VDA Program Archives | INSIDE SALT

Incoming from Delaware: Unclaimed Property VDA Program invitation notices have been sent out

by Stephen P. Kranz, Eric D. Carstens and Vanessa S. Torres | Apr 13, 2026 | Audits, Delaware, Interest and Penalties, Unclaimed Property

The Delaware Office of the Secretary of State (SOS) confirmed that on April 10, 2026, invitation notices were sent to businesses (holders) identified as potentially out of compliance with Delaware’s unclaimed property law. The notices encourage holders to enroll in the SOS Unclaimed Property Voluntary Disclosure Agreement (VDA) Program within 90 days of receipt of the notice and cautions that failure to do so will result in the holder being referred to a peer state agency (the Department of Finance) for examination – the day-to-day of which is conducted by one of Delaware’s third-party unclaimed property audit firms. As a result, these seemingly routine initial regulatory compliance notices should not be ignored, and it is critical that companies be on the lookout for these notices and respond in a timely manner.

VDA Program invitations are typically sent to the holder’s chief financial officer (CFO) via certified mail. Given the history of these notices being lost, delayed in the mailroom, or forwarded to the wrong department, it may be prudent for those responsible for unclaimed property compliance to check with their CFO in the coming weeks on whether a letter from the SOS was received since the 90-day clock is imminent. Recipients of these invitations range from middle-market companies to Fortune 100 companies, both privately and publicly held, across a wide range of industries, including oil and gas, retail, banking, utilities, technology, media, healthcare, manufacturing, pharmaceutical, and consumer products. However, there has recently been a noticeable increase in invitations sent to companies that maintain a long filing history but may have been involved in recent merger or acquisition activity. Additionally, companies that have formed within the last 10 years but have experienced rapid growth over the last few years are at higher risk of receiving invitations. This group includes startups that have recently gone public; cloud and artificial intelligence companies; and companies with online and transient customer bases, such as payment processers and online marketplaces. Delaware incorporated entities with a large presence of foreign owned (or unknown) property on their books and records are always at risk of an unclaimed property regulatory compliance review by Delaware.

The lookback period for both the unclaimed property audits and the VDA Program is 10 report years, plus the five-year dormancy period for most property types, equating to a 15-year lookback period. Often, complete and researchable books and records are not available for the full lookback period and the VDA Program regulations require estimation for the older periods.

Enrolling in the VDA Program offers several benefits, including, but not limited to, a waiver of Delaware’s statutory penalties, a significant reduction in interest paid on any findings, control over the process, a 90-day aging criteria for voided disbursement checks that limits the workload (compared to the traditional 30-day period), and not being referred to the Department of Finance – which has the potential to turn into a multistate audit.

Holders that receive an invitation to the VDA Program from the SOS in the coming weeks are [...]

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Holders Beware: Delaware Department of State Notices to be Mailed in Two Weeks!

by Eric D. Carstens and Stephen P. Kranz | Sep 29, 2017 | Audits, Delaware, Unclaimed Property

In two weeks, the Delaware Secretary of State (SOS) will begin mailing notices to holders who have been identified as likely being out of compliance with Delaware unclaimed property law. Holders that do not enroll in the SOS Voluntary Disclosure Agreement Program (VDA Program) within 60 days of the mailing of this notice will be referred to the State Escheator for examination. Once an audit notice is issued, the SOS will have no legal ability to accept a holder into its VDA Program.

The VDA Program was put in place to respond to concerns about Delaware’s audit program and allow holders to come into compliance through a “self-audit” that is administered by the holder, as opposed to the State Escheator. The audit is overseen by a third-party provider that must approve the steps taken by the holder, but allows more flexibility in terms of the details and deadlines than a traditional audit. Delaware law requires that every company be provided with an opportunity to voluntarily comply prior to being issued an audit notice. For holders that receive a notice from the SOS in a little over two weeks, this letter will be their one opportunity to voluntarily come forward and enroll in the VDA Program and requires prompt decision making and evaluation, given the 60 days deadline and potentially significant implications.

It is still expected that the final Department of Finance (DOF) regulation required by SB 13 will be included in the October 1, 2017 Register of Regulations. If this holds true, companies currently under a Delaware audit authorized by the State Escheator on or before July 22, 2015, will have 60 days from October 1 (i.e., until November 30, 2017) to convert to the SOS VDA Program. Again, the same analysis and implications are at stake.

Practice Note

There is a lot for holders to consider in a very short period of time. Holders should be aware that there are may be more than the single, historic third-party provider in charge of administering the SOS VDA Program. Adding new providers creates uncertainty in the process and it is not clear how holders will be assigned to each provider.

Holders in need of advice on whether to enroll in the SOS VDA Program should reach out to the authors to discuss their options. Stay tuned for our analysis of the final DOF regulation, which will be posted shortly after publication.

Delaware Proposes Unclaimed Property Regulations – No April Fools

by Eric D. Carstens and Stephen P. Kranz | Apr 7, 2017 | Audits, Constitutional Issues, Delaware, Nationwide Importance, Procedure, Unclaimed Property

On Saturday, April 1, 2017, the Delaware Department of Finance (DOF) promulgated two regulations that would repeal all existing unclaimed property regulations and replace them with a single DOF regulation containing a revised Reporting and Examination Manual. The Secretary of State (SOS) also promulgated a regulation that outlines the method of estimation to be used for participants in the Voluntary Disclosure Agreement (VDA) Program. These promulgations are in accordance with the General Assembly’s instructions to do so in Senate Bill 13, which was passed in January and enacted by Governor John Carney on February 2, 2017. Any written submission in response to these regulations must be sent to the respective agency by Wednesday, May 3, 2017 at 4:30PM EST. (more…)