Dormant bank accounts discovered in attic
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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."
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I wonder if the bank would have lost the customer's details had it been a dormant debt such as a mortgage or loan?
I think not.
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Hi All your information is more than a little incorrect. Lloyds TSB did not own Bank of Scotland until last year infact they only took over the Halifax and Bank of Scotland early this year.
Get your facts right, I as a License fee payer get really annoyed when The BBC gets the simplest of things wrong!
From Andrew in Bedford.
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My Grandad put £5 into a bank account in 1985 and [bank details removed] can't find it.
So if they can't find that I feel really sorry for people who have even older accounts.
Even though £5 is not that much, I wonder what its up to now? Could do with a few more pennies. I'm getting married in September :-)
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Same thing happened after the death of my husband when we tried to sign the childrens accounts over to them. I was told to post the passbooks off to [bank details removed] head office, which we did. Unfortunately do to dealing with the death of my parents also the childrens accounts got forgotten for a further 6 months. When we contacted them they said that they had no record of the accounts. It took them 2 1/2 yrs to 'find' the accounts. Also when my mother died [another bank] told me that she has closed her account before she died! Which I knew she hadn't and they also said that she didn't have life insurance with them, which she had told me she had. It was approx 12-18 months later that it was proved that she did in fact have nearly £1,000 in the bank and also a life insurance policy!!! They are not willing to pay out money to people even though the money is theirs to start with. Bankers are the scum of the earth in my opinion.
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The item on the dormany
t bank accounts was touching, involving a blind disabled mother etc but did not deserve the priority it was given. It seems highly likely to me that the accounts had been cashed even though ancient paperwork had been found in the loft. As an excellent program in uncovering dodgy practices, you do yourself a disservice by presenting features that are not grounded in fact. I have no connections with the deservedly discredited banking services but do seek impartiality.
[No username responds: The issue on the program was about the Bank of Scotland trying not to be accountable for our savings that we have proof of.....FACT
Our Mother name was on the Deaf/Blind Register, before we were born.......FACT.
Our Father lost a leg when he was a child cleaning machinery in a factory......FACT.
The only cheap shot is YOU not being focused on that the report was about DORMANT BANK ACCOUNTS.......FACT]
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I had an account with a bank [Bank name removed by Moderator]for years as a child from as early as 9 or 10 when i lived in londen east finchley back in the 1980's.
20 years on i found my account book which had £69 still in the account. When i went to a branch in wisbech cambs with my book arfter my father found it and gave it to me i gave it to them and they said the account no longer was there as the bank had closed it due to it be in active for so long and they took my book from me as they said it was there book and i never saw the money again.
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This comment was removed because the moderators found it broke the House Rules.
I recently found a dertificate of Premium bonds from about 27 years ago, I contacted them and they told me that th bonds are still valid and told b=me how to link them to more recent bonds and change the address. If they can do it I am sure the banks can find the money too!
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Financial institutions are only legally obliged to keep records for 7 years following the closure of an account policy etc. I work for a public sector based financial organisation were records are never destroyed. We receive many enquiries from people who paid contributions years ago and in every case following investigation it is always found that the money has always been returned to them in the past and the account subsequently closed. I think this was poorly researched and extremely biased reporting against RBS
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I have recently been asked by my bank to sign a slip to confirm that I wish to keep my account open - otherwise it will be classed as dormant and therefore if I wanted to access it in the future I would need to contact the bank and probably have to re-apply to get my own money. I am puzzled as this account is an ISA opened in the last few years!
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Is Watchdog aware of the Government plans to implement a scheme to use funds held in dormant bank/building society accounts that have had no activity for at least 15 years for the benefit of the community? The scheme I believe is planned for April of this year. It was not mentioned on the programme, perhaps this could be rectified so those who are aware of their dormant account can do something with it. I feel however that this is an unfair scheme and gives no one who may discover in time an unknown dormant account a chance of receiving what is rightfully theirs. It irks me to think of £850m going this way.
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My son had a bank account opened up for him by an aunt when he was 1 year approx. old in 1990. The last time money was paid in was 1994. Since then his Aunt has been divorced twice and remarried twice and my husband and I split up. To add to the confusion I reverted to my maiden name and called my son this as well, we never changed his name by "Deed Poll". The account is now dormant and the bank refuses to resurrect it saying that the trustee has to request this (his Aunt) and they want copies of said Aunts Decree Absolutes (2) to prove who she is. We even have the passbook to the account. These banks get so wrapped up in their petty officaldom that they fail to see that for the small sum of money they are witholding from my son they are causing a lot of upset - this is his pocket money we are talking about.
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I have a dormant bank account. The account was last used in 1967.It is a deposit account,I have the pass book,it has not been
closed.I was rejnited with the pass book after looking for my sons endowment insurance.I took the book to the Gillingham branch. In the letter they sent to me they said (after an extensive search) the account was not in existence. Over the years I have tried several times to trace this account,but hit a brick wall each time.The account holds £4790:10.This money was from damages & injures I received in a car accident.
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Late last year I discovered that I had not received a statement, for a deposit account I had with [company details removed] since April 2005.
I had overlooked this account due to several family bereavements. I contacted the bank and was told that if an account had not been used for a long time it was frozen for security reasons and eventually if still not used any credit balance is then moved to a suspense account. Which is what happened to my £717.05. I was not informed of this at any time even though I had a current account, in use, with this bank. I did retrieve my savings but I feel the bank was acting in an underhand way an should have informed me of their proposed action.
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I actually have a passbook for an account opened in 1956 with a bank. The type of savings account would have required the passbook to withdraw the funds so I assume that there are still funds there somewhere. The bank has not found this dormant account despite having many details of addresses etc. I have now filed the passbook and all correspondence away again until i feel like tackling it again!
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I was quite interested in your report about dormant bank accounts, as recently my husband has been trying to locate an old account with the Woolwich which he hasn't use for probably ten years or more. There was not alot of money in the account and he wanted to close it; we went through the correct channels by applying to bba.org.uk, only to have an e-mail come back a few weeks later saying that they cannot find an account in my his name. Which I find surprising as he still has the passbook and has never closed the account; we also supplied the account number.As I have said there wasn't alot of money in the account, but it is the principle of the thing. How can the banks suddenly close dormant bank accounts without informing the customers. Totally out of order!
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my mum opened me a building society account in 81 with £20. I still have the account book and a statement saying its in a high rise share account and its was worth £32.29 that was in 98 . having been such along time i gave them a call to see if they could trace the account,they can but i am being charged £1 every 2 months for not having much in the account its down to £14 now .I thought id get some interest not loose money
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if this family were to owe the bank twenty five pounds each, the bank would charge them interest on this, but the famil would not be able to put it in a drawer marked dormant? would they, they is one rule for the people and another for the big boys, they have no right in closing or putting people money somehwere else without this families knowledge there parents paid it into this bank in good faith, not to be just brushed aside because no one has used the account, how dare they do that with other peoples money.
JUst another way the big boys rule and how greedy the banks have become.
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Like an earlier poster, I was informed recently that my 2 year old ISA would become dormant if I didn't contact my bank, a large, well publicised company that encompasses many high street names now. This was in line with British Bankers Association guidelines, apparently. If made dormant I would need to reopen my account before I could access my funds. This could have caused problems had I needed it but I'm sure my bank would have been helpful if I had owed it money and found my savings frozen.
I wonder how many people have recent, dormant accounts that they can't now access quickly. I nearly missed the letter telling me of this so I imaging the numbers could be considerable.
Is having a savings account another freedom we've lost in the name of security?
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How cruel and incompetent was your report on cash in the attic. I do not know what sort of economics expert she was, but she was wrong in her estimates of what the bank accounts might now be worth. For an account to grow from £25 to £1300 in 50 years would require a compound interest payment of 7.9% every year. That account probably started at 3 to 3.5% and more than likely got lower with time. Even if the account were not closed, it is unlikely that it would be worth £200 now; probably a lot less. I say cruel because the people in the show think that they have "lost" £3500 between them. That is a lot harder to accept than a real loss of less than £500.
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I watched with interest the case of the family whose bonds cannot be traced by the Bank of Scotland. I note the comments where the bank have apologised to Watchdog for the mis- information supplied to the Martin fanily. Have the bank actually apologised personally to them and do they have a definitive answer as to whether they will honour the bonds. It seems what they might succeeed in receiving is a drop in the ocean compared to the huge amount of money that is still dormant at present. If the bank cannot find any evidence to suggest the bonds have been withdrawn I think they should honour their commitment to this family and pay up. I also agree with other posters if this family were owe the bank money I am sure there would be plenty of evidence to ensure recovery procedures would always be in place. Banks should not be allowed simply to close accounts by making hem dormant. The Government should legislate to prevent this from happening rather than introduce laws that allow the banks simply to do what they like.
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I have worked for 2 different banks and I do not trust them. I have seen many things that surprise me. Unfortunately they are all part of our lives and cant escape them. It doesnt surprise me that accounts cannot be found, systems are constantly being updated and not all info is passed over...
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When my Grandmother died, mu auntie contacted the bank about the two accounts she had left to her family (we had bank statements for both). The bank advised us that she only had one current account with them and that the bank had no information about her savings account, which we had understood to have held in the region of £15,000. After much correspondence the bank finally 'found' the £15,000 account, which they then advised they had to make the 'dormant' after statements were returned undelivered to them, as they didn't know her new address. This comment was strange, as they managed to send post for her current account to her new address after she advised them of her move, yet the bank faied to update their records for her savings accounts (which were linked). However, I was not surprised by the banks actions. I work for a company that administers various types of pension scheme. Some schemes may not make any bank transactions for months, evens years. We have found that certain banks will automatically make accounts dormant when no transactions have taken place for a period of over a year. Historically, my experience is that they do not attempt to contact the customer to comment / advise / discuss their actions, they just close the account and do not make any attempt to advise the client. When we ask the banks for balances, or to transfer funds etc, the banks will deny any knowledge of the account and it can take a great deal of work by the company I work for, for the bank to own up to the existance of the account / money. The most disturbing thing is that, even when the bank 'own up' to the existance of an account / money, they do not apologise for closing it down without notifying anyone and cannot / will not, admit that what they did was wrong. Also, they disagree with our requests for them to apply interest to the accounts for the duration of its 'dormancy' at the rate it would have received interest at. My Grandma worked blooming hard ( and more than that ) to scrimp and save her £15,000 and the bank could have so easily taken away what she worked so hard for to leave to her family. The banks show no remorse and that makes me more than angry.
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I think it is a disgrace that the banks are getting a free hand to make up thier own rules and hence closing down peoples accounts. I also think that it is a disgrace that the government is allowing them to do this but I think the government wants to be seen to be doing the right thing but is secretly got its own hidden agenda as it knows full well if the accounts are closed then that leaves all the more money for them to use for themselves after all it has announced that it intends to use the money on dormant accounts only it knows people can't access them and is not helping them access them either by allowing the banks to do what they want!
On another point I would like to point out that the banks have never contacted me or my family at all yet regarding this matter and their silence in this speaks volumes. Bob Martin and family.
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I think things would be different if the shoe was on the other foot and someone had an account overdrawn for that length of time.
The banks have there cake and eat it and the leftovers aswell.
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I think that this is absolutely shocking. Even after the bank in question being named and shamed still to communication with the Martin family. Maybe any others in the same position with this bank could get together and take them on afterall banks lost in court with alot of other dodgy dealings recently!
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I would just like to remind everyone that unless enough people come forward and ensure others are aware of what is happening, these bankers will carry on this way for ever. Just look at what has happened lately with the collapse of the world economy, partly due to the banks. Look at the bonus figures, look at the profits they still post, even though we the public are bailing them out. Pathetic!
Now look at the challenges lately, due to programmes like this and families like the Martins. The mis-selling of endownment policies, millions paid out in compensation, illegal credit card charges, millions paid out, now illegal bank charges, decision pending. So come on, we deserve the right to challenge practises that are not correct. Let's add dormant accounts to the list, or have the funds been stolen because there are now no records? If the banks can show resonable doubt that the accounts were emptied, ie records of transactions, then fine. However if they can't they should pay out. If they can provide details of mortgages for 25years and more on occassion, they should hold records of savings. Or are they not fit for the purpose!
Let's face it the figures are tiny to the banks, but very substantial to the Martins and all the other cases that are coming to light. Is there anyone we can trust? Banks. Government.
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In reference to No 9 above where relicz wrote that he works for a finacial organisation. Relicz refers in the closing comment that he/she thought it was poorly researched and was extrememly biased reporting against the RBS. Well if there comment was not so extremely biased as he/she admitted working for a financial institution so I think it is obvious that He/she would vote in favour of their own working practices. Furthermore if Relicz had done his/her research properly then he/she would not be making an accusation of poor researching! Why is this? It is because Relicz would have known if he/she would have had done thier own research that the reporting was in fact against the Bank of Scotland and NOT as Relicz portraid and said the RBS!! This just convinces me more on how competent the financial people are as they still yet can't get even the story correct!!! Which makes you wonder about all the rest of Relicz story about all his so called investigations being incorrect as well! IE Perhaps they get all these so called facts incorrect as well?
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