Governments can take your stocks without your permission. It happens all the time
US states have been quietly tightening unclaimed-property laws in ways that make it far easier to declare stocks and other securities "abandoned" and seize them, even when the owner is alive, reachable and still receiving dividends. Where most states once waited seven years before treating shares as abandoned, more than half now use just three years, and many have shifted from a "lost" standard (such as returned mail) to a looser "inactivity" standard, meaning simply not logging in or contacting the broker can trigger the process. Once flagged, a brokerage or transfer agent sends notices, and if no adequate response follows, the securities are transferred to the state and can be sold outright.
The piece highlights the case of Jan Peters, a German citizen who owned 1,029 Amazon shares that California seized after his address was erroneously listed as "Munich, CA 00000." The state sold the stock for about $1.6 million; by June 2025 Peters calculated the shares would have been worth over $4.2 million, and although he recovered the sale proceeds, he lost roughly $2.6 million in appreciation. His challenge reached the US Supreme Court, which declined to hear it in October 2025. States defend the practice as consumer protection, creating a central registry for forgotten assets, but the article notes they also benefit financially, as governments can generally use unclaimed cash while awaiting owners to come forward.
- US states are shortening timeframes for declaring stocks "abandoned" and seizable
- Many now use mere inactivity, not lost contact, as the trigger
- Amazon investor Jan Peters lost ~$2.6m after California sold his shares
Both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
Unclaimed property laws serve an important consumer protection function by reuniting citizens with forgotten assets and establishing clear registries of outstanding obligations. Shortening timelines and using inactivity standards reflect modern realities: someone who has not accessed an account or contacted their broker for three years has likely genuinely forgotten about the holding. States benefit financially from managing these funds, but this revenue legitimately supports database maintenance, claims processing and administration. Without such laws, millions in forgotten securities would remain permanently unclaimed, representing a genuine loss to actual owners and perpetual liability for financial institutions.
The case against
Whilst unclaimed property laws have legitimate purposes, recent tightening represents a troubling expansion of state seizure powers that prioritises government revenue over property rights. Three years is far too short to presume abandonment—investors reasonably leave holdings untouched for years, particularly dividend-paying stocks intended as long-term holdings—and inactivity alone is an inadequate proxy for genuine abandonment. The conflict of interest is stark: states can immediately liquidate and spend seized assets rather than holding them in trust, creating perverse incentives to declare property abandoned prematurely. The Peters case exemplifies the resulting injustice: a reachable, living owner with clear claim to his shares lost approximately $2.6 million in appreciation when California erred in recording his address, showing that the system too readily captures property from owners who never truly abandoned their holdings.