Information Regarding Unclaimed Funds
Unclaimed funds are monies paid by the bankruptcy trustee to the Bankruptcy Clerk who then is the custodian of those funds until the person entitled to those funds files an application to pay the unclaimed funds to them. In a bankruptcy case that has assets, the trustee pays out money collected to creditors who have filed claims in the case. Also, a trustee may pay out money to a debtor (as in a dismissed chapter 13 case in which the debtor made plan payments to the trustee but no plan was confirmed). When a trustee makes such a payment to a creditor or the debtor, the trustee always issues a check to make the payment.
Sometimes, the check is returned by the Postal Service as undeliverable or the check is not cashed within 90 days. By law, in Chapter 7 and Chapter 13 cases, the trustee is required to deposit those funds to the court as unclaimed. Typically the check was returned to the trustee as undeliverable because the creditor or debtor had moved and did not report a change of address to the court and the trustee.
If your name or the name of your business appears on the list, you may be entitled to recover the unclaimed funds. But if you were a creditor in the case and received payment of your claim against the debtor in full from sources other than the bankruptcy case, you would not be entitled to the unclaimed funds.
Instructions for Applying for Payment of Unclaimed Funds
The Court may only disburse unclaimed funds to the rightful owner upon full proof of the right thereto. Therefore, the following forms and documentation are required:
1. An Application for Payment of Unclaimed Funds. Include the case name and number. If the funds were deposited for joint claimants, both must sign the application. Be sure to complete the certificate of service.
2. Proposed Order to Pay Unclaimed Funds to Claimant. If anyone holding a power of attorney on behalf of the entity entitled to the funds has filed the application:
• the proposed order must direct that the check shall be made payable to the entity entitled to the unclaimed funds but the proposed order may direct that the check be mailed to that entity care of whoever holds the power of attorney; and
• the proposed order must include as a recipient (in the order’s “Copies to” portion) the entity entitled to the unclaimed funds.
3. Statement of Social Security Number or Taxpayer Identification Number of Applicant for Release of Unclaimed Funds. In order to protect the privacy of your SSN or TIN, the clerk will docket that Statement in a way that the public will not have access to the Statement. Be sure to mail this Statement to the United States Attorney and the United States Trustee and to complete the certificate of service.
If the Applicant is an Individual, please submit the following:
a. A photocopy of an official government identification card – for example, a Passport, Military ID, or a valid and current driver’s license. Be sure to redact (blacken out) any date of birth, Social Security Number, Taxpayer Identification Number, or account number.
b. If the applicant is represented by an entity holding a power of attorney, a notarized power of attorney must be filed. So-called fund locators may file an application only by including a notarized power of attorney.
c. If your name is different from the name on the check that was issued and that went unclaimed, include an explanation of why you are entitled to the funds, and proof of your entitlement:
• For example, if your name changed due to a marriage, include that explanation and attach a copy of the marriage certificate.
• If the individual to whom the check was made payable died, see the next discussion.
If claiming on the behalf of the estate of a deceased party:
Certified copies of all probate documents necessary to substantiate the representative’s right to act on behalf of the decedent’s estate must be provided as proof of entitlement.
If the Claimant is a Corporation/Partnership:
a. The Application must be signed by an agent for and on behalf of the Corporation or Partnership
b. A statement of the signing agent’s authority with the corporate seal must be filed.
c. If the applicant is a successor corporation, the applicant must provide documents establishing the chain of ownership of the right to receive the unclaimed funds.
4. Vendor Information Form. Once the order has been entered, a completed and signed Vendor Information Form is required to process the payment in the court’s financial management system. Please include this form with your submitted application. Failure to complete and sign the form will result in a delay of payment. Please complete and sign the highlighted portions. Please note that the term Vendor on the form represents you, the Claimant.