01 December 2005 - New independent Commission to review how a multi billion pound windfall from unclaimed financial assets can boost communities
Source: ENDSMedia
The Commission on Unclaimed Assets launched today will review how billions
of pounds of unclaimed assets can be reclaimed by their owners or channelled to benefit
communities right across the UK.
Over the past two years leading members of the Government have signalled
their determination to
act on the issue of unclaimed assets Ø savings and other forms of
investments that lie unclaimed for years and sometimes even decades. The total size of the unclaimed assets
is unknown, but it is thought the figure may top £5bn for dormant accounts at British banks
alone. It has been claimed in recent years that the banks have been exploiting these funds to
help boost their profitability.
The Commission has been initiated by the Scarman Trust and backed by seven
other charitable foundations, including the Rowntree Foundation and Carnegie Trust. The
Commission will act as an independent catalyst to ensure that Britain reaps the maximum benefits
from these unclaimed funds.
The Chancellor, Gordon Brown, is expected to outline the government´s policy
on unclaimed assets in his Pre Budget Statement on December 5th. The UK financial
services industry, meanwhile, has mooted a potential figure of £1bn in unclaimed bank and
building society accounts in response to the Government drive for action.
The Commission will initially report in June 2006 after which a more
detailed action plan will be formulated. The first large scale delivery of funds to communities is
expected by April 2007, though the Commission, whose role is limited to establishing the framework, will
not be responsible for the actual distribution of funds.
Commission Chairman, Sir Ronald Cohen commented:
úOur first concern must be to re-unite consumers with their money wherever
possible. This should be made as simple and as free to do as possible, with every penny of accrued
interest fully reimbursed. Based on experiences elsewhere in the world, we would expect
that around six out of ten dormant account holders will get their money back in a short period of
time. For that high proportion of people, our aim is both to publicise this important consumer
issue and to devise effective systems for the return of these funds to their rightful owners.
úAs for the money that remains unclaimed, we must never forget that this is
neither the Government´s nor the banks´ property Ø but the people´s money. This is why
we are determined to engage in a very broad public consultation process so that as many
interested parties are able to have a proper say about how the money should be spent in order to have the
biggest impact possible on deprived communities in Britainî.
Commission Secretary Matthew Pike added:
úWhat the Commission brings to this issue is an ability to act as the focal
point for all sides in this debate. We will do so in a completely even-handed and fair manner. The
banking industry, meanwhile, will find us sensitive to the many challenges they face in
settling this issue. We are keen to discuss how they could gain from this policy change both in terms of
their standing with consumers as well as financially, given that unclaimed asset funds could
help to create new and profitable investment opportunities within local communities. These
potential opportunities could be worth billions of pounds for financial institutionsî.
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