Account closed by Nationwide

[Deleted User]

I hope this is in the right forum - this is my first post on the money saving forums.

I was just wondering if banks can close down accounts that have been inactive for some time without telling the account holder?

My husband was going through bank statements etc, at the weekend for his tax return and noticed that he hadn't had a statement from his Nationwide account for this year. It's not an account he uses, it was given to him by his parents and he just has about £700 in there.

He phoned up Nationwide to find out how much interest he had received only to be told they had no record of the account, and that it had probably been closed down due to inactivity :eek: Now he has to go into a branch to try and get the money back. However, we had no notificiation that they were going to do this, should Nationwide have informed us of their intentions?

In addition should we be expecting Nationwide to give a good will gesture for making off with his money? We are contemplating taking out a mortgage with Nationwide (and I already have several products with them), and we might reconsider this depending on how they treat us.

Has this happened to anyone else, and how long did it take to get your money back?

ReportInvestor

Hi Chibi and welcome to the site .

They haven't "made off" with your money as it is clearly still available to you. And no - you won't be entitled to any goodwill guesture. BSs usually like to be seen to track down dormant accounts in order to keep on the good side of their patron. Gordon Brown.

If the account was given to your husband by his parents, has he taken the trouble of changing the address and telling Nationwide that he is now 18 and a taxpayer ?

Gordon Brown would like to "make off" with your money by ensuring in future that dormant account money is made available to charitable purposes (no doubt decided by him) but even then you would still be able to get your money back.

Anyone who thinks they may have a dormant account with any building society should go to https://www.bsa.org.uk/consumer/factsheets/100948.htm where you can find information to help you track down your "lost" money.

Out of interest, and for the benefit of all MSErs, when did he last receive a statement and when was there last a transaction on the account? Did he receive AGM voting papers around July 2006?

codetown

could you specify what is the definition of 'dormant'?
How long was it without *any* operation before the Nationwide closed it?

This is serious and I am not happy to hear this sort of actions from them!

[Deleted User]

It's hard to say how long it had been dormant. He changed the address of the account a couple of years ago, but we are thinking that that never went through as he never received any statements after this date. Surely changing the address of an account constitutes activity?

He has never actually made any withdrawls or payments to the account - just interest payments from Nationwide. I think it's been a couple of years since he received a statement and he didn't receive the AGM voting papers (although I did receive some due to my mortgage account). I did wonder at the time where his where, but the thought slipped my mind before I could say anything.

Shouldn't banks get in touch with people before deciding that an account is dormant?

ReportInvestor

Chibi wrote:

Surely changing the address of an account constitutes activity?

Shouldn't banks get in touch with people before deciding that an account is dormant?

Yes & yes,

but the fact that they didn't confirm the change of address means that for some reason it didn't happen. Did hubby actually write the letter? We all know how stressful a time it is when you move house, and it wasn't as if he was using the account so it might have slipped through the net as one of those things that could be put off when there are 100+ other more important jobs to do.

What has probably happened subsequently is that the statements have been returned to sender from your previous address. Which is adequate reason for making the account dormant.

You wouldn't want anyone who got the details illegitimately to use the information to make off with the money.

Nationwide was probably protecting both itself & you by making the account dormant.

[Deleted User]

ReportInvestor wrote:

Yes & yes,

but the fact that they didn't confirm the change of address means that for some reason it didn't happen. Did hubby actually write the letter? We all know how stressful a time it is when you move house, and it wasn't as if he was using the account so it might have slipped through the net as one of those things that could be put off when there are 100+ other more important jobs to do.

What has probably happened subsequently is that the statements have been returned to sender from your previous address. Which is adequate reason for making the account dormant.

You wouldn't want anyone who got the details illegitimately to use the information to make off with the money.

Nationwide was probably protecting both itself & you by making the account dormant.

He actually tore the slip off the bottom of one of his statements for you to to change address with, so we know he actually did send it. He was also being very lazy and didn't bother to change the address for a few years after he moved which is typical hubby behaviour.

If Nationwide hadn't changed the address on the account the account address was his parents who have not moved since 1999, so we still should have received something. Generally his parents are good at forwarding mail onto him (even junk mail, which is a bit annoying).

While I agree that it's best the account go dormant instead of being hi-jacked, it's still annoying that they don't even appear to have attempted contacting him at all.

ReportInvestor

That's strange then.

It's fortunate that it is the Nationwide BS so hopefully it won't be too much trouble to get to a branch and move his money to a better paying Nationwide account while ensuring that you get in writing that his membership has been continous (just in case the unthinkable happens and Nationwide converts into a bank).

jonesMUFCforever

For most banks they define a dormant account as having no entries for at least 3 years(not including interest).
I would disagree with CHIBI changing address does not constitute an entry on the account and therefore has no bearing on the dormancy.

pjala

Surely a dormant account, is just an account you leave in a Building Society to accumulate interest over the years. I would be furious, if for instance ING closed down my account that I put a couple of hundred into, then left to its own accord.
I know it doesn't make financial sense in some ways to do that, but "dormant", means nothing.

ReportInvestor

It does to the Chancellor. He was mad enough and greedy enough to want to be able to grab your money after 3 years of dormancy but eventually relented.

See this MSE thread for background

[Deleted User]

Thanks to everyone who replied to this.

We went into the Nationwide on Saturday and they changed the account status to dormant in 2004 (around August time I think). Apparently they received a letter back with a 'not known at this address' written on the envelope. His parents would not have done this, so we are assuming that a postie delivered the letter to the wrong address, and the recipients instead of noticing the incorrect address just returned the letter to sender.

Considering the amount of incorrectly delivered mail we get this is the most likely explanation. Apparently Nationwide do not bother to try and track down owners of dormant accounts (the first lady we spoke to said there was no point as they might not be at that address). We did point out that this might be rather shortsighted of them, but apparently it's the way they work. It does seem rather strange that it only takes 1 letter delivered to sender to change an account to dormant as well.

It will take 4 weeks (!) to get the account reactivated and OH had to fill in a new account application form. We are a bit concerned about this as it suggests that his membership has lapsed, but we will deal with that when the account is back up and running. At the moment we don't know if he will get the interest owed for the past 2 years, we'll only find out when the account is back. We did get the impression that he should get the interest and the account manager did say that if not we should raise a complaint.

I'm not totally happy with the way Nationwide have dealt with this, but I was very impressed with their account manager who was very helpful and tried to answer as many of our questions as she could.

I suppose the moral of this story is to make the OH keep track of his money slightly better than he has been doing