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Inactive & Dormant Accounts - One in the Same?
by Randy Carey and Andy Zavoina, BOL Gurus
Guru Bio
Question: At my bank, we are trying to decide if inactive accounts and dormant accounts are the same. What are your ideas on this? We are trying to determine for yearly unclaimed funds reporting purposes.
Answer from Randy: The definition of an inactive/dormant account for escheat purposes is determined by your specific State laws. Do a search for "unclaimed property" and your state on Google and pick the result that is your State's Unclaimed Property website. Almost all the States post their rules and regulations on-line.
Answer from Andy: You may also look at your deposit agreement to see how you defined it. Ensure it meets your requirements under your state laws and that you are applying the terms corrcetly in your practices. In Texas, as one example, "inactive" is the term used by the state and "dormant" is not used at all. Here is one example of a deposit agreement definition.
“Dormant Account” or “Inactive Account” means any Account to which there has not been a debit or credit by an act of the Owner or an Agent of the Owner, other than us, and the Owner has not communicated with us for a period of more than 365 days.
First published on BankersOnline.com 3/24/08
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