Many Ohio attorneys are unaware that they must file an annual report with the Ohio Department of Commerce’s Division of Unclaimed Funds — even when they have no unclaimed funds to report. But with this obligation comes the opportunity to improve access to legal services for Ohioans. When the 133rd Ohio General Assembly passed S.B. 276 in 2021 specifically designating the new category of “Attorney Unclaimed Funds (AUF),” Ohio’s legislators transformed the professional obligation of Ohio attorneys to annually report unclaimed client funds into an opportunity to direct dollars to life-changing housing and legal services for low-income Ohioans.

This year, reporting is easier than ever thanks to the Division’s new system designed to simplify reporting. Attorneys can create and file reports directly from the Division’s new website instead of logging into the Ohio Business Gateway. With the November 1 deadline to report unclaimed funds quickly approaching, now is a great time to begin the reporting process.

Reporting Requirement Explained 

The requirement to file a report applies to all attorneys or firms who hold funds belonging to another person. Generally, any attorney or firm with an active IOLTA or IOTA would be obligated to file an annual report, with many likely to file a none (negative) report if all clients (or owners of funds) are known and accessible. However, funds become “unclaimed” when the holder cannot identify or locate the owner. Those funds must then be remitted to the Division once they become “dormant,” which typically occurs after three years of losing contact with the owner.

See Ohio Admin. Code § 1301:10-1-01(P).

By utilizing the property code TR88 to report and remit AUF on your reporting form, the Division directs the remitted funds to the Ohio Access to Justice Foundation, which invests them in civil legal aid and good works initiatives across the state. Nevertheless, if the owner does come forward later, they can file a claim with the Division to request a return of the funds.

AUF include:

• Unclaimed IOLTA funds held pursuant to R.C. 4705.09.
• Unclaimed IOTA funds held pursuant to R.C. 3953.231.
• Unclaimed residual settlement funds, whether for named or unnamed plaintiffs.

See R.C. 169.01(L).

The Division offers a Voluntary Compliance Agreement (VCA) for companies or holders of unclaimed property that was not reported in past reporting cycles and would like to become compliant with the Ohio Unclaimed Funds law. In exchange for voluntary compliance through an executed VCA, the Division will agree to forgo the right to assess penalties and interest outlined in the law.

The Impact Behind the Obligation

The Foundation has put AUF to good use by funding the second phase of its Neighborhood Stabilization Grant Program. This award-winning program supports innovative housing projects across the state, such as a new housing development in Greene County that provides safe and affordable housing for low- and moderate-income seniors.

The Neighborhood Stabilization Grant Program funded Advocates for Basic Legal Equality to provide critical legal services to Yellow Springs Home, Inc., a nonprofit organization that has worked for over a decade to bring the Cascades project to fruition. The innovative community land trust model ensures that the Cascades will remain affordable for senior residents for decades to come.

“Because of the Foundation’s partnership with the Division, we can continue funding legal aid to take on these incredibly impactful housing projects,” said Angie Lloyd, the Foundation’s executive director.

Resources for Attorneys 

There are many resources available to attorneys navigating the reporting process. In addition to the Division’s new website and VCA, the Division has also created a series of how-to videos.

The Foundation’s guidelines provide helpful tips specific to AUF, along with contact information for Foundation and Division staff. Attorneys can even earn free CLE by completing the on-demand IOLTA Update course jointly produced by the Foundation and the Ohio Bar Liability Insurance Company (OBLIC).

A Call to Meaningful Action

By setting aside time each year to file, attorneys fulfill a legal obligation and contribute to the well-being of communities across Ohio.

“Thank you to the attorneys who report unclaimed funds,” Lloyd said. “Just by fulfilling your professional obligation, you’re investing in legal services that create lasting economic impact for Ohio communities.”

This fall, ensure compliance by filing the annual Attorney Unclaimed Funds Report and contribute to meaningful community impact.

We extend our sincere thank you to co-author Jennifer Rieman, Communications Director of the Ohio Access to Justice Foundation, for her collaboration on this article.

This article first appeared on the Ohio Bar’s website, available at: https://www.ohiobar.org/member-tools-benefits/practice-resources/practice-library-search/practice-library/from-obligation-to-impact-how-attorney-unclaimed-funds-support-our-communities/. 

This information is made available solely for loss prevention purposes, which may include claim prevention techniques designed to minimize the likelihood of incurring a claim for legal malpractice. This information does not establish, report, or create the standard of care for attorneys. The material is not a complete analysis of the topic and should not be construed as providing legal advice. Please conduct your own appropriate legal research in this area. If you have questions about this email’s content and are an OBLIC policyholder, please contact us using the information above.