June 18, 2008 | posted by Pam Atherton in Banking, Insurance, Investments, Pensions, Savings |

The race is on to reunite owners with long forgotten bank and building society accounts, as a Government Bill to reclaim ‘dormant accounts’ goes back to the House of Commons for a second reading next week.

There is an estimated £400m sitting in abandoned bank and building society accounts which the Government plans to use  to fund youth and community projects once the Dormant Accounts bill becomes law.

But the total amount of all unclaimed assets is believed to be nearer £15bn, including £466m with National Savings & Investments.

Even after the Dormant Accounts bill comes into force, forgotten bank and building society accounts can still be reclaimed by their rightful owners (or their heirs) at any time, providing they can  prove ownership.

Halifax and the Nationwide and Yorkshire building societies have launched their own initiatives in recent years to trace the owners of dormant accounts - defined as those where there has been no activity for 15 years.

To make it easier for customers to trace long lost assets, the banks, building societies and National Savings & Investments  established a free of charge website called www.mylostaccount.org in January this year to list the details of all their known dormant accounts  in one place.

Another website, www.uar.co.uk, charges a small fee but has a much more comprehensive database including occupational pensions, personal pensions, shares, dividends, unit trusts and endowment life policies as well as bank and building society accounts.

Lloyds TSB, and its mortgage arm, Cheltenham & GLcouester (formerly a building society) is the latest bank to step  up its efforts to find the owners of 120,000 dormant accounts worth £69m by employing a specialist tracing agency.

The average amount in the Lloyds’ accounts is £575, with 10 per cent holding £1,000 or more.

People forget about accounts for a variety of reasons such as moving home,  going abroad, their circumstances change or institutional name changes. 

Those who die intestate (without a will) leave no record of their assets and even those who do write  wills sometimes forget to  list all their assets so that executors cannot make a claim.