15 March 2016
The Assistant Chief Minister, Senator Philip Ozouf, has lodged proposals to use money in ‘dormant’ bank accounts to help charitable causes.
Dormant accounts are considered to be those where contact has been lost with the customer, or where no instructions have been received from the customer, for at least 15 years.
The draft Dormant Bank Accounts Law would enable money in dormant bank accounts to be transferred from the banks into a new fund, which would be called the Jersey Reclaim Fund.
Significant reserves would have to be kept in order to ensure that any claims by bank customers could be repaid by the Reclaim Fund.
Thereafter, the law restricts the use of any funds credited solely for charitable purposes, which could include:
- public participation in sport in Jersey
- advancement of the arts, culture and heritage in Jersey
- health, education or environmental projects in Jersey
The fund could also be used to establish the long-awaited Charities Commissioner. The setting up of this body is designed to both strengthen and protect the Island’s hugely valued charitable sector, as well as to promote the Island as a centre for international philanthropy.
In recent years many countries have introduced dormant bank account legislation. Such legislation has advantages for banks in Jersey because it means that they can remove liabilities from their balance sheets. The proposed Jersey legislation, similar to that of the UK, contains strict protection for bank customers: an account holder would still be able make a claim for repayment through their bank to the Jersey Reclaim Fund at any time. The bank would repay their funds, and seek the balance from the fund.
Senator Ozouf said “The draft Dormant Accounts Law is a significant step forward which, if adopted, could bring considerable benefits to local good causes. The legislation moves us into line with other countries and has the additional benefit of further boosting the Island’s reputation as a centre for international philanthropy.
“A great deal of careful work has been undertaken to finalise these proposals. My team look forward to briefing Scrutiny and taking the legislation to the States Assembly so that it can come into force later this year.
“At long last, unclaimed money left dormant in accounts, with the strictest of controls and processes to provide reassurance to customers, will be able to be made available for good causes.”
The draft Dormant Bank Accounts Law will be debated in the States next month.