Dormant Accounts

The Dormant Accounts Act 2001 provides that balances on dormant accounts in certain financial institutions be remitted to the State and disbursed for charitable purposes or purposes of societal or community benefit. The balances in question are to be transferred not later than 30 April each year. The first such transfer took place in 2003. The period for determining dormancy is 15 years since the last customer-initiated transaction. Notwithstanding that accounts may be declared dormant, the Act guarantees the right of account holders to reclaim their moneys at any time.

The balances on dormant accounts, including accrued interest, are paid into the Dormant Accounts Fund which is managed by the NTMA Moneys from the Intestate Estates Fund Deposit Account may, on the direction of the Minister for Finance, also be paid into the Fund. In addition, under the Unclaimed Life Assurance Policies Act 2003, the net encashment value of certain life assurance policies are transferred to the Fund where the holders of the policies in question cannot be traced. The first transfer in respect of dormant life assurance policies took place in 2004.

The NTMA is obliged to determine the amount to be paid into the Reserve Account of the Fund to meet repayments and expenses. With the approval of the Minister for Community, Rural and Gaeltacht Affairs, given with the consent of the Minister for Finance, this has been set at 15 per cent of the total amount of the Fund.

The Dormant Accounts (Amendment) Act, 2005 provides for the establishment of the Dormant Accounts Board in place of the former Dormant Accounts Fund Disbursements Board and for new arrangements in relation to the disbursement of moneys from the Dormant Accounts Fund. Decisions on disbursements are now made by the Government, while the Board advises on priority areas for funding. The Board also has a role in monitoring the impact of the funding.

A total of 33 million euro was transferred to the Dormant Accounts Fund from financial institutions in 2008. 19 million euro was reclaimed in respect of reactivated dormant accounts in 2008. The total amount held in the fund at end December 2008 was 151 million euro. Disbursements from the Fund amounted to 73 million euro in 2008.

In the first quarter of 2009, there have been further disbursements of €2 million and reclaims of €4 million. The amount under management in the Fund at end March 2009 is €145 million.