Checking accounts or CDs at banks, or saving and loans can become abandoned if the rightful owner fails to communicate an interest in such over a period of time. Referred to as the dormancy period, the obligation of the account holder of the unclaimed property is to report and remit the unclaimed property begins when there has been no owner-generated activity for a state-defined period of time. This period of inactivity is referred to as a “dormancy period.”
The rules governing unclaimed bank accounts vary from state to state. Each state provides some type of unclaimed property service for it’s citizens, so that no single place is responsible to look for forgotten funds. Even if the bank branch moved, failed or was part of a merger and changed names, a lost bank account can be retrieved.The wave of closing and failed banks and saving & loans during the 1980s, resulted in the passing of the Financial Institutions Reform Recovery & Enforcement Act of 1989.
This occurs fairly common due to a period of inactivity, a death of a family member, a name change due to a divorce or marriage. In some cases an individual in switching banks believe they have closed or emptied the account but left a balance in it. But in general, after about two years without any activity (one made no withdraws or deposits or haven’t cashed a check) and after the institution’s efforts to reach you fail, the property will be considered abandoned and will escheat. Escheat is when the property is transferred to a state or government agency, making the state or agency the legal custodian of the funds until the owner or heir comes forth to claim. The property or money was delivered to the government agency because the owner, distributee, devisee, or heir could not be found, or refused to accept the property.
There are databases containing information about the millions of unclaimed bank accounts and other missing assets such as a lost 401k account from every State and those lost bank accounts due to Bank failures that are NOT included in the States’ online databases. The information available run the gamut from forgotten phone and rental deposits to contents of safe deposit boxes, bank accounts and securities. Limited to non-type information can be included about funds owed by federal authorities, because they typically operate their own lost-and-found services.