The scheme was launched in 2011 to track down the owners of dormant bank and building society accounts and reunite them with their money. And when finding them isn’t possible, the money is passed to the Reclaim Fund who make it available to good causes, with an emphasis on disadvantaged young people, social enterprises and financial inclusion.
But there is one key difference between the Dormant Assets Scheme and the school lost property department. The scheme is set up in such a way that sufficient funds are retained to cover anyone who gets in touch about reclaiming their assets. “So when a shareholder suddenly remembers that share after however many years, the Reclaim Fund can put them back in the position they would have been,” says Robert. “And that fundamentally differs from how most companies operate share forfeiture schemes.”
There are 30 participants so far (the scheme is currently only open to banks and building societies) and it’s proved a huge success both from the perspective of account holders being reunited with lost or forgotten accounts and the positive wider impact on society through donations to good causes.
“The fund had hoped to gather around £400m in the first few years, and yet has recently passed the £1.25bn mark,” says Adrian Smith, Reclaim Fund CEO. Taking up the school analogy, he adds that the fund currently has “millions of lost property items” – bank and building society accounts that can’t be traced back to their original owners.
The benefits to shareholders and wider society of including shares in the Dormant Assets Scheme are clear and Claire Etches, Head of the Dormant Assets Fund at the Department for Culture, Media and Sport, is exploring ways in which the scheme can be expanded to other business sectors, including shares, culminating in a report released earlier this year by four industry champions (including Robert) called The Dormant Assets Scheme: A Blueprint For Expansion.
“It’s hugely complicated,” Claire says. “There are so many components to ensuring that such a diverse scheme can be set up and run effectively with consumer protection still at the heart of it.” However, she is confident the extension will be supported. “There is so much potential money here that can be used to help the most vulnerable in society.”
Track and trace
Steve Banfield, Head of Industry at Equiniti, applauds the achievements of the scheme to date and the considerable work that has been accomplished by Claire and her colleagues on issues such as creating consistent definitions of ‘dormancy’ and ‘gone aways’ that the industry can work with.
“One of the requirements will be to ensure that there is a robust track and trace process,” says Steve. “There needs to be an ability to go to track and trace after you have hit the ‘gone away’ point, which could be as early as 18 months. And the quicker you go into track and trace, the quicker the process is and the more chance you have of reuniting the shareholder with their shares. What we’re trying to ensure is that anything that does transfer into the fund has been through a very thorough process in terms of trying to repatriate it.”
*This article is based on a plenary session at the 2019 Equiniti Share Registration Conference