CHARLESTON — West Virginia Attorney General Patrick Morrisey, along with a bipartisan coalition of 30 states, has reached a settlement in a case against the state of Delaware in connection to litigation regarding unclaimed property involving MoneyGram transfers.
The state will receive more than $3.8 million plus interest.
Morrisey joined a multistate coalition in 2016 in filing suit in the U.S. Supreme Court to recoup hundreds of millions of dollars that rightfully belongs to West Virginia and other states — unclaimed money from uncashed money orders sent through MoneyGram and wrongly handed over to Delaware.
“This is a great victory for West Virginia and our partner states — the money rightfully belongs to West Virginians,” Morrisey said in a press release. “Every dollar unlawfully held elsewhere represents another dollar of accrued interest that our state can utilize to improve its schools, parks, roads, etc.”
In 2023, the U.S. Supreme Court unanimously ruled that the funds should be returned to the states where unclaimed money orders or similar products were purchased.
Under the terms of the settlement, Delaware will transfer more than $102 million of the property that MoneyGram reported to Delaware from 2011 to 2017 to the coalition states, based on each monetary instrument’s place of purchase. Delaware’s transfer represents roughly half of the report years disputed in the litigation.
In addition, approximately $89 million deposited by MoneyGram in a litigation escrow account from 2018 to 2022, plus interest earned, will be distributed among all 50 states based on each instrument’s place of purchase. The coalition states will receive nearly $55 million, plus earned interest, from the escrow account.
States will assume custody and responsibility to return any property received under the terms of the settlement or from the escrow account to owners, including paying any claims for the property.
West Virginia is set to receive $3,823,000.04, plus interest.
The lawsuit centered on the state's unclaimed property collection practices, which contribute hundreds of millions of dollars\ to state government operations each year.
As the corporate home to almost 2 million companies, Delaware receives unclaimed property from all over the country. It amounts to one of Delaware's largest government revenue sources and is part of the reason Delaware is a rare state that doesn't assess sales taxes and more generally has low taxes compared with other states.
The case focused on unclaimed property, such as checks that go uncashed, lost refunds that never find their home and such. It can include unclaimed bank accounts, gift cards and even stock dividends. It eventually makes its way to state governments to hold until the rightful owner comes looking for it later. States have different rules for when property is considered dormant and must be handed over. In Delaware, it's five years for everything except securities, which is three years.
Delaware is known for guarding these monies when other states go to court for them. This recent case dealt with money issued by MoneyGram, one of the largest money transfer companies in the world. Pennsylvania sued Delaware in 2015, saying unclaimed MoneyGram funds should go to the state where they originated instead of Delaware, where the company is incorporated. The other states joined Pennsylvania’s cause, and the case ended up at the U.S. Supreme Court.
In addition to West Virginia, other states that joined the coalition led by the AGs from Arkansas, Pennsylvania, California, Texas and Wisconsin are Alabama, Arizona, Colorado, Florida, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Michigan, Montana, Nebraska, Nevada, North Dakota, Ohio, Oklahoma, Oregon, South Carolina, Utah, Virginia, Washington and Wyoming.
