Paypal may escheat or give your unclaimed money to your state if you fail to log into your account for two or more years. Paypal has a section in its Terms of Service that explains what happens when you fail to log into your account for two or more years. The section is entitled “Escheatment of Dormant Accounts.” There could be hundreds of thousands of dollars in dormant Paypal accounts scheduled to be escheated at anytime.
A Paypal member may not log into their account for a number of reasons. For example, say a member becomes too ill or injured to log into their account. The account could be inactive long enough for Paypal to close the account and escheat the funds in the account to the members state of residence listed in their primary address. If the account holder’s address is unknown or a foreign country, the funds will be escheated to the state of Delaware. In some cases, Paypal will try to notify a family member of the Paypal account holder before closing or escheating an account.
According to “The Free Dictionary by Fairfax Online,” an online dictionary, escheatment began as a law that allowed feudal kings to acquire large tracts of land after the death of a nobleman. During this time, nobility preserved their wealth by leaving estates to a single designated heir rather than breaking it up among several heirs. The land would be escheated to the king if there were no nobleman to serve as heir. Historically, only real property like land was subject to escheatment law.
Over time the law was changed to include personal property like Paypal funds. Today, some Paypal members have large sums of money that could become subject to escheatment. Thousands of bloggers, online merchants’ and various Internet service providers use services like Paypal to do their online banking. If you fall into one of these categories, your funds could become liable to escheatment if you fail to make proper arrangements. Keeping your personal information current is a good place to start. Keeping your payment address current in Paypal is the main thing as far as escheatment is concerned. This way, any funds in your Paypal account can be mailed directly to you if you fail to log into your account for two years or more and Paypal exercises escheatment.