DC Sues AT&T For Unclaimed Phone Minutes

Suki I submits news that Washington, D.C.'s attorney general has filed suit (District of Columbia vs. AT&T Corp, Superior Court of the District of Columbia), claiming the city has the right, through laws applying to unclaimed property, to unused calling-card balances held in the name of D.C. residents. "The suit claims that AT&T should turn over unused balances on the calling cards of consumers whose last known address was in Washington, D.C. and have not used the calling card for three years. 'AT&T's prepaid calling cards must be treated as unclaimed property under district law,' the attorney general's office said in a statement. ... [That sum] represents some 5 to 20 percent of the total balances purchased by consumers who use the calling cards. States and municipalities have often similarly used unclaimed property laws, known as escheat laws, to claim ownership of unused retail gift card balances." Suki I links also to Reason Magazine's coverage.

Comments

All your value belong to us? Nope.

[LostCluster]

This is law in many places... leave a balance in a bank account and fail to respond to any correspondence or make any transactions, and that money is transferred to the government who will publish your name in a massive newspaper insert, and then give it back to you if you claim it by proving the social security number the account was under is yours, and if that times out it goes to the government to do whatever they want with it.

Gift cards in many places have taken up the retailers on "if this fee is not allowed by law" to kill off inactivity fees. You now have many years or until the store shuts its doors for good (even during a post-bankruptcy liquidation that operates under the store's name) to use that money.

So, why does AT&T and the other phone companies think they can get away with voiding cards they don't hear from for three years and keeping the money? It's an unclaimed balance, and businesses aren't allowed to profit from such things in many other cases... what's the difference?

Re:All your value belong to us? Nope.

[cgenman]

I had one state (Virginia, I believe), track me down after 6 years for a balance left in a former employer's pay system. I was surprised at the tenacity of the government in a case like this. They didn't just grab the money an run, like some other commenters here seem to imply.

AT&T Not Voiding the Cards?

[BBCWatcher]

I don't think AT&T is voiding the cards. Washington, D.C., seems to be asserting that the card numbers should expire after three years. But why 3 years? Why not 5? Or 7? Or 10? Or 50? I assume AT&T will argue that 3 is arbitrary and, of course, too little time. I also assume that AT&T will argue that a certain federal agency in Washington, the FCC, regulates all things telephone, so (dear District), kindly go take it up with them. And, if those two arguments don't work, naturally AT&T would provide the District with about 386,200 calling cards, each with an average of 6 minutes of call time remaining, so that the city government can hold onto the actual unclaimed property until citizens reclaim their cards. After all, those citizens purchased minutes, and that's the unclaimed property in question. There's no cash there any more.

Re:Yes!!!

[Attila Dimedici]

Sorry, I don't have a citation. However, I worked as a manager of a retail store before there were gift cards. When we sold gift certificates we had to keep careful record of when they were sold and when they were redeemed, if they were not redeemed within a certain time period (my recollection is two years, but I'm not sure) we had to report it to the home office so that they could remit the money to the state. This policy was new (not because the law was new, but because the company I worked for had just found out about it), and they introduced expiration dates for gift certificates at the same time (the expiration date coincided with the date at which they were required to turn the money over to the state). Stores that were in states that did not have such laws did not have expiration dates on their gift certificates.