UNCLAIMED BALANCES
I would describe this banking custom as legal stealing.[B] Bankers,
as well as other estimable persons, obtain their gleanings and their
perquisites, which are credited to certain sundry accounts, such as
“unclaimed dividends,” “unclaimed balances,” and so on. Those banks,
too, that issue notes must profit to a certain extent by the paper
that is lost and destroyed by the public; and though it is impossible
to estimate the gain to the banks from these sources, their absolute
silence on the subject seems to indicate perhaps more eloquently than
statistics, that the fund thus derived must be considerable, even if it
be not vast.
[B] The Government is not prepared to promote legislation for the
purpose of requiring the banks of the United Kingdom to make a return
showing the sums of money in their hands in respect of dormant and
obsolete accounts.--Vide Press, Feb. 1908.
Coming to the definition of an unclaimed balance, it must be confessed
that it is somewhat difficult to explain exactly what an “unclaimed”
balance is, for the simple reason that the banks, when an account
becomes dormant, seldom make an effort to discover whether the owner
be either dead or alive, or to whom the balance belongs. On the other
hand, if they do not court inquiry, it cannot be said that they
obstruct it. Neither, however, do they encourage it, nor assist the
owner or claimant in any way, but content themselves with passively
carrying forward the figures from half-year to half-year. The public
may well be dissatisfied with this treatment, for it is quite apparent
that were the banks to make it their business to discover the owners
or claimants they would be successful in five cases out of six, and,
further, the longer they nurse these so-called “unclaimed” balances,
the greater is the probability that they will for ever retain them.
We will first discuss the position of the current-account customer in
relation to this practice. As a rule, it is well known to the members
of a deceased man or woman’s family where the banking account was
kept; so inquiries are usually made, and the balance standing to the
credit of the deceased ascertained. There are, however, exceptional
cases. A man may have accounts with two different bankers and though
one is known, the second may not be. If the pass-book relating to the
second account be at the bank, the manager very probably will keep it
there. Again, a person on a visit to a place may open a small temporary
account at a bank there, and should he die suddenly the manager will
not make any attempt to trace his representatives. When the pass-books
which relate to these “unclaimed” balances are at the bank, some
managers are most careful that they shall not go out again; and, in
order to prevent their being sent through the post to the addresses
on the ledgers, the books are generally placed in some out-of-the-way
corner of the strong-room, there to await the coming of their owners.
This is certainly a novel way of protecting the interests of one’s
clients, though it doubtless has not the smallest claim to originality,
and may not be completely unknown in other trades than that of banking.
Secondly, we come to the deposit-receipt or deposit-note; and it will
readily be allowed that a small piece of paper of this description may
easily be either lost or accidentally destroyed. It must be borne in
mind, too, that the companies, in the event of a depositor’s death,
do not take any steps to inform either his next-of-kin or his legal
representatives that certain sums of money are standing to his credit
in their deposit-ledgers, even when they are aware of his decease.
Then, again, after a depositor’s death these documents are sometimes
overlooked or inadvertently cast aside with other papers. Such sums,
after a lapse of years, might go to swell a company’s unclaimed
balances.
But it is a misnomer to speak of these sums as “unclaimed,” when it
is obvious that they are simply “unpublished,” and that the banks,
were they so inclined, could find the true owners of a large number of
these balances in a very short space of time. In many instances they
have good reason to think that the customers are dead, even when they
possess no positive information to that effect; and as they have their
addresses in the deposit-ledgers, all they have to do is to write a few
letters of inquiry. However, the banks have the law on their side; and
though they are obliged to answer any questions which may be made by a
deceased’s representatives, they are not compelled to give information
gratuitously, so they choose to remain silent, and insist upon the
initiative being taken by interested persons.
Furthermore, a deceased depositor may have held three deposit-receipts.
Should two of these be presented for payment by his executors, the
manager need not inform them that there is a third sum standing to the
credit of the deceased in the books of the bank; and he possibly will
not. An interested person, therefore, should always inquire whether
there be any other sums standing to the credit of the deceased, either
on current account or deposit.
It need not be remarked that should the balance be a debit one the bank
will speedily send in its claim, together with a note of sympathy to
the widow, begging her to consider the company quite at her service.
So hardened is a bank-manager that he will actually attend the funeral
of an old and esteemed client whom he has been charging 5½ per cent.
interest and ¼ per cent. commission for years. It is a bad sign
when a limited liability company is represented at a funeral by an
official; and should two bank-agents put in an appearance, one can
only quote: “Where the carcass is, there will the vultures be gathered
together.” Seeing that they are so eager to exhibit their respect for
the rich dead, it may be considered somewhat surprising that they are
not more sympathetic towards the poor living, and, also, that they
do not publish their so-called unclaimed balances for the benefit
of their customers’ descendants; but life is full of these little
contradictions, and, after all, the acids and the sweets, judiciously
blended, give a zest to existence.
Finally, some banks, we know, issue pass-books to their depositors
instead of receipts. It sometimes happens that, at a depositor’s death,
the book is with the banker. Unless, therefore, his own people chance
to know that he had a deposit account, all traces of its existence are
obliterated, for the banker, who has the book in his possession, is not
compelled to give any notice. After the publication of one of my books
my publisher received a letter from a lady complaining bitterly that a
certain bank had treated a kinswoman of hers in this manner. Should the
relations of a deceased man or woman have reason to suspect that money
has been saved and placed somewhere, they should go to every bank in
the town where the deceased resided and inquire whether any sums are
standing to his credit in the books of the banks. Their application
cannot be refused, and the result may possibly be somewhat surprising,
while they will at least have the satisfaction of knowing that their
kinsman’s savings are not being devoted by the banks to their own use.
As the law now stands, a deceased customer’s balance is, to a certain
extent, at the mercy of his banker; but whether these unclaimed
balances would in the aggregate amount to the huge total at which some
people are disposed to estimate them is rather doubtful. That the law
urgently requires amending cannot, however, for a moment be questioned,
for persons whose own interests conflict with those of the public
can seldom be trusted to judge impartially; and it is quite evident
that directors, who are imbued with the commercial instinct, are not
exceptions to the rule. The aggregate, no doubt, would be represented
by a large sum, but the public, where money is concerned, generally
looks pretty smartly after it, so one would imagine that this total
would consist principally of numerous small balances, and that large
windfalls must be few and far between.
These so-called “unclaimed” balances are, we have seen, in reality
_unpublished_ balances, and steps certainly ought to be taken to compel
the joint-stock banks to advertise in certain London and local papers
the names and last known addresses of those individuals in whose names
sums of moneys, in excess of say £5, have been standing intact in
their books for any period in excess of five years. The banks might
also be made to hang a list of these names in a conspicuous part of
their offices, so that those who are entitled to these sums should
at least have an opportunity of claiming them. Were the companies
compelled to adopt this course, we should hear very little more of
unclaimed balances, for the thought of publicity would be distasteful
to them, and they would immediately take steps to put themselves in
communication with either the customers or their kinsfolk. One would
think, too, that the Government had a better claim to these balances
than the banks. Mr. Asquith, for instance, might find them useful as a
basis for his old-age pension scheme!
Depositors, seeing how matters stand, should keep their receipts in
some place where they cannot be overlooked; and in the event of a
pass-book being received, a note should be made in a diary, or even in
the “Family Bible,” to the effect that such a book is in existence; as,
should it be at the bank at the time of a customer’s decease, we know
that the manager may retain it, with the result that all trace of the
money will be lost.