The Parliament has passed a bill that will increase the number of years that bank accounts may be inactive before funds are transferred to the government.
The Banking Laws Amendment (Unclaimed Moneys) Bill 2015 – currently awaiting the royal assent – will allow bank accounts and insurance policies to be inactive for seven years, a government statement said.
This would reverse the decision – made when Bill Shorten was financial services minister in 2012 – that reduced the maximum period of inactivity to three years.
"This desperate cash grab by Labor resulted in $550 million from thousands of accounts being transferred to ASIC in 2012/13 – an almost eight-fold increase in collections in a single year," the government said.
"The former Government's change not only imposed large costs and inconvenience on those Australians that had to wait up to six months to reclaim their money, but also left many Australians financially distressed and unable to access their funds when they most needed them."
The provisions – which do not apply to children's accounts – remove the requirement for ASIC to publish an "unclaimed money gazette" that includes the account holder's name, last known address and the amount of money held by the government, according to the statement.
The bill will also cut $36 million of "red tape" for business, since accounts in foreign currency would be exempt because "they are primarily used for business transactions".
"There is currently $700 million in lost bank accounts and life insurance policies. Australians can still access information about unclaimed accounts, free of charge, through the ASIC MoneySmart website," the statement said.
SUBSCRIBE TO THE IFA DAILY BULLETIN
- 11:54ASIC permanently bans former AMP adviserBy Staff Reporter
- 11:01IRESS announces first half resultsBy Jessica Yun
- 11:05Banks the key to closing advice gap, Tria saysBy Larissa Waterson
- 10:44Adviser ethics certification launchedBy Staff Reporter
- 11:06Banks evade FOFA, industry funds claimBy Larissa Waterson
- 16 Aug 2017UBS appoints head of wholesale distributionBy Staff Reporter
- view all