The legal definition as to what is to be deemed a dormant, unclaimed or inactive bank account varies according to each jurisdiction, even with countries lacking specific regulation on the issue. The main feature of these assets is that they lingered for a long time without action or notice from its owner and the Bank has lost contact with that owner or his or her heirs.

Certain legal systems require from the Banks to transfer the unclaimed assets to public agencies in charge of taking custody of them, allowing the owner or his or her heirs to claim them, be at any time, or within a set period of time after which the funds become the property of the government. Instances of these regimes are Uruguay (article 3 of the Law Nº 10.603 dated February, 23, 1945 on “frozen deposits”), Chile (article 156 of the General Law of Banking) and the United States, through legislation in each of the states.

Other systems, such as the one in Spain, also establish that the unclaimed sums be transferred to the state, but plainly as a transfer of property, precluding the right of the original owner to claim them. In this sense, the Law 33/2003 on the Assets of the Public Administrations deals in article 18 with the unclaimed or abandoned assets held in Banks, prescribing that after twenty years without notice from the owner, they are vested in the state.

A third group of legislations allow the Banks to indefinitely keep the funds, although laying out mechanisms aimed at facilitating the tracing of the assets and its recovery by the owners or their successors. Thus, the Registrar of Unclaimed Assets has been established in the United Kingdom, being managed by Experian and in which the value of the unclaimed funds is estimated in 15 billion Pounds. Important financial hubs characterized by a strong bank secrecy that gave rise to suspect the existence of large sums of unclaimed funds, such as Switzerland, were the target of international pressure aimed at more transparency enabling the recovery by the owner’s legal successors. This contributed to the enacting by the Swiss Bankers Association of the “Guidelines on the treatment of dormant accounts, custody accounts and safe-deposit boxes held in Swiss banks”, in effect since July 1, 2000.

Lastly, many jurisdictions remain with no specific legal regulation related to dormant accounts.


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