Saturday, November 9, 2013

Life: TD Bank Debit Card expired and Dormant Bank Accounts

I was just checking out some features on the TD Bank website and TD Bank mobile app and ran into some problems. So, I went to a branch and inquired about it. I didn't have to wait long probably because it was a mid afternoon Friday.

While they the representative was looking into it, she found also noticed that my debit card had expired because I haven't used it for a while. I found this odd because I thought they typically send a new card. Since I almost never use a debit card, I haven't actually bothered to check before.

At the same time, I have also learned that there is such a thing as dormant accounts where if the account is inactive for a period of time, the bank turns your money over to the state. I found the website that you can go to find unclaimed money by visiting missingmoney.com (link provided below). Some states may have their own site, so you may want to try that first. I found using the search term "Unclaimed Property" plus your state will find most state's site.

At first, I thought this practice was odd but I could see some value to this although I cannot really find the real reason online yet. Although I find 1-3 years to be too short but seems like the government has shortened this over a period of time. I am also not sure how long the funds can stay in the unclaimed funds for each state. One benefit is that it does protect you from the bank creating new policies that may "legally" take your money over a period of time since most banks have the open clause to change their policies at any time. I believe most policies take affect within a year. One of the policies could be to add fees due to inactivity. Then at some point additional fees below a minimum amount. If there was no minimum amount, the bank could also add a policy for that as well. Not great customer service policies but sounds legal. I'm not sure what other reason there could be.

If longer than that, the policy would also be good for long term inactivity. Perhaps your parents invested money in your account that you did not know about. Or you had an account that you forgot about because it had low funds. By turning the money to the state, you now have a centralized place to find your funds. Also I think this may also include retirement funds. So if you had a 401k from previous company and forgot to change your address, those funds may also go towards that (I am guessing at best).

Also, if the person has the bad fortune of getting into an accident with long term health problems, or death, or anything that prevents them from communicating their accounts, friends or family could see if the person had funds to be possibly used for bills or inheritance. I can see how the shortened period would help this case.

I'm not sure if this is true, but you may want to also check if CDs may fall under the inactivity rule. It sounds odd that CDs would fall under that but there was a site with complaints. I did not investigate farther if this was legitimate or not because I have not owned any CDs.

All in all, the experience was very nice at TD Bank. I did get my services enabled. I was in a hurry and didn't ask what caused the problem (although I should have), but my guess is that it may have been flagged as dormant. I had a small fund account sitting there for a couple years because it was for some charity. I would definitely give TD Bank more consideration in the future. The rep even mentioned about mortgages but did not "sell" their service and was more conversational which I actually do appreciate. I had poor experience with a branch with another bank in nyc that sells even another account every time I go in just to get a check. It was only that branch though because I did not have that problem in other states.


Reference
http://www.ehow.com/facts_5009248_what-happens-dormant-bank-accounts.html
http://www.whec.com/news/stories/s2964818.shtml
http://www.city-data.com/forum/new-jersey/21417-nj-will-confiscate-you-bank-accounts.html
In general - http://www.missingmoney.com
For California - https://ucpi.sco.ca.gov/UCP/Default.aspx