Individual Investors

Investors' Knowledge Base

Escheatment


What is Escheatment?
Each state has laws that require financial institutions to turn over abandoned property to the state.  The process of turning over abandoned property to the states is called escheatment.

What is considered abandoned property?
Depending upon the state in which your account is registered, abandoned property may be defined as one or more of the following categories:

  • Inactivity Only – The account is considered abandoned if there is not contact on the account during the timeframe, or dormancy period, established by the state.
  • Returned Post Office (RPO) Only – The account is considered abandoned solely because the address on the account has been deemed undeliverable by the United States Postal Service.
  • Returned to Post Office (RPO) and Inactivity – The account is considered abandoned because there has been no contact made on the account and the address has been deemed undeliverable by the United States Postal Service.
  • Returned Post Office (RPO) or Inactivity – The account is considered abandoned because there has been no contact made on the account or the address has been deemed undeliverable by the United States Postal Service.

Where is my account considered registered?
The state in which your account is registered is usually the state of the owner’s last known address.

Inactivity Regulation – What is Inactivity?
State inactivity laws have been in place for many years.  However some states are becoming more aggressive by enforcing their inactivity provisions or reducing dormancy periods, requiring financial institutions to turn over shareowner’s assets sooner. These regulations require account owners, including mutual fund shareholders, to make contact with their fund companies on a regular basis.  What constitutes contact and how frequently the contact must occur varies depending on the state in which the account is registered and the type of assets or type of account.  Generally, property is considered abandoned after a period of 3 – 5 years of inactivity or “no contact”.

When could my account be considered abandoned property requiring my investment in Virtus Funds to be turned over to the state?
Generally, property is considered abandoned after a period of 3 – 5 years of inactivity or “no contact”.  However, unclaimed property laws and regulations are dynamic and often change with short notice. Please see your State Treasurer’s website for more information regarding state abandoned, or unclaimed property laws.

I live in a foreign country.  Why did I receive a notice about escheatment?
Abandoned property accounts with foreign registrations are required to be turned over to the state where the mutual fund is established.  Most Virtus Funds are established in Delaware however, some are established in Massachusetts.  If you have a foreign registration on your account and you received an escheatment notice from Virtus Funds, it will be subject to escheatment under the requirements of Delaware or Massachusetts.

What do the escheatment laws and regulations consider contact or activity with my Virtus Funds account?
Although each State may have different laws and regulations for considering when an account is deemed active, we accept the following actions to maintain an active status:

  • Log into your Virtus Funds account online at Virtus.com – account log-in is required
  • Call our automated phone system, which is available 24 hours a day, 7 days a week, at 1-800-243-1574 and check your account balance or update any needed information for your account.
  • Contact one of our Client Service Representatives on our toll-free number.  Our hours are Monday – Thursday from 8:30 am to 6:00 pm, Eastern Time and until 5:00 pm on Friday’s.
  • Ask your Financial Advisor to contact us on your behalf.
  • Write to us at:
    • Virtus Mutual Funds
      PO Box 9874
      Providence, RI  02940-8074

How often do I need to contact you to keep my account in an “active” status?
We suggest that you contact us at least annually, however the applicable state law for your state will dictate the frequency.

I am enrolled in an automatic investment or redemption program.  Is that considered contact?
Unfortunately, state regulations do not consider automatic investment or redemption plans to count as contact on your account.  If this is your only investment activity, you will need to establish contact by one of the methods (Refer to the list above).

What if I do not contact Virtus?
If you do not contact us within the time period specified in the state in which your account is registered, we may be required to escheat your account(s) and turn your financial assets over to the applicable state of your account registration.  We will do everything we can to get in contact with you before sending your funds to the state including sending letters and if possible, attempting to contact you by phone.

What is the easiest way to maintain contact on my Virtus Funds account(s)?
The easiest way to maintain contact with us is to access your account(s) online by logging into your account(s) through Virtus Funds’ website annually, asking your Financial Advisor to contact us on your behalf, or by speaking to one of our Client Service Representatives by calling 1-800-243-1574 Monday through Thursday from 8:30 a.m. to 6:00 p.m., Eastern Time and Friday’s until 5:00 p.m.  If you are calling before or after business hours, you can access your account using our automated voice response system.

What happens if my Virtus Funds account is escheated to the state?
For Non-Foreign accounts, if your account is escheated, your full account balance will be turned over to the state of your last known address. You will then need to contact the state to which your account is escheated to establish your ownership of the funds and request that the funds be returned to you.  If your account is escheated, please see your State Treasurer’s website for information on recovering escheated financial assets or unclaimed property.  For Foreign accounts, the full account balance will be turned over to the state in which the fund is incorporated.  (Either Delaware or Massachusetts).  Unfortunately, when you receive the value of your mutual fund back from the state, you would only receive the value of the account at the time the state liquidated it, losing all of the benefits of compound investing and any market growth or appreciation since the liquidation.  Please note; it is likely that there may be a fee accessed by the state in order to claim the assets.

Where can I find more information about the abandoned property laws of my state?
Please see your State Treasurer’s website for more information regarding state abandoned, or unclaimed, property laws.

Does Virtus utilize third party vendors to assist in locating shareholders?
Virtus utilizes Keane, who is a leading provider of unclaimed property communications, compliance and consulting services in the country, to assist in locating lost shareholders.  Therefore, if your account is considered abandoned, it may be possible that you will receive communication from Keane on our behalf.