Source: New Zealand Government
A law change has been introduced to make it easier for forgotten funds in institutional accounts to be returned more easily to their rightful owners.
Revenue Minister Stuart Nash has introduced an amendment to the Unclaimed Money Act 1971. It will update the rules controlling forgotten sums of money held by banks or other financial institutions and professional bodies.
“The Unclaimed Money Act has not been substantially updated for more than 40 years,” said Mr Nash. “We want to make it easier for the rightful owners of the funds to track them down, and for the financial institutions or agencies involved to comply with the rules.
“There is a long list of institutions who hold money on behalf of a client. As well as banks and building societies, it includes lawyers’ trust accounts, sharebrokers, real estate agents, auctioneers, insurance companies, motor vehicle dealers and company liquidators.
“As at November 2019, there was an estimated $199 million of unclaimed money in the Crown’s accounts. In the year to November 2019, Inland Revenue returned about $2.4 million of unclaimed money to its rightful owner.
“Financial institutions have a number of accounts that have been inactive for a long time. If they are unable to trace the owner, the bank incurs the cost of maintaining these accounts, including a physical register, until they can be transferred to the IRD to manage. In some cases this process takes 25 years.
“The proposed changes will ease compliance costs for banks and make it easier for Inland Revenue to track down the owner of the money by actively using its systems and data collection records to link unclaimed money accounts to taxpayers,” said Mr Nash.