0-QUESTIONS AND ANSWERS FINAL.pdf

QUESTIONS AND ANSWERS

2223-01 RFI UP

Payment/Disbursement Services

Questions and Answers Below are the questions and answers related to this RFI. In the table below, the Department of Financial Services (Department) has answered each of the written questions submitted by vendors.

No. QUESTION DEPARTMENT RESPONSE

The current process mentions that the Department makes prompt payment of approved claims by check, am I correct in assuming that is an internally managed process or are there any vendors currently contracted to provide assistance on the payment disbursement? If there is an incumbent contract that would be replaced in the event of a future solicitation, can we get the vendor name and contract number?

The Department currently issues all payments itself. There is no incumbent contract.

What is the average disbursement for unclaimed property fund returns?

$875

What is the highest disbursement the state has paid out for unclaimed property funds? The lowest?

Highest: $7.5 million Lowest: $.01

Are funds expected to be paid out by the vendor for a valid claim and then the vendor invoices the state?

Or does the state intend to send funds to the vendor and then the vendor facilitates the disbursement to the claimant?

The Department intends to process/approve claims with no changes. The Department is open to seeking ideas on how to process the payments through the vendor to get the funds into the hands of the unclaimed property claimant.

Are you happy with the existing approval system/validation process for claimants submitting their claims, and you are simply looking for a better way to disburse (get rid of checks)?

The Department is satisfied with its current process but is exploring alternative payment methods.

Please share areas within the current Payment Validation System that can be improved upon if any.

The Department would like to reduce the number of cancelled, reissued, and returned warrants (lost, claimant says never received, incorrect address, etc.).

If a system was presented that managed claimant intake, validation, multiple payment disbursement types and robust reporting for audit purposes; and, supported customer service/call center needs, would the state be interested in this white glove approach?

The Department is not currently seeking to replace its unclaimed property claims application, but it is interested in exploring alternative payment methods.

Would the state like all data collection and disbursement services to be integrated via API?

The Department processes mainly by batch method but is not opposed to API or Webservice. It depends on the type of “files” being processed.

What is your “wish list” for best case scenario for unclaimed property disbursements?

The Department strives for increased efficiency; 100% delivery and usage by consumer.

How much unclaimed property has been dispersed in the last five years?

$1.8 billion

What are the volume projections of funds that are anticipated to be dispersed in the next five years?

$2 billion+

Are funds dispersed on an annual basis?

Funds are dispersed on a daily basis.

What is the median value of the claims paid in 2021/2022?

$875

If dispersing funds via stored value products, is cash access required?

No.

Will claimants have a choice of payment methods or will the state determine method of payment?

Claimant will have choice of payment method.

It would be good to have a better understanding of the amounts distributed i.e. those under $100, between $100 and $500 and over $500.

The following constitutes a rough breakdown of the percentage of payments made based on the amounts of the unclaimed property:

Less than $100: 62% Between $100 and $500: 26% Between $500.01 and $1,000: 5% Between $1,000.01 and $10,000: 6% Greater than $10,000: 1%

Are funds distributed to persons under the age of 18?

How are persons identified prior to disbursement (ie DOB, SSN verification)?

Date of birth, SSN verification, and proof of connection to address.

Will the State be storing any cardholder information, including full 16 digit PAN? If so, please provide details of PCI compliance.

Are claims disbursed outside of the 50 US states?

Yes.

What are the most significant hurdles the State is looking to resolve by switching off of paper check issuance?

The Department will maintain paper check issuance but would like to consider alternatives that would enhance or improve current processes and help reduce the number of cancelled, reissued, and returned warrants.

Is the State looking for a total conversion from paper check, or would that still be an option for recipients?

No. Paper checks would still be an option for recipients.

Does the Department foresee any required rulemaking as necessary, prior to implementation of modern payment options?

Yes. The necessary rulemaking change is in progress.

Current §717.124 refers to a “notification and explanation of the dollar amount, the source, and the property type of each account included in the disbursement.” Is the Department planning to manage these notifications independently of the modern payment options, or would these options also need to include the notifications?

The Department intends to continue notifying the claimant and advising them of the unclaimed property type and amount. The Department requests information on alternative payment solutions.

The alternative payment solution may include additional notifications and property descriptions.

In terms of technology integration, is the state interested in processing files via batch or API?

The Department processes mainly by batch method but is not opposed to API or Webservice. It depends on the type of “files” being processed.

Will the selected Vendor be required to use the State’s technology infrastructure to process payments or will the State rely on the Vendor’s technology and security platform suite?

The Department is open to solutions that depend on either the Department’s infrastructure or the vendor’s infrastructure.

The RFI language states: In fiscal year 2021/2022, the Department processed over 600,000 claims resulting in the return of $388 million.

Can the Department please provide the average amount and volume of disbursements? (e.g., three-year trend)

Average disbursement amount for fiscal year 21/22: $650;

Average disbursement amount for fiscal year 22/23: $875;

Approx. volume of warrants issued fiscal year 22/23: 198,000.

What methods of payment does the Department currently use for disbursement? Also, can the Department provide the percentage of each disbursement type used?

The Department currently mails warrants to the claimant for 100% of disbursements.

Can the Department please provide the name of the current service provider?

There is no contracted service provider. The Department currently mails warrants to the claimant for 100% of disbursements.

Can the Department disclose who acts as your concentration bank for funding and for transaction processing?

The Department’s concentration bank is currently Wells Fargo.

How much fraud does the State experience today with the current payment process?

The Department has a robust process of identifying the appropriate unclaimed property owner which minimizes fraud.

How many of the 600,000 annual claims and $388 million in annual payments are to businesses as opposed to individuals?

Approximately 15-20% of unclaimed property disbursements are issued to businesses.

Please provide the number and dollar value for check payments made in the last fiscal year to businesses and individuals (listed separately) for each of the following ranges:

• $0 - $25.00

• $25.01 - $50.00

• $50.01 - $500.00

• $500.01 - $1,000.00

• $1,000.01 - $10,000.00

• $10,000.01 and up

The following is a breakdown of payments for the last fiscal year.

Approximately 20% of payments are issued to businesses.

$0 - $25.00 - 163,837 totaling $1.38 million

$25.01 - $50.00 - 99,688 totaling $3.57 million

$50.01 - $500.00 -237,477 totaling $38.5 million

$500.01 - $1,000.00 - 28,206 totaling $20.9 million

$1,000.01 - $10,000.00 - 34,973 totaling $106 million

$10,000.01 and up - 4,493 totaling $176 million

Are any of the claim payments made to more than one individual and if so do they all need to endorse the check?

Claim payments are only issued to multiple individuals if the unclaimed property is owned by multiple individuals. Both payees would be expected to endorse the warrant for deposit. The overwhelming majority of payments are made to single payee or to “Or” payees.

How many of the claims are made to claimants outside of Florida? Are any payments made to individuals or businesses outside the United States and if so how many?

On average around 29% of all claims paid are to claimants living in other states.

On average around 0.45% of all claims paid are to claimants in foreign countries.

How many claims payments are unredeemed each year?

Approximately 11,000 unredeemed (stale-dated) checks in calendar year 2022.

How many are lost and have to be replaced?

On average there are approximately 1,150 replacement checks each year.

Are any claim payments reported stolen or fraudulently cashed and if so how many and for how much?

The Department receives very few reports of stolen checks and submit an average of 11 forgery affidavits for bank review each year.

Is it the State’s intention to maintain the option for claimants to be paid by check while offering other payment options (i.e. is the goal to eliminate check payments altogether)?

Yes, it is the Department’s intention to maintain the option of claimants to be paid by check while potentially offering other options.

Are there any statutory or regulatory changes that would need to be made to offer additional payment options?

Yes. The necessary rulemaking change is in progress.

The RFI mentions that you are looking for efficiencies – can you describe what specifically are inefficiencies in the present process?

The Department would like to find ways to reduce the number of cancelled, reissued, and returned warrants.

What metrics would be used to measure the success of a program that offers additional payment options?

The Department would determine success pursuant to the terms of any potential contract for these services.

Would the State be interested in a solution for the payment(s) only or are you open to a technology layer that manages that process?

The Department is not currently seeking to replace its unclaimed property claims application, but it is interested in exploring alternative payment methods.

What is the average annual amount of unclaimed property disbursements over the last 2-4 years?

$1.8 billion+ over the last five years.

Can you describe the current process to validate and issue a payment?

This is performed internally. Claimant must prove they are the same person listed as the apparent owner and the person entitled to the funds.

What is the estimated cost to the state to issue a payment for unclaimed property today?

Payments are issued internally by Department staff, therefore the only cost to the state is employee salary, administrative overhead, printing checks, and postage.