Rhode Island Is Budgeting $37.6 Million of Other People’s Lost Money

Rhode Island Is Budgeting $37.6 Million of Other People’s Lost Money

James Diossa is running for reelection as the state projects $76 million in unclaimed-property revenue this fiscal year. Voters should ask why returning that money is not the first priority.

In James Diossa’s reelection video, the Rhode Island general treasurer’s 6-year-old daughter asks a surprisingly useful question:

“Dad, what do you even do?”

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Diossa tells her that he manages the state’s money.

That is true. But his office also manages an enormous amount of money that does not belong to the state.

It belongs to Rhode Islanders.

The state’s unclaimed-property program collects forgotten bank accounts, uncashed paychecks, insurance proceeds, utility deposits, refunds, securities and the contents of abandoned safe deposit boxes.

The Treasurer’s own website says more than 300,000 Rhode Islanders have property waiting to be returned. Many do not know the money exists until they search the state database. 

But Rhode Island’s latest financial projections reveal something voters should understand before they decide whether to give Diossa another four years.

For fiscal year 2027, which began July 1, the Treasurer’s Office expects the unclaimed-property program to produce $76 million in revenue. It projects paying $34 million in claims.

It also expects to transfer a $37.6 million surplus to the state’s general fund. 

Those figures are not directly comparable as a return rate, because money collected and money claimed in a particular year may involve different accounts. But they expose the fundamental conflict at the heart of the system.

The state is supposed to safeguard people’s money and return it.

The state also budgets the money as revenue.

Rhode Island is hardly alone. Across the country, states have transformed unclaimed-property programs from consumer protection operations into dependable sources of government funding.

The government calls the money abandoned. The owners usually call it missing.

A paycheck does not become government money because someone moved and failed to cash it. A life insurance benefit does not become government money because an heir never learned the policy existed. A forgotten brokerage account does not become government money because statements went to an old address.

Rhode Island should receive credit for doing more than many states.

It's Your Money program, launched in 2017, uses information already held by state agencies to identify some owners and send checks automatically. The first round was designed to return more than $10 million to 35,000 Rhode Islanders without requiring them to discover the program and file conventional claims.

Under Diossa, the Unclaimed Property Division reported returning $15 million through approximately 20,000 claims in 2024. His office also supported legislation limiting the fees that private finders may charge people to recover their property. Those are real accomplishments.

But the existence of an automatic-return program raises a larger question.

Why is automatic return still the exception?

Rhode Island already possesses tax records, driver information, business registrations and other government data. When the state can reasonably verify an owner and locate a current address, it should return the money automatically.

It should not force people to repeatedly search a website for money that the government already knows may belong to them.

The situation is particularly troubling with stocks.

The Treasurer’s Office expects to receive $35.7 million during fiscal year 2027 from selling securities that have been in state custody for at least four years. The liquidation project also includes equities for which the state system does not contain a recorded owner.

Once securities are sold, a later claimant may receive the sale proceeds, but Rhode Island law generally denies owners any claim for subsequent appreciation.

That can be a serious loss.

Someone who discovers years later that Rhode Island sold shares in a successful company may recover only what the stock was worth when the state liquidated it, not what the investment would be worth when the owner finally comes forward.

Meanwhile, the proceeds are deposited into the general fund.

That arrangement may be legal. It is not necessarily fair.

Diossa is now asking voters to judge his record. His campaign should make unclaimed-property reform a central issue, not a footnote.

He should promise to expand automatic payments to every account that can be reliably matched using state data. His office should publish how many properties are received, how many owners are contacted, how much is returned automatically and how much is transferred to the general fund.

Before selling stocks, the state should conduct an aggressive search using tax records, databases, electronic notices, and updated address information. Owners should also receive the benefit of investment gains for a reasonable period if the state sells their shares.

And when the state earns interest from money belonging to identifiable residents, lawmakers should consider whether at least some of that benefit should follow the owner.

The election is on November 3. Diossa’s campaign message is that he has protected Rhode Islanders’ financial futures and wants another term to continue the work. He announced his reelection campaign in April. 

Here is one clear way to prove it.

Rhode Island has already shown that it can find owners and automatically return their money. Now it should stop treating that approach as a special program and start treating it as the normal way the government operates.

The state should not be better at budgeting people’s lost money than returning it.