BBC Watchdog: Dormant bank accounts discovered in attic

Tony

What Consumer Founder
Apr 7, 2008
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Bolton
You never know what you might uncover when you have a clear out of the attic. Old holiday snaps, bric-a-brac, forgotten tools. Or maybe even details of bank accounts, in your name, that you knew nothing about.

This is exactly what happened to siblings, Bob, Dianna and Shirley Martin.

If a bank account goes more than 15 years without any deposits or withdrawals, and with no contact from the holder, it becomes what's known as 'dormant'. There's a lot of forgotten money in dormant accounts across the UK: an estimated £850 million in fact. Some of this money could belong to the Martins.

Discovered savings accounts
They found an enormous bag of old photographs while clearing out the attic in September 2008. Among the photographs, the Martins found paperwork from The Bank of Scotland. The paperwork related to savings accounts set up in each of their names 50 years ago. Each of the three accounts had been credited with £25 - the oldest in 1959 on behalf of sisters Dianna and Shirley and a later one, in 1962, for their younger brother Bob.

It was the first the children knew of the accounts, but the paperwork from the bank showed that their parents, David and Annie, had cashed in Defence Bonds and invested the proceeds in trust for their children.

It was a big sacrifice. In 1959, the £25 their parents set aside for each of their children could've bought them a holiday, or covered shopping bills for months. Instead they put the money in the bank - even though life was tough.

"Dad only had one leg - he found it hard to get work. But he did work a lot. My mother was blind and deaf and she took the effort to do this and I would have thought this was quite a big effort," said Dianna.

The family visited the bank three times
Excited by their find, the Martins went straight to their local Bank of Scotland branch to discover how to get their money. Instead of the answers they'd hoped for, the bank told them that because the accounts were dormant, they'd have to fill out a special form online.

"We came home that night and filled out a form on the internet [which] said we'd get an answer in six to eight weeks," said Bob.

On the trail of these missing accounts, Bob visited the bank a further three times. Each time he brought his documentation with him, and each time the bank told him something different.

No access to the money
First they told him that the accounts had been deleted. Then, that the accounts had been cashed in. Finally, the bank admitted that they couldn't find any records of the accounts whatsoever. This left the Martins with no access to the money in their name and no idea what had happened to the accounts.

Claire Francis, Editor of moneysupermarket.com, believes the bank should be able to explain what has happened to the Martins' accounts. She told us: "These accounts were opened a long time ago, but that doesn't mean that they shouldn't be able to track their money and be reunited with it. The Bank of Scotland somewhere should have a record of who that money belongs to."

The Bank of Scotland is part of the Lloyds Banking Group, which has just announced a major campaign to find the owners of dormant funds. It says it's already reunited customers with £23 million, but that there's still £93 million lying unclaimed in their vaults. Some of this money could belong to Bob, Dianna and Shirley.

What would that money be worth now?
We asked economist Silvia Pepino, a researcher from the London School of Economics, to do a rough estimate as to how much could be in those bank accounts today. With few details available about how the accounts were managed, or the rates of interest they attracted, Silvia had to make a few assumptions.

Silvia based her calculations on the Bank of England's base rates since 1959 and 1962. She assumed the interest rate payable on the accounts was compounded monthly. She also assumed the accounts were tax free.

Silvia estimated that the Dianna and Shirley's 1959 accounts could today be worth around £1,300. She thought Bob's 1962 account could be worth slightly less at £1,100.

The Bank of Scotland has still not been able to explain what has happened to these two accounts. When the Martins parents invested their hard earned cash in the Bank of Scotland they could never have thought it would be so hard for their children to get it back.

Bank of Scotland's response
"Bank of Scotland has been proactively*trying to reunite customers with any dormant*funds which they are entitled to since 2007. The reunification efforts to date have been very successful with over £23million returned.*
*
"Our records indicate that a dormant account search was requested by Mr Robert Martin at our Forfar*branch on the 18 February 2009 and a response was issued to the branch the following day. Bank of Scotland has not been able to*locate a search request from Mr Martin prior to the 18 February, but do acknowledge the previous visits to our Dundee and Forfar branches.*We wish to apologise for the incorrect information provided to Mr Martin in January and the delay this caused to providing him with*a response to his enquiry.**

"In February, our Forfar branch*informed*Mr Martin that we were unable to trace any dormant accounts*with the information provided.*Our search was conducted*using handwritten letters from 1959 and 1962 and there was no account number or passbook available to assist the search. Had the money been left in these accounts it would have been transferred to our dormant account database. Bank of Scotland does not destroy records of dormant accounts.*
*
"Evidence to support the theory that the account was closed is not available as, unlike dormant accounts,*banks*only keep records of account closures for*a period of six years after the date of closure. This policy is in line with the 1980 Limitations Act and recommendations of the FSA."



Dormant bank accounts discovered in attic