Thursday, September 9, 2010

Spend your dormant bank account money before the government does it for you

One news item that got brief coverage in the mainstream media was the recently announced plan by the British government to use dormant savings accounts to help fund community projects. As it stands, there is an estimated £935 million sitting in dormant U.K. based bank and national savings and investment accounts. The U.K. government is establishing a "Big Society Bank" which will finance charitable groups and other non-profit companies who will take over certain social programs in the country basically in a thinly veiled attempt to offload expenditures from the government. All this is part of the move that the U.K. government is forced to make to narrow its record budget deficit of £143 billion and debt of £924 billion. As it stands, there is an estimated £935 million sitting in dormant U.K. based bank and national savings and investment accounts. Part of this move stems from a law passed in 2008 under Prime Minister Gordon Brown's watch that allowed the government to use money from dormant bank and building-society accounts for "social or environmental purposes." Only accounts where there has been no customer activity (i.e. no contact with the financial institution and no transactions on the account) in the 15-year time period are ripe for raiding. Fortunately for consumers, even if the government reclaims your cash, the Dormant Bank and Building Society Act allows account owners to claim it back. I guess if you put enough lipstick on a pig by touting the use of the money for "social or environmental purposes", eventually, people will stop thinking it is a pig and instead, see a beautiful woman who's trying to steal what might be yours.

Once a government somewhere tries the tactic of raiding dormant bank accounts to fund their activities that should be funded by our tax "donations", other governments around the world are likely to duplicate the idea since none of those governing us are particularly well known for being original thinkers. In light of this, I'd like to help both Canadian and American readers find the money that they or their family members may have forgotten about.

Should you happen to live in the United Kingdom, here is a link that will help you track down your dormant accounts.  The service is provided by the British Bankers Association, the Building Societies Association and the National Savings and Investments.  The service is apparently free; all that's required of you is to supply your name, address and telephone number.

1.) Unclaimed Bank Accounts - United States

If you live in the United States, the process is somewhat complicated by the fact that each state has its own laws governing the recovery and claiming of unclaimed assets which can include bank accounts, bonds, mutual funds, life insurance policies, utility deposits. There is no central federal repository for unclaimed funds. While each state maintains a database, there is no national unclaimed property database. In the case of bank accounts, they are normally considered dormant if there have been no transactions for between two and five years. Attempts to contact account holders are generally made after two and five years, if unsuccessful, the funds in the accounts are turned over to state governments.

Here's are a few state links that may help you if you're looking for unclaimed funds. Just click on the state name and you should be taken right to the website that you're looking for.

Just to give you some idea of the number of bank accounts and amount of money involved, the State of California is currently in possession of more than $5.7 billion in unclaimed property belonging to approximately 11.6 million individuals and organizations.

For those readers whose states are not listed above, I would suggest that you type your state name followed by the words unclaimed property (i.e. Texas unclaimed property) into Google and I suspect you'll get the result that you are looking for near the top of the search results list. I also notice that there are many privately owned companies that will help you search for your unclaimed bank accounts, however, I would suggest that you try this route first because it doesn't cost you anything.

As an aside, I have to say that I really like the creativity that the American states use when naming their unclaimed property websites. Florida Treasure Hunt and Illinois Cash and Dash were my two favourites.

2.) Unclaimed Bank Accounts - Canada

Bank accounts are considered dormant in Canada when there has been no activity for 10 years and when the bank has been unsuccessful at contacting the owner of the funds. These funds are then maintained by the Bank of Canada. At the end of December 2009, the Bank of Canada was holding 1,122,000 unclaimed accounts worth $395 million. Over 93.4% of the accounts had balances of less than $1,000 representing 30.82% of the total funds under the Bank's care. The oldest balance dates back to the year 1900. Interestingly enough, the Bank of Canada maintains balances of $1000 or more for 100 years and balances under $1000 for 40 years. In the case of a balance under $1000, a written claim must be received by the Bank of Canada no later than December 31st of an account's last transaction plus 40 years (i.e. 10 years of dormancy in the bank's hands and 30 years in the hands of the Bank of Canada). In case you were wondering, the Unclaimed Balances Service also looks after unclaimed GICs, term deposits, bank drafts and credit card balances but only those issued by federally-regulated financial institutions.

Fortunately, in Canada the process of reclaiming your dormant bank accounts is very easy. Simply go to the Bank of Canada Unclaimed Balances webpage located here. In case the link doesn't work for you, it can be found if you type "dormant bank accounts Canada" into Google and it should be the first result. All you have to do is type in your name and optionally, the province you live or lived in and hit the search button. Not only did I search my own name, I searched the names of every relative, living and dead, that I could think of to see if they may have had any dormant bank accounts. There are far worse things in this world than calling up one of your cousins to tell them that they have a dormant bank account that has a few hundred dollars in it. Once you have identified that you have an unclaimed balance, you will need to fill out a claim form and return it along with additional required information and return it to the Bank of Canada. Again, fortunately in Canada, there are no fees charged for searching the Bank's records and for recovering your unclaimed balances! Please also keep in mind that you may be heir to the estate of an owner of an unclaimed bank account so search accordingly. Here are the procedures that must be followed to make a claim in any case.

When you search the database, here's an example of a result that you will get if you search the name "Johnson". As a bonus, if you happen to be related to this person who banked at the Royal Bank in St. John New Brunswick in the 1980's, there's $11,496.19 waiting for you.

Should you happen to do your banking at a credit union or caisses populaires, dormant accounts are not transferred to the Bank of Canada. If you bank (or have banked) in British Columbia, Quebec or Nova Scotia simply click on the name of the province and you will be automatically taken to their publicly-searchable database. If you live elsewhere, you will have to attempt to contact either the branch where the account was held or the provincial credit union head office.

Good luck and I hope that you hit the jackpot before the government decides to that they deserve your money more than you do! Don't forget that pig with lipstick!



  1. jeez its bloody better to buy a BIG safe and put no cash in banks at all ffs

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