Banking experts think that up to GBP5bn may be sitting in "dormant" bank accounts in the UK that haven't been used in a long time. What does this mean, and could you get some of this huge amount of money that is just sitting there?
The British Bankers' Association says that a bank account becomes dormant when the bank and the customer "lose touch with each other." In real life, this usually means that the account holder has died or moved and the bank hasn't been told. They can't find the account holder later on.
If an account hasn't been used in about a year, the bank will write to the last known address of the account holder and ask if they want to keep the account open. If the bank doesn't hear back from the person, the account will become "dormant." This means that from now on, the customer will not get any more bills, chequebooks, or other mail.
The money in the account will still earn interest at the normal rate for that account, and the bank will still keep track of the account balance and the last known address of the holder.
A dormant account usually happens for one of two main reasons. The first and most obvious reason is to save the banks the cost of sending out statements and other paperwork when the account hasn't been used in a while (other than that initiated by the bank itself, such as interest payments).
The main reason, though, is to protect against identity theft. If a bank keeps sending statements to an address where the account holder is no longer living, it is all too easy for these documents to fall into the hands of fraudsters, who could use the sensitive information they contain to start an ID theft campaign.
Most dormant accounts will have very small balances, but some will always have a lot of money in them. These are often the accounts of people who have died. If you think you might be owed money from a dormant account, you can make a claim by filling out a form from the bank.
You will have to explain why you want to make a claim, like if the account belonged to a close relative whose estate was left to you. You will also have to show that you are who you say you are and, if necessary, that you are related to the original account holder.
If the bank doesn't agree that you should be able to take over the account, you can file an appeal and have your case looked at again. If the appeal doesn't work, you can take your case to the Financial Ombudsman Service, whose decision is final and binding.
