Delaware is again leading in unclaimed property enforcement, issuing new VDA program invitations on Aug. 15 to boost compliance efforts.
For companies incorporated or doing business in Delaware, the stakes are high: Those who do not respond within 90 days face automatic referral to audit – losing access to the more favorable voluntary disclosure agreement (VDA) process.
Unclaimed property continues to be a significant financial and reputational risk area for businesses, and Delaware's continued enforcement actions reflect its commitment to maximizing compliance and revenue through both cooperative and compulsory means.
What companies should know: The risks – and opportunities – are real
1. The VDA invitation is not optional
The Delaware secretary of state (SOS) will issue another round of invitations in August 2025 to join the state’s VDA. These invitations are not merely suggestions – they trigger a mandatory response timeline. Companies must respond within 90 days, or they will be automatically referred for audit by the state Department of Finance. At that point, the more favorable VDA path is permanently closed.
Crowe insight
The scope of the VDA invitation often goes beyond the named entity. Delaware’s expectation is that companies will conduct a thorough unclaimed property review of all Delaware-incorporated legal entities within their corporate structure, not just the specific entity to which the invitation was addressed.
This broader review requirement can uncover dormant or dissolved subsidiaries, legacy business lines, or historical transactions that carry escheatment risk. Ignoring this expectation – or limiting the scope to a single entity – might raise red flags with the state and jeopardize the integrity of the VDA process.
Taking a narrow view can become a costly oversight. A comprehensive, enterprise-level approach is essential to mitigating exposure and preserving goodwill with Delaware regulators.
2. The verified report is gaining teeth
Delaware has sharpened its enforcement tools through the verified report notice – a growing component of its compliance strategy. This is not a routine filing. When selected, companies must complete a one-year review of their most recently submitted annual unclaimed property report and either:
- Affirm that they are fully compliant with Delaware’s unclaimed property laws
- Certify that they had no reportable property during the applicable year
Crowe insight
As part of the verified report submission, companies are required to provide copies of their unclaimed property policies and procedures. This requirement is intended to validate that the company maintains a robust, consistent compliance framework – not just one-off filings.
If a company fails to submit a verified report when requested – or submits an incomplete response – Delaware may initiate an immediate audit. And once under audit, the VDA path no longer is available.
This part of the process is more than a check-the-box exercise. It’s a test of whether your internal controls are audit-ready – and a clear signal that passive compliance no longer is enough.
3. Commonly overlooked property types – and where liability hides
Many companies are unaware they’re holding unclaimed property – often because it doesn’t appear on today’s balance sheet. Examples of commonly escheatable property include:
- Uncashed payroll checks
- Vendor overpayments and credit balances
- Customer refunds, rebates, and deposits
- Gift card balances and loyalty points
- Equity-related items like unexercised stock options or dividends
Crowe insight
Unclaimed property exposure isn’t limited to what you see on the books. During Delaware’s 15-year audit lookback period, any aged checks or credits that were written off as income – thus impacting your profit and loss statement – still are considered unclaimed property and subject to reporting and remittance.
These historical write-offs can represent substantial liability, especially if documentation is incomplete and Delaware applies estimation techniques to fill the gaps. That’s why even businesses with “clean” current books are not immune to enforcement risk.
Looking ahead: Proactive compliance can protect your business
Delaware’s enforcement signals a broader trend: Unclaimed property no longer is a back-office issue – it’s a strategic compliance concern.
Forward-thinking companies are:
- Proactively reviewing historical records and exposures
- Enrolling in VDAs before enforcement arrives
- Developing internal compliance programs to manage future obligations
- Working with experienced advisers who understand multistate complexities
At Crowe, our unclaimed property professionals guide companies through the entire compliance life cycle – from risk assessments and due diligence mailings to audit defense and VDA enrollment. We can help protect your bottom line and your reputation.
Final thought: The 90-day window is your opportunity
If your company receives a Delaware VDA invitation or verified report request, act immediately. The cost of delay is steep – but the opportunity to resolve issues cooperatively and efficiently still is within reach.
Let’s talk strategy – before the state takes the lead.
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