Dormant bank account seized by bankrupt governments
Duncan Richardson, News Editor
12 Jun 2014, 11:05 a.m.
Over the last few years governments around the world have enacted legislation that allows money held in dormant bank accounts to be confiscated. Interestingly just prior to the 2008 economic crash the UK Parliament passed the 2008 Dormant Bank and Building Society Act.
The act enables banks and building societies to transfer money held in dormant accounts to a central reclaim fund. The central fund is tasked with managing the money, dealing with any disputes and ultimately passing the proceeds to the Big Lottery Fund. In the UK accounts have to be dormant for at least 15 years before they can be seized. The British Bankers Association estimated the law could raise $600 million for the government.
Japan has recently enacted similar legislation which allows dormant bank accounts to be seized after 10 years and in 2013 Australia amended legislation to allow dormant account to be raided after just 3 years. In the U.S. 50 states already have regulations in place to seize dormant bank accounts.