On October 14, 2020, the minister of finance and public service published a press release on the ministry’s website, addressing concerns regarding the claims that the Government has passed a Bill to close dormant bank accounts and levy a monthly fee on such accounts.

The minister indicated that this was ‘simply false’ and reminded the public that there is an established legal process in place with respect to unclaimed funds. 

WHAT ARE UNCLAIMED FUNDS?

Unclaimed funds are moneys that have remained unclaimed in the possession or under the control of a deposit-taking institution (DTI), which includes banks, merchant banks and building societies, for a period of 15 years or more. Therefore, unclaimed funds are distinct from funds in a dormant account. 

WHAT ARE DORMANT ACCOUNTS?

The Banking Services (deposit-taking institutions) (Customer Related Matters) Code of Conduct, 2016 (the Code) includes conduct which DTIs must adhere to when addressing customer-related matters as reflected in the Code. The Code defines a dormant account as a savings account showing no deposit or withdrawal activity (other than posting interest) for a period specified by a DTI not being less than six (6) months. This means that the period which determines the classification of an account as dormant is dictated by the DTI at which the account is held but cannot be for a period of less than six months. Therefore, an account can be dormant and the funds in it not be deemed unclaimed funds. The Code does, however, require DTIs to ensure that each account statement include the basis on which an account status may be classified and treated as dormant and any other variations that become applicable when a classification of ‘dormant’ occurs. 

BANKS OBLIGATION WITH RESPECT TO UNCLAIMED FUNDS

The Banking Services Act (BSA) requires DTIs to send annual reports to the Bank of Jamaica (BOJ). The annual report includes a list of unpaid cheques, drafts or bills or exchange drawn, certified or accepted by the bank and payable in Jamaica or elsewhere in respect of which, during a period of seven or more years, no transaction has taken place and no statement of account has been requested or acknowledged by the account holder.

The BSA also states that where it appears on the annual report (as required by section 82 of the BSA) that money have remained unclaimed in the possession or under the control of a DTI for a period of 15 years or more, the Ministry of Finance and Public Service shall cause a notice to be published two or more times in the Gazette and in a daily newspaper circulated in Jamaica (notice). The section of the BSA governing unclaimed funds does not apply to building societies.

The notice must include:

1. full particulars of the money so unclaimed;

2. the period during which the money have remained unclaimed; and

3. the statement that unless, within one year from the date of the first publication of the notice in the Gazette and on the website of the Ministry of Finance and Public Service, a claim to those money is established to the satisfaction of the DTI concerned or, failing that, to the satisfaction of a court of competent jurisdiction the money will be dealt with in accordance with subsection 126 (2).

UNCLAIMED FUNDS BECOME REVENUES OF JAMAICA

If within the one-year (1) period that runs from the date of the first publication of the Notice in the Gazette (“Claim Period”), there is no claim to those money, to the satisfaction of the DTI, or failing that, to the satisfaction of a court of competent jurisdiction, the money shall lapse and become part of the revenues of Jamaica.

Where a claim is duly made but not determined within the Claim Period or where a claimant lodges a certificate, signed by a judge of competent jurisdiction, with the Accountant General explaining that a claim has been made but has not yet been determined, the money shall not become revenue of Jamaica until the claim is determined not to be to the satisfaction of the court.

Even after unclaimed money have become a part of the revenue of Jamaica, the Accountant General may pay the unclaimed money, now already treated as part of the revenues of Jamaica, to any person who establishes a claim to the satisfaction of the Accountant General within a period of fifteen (15) years after the sum is treated as having become part of the revenues of Jamaica.

The BSA indicates a claim should be made ‘to the satisfaction of the DTI’ and therefore it is within the DTI’s discretion what will be required to make a claim to ownership. The law implies that this discretion be exercised reasonably. 

PRACTICAL CONSIDERATIONS

Accounts holding money deemed to be unclaimed funds can occur in a number of circumstances. For example, where the account holder:

1. has migrated and not returned;

2. is deceased;

3. is incarcerated; or

4. is of unsound mind or suffering from some mental incapacity; 

In each of these circumstances it is advisable to seek the advice of an attorney-at-law on the legal processes entailed to make a claim on the behalf of the account holder. For example, where the account holder is of unsound mind, a mental health order is required and where the account holder is deceased, the deceased’s estate must be probated.

The Ministry of Finance is solely responsible for the publication of the list of unclaimed money and not for the making of a claim to the money deemed unclaimed. If you think you may have an account with money deemed to be unclaimed, carefully review the Notice which can be found on the Ministry of Finance and Public Service’s website mof.gov.jm/documents/documents-publications/document-centre/category/218-unclaimed-bank-balances.html. The earlier the account holder takes steps to take an account off a dormant account list or to recover unclaimed funds, the less complicated and costly the process to retrieve the funds is likely to be.

To avoid funds being deemed unclaimed remember to keep your information with your bank current, including changes in address, status, etc. This is also helpful to the bank in being able to establish that it knows its customer. Remember fifteen years after the sum is treated as a part of the revenues of Jamaica, it is permanent. In 2018 the aggregate of unclaimed funds was reported to be $15 billion.

The Government of Jamaica would certainly be happy to have a sum such as this at its disposal, given the preliminary estimates for repairs to infrastructure from recent events of severe weather or to meet the demands on our health system as a result of COVID-19. 

Joanna Marzouca is an associate at Myers, Fletcher & Gordon, and is a member of the firm’s Commercial Department. Joanna may be contacted via joanna.marzouca@mfg.com.jm or www.myersfletcher.com. This article is for general information purposes only and does not constitute legal advice.