Finance News: MPs support motion to free up unclaimed cash for the sector

Mathew Little

A quarter of all MPs have signalled their support for a plan to force banks and building societies to donate unclaimed assets in dormant bank accounts to charity.

An Early Day Motion, tabled by Labour MP Martyn Jones, calls on the Government to change the law so that voluntary organisations could benefit from a "multi-billion pound windfall" if the rightful owners of the money cannot be found. So far, 180 MPs have signed up to the motion.

In this year's Budget, Chancellor Gordon Brown warned financial institutions they had until November to find the real owners of the billions of pounds tied up in dormant accounts, or give it to charity.

Jones accused some banks of using "dormant money from customers' accounts to boost company profits".

"So far, a quarter of all MPs in the House of Commons have signed my motion," he added. "I want the Government to follow the example of other countries - most notably Ireland - in taking a radical new approach towards dormant accounts. If financial institutions choose to ignore the Chancellor, I hope he will legislate to bring about change on this scandalous situation."

According to Jones, the amount of money residing in dormant accounts could be between £15bn and £80bn.

In March, a new charity, the Balance Charitable Foundation, was launched to convince financial institutions to distribute money in forgotten accounts to good causes. But there is some resistance to the idea. According to Adrian Coles, director-general of the Building Societies Association, "this money belongs to those who deposited it, not to the government, charity or anyone else. In case of mutuals, unclaimed monies are used for the benefit of all members, not shareholders."

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