LITTLE ROCK (KATV) — Attorney General Tim Griffin released a statement today, stating that Arkansas, Pennsylvania, California, Texas, and Wisconsin have agreed to a settlement, ending an outstanding damages phase of a property dispute.
“This settlement concludes nearly eight years of litigation over unclaimed Official Checks and returns more than $190 million to the people of Arkansas, our coalition partners, and other states.” says Griffin. “I’m proud of our work on this important case, and I’m grateful to our coalition partners – particularly the attorney generals of California, Texas, and Wisconsin, and attorneys for Pennsylvania – for their hard work on this matter.”
“I want to express my appreciation to Solicitor General Nicholas Bronni, who argued the case before the United States Supreme Court. I look forward to reuniting the people of Arkansas with their money.” he continues.
Arkansas’s share of the settlement will total to $761,907.91 plus interest earned and expenses.
In February 2023, the United States Supreme Court unanimously agreed with Arkansas’s disputed arguments in Arkansas v. Delaware regarding which state should be entitled to seize custody of funds payable on unclaimed official checks.
Those checks are sold by MoneyGram, which operates in all 50 states and also internationally. The state brought an original jurisdiction action to the Supreme Court in 2016, seeking more than $250 million in unclaimed funds.
Since 2005, the money transfer services company has turned funds over to Delaware, despite the Federal Disposition Act that says any type of proceeds on unclaimed money orders, traveler’s checks, and similar items but be submitted to the same state where the item was purchased.
In the opinion by Associate Justice Ketanji Brown Jackson, a court unanimously agreed that the funding was regulated by the Federal Disposition act, and that MoneyGram should have sent the funding to Arkansas and its coalition partners.
In a requirement stemming from Jackson’s opinion, MoneyGram has to report sums on unclaimed, illegitimate checks to the state of purchase and funds associated with instruments purchased in Arkansas.
The funds are then deposited with the Auditor of State’s unclaimed property fund.
According to the terms of the settlement, Delaware will send more than $102 million of the property that MoneyGram documented to Delaware from 2011 to 2017 to the coalition states.
The returns will be based on each monetary instrument’s place of purchase. Delaware’s transfer is based on about half of the report years argued in the litigation.
Furthermore, almost $89 million which was deposited by MoneyGram from 2018 to 2022 in a litigation escrow account plus interest earned will be administered to all 50 states, according to each instrument’s place of purchase.
According to the office of Attorney General Griffin, the coalition states will receive nearly $55 million, plus interest earned, from the escrow account.
Escrow funds and also the amount from the settlement will be deposited with the Auditor of State’s unclaimed property fund, where Arkansans can reclaim it.
All states are expected to assume custody and responsibility to give back any property that was under the terms of the settlement, or from the escrow account to the owners after receipt.
