Inactive, Dormant Bank Accounts forfeited to Governments

This article has a fitting title based on many Newspaper Headlines that I have seen about the “Introduction/Changes to Dormant bank Account Funds being passed to respective Governments.

UK: More than £400 million in so-called dormant bank accounts is to be raided by the Government to fund charities, youth clubs, sports and community centres.
AUS: Labor Government to raid dormant bank accounts.

However, headlines are RARELY that accurate.

Take the recent Australian changes to Inactive Bank Accounts.

Three main changes to the legislation have been enacted.

All future claimants for Inactive Account balances will be able to claim Interest on their funds from July 2013.  Previous rules excluded the payment of Interest.

Balances will be transferred from the Banks to the Government, after THREE years instead of the previous SEVEN years. However, there is no Time Limit for people to reclaim these funds in the future.
The Funds are NOT lost FOREVER.
Accounts are only treated as Inactive, if no deposits or withdrawals are made during that time period. Interest and Fees are NOT counted as valid transactions.

Under previous legislation, accounts with balances under $100 could not be transferred, but in practice a figure of $500 was selected to be used.  The new legislation removes this $100 rule, but it remains to be seen what figure will be used in practice.

United Kingdom

Bank accounts in the UK become Inactive after 15 years of no transactions, and the funds are then transferred under the Unclaimed Assets Scheme, established under the Dormant Bank and Building Society Accounts Act 2008.
The purpose of the scheme is to enable money in dormant accounts (i.e. accounts that have been inactive or dormant for fifteen years or more) to be distributed for the benefit of the community while protecting the rights of customers to reclaim their money.


When there has been no owner activity in relation to the balance for a period of 10 years, and the owner cannot be contacted by the institution holding it, the balance is turned over to the Bank of Canada, which acts as custodian on behalf of the owner.

The Bank of Canada holds unclaimed balances of less than $1,000 for thirty years, once they have been inactive for ten years at the financial institutions. Balances of $1,000 or more will be held for 100 years once transferred to the Bank of Canada.

If the balance remains unclaimed until the end of the prescribed custody period, the Bank of Canada transfers the funds to the Receiver General for Canada. More at:

The Bank of Canada provides a free online Unclaimed Balances Search database for unclaimed bank balances.

United States

In the United States a time frame of three to five years with no customer-initiated activity will send an account into dormancy. The amount of time that must lapse depends on the state in which the bank account was opened.

Prior to sending the account to the state, the bank must try to notify the account holder. If the customer does not respond within a certain amount of time, the banks are then required to turn over funds of the inactive account to the state treasury. These funds are then held as unclaimed property, but can be retrieved by the customer via However this can be a long process.

  • New York:  More than half of New York’s unclaimed accounts are dormant savings accounts — accounts that have had no activity for three years.
  • California: California’s Unclaimed Property Law, which requires financial institutions etc., to annually report and deliver property to the Controller’s Office after there has been no customer contact for three years.
  • Illinois: 5 Years is the inactivity time before an account is dormant.
  • Washington: Property is usually considered unclaimed after three years, when it is turned over to the state of Washington
  • Florida: The property must have been inactive for a set period of time, usually between one and five years, before it is transferred to the State.
  • Texas: Bank accounts are considered abandoned after 3 years of inactivity.
  • Louisiana: Louisiana law states a FIVE year inactivity period for “Demand, savings or matured time deposits”.


In 2011, Bill 4438 was proposed to the Philippine parliament so that current or checking accounts with no activity (deposits or withdrawals) for three years would be deemed dormant or inactive. For savings accounts, the period was five years.
After this period the bank would transfer the money to the National Treasury.  I am not sure if this Bill was passed.

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