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Money in limbo tempts trackers

Some investigators have stolen unclaimed property; owners don't know they don't have to use private agencies or pay a commission.


© St. Petersburg Times, published July 2, 2000

Perry Carter never claimed a $5,000 insurance settlement in 1987. Instead, he spent years disputing the amount with his insurance company, which eventually reported the unclaimed money to the state.

That's when International Locator Service of Largo got involved.

The company, a private investigative agency often described as an heir finder, collected his money. But instead of doing what such agencies are supposed to -- finding Carter to give him the money minus a hefty commission -- state investigators say the company kept the $5,000.

"I wasn't really concerned about claiming the money because I didn't really think anyone else could," said Carter, a 66-year-old Jacksonville retiree who was owed the settlement after a small house fire. "How could anybody have the gall to try to claim the money for anybody else? It's my money."

International Locator didn't keep only Carter's money, state officials say.

It helped itself to another $265,000 from 23 other people across the nation who were owed money from old inheritances, utility deposits, never cashed paychecks, even gift certificates, they say.

In May, the Florida Comptroller's Office sued the company, contending it forged signatures of victims on documents between October 1998 and June 1999.

Just two weeks ago, a Deltona private investigator was sentenced to probation after closing her business and confessing to stealing $400,000 in unclaimed property from 50 victims over a decade.

State officials say these cases have prompted them to start keeping better watch over this longtime industry that deals with more than $100-million and tens of thousands of claims each year.

"It certainly has caught our attention," said Andrew Grosmaire, assistant chief of the bureau of unclaimed property, part of the Comptroller's Office.

But, they say, keeping an eye on the industry is sometimes a difficult task because Florida law lacks teeth and because one department investigates the companies while another regulates them.

For example, the Comptroller's Office sued International Locator, but the Department of State, which regulates the industry, has given the company a green light to continue its business, allowing it to collect another $2.5-million since the allegations were made.

The owners of International Locator, who say they were duped by an employee who stole from them, and others in the unclaimed property business, say their industry has no more problems than any other.

"I think there are occasionally going to be some violations by members of the industry," said Larry Gonzalez, a lobbyist for the Property Asset Recovery Association, "but overall the industry is performing the way it should."

* * *

In Florida, unclaimed property is big business.

The state collected almost $116-million in unclaimed property in fiscal year 1998-99 and returned $63-million -- about a third through private companies.

"We're not running a mom and pop stand here," said Peter De Vries, chief of the Bureau of Unclaimed Property. "This may seem like petty stuff compared to murder, but it has national scale."

Here's how it works:

Florida law requires companies to turn over money from accounts after they remain inactive for five years. Most money comes from banks, brokerage firms, mutual fund companies, insurance companies and companies that hold customer deposits. It comes from people who never collected a deposit from a utility company, claimed an inheritance or cashed a paycheck.

Many times, De Vries says, people forget to collect property or don't want to for some reason. Here are some recent examples:

A Miami schoolteacher did not cash $22,000 in paychecks because she didn't need the money.

A man died and left about 40 bottles of wine worth $60,000 to $80,000 in a safe deposit box. A 1929 bottle was valued at $4,000 alone. The man's children, located in Philadelphia, drove down to get the wine.

A brother did not collect a $600,000 inheritance from his sister because the two did not get along. His family had him declared incompetent and collected the money.

The state attempts to find people, using newspapers, Web sites and letters. If it does, it can often provide the money for free within weeks.

But it doesn't search forever, only for about a year. Meanwhile, private agencies are allowed to look for those with unclaimed property. If they find them, the agencies make money by charging up to a 60 percent commission to hand the money over, De Vries said.

Many people don't know, however, that they don't have to use the agencies or pay the commission to claim their property. At any time, even after an agency alerts them to what they are owed, they can contact the state and get the money with no commission.

Fifty-one companies, including six in the Tampa Bay area, are licensed in Florida to collect money. Another eight across the nation are licensed to do business in Florida.

"The companies make it sound like this is the only way to get money," said Melanie Mowry-Etters, spokeswoman for the Comptroller's Office.

By state law, any money that remains unclaimed is turned over to the state Department of Education. Last year, $50-million was given to that department -- a huge sum of money until it is compared with the annual budget of one school district, such as Pinellas County, which tops $1-billion.

* * *

Patrick and Marie Lenane of Iowa say they lost about $7,000 to International Locator Service.

The couple, who lived in Winter Haven a decade ago, are among the few victims to get their money back. "We were lucky," Mrs. Lenane said.

Most of the 24 people, who lost from $43 to $25,000, don't even know they are owed money. The state has been able to locate only three victims so far.

An attorney for International Locator said last week they also are searching for victims to try to return money even though he maintains the company was not at fault. Charles Samarkos said an independent contractor, the son of the company's former attorney, actually assumed the identities of the 24 people by forging signatures, and then collected the money.

"We have done nothing wrong," Samarkos said. "We are really an innocent victim."

Samarkos said the agency discovered what happened last year and reported the independent contractor, Jay Williams, to the Pinellas County Sheriff's Office, which is investigating the complaint.

The Comptroller's Office sued the company in Pinellas-Pasco Circuit Court, demanding the agency return $270,000. In turn, the company sued Williams, his mother, Diane Shea Williams, and his sister Nila Dawn Williams.

Diane Williams, International Locator's attorney for four years, said in May that her son was in a drug rehabilitation program. She did not return phone calls last week.

The Comptroller's Office turned over its investigation to the Department of State, which has the authority to suspend or revoke licenses. But in a letter to the Comptroller's Office last month, the department said the allegations did not violate the statute.

Pat Traylor and Beverly Hargett, the owners of International Locator, said theirs was one of a handful of such businesses when they opened in 1974. They say they are still some of the only women in the industry.

"We do a great service for the people of Florida," Traylor said. "We feel like we're very reputable. We've never had problems like we've had this past year. But this industry is like any other. You're going to have one or two bad apples."

Traylor continues to be a member of an advisory board that makes recommendations about the industry to Comptroller Robert Milligan. She replaced John Swearingen, owner of a West Palm Beach business which also was under investigation by the state at one time.

Swearingen, who has been in business 16 years, said last week he did not want to talk about the investigation, but said the industry was getting an unfair reputation based on a couple of random problems.

"The industry hasn't had many problems in the last 20 years," he said. "We enjoy helping people find the money but mistakes happen."

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