The Bank of Ghana has issued a directive on unclaimed balances & dormant accounts for banks and specialized deposit-taking institutions.
The directive seeks to ensure that balances in accounts that have been left unattended to for over a period of time are managed under a special account. The account is referred to as the dormant account register.
The directive by the Bank of Ghana which is pursuant to Section 92 of the Banks and Specialised Deposit-Taking Institutions Act, 2016, explained that a dormant account could be a current or savings account with credit balances and their derivatives with no ‘customer-initiated activity’ by the account holder or a third party on the account holder’s behalf for a period of two years.
In the case of fixed deposits or investments scheduled by a customer to roll over upon maturity and the roll-over has persisted for more than three consecutive rollovers or two years, a regulated financial institution shall initiate actions to re-identify the customer, renew consent to continue the instructions and update the customer’s records.
The directive shall however not be applied to accounts that are subjects of litigation, fraud, investigations by a regulatory authority or law enforcement agencies, and others.
Where the regulated financial institution is unable to contact the fixed deposit account holder pursuant to subsection 7, the regulated financial institution shall transfer the funds to the dormant account register.
Creation of dormant account register
Where an account becomes dormant and the balance is less than an amount determined by the Bank of Ghana, the regulated financial institution may transfer the account to the dormant account register or close the account after due notice to the customer of the decision to close the account and transfer funds to the customer or the Bank of Ghana where the customer could not be reached.
The Bank of Ghana stated that a dormant account shall continue to be covered under the Ghana Deposit Protection Scheme until transfer to the Bank of Ghana.
The directive requires a regulated financial institution to take adequate steps to contact an account holder at least three months prior to an account falling into dormancy and also take all necessary steps to identify a dormant account holder prior to initiating dormant account reactivation.
Importantly, in an effort to locate a dormant account holder, a regulated financial institution shall also not disclose the account balances and any other sensitive information to any third party.
The directive also added a regulated financial institution shall display a poster in all banking halls on the process of reclaim of funds of dormant accounts transferred to the Bank of Ghana. This shall include information on how accounts of customers may be regarded as dormant.
Steps to follow to reclaim account
The directive said a regulated financial institution shall display a poster in all banking halls on the process of reclaim of funds of dormant accounts transferred to the Bank of Ghana. This shall include information on how accounts of customers may be regarded as dormant.
Also, a regulated financial institution that receives a request from a dormant account holder of funds transferred to the Bank of Ghana shall take steps to validate and seek the claim on behalf of the claimant at the Bank of Ghana.
Penalties for failing to comply with directive
According to the BoG financial institutions that breach provisions of this directive shall be liable to an administrative penalty of not more than ten thousand penalty units.
Notwithstanding the penalties specified, the Bank of Ghana may impose any other penalty or take any remedial action that the BoG considers appropriate.