Consultation Opens on Dormant Bank Accounts Scheme In Jersey

by Robert Lee, Tax-News.com, London

22 December 2008

People in Jersey are being asked for their views on introducing a scheme that would allow money in dormant bank accounts to be used for the good of the island.

A number of account holders forget about or lose track of bank accounts, particularly if they only contain very small amounts of money. The Economic Development Department (EDD) is considering introducing a dormant accounts scheme in Jersey in order that deposits in these accounts may be put towards useful purposes. Similar schemes have recently been introduced in several other countries, including Australia, Canada, Ireland, New Zealand, Spain, the UK and the United States.

EDD has today released a consultation paper setting out a number of issues and outlining individual proposals for comment. Issues include how to define ‘dormancy’, what efforts banks should be required to make to re-unite accounts with their owners, how the reclaim fund should be administered, whether the scheme should be voluntary or compulsory, how owners should go about reclaiming their accounts and how the money collected through the scheme should be used.

It is proposed that the scheme would operate using a central reclaim fund into which banks would pay the deposits held in dormant accounts. The reclaim fund would be distributed to good causes but would always retain enough money to meet any future claims by the original depositors.

Alan Maclean, Minister for Economic Development said:

“I am pleased that we are working on this excellent initiative which was first suggested by the Jersey Bankers Association. This is a great example of how our finance industry can work together for the benefit of our community. Other jurisdictions have already successfully introduced dormant bank account schemes and I am confident that Jersey will gain from taking a similar approach.”

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