California DMV kept surplus auction money without notifying vehicle owners. New legislation would require certified mail notification within 14 days. Bill aims to close a long-standing consumer protection gap in lien sales. A person living paycheck to paycheck can have their whole life flipped upside down if they end up getting their car towed away one day. If fees rack up quickly, it can become more expensive to get the car back than to simply look for another way to get around. In California, the DMV auctions off cars left in tow lots over this exact situation. What it didn’t tell owners was that while those auctions would pay off the original owner’s debt, the state was pocketing whatever extra might have come in. Now, lawmakers want to shut that down. More: NY Driver Attempts DMV Fraud With Crayons And Markers A new bill from State Sen. Kelly Seyarto would require the DMV to notify vehicle owners when their impounded car gets sold for more than what they owed. He calls the situation a “serious consumer-protection gap in California’s lien sale process by ensuring that vehicle owners are actually notified when the state is holding surplus auction proceeds that belong to them.” Right now, if your car gets auctioned and generates extra money, the state can hold onto it. And if you don’t claim it within three years, it’s gone for good. Photos Stellantis, Google Maps According to reporting from CalMatters, the DMV collected over $8 million from about 5,300 vehicles between 2016 and late 2024 under this system. It has never had to notify owners, remind them, or reach out in any way. Thankfully, the proposed fix is incredibly straightforward and sensible. The DMV would have 14 days to notify the owner via certified mail about how much money is available after the sale. It would also have to inform the now-previous owner of how to claim the cash. To be fair to the DMV, after this story broke, it launched a tool online to help people check to see if they have money waiting for them. Sure, that’s reactive, but at least it’s better than nothing. The bill is heading to a Senate Appropriations Committee hearing with no opposition as of this writing. That would seem to indicate that it has good odds of passing. SB 1029 would require the DMV to send certified notice within 14 days of receiving lien sale proceeds, informing the registered owner that surplus funds may be available and providing instructions on how to file a claim. pic.twitter.com/E9ZbQRLgN4 — Senator Kelly Seyarto (@SenatorSeyarto) March 5, 2026