New Jersey Senate Seeks to Reform Dormant Account Law for Gambling Sites

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A legislative effort is underway in the New Jersey Senate to make a small but significant change to the state’s online gambling laws, specifically concerning inactive accounts. If the bill passes, it will be a boon to infrequent gamblers. Under the current law, such players need to worry about potentially forfeiting money in their accounts if they forget to withdraw or play with it.

New Jersey passed its online gambling expansion bill in 2013. The law was set to expire last year, but the legislature successfully extended it for another five.

Under those original 2013 rules, online casino accounts are deemed “dormant” after one year of inactivity. At that point, operators must make a good-faith effort to contact the player and encourage them to withdraw their balance. Failing that, however, they are allowed to seize the balance and split it 50/50 with the state.

There’s nothing nefarious about the original law. Lost or forgotten money is a drain on the economy, so some sort of policy for abandoned funds is necessary. However, it’s not uncommon for players to step away from the game for a year or more. It might even be a good responsible gaming practice to do so periodically.

So, that original, strict policy may have had some unintended effects.

A More Player-Friendly Policy

Sen. Vincent Polistina and three cosponsors have proposed changing the threshold for accounts dormancy to three years. 

Perhaps more importantly, funds in such accounts would become unclaimed property under the Uniform Unclaimed Property Act (UUPA). This law was drafted by the National Conference of Commissioners on Uniform State Laws (NCCUSL) in 1981 and adopted by New Jersey in 1989.

That would allow players the possibility of reclaiming their funds later rather than losing them. A similar bill was proposed in the Assembly in 2018 but did not pass.

Sen. Polistina’s office did not immediately respond to a request for comment on his proposal.

What Are the Rules About Unclaimed Property in NJ?

The UUPA serves a dual purpose: On the one hand, it allows the true owner of abandoned money or other intangible goods to reclaim them at any time. On the other, it solves the problem of value being removed from the system by granting the state the use of the property for as long as it remains unclaimed.

Under the UUPA, unclaimed property—such as funds in abandoned bank accounts—goes into a trust fund. Rightful owners can use a government website to search for missing funds and reclaim their property at any time. The state will even pay a small amount of interest on the money based on the length of time it was in trust.

For as long as it remains in trust, however, the state government has the use of the money. It can, for instance, invest the money, loan it out, or use it as liquid capital.

Effectively, the government acts like a bank offering a savings account. It holds the money for safekeeping but benefits from its use in the meantime.

In New Jersey (unlike some other states), there’s no time limit for reclaiming money in the unclaimed property trust.

Don’t Ignore Inactive Account Warnings

It’s important to note that Sen. Polistina’s proposal isn’t law yet. The legislative session has just begun, and the bill may or may not pass.

For now, the law is that New Jersey online casino operators must warn players after one year of inactivity. After that, they may confiscate the funds.

Players who intend to take a prolonged break from playing should always withdraw all funds from their account to be safe. If you receive a warning from your online casino about an inactive account, don’t ignore it! It’s worth double-checking that your balance is at $0 so that you won’t lose any money if the account gets flagged as dormant.

About the Author

Alex Weldon

Alex Weldon

Alex Weldon is an online gambling industry analyst with nearly ten years of experience. He currently serves as Casino News Managing Editor for Bonus.com, part of the Catena Media Network. Other gambling news sites he has contributed to include PlayUSA and Online Poker Report, and his writing has been cited in The Atlantic.
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