Would anyone happen to have any Dormant Audit Procedures they are willing to share? This would be a great help to me!

If you are speaking of dormant deposit accounts that are removed from dormant status, from what I remember (haven't worked on that in a long time), these are steps you should consider performing:

1 - Determine what caused the dormant status to be removed.
2 - If it was a withdrawal performed at a branch, verify signature on withdrawal ticket to the signature card.
3 - If it was an address change, verify signature on address change request to the signature card
4 - If it was a deposit or any other type of transaction where the signature cannot be verified, review subsequent activity for any unusual activity (obviously some time needs to have passed from the dormant status removal date). If there are subsequent withdrawals, verify signature.
5 - Consider sending a balance or transaction confirmation to the customer, especially if unusual activity is noted.

I am writing this from distant memory and could be forgetting some steps that could be performed.

Remember the definition of a dormant account may vary from state to state.

If you are speaking of an Abandoned Property audit, that is totally different. As oscupa mentioned, you have to check state requirements.

Thanks you all for the advice. I have trouble finding where this state law would be. I guess it would be to easy for a state to have a site with laws pertaining to banking?

This site will allow you to go directly to each state's website where you can find abandoned property instructions and regulations: http://naupa.org/

There is, or should be, a separation between a bank's dormant monitoring process/procedures and their abandoned property/escheat process/procedures. "Dormant" is defined by each bank in whatever way they reasonably feel an account should be classified as dormant. State laws speak to when an account is considered abandoned property and escheatable.

Great advice here. Look for anything that cannot be independently verified - cash deposit, phone call, etc.

One bank, they had an intermediary step between active and dormant where the bank automatically sent notifications to customers. Also - state specific rules - in some states, activity on one account (if linked to other accounts) would be considered active. (If I had a savings and checking, as long as e.g. the checking account was active, the savings would not be considered dormant, especially if they were receiving statements at the same address.)

Just don't confuse 1) some internal definition established for internal control reasons with 2) the State mandated rules for the escheat of monies to the State.

Terms like inactive, dormant, etc., are thrown around and they are normally without definition.

At my shop, a form must be submitted before the dormant is released. The form must state if the activity is a deposit or withdrawal, provide a copy of the signature card and the transaction. We are a small bank so this is not onerous for us like it might be in a bigger bank.

Our procedure gives us both control and comfort that we aren't releasing dormant status willy-nilly or for nefarious purposes.