FEATURE: The true extent of lost accounts
With thousands of people logging onto a website that helps unearth lost accounts, Barney McCarthy looks at how to trace your money
The passing of last week’s deadline to claim a £7m prize won in a Euro Millions lottery draw in September had many of us scratching our heads in exasperation, incredulous that someone could pass up the opportunity to get their hands on such a huge sum of money. But mislaying a ticket for what is often quoted as a 14-to-one million chance is one thing, imagine losing track of money that is already yours.
A service set up through a collaboration between the British Bankers’ Association (BBA), the Building Societies Association (BSA) and National Savings & Investments (NS&I) called My Lost Account helps consumers trace old bank and savings accounts. In the three weeks from its launch at the beginning of February, it received 140,000 visits, resulting in 72,000 claims being submitted to the three organisations.
Angela Knight, chief executive of the British Bankers’ Association, says the improved service builds on the three existing central tracing services and will improve accessibility significantly. “It is a key part of the industry’s commitment to make further steps towards reunifying customers with their money in advance of the statute-backed unclaimed assets scheme,” she says. This additional scheme, to be introduced in 2009, will ensure that the contents of all genuinely lost accounts will be given to community causes, rather than being held over for owners that may never claim the funds.
Visitors to the website fill out an application form which is then passed securely to the institutions that may be holding the dormant or lost account. The institutions contacted carry out a search of their accounts and the applicant is informed whether any account they hold matches the details submitted online. Where the original bank or building society no longer exists, such as when it has been taken over, the successor institution will carry out the search.
The website contains a database of all UK buildings societies and relevant banks, including those that are no longer trading under their original name. Those without access to the internet are not excluded either as paper-based search facilities are available. Searches can take up to three months as they can involve institutions having to search very old records on the basis of outdated or partial information.
Everything’s not lost
So how does an account become lost? Banks, building societies and the NS&I seek to keep in touch with their customers wherever possible. However, if an account has been inactive for an extended period, the account holding bank or building society will write to the customer asking whether they wish the account to remain open. If no response is received, correspondence will be ceased and the account is classed as dormant or lost. This ensures that financial details are not sent to what might be an old address, reducing the risk of fraud and ID theft. The most typical cause of an account becoming dormant or lost is a change of address, so remember to notify the relevant financial institutions when you move house.
Halifax, one of the UK’s largest savings providers, revealed in February that it was to perform up to 25,000 searches in conjunction with credit reference agency Experian to find up-to-date contact details. Once these customers have been located, Halifax will write to them in order to re-establish contact. The average balance for these customers is £273 and the cost of the searches will be met by Halifax, rather than being passed on to consumers. Since March 2007, Halifax has reunited customers with over £14m of all the money held in its dormant banking and saving accounts. Tony Wilcox, head of savings at Halifax, says: “We are determined to reunite as much dormant money as possible with the rightful owners.”
Treating customers fairly
The service ties in with the new banking and business banking code launched this week. The implementation follows an independent review and consultation with consumer groups, HM Treasury, regulator the Financial Services Authority (FSA) and the Office of Fair Trading. Information on how to find dormant accounts is one of the central tenets of the new code, alongside commitments to responsible lending and clearer information about credit cards and credit card cheques.
With regulation by the FSA making financial services more geared towards consumer protection and assistance than ever before, and a tailor-made service aimed at reuniting you with your money, it seems there has never been a better time to claim what is rightfully yours.