What Happens to Bank Accounts With No Activity?

Banks monitor the deposit and withdrawal activity for accounts to ensure that they remain active. If activity stops in a bank account, the financial institution will eventually classify it as inactive, dormant and then finally abandoned. State laws vary regarding the process banks must follow for managing bank accounts which appear to have been abandoned.

Banks may levy a dormancy fee against an inactive bank account once the account moves into the inactive status. The bank will subtract the fee from the account balance on a monthly basis while the account remains inactive. Depending on the account balance, dormancy fees could consume a remaining account balance entirely over time, bringing the balance down to zero. If the account balance reaches zero, the bank will close the account. If you reactivate your account, the dormancy fees will stop and you can use the account again. If you have a balance sufficient to continue paying dormancy fees, the bank will maintain the account in dormant status until the bank can declare the account abandoned with the state.

Once the bank declares the account abandoned, it usually attempts to contact the account holder about the unclaimed property, notes the U.S. Office of the Comptroller of the Currency. The bank might send the customer a letter at the last known address associated with the account. A bank might also publish a list of abandoned bank accounts in the newspaper in an attempt to notify customers of the unclaimed property.

When a bank account meets the criteria for abandonment, the bank can begin the process of escheatment. Escheatment identifies abandoned bank accounts and prepares to remit any funds remaining in the account to the state treasurer. The time period for abandonment ranges from three to five years. The bank may charge the customer an escheat fee, subtracted from the account balance, according to Sovereign Bank.

If you think you have unclaimed property from an abandoned bank account, contact your state unclaimed property program to learn about funds that may belong to you. Visit the National Association of Unclaimed Property Administrators website to find contact information about your state’s program. Depending on your state’s services, you might need to contact the office by telephone or you may find a website with database search services.