June 2011
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esCHEATment

I’ve owned some stock in a certain video game company for several years now. It does have some potential to really take off, I think, but for the last few years it hasn’t been doing much and so I’ve just been holding onto it. Then just recently, out of the blue, I got a phone call from someone claiming to be from my online investment firm, telling me that if I didn’t fill out a form or buy or sell something soon, the law would require them to report my account as “abandoned” and then the great state of California would basically seize all my funds from that account.

I was dumbfounded. How could that be legal? In fact, I just assumed that it couldn’t possibly be for real and that I was simply being made the target of some sort of scam. Well, it is legal, and it is a scam. I’ll explain…

Despite my initial gut feeling distrust of the guy on the phone, I decided to play along for a few minutes rather than just hang up. I discovered that I had indeed been sent an email about this (to an account I rarely check), and that email contained a link that I was supposed to click. When I examined the URL, it just looked like a bunch of gobbledy-gook, and it was not recognizably part of my online investment firm. My suspicion edged closer to certainty, and I did not click the link.

Later that day I got around to actually calling the company to report the suspicious call and email. But to my surprise, the person I spoke with confirmed everything the guy on the phone had told me. Apparently this is quite normal in the world of online stock trading! If an account has had no activity for just two or three years, the state arbitrarily assumes that the money has been abandoned and they grab it. Yes, there are ways to reclaim it again, but as you can imagine they sure as hell don’t make that easy, and there are almost certainly fees to pay. Two or three years?! I can understand that there are probably good and reasonable circumstances for this kind of thing, but I would have thought that the time frame would be more like forty years, or after the owner has died! I’m sorry, but two or three years is nowhere near long enough for money to be considered abandoned and “up for grabs”. Greedy government bastards. You have to hold it for at least one year to avoid getting screwed by the capital gains tax!

Oh, and the best part is that this practice is known as escheatment. It’s like they’re not even trying to disguise that this is nothing more than a shameless rip-off by the government! Err, I mean another shameless ripoff. Two or three years? Grrrrr…

2 comments to esCHEATment

  • Hey Dan, I see what money they steal from us on a quartely bases in fees that really don’t go to what there supossed to and talk to many other people in all kinds of industries in the same boat. The government is out-o-controll, I just wonder when people will finally get fed up with all this C!@$.. and stop electing fools, but with an estimated 48% of the population not paying any taxes your contribution are greatly appreciated
    .

  • Oh and one more thing.. I always love how they demonize corporations and they do junk like this..

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