The California State Controller’s Office on a single day in 2024 approved wiping away more than $57 million in interest it was owed in a sweeping action with no public explanation at the time, a Sacramento Bee investigation has found.

The money was owed by corporations, insurance companies and other businesses who were on the hook — in some cases more than $1 million each — for their handling of accounts or other property Californians had forgotten about or did not know existed.

The sheer amount the agency waived was staggering, records show. In all of 2023, the Controller’s Office forgave just under $3.9 million in interest overall. Last year, it waived a combined $2.9 million.

The Controller’s Office manages public money, audits agencies and runs the payroll system for state workers. A spokesperson for the office in an email said the decision to wipe away more than 4,200 separate interest payments on June 14, 2024 “reflected the conclusion of a broader cleanup of accounts carried over from prior administrations.”

The top factor that went into waiving the payments was the age of the cases, the spokesperson said, adding that the legal deadline to collect the money through the court system had passed. The wiped accounts were on average, 15 years old. The waived accounts from 2023 and 2025 were on average three to five years old.

The state law governing the interest payments process does not mention the statute of limitations as a reason to waive interest owed.

California’s unclaimed property system oversees a staggering number of assets, valued at roughly $15 billion as of June.

Many things can be considered unclaimed property, but it is often a bank account that is not being used or uncashed checks from utility and insurance companies. Its value can be in the pennies, but the banks, companies and other holders of the property are required to make annual reports to the state and efforts to contact the owners of the money or other assets.

If, after a few years, the property remains uncollected, the holders of the goods must then hand it over to the Controller’s Office. The agency keeps a database of all the property waiting to be claimed by Californians. The current State Controller Malia Cohen, who was elected in 2022, said in a recent op-ed that the office returns roughly $1.5 million daily to people who successfully file claims. She is running for a second term in November.

If the holders don’t properly report or deliver the items, they have to pay the state 12% interest on the asset from when they were supposed to. The office can grant them a reprieve if the failure to do so was because of “reasonable cause.” That can include circumstances outside the property holder’s control or if the Controller’s Office gave them incorrect information.

Property holders can file letters with the agency to ask for a waiver.

That said, many that received one in 2024 did not have to ask for the agency to forgive the owed money, records show. One of them was Merrill Lynch, which had a $1,918,901 interest payment waived by the office. Another is National Financial Services, which had a $1,678,834 payment wiped away.

Letters the Controller’s Office sent to those companies are nearly identical and both include the sentence: “We find that under the present circumstances, this matter satisfies or arguably meets the standard set by the legislature for a waiver and, consequently, such wavier is granted.” But they do not include specific information to explain why.

The Controller’s Office spokesperson said the agency forgave the amounts because a three-year statute of limitations had passed to collect the debt in court.

“Incurring the cost of preparing litigation to pursue collection would have been costly to the state, time consuming and with no change in results,” the spokesperson said.

The agency also said in a statement the “2024 total was much higher” because it was working through a backed up workload “due to staffing limitations.”

In 2019, the agency had four staff members in the unclaimed property division, which is the same amount it had in 2024, according to the Controller’s Office. Members of the agency’s legal office also work on cases. It had one additional support staff member in 2024 that it did five years earlier.

Former State Controller Betty Yee, who served in the role from 2015 to 2023, found it unusual that the agency approved so many waivers in one day.

She acknowledged that there were a lot of unclaimed property cases for agency staff to handle, but she was surprised to hear that the office had forgiven interest owed without holders asking for it.

“It did become a workload issue for sure,” Yee said, “but there has to be a request for a waiver.”

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