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Unclaimed Bankruptcy Funds and Distributions

Bankruptcy unclaimed funds are monies paid by the bankruptcy trustee to the Bankruptcy Clerk, who then is the custodian of those funds. Court appointed bankruptcy trustees often aren’t able to locate those owed money, particularly if you’re a creditor owed unclaimed funds from a bankruptcy filing in another state. Sometimes the money paid out by a trustee, is returned by the post office as undeliverable or the check is not cashed within 90 days. By law, the trustee is required to deposit those funds to the court as unclaimed. Bankruptcy Courts are a seemingly unlikely yet substantial source of unclaimed assets, holding hundreds of millions of dollars in unpaid distributions. It is estimated that Federal bankruptcy courts holds over $200 million in unclaimed funds.