Dormant Bank Accounts Consultation Paper

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A decision made (12.12.2008) to approve the green paper concerning a proposed dormant bank accounts scheme.

Decision Reference: MD-E-2008-0239
Decision Summary Title :	Dormant Bank Accounts Consultation Paper		Date of Decision Summary:	11 December 2008
Decision Summary Author:	James Mews, Finance Industry Development		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	n/a
Written Report Title :	Dormant Bank Accounts Consultation Paper		Date of Written Report:	11 December 2008
Written Report Author:	James Mews, Finance Industry Development		Written Report : Public or Exempt?	Public
Subject: The issuing of a consultation paper on a proposed Dormant Bank Accounts scheme.
Decision(s): The Minister for Economic Development approved the green paper concerning a proposed dormant bank accounts scheme and determined that it should be published by the Department and presented to the States Assembly.
Reason(s) for Decision: A significant number of account holders forget about or lose track of their bank accounts. It is proposed that a Dormant Bank Accounts scheme should be introduced to reinvest dormant deposits for the benefit of the Island as a whole.
Resource Implications: No measurable cost or manpower implications arise for the Commission, the States or industry.
Action required: The Minister approved the consultation paper and the Greffier was requested to present it to the States Assembly. The Finance Industry Executive to take such steps as are necessary for it to be published by the Department, including uploading the document to the departmental website.
Signature: Senator P.F.C.Ozouf		Position: Minister for Economic Development
Date Signed:		Date of Decision (If different from Date Signed):

Dormant Bank Accounts Consultation Paper

MINISTER FOR ECONOMIC DEVELOPMENT

DORMANT BANK ACCOUNTS CONSULTATION PAPER

1. THE ISSUE AND RECOMMENDATION

1.1. It appears that a significant number of account holders forget about or lose track of their bank accounts containing deposits. It is proposed that these dormant deposits should be reinvested for the benefit of the Island as a whole, while preserving the rights of the account-holders, should they reappear.

1.2. In accordance with States policy, a consultation paper has been prepared so that all interested parties will have an opportunity to contribute their views on the proposed scheme. It is recommended that the Minister approve the consultation paper and that the paper should be issued.

2. BACKGROUND

2.1. Although banks attempt to reunite funds in dormant accounts with their owners, this is not always possible, often because the customer has neglected to inform the bank of a change of address. Currently, there are no measures in place in Jersey to deal with deposits in dormant accounts, which may amount to a substantial total.

2.2. Dormant bank account schemes (or broader unclaimed asset schemes) have recently been introduced in several other countries including Australia, Canada, Ireland, New Zealand, Spain and the United States, and the UK Dormant Bank and Building Society Accounts Act 2008 was passed in November 2008.

2.3. The Jersey Bankers Association first raised this suggestion with government and the Economic Development Department are taking the suggestion forwards.

3. THE CONSULTATION PAPER

3.1. After an overview of the proposed scheme, the paper discusses a number of issues and sets out individual proposals for comment. Issues include how to define ‘dormancy’, what efforts banks should be required to make to re-unite accounts with their owners, how the reclaim fund should be administered, whether the scheme should be voluntary or compulsory, how owners should go about reclaiming their accounts, whether any interim steps are needed, whether other assets should be included in the scheme, and what use should be made of the moneys collected through the scheme.

3.2. The paper then summarises the issues by posing ten succinct questions in relation to the above.

4. RECOMMENDATION

4.1. It is recommended that the Minister approve the consultation paper and that the paper should be issued.

JAMES MEWS

Director, Finance Industry Development

11 December 2008