Time to wake up sleeping accounts
A staggering £500m is sitting dormant in banks and building societies nationwide and if savers fail to claim them the money could start flowing into a central government pot for good causes.
In a few weeks politicians are due to introduce legislation allowing money held in dormant accounts untouched for 15 years to be moved under the Unclaimed Assets Scheme.
This could start happening from 2009, so time is running out for banks to reunite customers with their forgotten cash.
Martin Lord, manager of Northampton and District Citizens Advice Bureau, is urging people to take action if they think they may have money unaccounted for.
He said: "Even though the account is not being used, any interest due will continue to be added to the balance. An account is usually considered dormant if it has not been used for one year, although this depends on the bank or building society, and the client has not been in contact with the bank or building society during this period.
"Once an account is considered dormant, it may be closed and the balance and interest transferred to a separate holding account. However, the funds, together with any accrued interest, remain the property of the account holder or their personal representative if the account holder has died.
"If the client wants to claim funds from, and/or re-open, a dormant account, they should fill in a claim form obtained from the bank or building society. When they return the form, they must provide proof of their identity, proof of the existence of the account and, if the account is not in their name, proof of their legal claim to the account.
"If the client does not know the name of the bank at which the account is held, or does not know the account details, they can make a claim through the dormant accounts page of the British Bankers' Association."
If an account has been inactive for an extended period of time it is the bank or building societies responsibility to write to the customer asking them whether they wish the account to remain open.
If no response is received, the bank will stop sending correspondence and will class the account as dormant. This ensures that financial details are not sent to what might be an old address, reducing the risk of fraud and ID theft.
The most typical cause of a bank account being made dormant is a customer failing to advise all relevant financial institutions of a change of address.
It can also happen when someone forgets about a savings account set up in childhood, when couples spilt up, people move abroad or someone dies.
Robert Cavinato of RS Financial Services in Kingsthorpe admitted that it was something he had rarely seen.
He added: "Most of my clients hopefully know where their money is. It is not something that comes up much. It is more likely to come up with deceased people."
However if an account does become dormant customers can either reactivate it on application to their bank or use the British Bankers' Association (BBA) tracing scheme.
And even if money is transferred under the Unclaimed Assets Scheme, the account holder will still have the right to reclaim their monies at any time, although this could be a lengthy, convoluted process.
Banks and building societies are currently trying to trace people by writing to them, appointing search agents or using the BBA which simply relies on savers coming forward to claim their cash.
The amount of effort taken to trace someone varies greatly between each organisation.
HSBC, Lloyds TSB and Royal Bank of Scotland are relying on the BBA, whilst Nationwide has appointed a search agent.
However the longer financial institutions leave the accounts dormant the better their own balances will be, as they earn interest from them.
Mr Lord added: "We support the basic idea that the money is put to good causes. As a lump sum it is a lot of money but per head of the adult population it would not be much.
"We don't get many inquiries about dormant bank accounts but we do get people asking us about dormant private pensions. There are thousands in existence and people change jobs but they do not tend to change bank accounts. We get people who remember having a pension from the 1970s or 80s in a previous job and the company no longer exists and they are trying to trace the pension."
To find out whether you have a dormant account contact the BBA on 0207 216 8909 or visit www.bba.org.uk
The website's dormant accounts section also includes a long list of banks that have closed, merged or changed name.
To contact CAB call 0844 855 2122.
Email to a friend
Print this page- Northampton company faces multi-million-pound damages claim over “toxic” Chinese sofas
- BREAKING NEWS: Tributes paid to Niamh Curry as brave five-year-old loses battle against cancer
- BREAKING NEWS: Pensioner dies after collision at Northampton shopping centre
- Man tied to tree and beaten on Northampton Racecourse
- BREAKING NEWS: Seven-year-old boy dies following house fire in Northamptonshire
- Northampton binmen at ‘breaking point’
- Saints’ stadium plans get support as long as traffic issues solved
- Eastern European pupils helping school standards across Northampton
- Northampton Town: Boothroyd ‘It’s all about stability’
- Northampton benefits advice agency reports surge in people losing entitlements
- Northampton company faces multi-million-pound damages claim over “toxic” Chinese sofas
- Northampton Saints: Aussie international Cameron signs on at Gardens
- Northampton binmen at ‘breaking point’
- Social housing tenants blamed for crime wave across Northampton housing estate
- Behind The Headlines: Crisis - What crisis this winter?
Looking for...
Featured advertisers
Jobs
Search for a job
Motors
Search for a car
Property
Search for a house
Weather for Northampton
Thursday 24 May 2012
Today
Sunny spells
Temperature: 12 C to 25 C
Wind Speed: 12 mph
Wind direction: North east
Tomorrow
Sunny
Temperature: 11 C to 22 C
Wind Speed: 22 mph
Wind direction: East
