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Delaware General AssemblyDelaware RegulationsMonthly Register of RegulationsFebruary 2016

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In compliance with the State’s Administrative Procedures Act (Title 29, Chapter 101 of the Delaware Code) and under the authority of 12 Del.C. §1154, the Delaware Department of Finance’s Office of Unclaimed Property, State Escheator, proposes to revise and replace its regulations related to its Voluntary Disclosure Agreements and Escheat Examinations.
In accordance with 29 Del.C. §10116, persons wishing to submit written comments, suggestions, briefs, and compilations of data or other materials concerning the proposed regulations should direct them to the following address:
Notice may also be directed via electronic mail to david.gregor@state.de.us. Any written submission in response to this notice and relevant to the proposed regulations must be received by the Department of Finance no later than 4:30 p.m. EST, Friday, April 1, 2016.
On January 29, 2015, the Governor of Delaware signed into law Senate Bill 11 of the 148th General Assembly, which directed the Delaware Secretary of Finance to complete the development of a detailed manual containing procedural guidelines for the conduct of Delaware unclaimed property examinations.
12 Del.C. §1154, State Escheator to make regulations.
1.1 Policy
1.2 Effective Date
1.3 Initial Holder Contact
1.4 Processing the VDA
1.5 General Information
1.5.2 The VDA Forms may not be altered without written consent of the State.
2.1 Preface
2.2 Guiding Principles
2.3 Effective Date
2.4 Authority to Conduct Abandoned Property Examinations
2.5 Examination of Holders
2.6 Notice of Examination
2.6.5 At no time is the State required to justify its selection of a Holder for examination.
2.7 Third-Party Advocates
2.8 Confidentiality and Non-Disclosure Agreement (“NDA”)
2.8.3 Approved Non-Disclosure Agreement
The following in an example of a Non-Disclosure Agreement approved by the Department of Finance:
1. Introduction. [auditing firm name] is a contract auditor that has been authorized to conduct an unclaimed property examination (the “Examination”) of the Holder by the state(s) identified on Exhibit A (hereinafter a “Participating State” or collectively, the “Participating States”, and shall include any additional state or jurisdiction that may, during the course of the Examination, authorize [auditing firm name] to act as its agent and to perform an unclaimed property examination of the Holder) to determine the Holder’s compliance with the Participating State(s)’ unclaimed property laws, rules, and regulations. Upon receipt of any subsequent authorization, [auditing firm name] shall promptly provide the Holder with an updated Exhibit A.
2. Confidential Information, defined. During the course of the Examination, [auditing firm name] may have access to, or receive, confidential and/or proprietary information concerning the Holder including, but not limited to, materials relating to the administration of the Holder’s business, operations, unclaimed property procedures and practices; financial information and/or accounting records; information regarding the Holder’s current and former shareholders, members or partners, principals, directors, officers, employees, retirees, beneficiaries, customers, consumers, vendors, contractors, agents and other such representatives; and/or any other materials or information disclosed by the Holder or its principals, partners, directors, officers, employees, agents, consultants, advisors, legal counsel, accountants, and other such representatives (collectively “Representatives”) to [auditing firm name] and its Representatives in connection with the Examination. All such information, including any materials derived therefrom, whether disclosed orally or in written (including electronic) form or otherwise, shall be considered by the Parties to be proprietary and confidential ("Confidential Information"). Confidential Information shall also include any report filing, voluntary self-disclosure agreement, or settlement agreement resulting from the Holder’s reporting of any unclaimed property as well as any settlement, payment(s), or other interim or final resolution of the Examination. Confidential Information shall not include information or materials that are: (i) in the public domain not as a result of the violation of the undertakings herein; (ii) available to [auditing firm name] on a non-confidential basis prior to the Holder’s disclosure of it to [auditing firm name], or (iii) hereafter made available to [auditing firm name] on a non-confidential basis from a source other than the Holder, provided that such source in so acting is not violating any duty or agreement of confidentiality.
3. Non-Disclosure. [auditing firm name], in receiving Confidential Information from the Holder or its Representatives, will preserve the confidentiality of such Confidential Information and shall:
a. restrict disclosure of such Confidential Information to [auditing firm name]’s Representatives having a "need to know" in connection with the Examination, and where such Representative is a third-party agent or contractor of [auditing firm name], ensure that said Representative is either: (a) a party to a non-disclosure agreement sufficient to protect the Holder's legal and equitable right in the Confidential Information; or (b) under a duty of confidentiality with respect to the Confidential Information as a result of a legally binding, regulatory, or statutory prohibition;
4. Records Retention. [auditing firm name] shall retain the audit work papers (which may include the Confidential Information) in a secure environment for no longer than the period of time specified under the laws, rules or regulations of the Participating State(s) or [auditing firm name]’s contract with the Participating State(s), whichever is longer, at which time the records (inclusive of any Confidential Information) shall be destroyed; and [auditing firm name] shall certify in writing as to such destruction to the Holder using the following contact information: Contact Name & Title, Company, Street Address, City, State, Zip; Telephone Number: Email Address:
5. Application of Agreement. This Agreement shall apply solely to the Examination and shall not be construed to permit the disclosure of any Confidential Information to any other state or jurisdiction not listed on Exhibit A, absent the express written consent of the Holder. This Agreement may not be canceled or modified, nor any of its provisions be waived, except in writing signed by the Parties hereto or, in the case of a waiver, on behalf of the Party making the waiver. This Agreement constitutes the entire agreement and understanding of the Parties hereto and supersedes any and all prior agreements and understandings relating to the subject matter hereof. If it is found in a final judgment by a court of competent jurisdiction that any term or provision hereof is invalid or unenforceable: (i) the remaining terms and provisions hereof shall be unimpaired and shall remain in full force and effect; (ii) the invalid or unenforceable provision or term shall be stricken from this Agreement and the validity, binding effect and enforceability of the remaining provisions of this Agreement shall not be affected or impaired in any manner.
2.9 Opening Conference
2.10 Scope of Examination
2.11 Examination
2.12 Reportable Property Types
Bonds
2.13 Projection and Estimation
2.13.6 Approved Remediation Outreach letter
2.14 Entity Sampling
2.15 Bankruptcy
2.16 Statement of Findings and Request for Payment
2.17 General Information
For more information on abandoned property Voluntary Disclosure Agreements and/or examinations, please contact the Audit Manager at the following address:
Please visit the State’s unclaimed property website, http://finance.delaware.gov/unprop/unprop_holders.shtml,for current contact information.
Last Updated: December 31 1969 19:00:00.
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