CBN announces its intention to collect all unclaimed balances of bank customers

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The Central Bank of Nigeria (CBN) has declared that it will transfer all dormant account balances and unclaimed balances in banks to a newly created designated account.

The central bank indicated that the monies would be invested in government securities and returned to the beneficiaries within 10 days of notification.

The warning was revealed in the Exposure Draft of the Guidelines on the Management of Dormant Accounts, which Naija News received in April 2023.

The document repeals the Guidelines on the Management of Dormant Accounts and Other Unclaimed Balances by Banks and Other Financial Institutions in Nigeria, which were issued on October 7, 2015.

“The Central Bank of Nigeria shall open and maintain an account for the purpose of warehousing unclaimed balances in eligible accounts,” the CBN stated. The account will be known as the “Unclaimed Balances Trust Fund Pool Account.”

According to the apex bank, qualifying accounts are dormant account balances that have been with the FIs for 10 years or more.

“Current, Savings, and Term deposits in local currency; Domiciliary accounts; Deposits towards the purchase of shares and Mutual Investments; Prepaid card accounts and wallets; Proceeds of uncleared and unpresented financial instruments belonging to customers or non-customers of FIs; Unclaimed salaries and wages, commissions, and bonuses” are eligible accounts and financial assets.

Other examples include “proceeds of stale local and/or foreign currency drafts not presented for payment by beneficiaries; funds received from a correspondent bank without sufficient details as to the rightful beneficiary and/or a recall of funds made to the remitting bank to which the Nigerian bank’s account had not been debited; and a judgment debt for which the judgment creditor has not claimed the amount of judgment award.”

According to the CBN, financial institutions must treat dormant accounts and financial assets as follows:

“Formulate policies for the recognition and management of dormant accounts and financial assets that are consistent with this guideline and other extant regulations; ii. Establish effective controls to ensure surveillance and second-level authorization on reactivation of dormant accounts, among other measures;

“iii. Maintain a register of dormant accounts balances; iv. Transfer balances that have remained in the dormant account register for up to ten years to the ‘UBTF Pool Account; and v. Require customers seeking to reactivate dormant accounts to provide evidence of account ownership, valid means of identification, evidence of the present place of residence, and affidavit on the accuracy of the information to reactivate the account.”

CBN said when it receives the unclaimed balances the apex bank will, “i. Open and maintain the ‘Unclaimed Balances Trust Fund Pool Account’; ii. Maintain records of the beneficiaries of the unclaimed balances warehoused in the UBTF Pool Account; iii. Invest the funds in Nigerian treasury bills (NTBs) and other securities as may be approved by the ‘Unclaimed Balances Management Committee’;

“iv. Refund the unclaimed funds to the beneficiaries not later than ten (10) working days from the date of receipt of the request. V. Where it is imperative to extend the timeline, a notice of extension shall be communicated to the requesting FI stating reasons for the extension.”

The Central Bank warned that any bank or financial institution that goes against the provision of the new guidelines would attract a penalty of not less than N2,000,000.

It added that failure to comply with CBN’s directive in respect of any infraction will attract a further penalty of N200,000 daily until the directive is complied with or as may be determined by CBN.

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