Kentucky Administrative Regulations › Title 20 - DEPARTMENT OF TREASURY › Chapter 1 - State Treasury › Section 20 KAR 1:050 - Unclaimed property; examination of holder records

Current through Register Vol. 51, No. 1, July 1, 2024
RELATES TO: KRS 393.010, 393.110, 393.160, 393.280
NECESSITY, FUNCTION, AND CONFORMITY: This administrative
				regulation relates to the examination of holder records by the department if
				any holder fails to make a full and complete report of property as required by
				KRS Chapter 393.
Section 1. If any
			 holder fails to make a full and complete report of property as required by KRS
			 Chapter 393, the department, after giving notice as provided in subsection (1)
			 of this section, may examine the records and other accounts of the holder.
(1) The department shall notify the holder in
			 writing ten (10) days prior to an examination. However, if the department
			 determines that the existence of the records may be placed in jeopardy unless
			 action is taken forthwith, the department may examine all records immediately
			 without any prior notice.
(2) The
			 examination may include:
(a) Records of
			 current accounts, dormant accounts, and accounts that may have been closed and
			 archived;
(b) Verification of
			 contractual agreements between depositors and the final organization regarding
			 the deduction of service charges, account increases or decreases, and the
			 cessation of interest payments; and
(c) In addition to the examination of
			 unclaimed accounts and contractual agreements, the examiner may review the
			 holder's annual procedures for reviewing dormant accounts.
(3) The department shall have reason to
			 believe that a holder has failed to comply with the reporting requirements of
			 KRS Chapter 393 and may examine the records of the holder if one (1) of the
			 following conditions exist:
(a) A holder has
			 not submitted a report to the department;
(b) A holder has submitted reports to the
			 department in which the holder's report states it has no unclaimed
			 property;
(c) A holder fails to
			 report types of unclaimed property normally reported by like businesses or
			 associations;
(d) When amounts on
			 the holder's report or amounts remitted from the holder are not comparable to
			 reports received from like holders; and
(e) When information is provided by other
			 governmental agencies or reliable sources that a holder may be holding
			 unclaimed property that has not been reported.
(4) At the completion of an examination a
			 statement of examination findings and proposed adjustments shall be delivered
			 to the holder. The statement shall be delivered by the department by hand or by
			 certified mail. The statement shall contain sufficient information to make the
			 holder aware of his reporting obligations and legal options.
(5) The holder shall have thirty (30) days in
			 which to review the examination findings and proposed adjustments to the
			 findings. No later than thirty (30) days of the date of the statement, the
			 holder shall cause to be generated an amended annual report. If the holder
			 disagrees on the facts, he shall file an official written protest within the
			 thirty (30) day period or the amount as set out by the statement will become
			 absolute and final and be immediately due and payable. The protest shall be
			 filed with the department and shall set out a clear and concise assignment of
			 any error alleged to have been committed by the department in its examination
			 or its statement. The holder may request an administrative hearing in its
			 protest.