This initially seems like good news: you come across a forgotten certificate of deposit in a file or safe deposit box. It seems like found money, until you learn that your bank has no record of it. When it comes to old bank accounts like C.D.s, time may not be on your side.
That's the lesson Janice Coleman, 79 and a retired librarian, learned. She found a $25,000 C.D. she had opened decades earlier while sorting documents during a move. When she went to cash it, she was told it no longer existed. That led to a yearslong quest, including checking multiple states' unclaimed property registries, contacting financial regulators and hiring a law firm to retrieve tax records. She has had no luck confirming what happened to her C.D., which she opened in 1990 at a bank later acquired by another institution. "I have tried everything," Ms. Coleman said. "It's like a morass."
One way an account can go missing is if a customer forgets about it or loses touch with the bank. Banks must turn over funds in inactive or abandoned accounts to the state as unclaimed property, a process known as escheatment. The funds typically go to the state of the customer's last known address. For C.D.s, the required period of inactivity, or "dormancy," is often three years or sometimes five. If the customer doesn't respond, the bank closes the account and transfers the funds. Most states hold the money indefinitely, but some set deadlines after which it can no longer be claimed.
If you find an old C.D., the first step is to contact the issuing bank or its successor. Adam Rust of the Consumer Federation of America advises asking to speak with someone familiar with dormant accounts. Owning a paper certificate doesn't guarantee the funds are still there, since the balance may already have been withdrawn or transferred, sometimes with only identification. As Meaghan Aguirre of the National Association of Unclaimed Property Administrators noted, "banks don't always require it to be turned in when it's redeemed."
Source: New York Times Business · Summarized by HeadlinesBriefing