In the first ruling written by Justice Ketanji Brown Jackson, the Supreme Court on Tuesday sided with 30 states which had argued Delaware had no right to keep hundreds of millions of dollars in uncashed MoneyGram checks for itself.
It was on the first day of the current term that the Court heard arguments in the case of Delaware v Pennsylvania and Wisconsin. The latter two were among 30 states arguing that a nearly half-century-old law applied to the case in their favor.
MoneyGram Payments Systems, one of the world’s largest money transfer companies, is headquartered in Delaware. It offers a means to send a check without actually having a checking account.
Here’s how it works: a consumer buys an official check at face value from a participating location—usually a bank or other financial institution. That institution will send the funds to MoneyGram, which treats them as a promise to pay. The check can then be delivered to the payee, who can cash it at a bank. The funds are reimbursed to the bank from MoneyGram.
However, if the payee doesn’t cash the check, those funds may be considered unclaimed property.
Jackson wrote in the Court’s unanimous decision that those unclaimed funds generally belonged to the states where the MoneyGram products were purchased, rather than exclusively to Delaware.
She noted that the 1974 law known as the Disposition of Abandoned Money Orders and Traveler’s Checks Act generally gives the rights to the states where the checks were bought.
Many of the largest U.S. companies are incorporated in Delaware. For the state, unclaimed property has become a big money maker. It accounted for $448.6 million of Delaware’s $5.4 billion in revenue in 2021, making it the state’s third-largest source of revenue.
Jackson made history when she was sworn in as the first-ever Black woman Supreme Court Justice on June 30th.