The Government has approved the provisions of the draft Dormant Account Bill 2001, which will put account holders, or their heirs, in touch with dormant funds in financial institutions.
Under the new scheme due to start next April, banks and building societies will be obliged to contact all customers whose accounts have become "dormant" - defined as an account where there has been no customer initiated transactions in 15 years or more.
Savings bonds, savings certificates and installment savings schemes will also be covered by the legislation.
Financial institutions will be required once the scheme is up and running, to contact account holdersby writing to that person at the last known address and will also, on an annual basis, bring the scheme to the attention of the general public, by way of advertisements in national daily newspapers.
These advertisements will inform all their other customers of the procedure to be carried out should that customer wish his or her funds to be retained at the bank or building society.
If the owners of accounts which have been dormant for 15 years or more, as of March 31st, 2002, do not come forward by the end of March 2003 to reclaim their money, the balances in the accounts will be transferred to a "Dormant Accounts Fund" to be established and managed by the National Treasury Management Agency.
The Fund will be managed by the Agency for two purposes - firstly, to meet claims for refunds from owners and secondly, to make payments under a scheme of disbursement to be provided for under the legislation.
Due to the legal complexity of some of the issues that have arisen in regard to dormant funds, a phased approach to the legislative framework is being pursued.
The initial Dormant Accounts Bill will be confined to accounts held in credit institutions, that is, banks and building societies.
However, it is intended that the scheme will be extended, at a later date, to cover other products and institutions which may be broadly similar to those already falling within the ambit of the legislation.
A follow-up Bill, to be brought forward by the Department of Finance later this year, will cover the more complex area of mature, but unclaimed life assurance policies.