resources
States Should Not Mistake Long-Term Investing for Abandonment
Long-term investors often check their accounts only occasionally, reflecting a common buy-and-hold strategy. However, some states are adopting inactivity standards that can trigger the seizure and liquidation of securities accounts, even when the investor has not abandoned the assets.
Unclaimed property laws should protect truly abandoned assets without penalizing investors who intentionally hold securities for the long term. Florida strengthened its law to better distinguish...
Millions of Americans buy mutual funds, ETFs, stocks, and other securities with the intention of holding them for years. They may not log in often. They may not trade. They may not check their...
ICI Welcomes Bipartisan Sponsors of Bill to Stop States from Seizing Long-Term Investors’ Savings
At an ICI event bipartisan SAFER Act, Representatives Sam Liccardo (D-CA) and Mike Lawler (R-NY) joined ICI leaders to make the case for a federal solution to the problem of state unclaimed property laws that can treat buy-and-hold investors as though they have disappeared.
Representatives Sam Liccardo (D-CA) and Mike Lawler (R-NY) joined ICI leaders to highlight the need to protect long-term investors from unfair state unclaimed property laws. When states prematurely...
Representative Mike Lawler (R-NY) speaks at an ICI event about the SAFER Act. Millions of American investors have adopted the advice given by financial advisors to invest for the long term and then...