Tuesday, 27 July 2010
Big Society Bank: can we really treat dormant accounts as treasure trove?
In the discussions about the ‘Big Society Bank’ there have been spluttering observations featuring the word ‘stealing’ – and the makers of these comments maybe have a point since neither they nor I have any real understanding as to what actually constitutes a dormant bank account (by which I mean the nature of the former ownership). They could be accounts where it is simply too expensive to track down the owner. Or we could be talking about small accounts for defunct little associations – local fishing clubs, ladies tea clubs and the like. Or even where there are no heirs meaning the money really does belong to the Government.
Which rather begs a question as to whether we should simply leave the money there in the (probably) vain hope that somebody will arrive with proof of ownership? After all it doesn’t belong to the government, does it? But then it will just sit there with the only people profiting from it being the banks who have control of the money. Indeed given the very small risk of substantial claims, the banks are able to treat the money as their own.
Alternatively – as has become the case – the Government can seize the money saying that it is, in effect, unclaimed treasure (using the same droit du seigneur as is the case with real treasure). And this does not seem an unreasonable approach given that the alternative of ‘finders keepers’ isn’t applicable. The only difference relates to age of the trove - treasure only applying to coins and precious metal more than 300 years old whereas the Dormant Bank & Building Societies Act 2008 only requires there to have been no customer activity for 15 years. Moreover, the Act requires any monies to go for charitable purposes whereas treasure trove is the explicit property of the crown.
It seems to me that, if treasure (whether governed by the treasure act or dealt with under ‘finders keepers’) isn’t theft, then using money in dormant bank accounts could also be seen in this light. Whether 15 years is long enough seems to me a matter for discussion and the success of unclaimed finance websites suggests that a review of this time period might be sensible. However, the principle underlying the Act seems reasonable even though an absolutist approach might define it as theft.