What happens to dormant deposits after ten years?

What happens to dormant deposits after ten years?

• A. It shall be reinstated
• B. It shall be escheated in favor of the government.
• C. Either A or B
• D. Neither A or B

Answer: (B)

Dormant deposits are funds in an account with no activity for a long period. After ten years of that dormancy, the law requires the bank to escheat the balance to the government as unclaimed property. The bank has tried to locate the owner, but once the ten-year mark passes, the money is no longer held by the bank and is turned over to the state. The rightful owner (or heirs) can still claim it later by going through the government agency that holds unclaimed funds. This is why the correct outcome is that the deposit escheats in favor of the government. Reinstating the deposit to the owner isn’t permitted after escheatment, and claiming that nothing happens wouldn’t align with the established rule for dormant accounts.

Dormant deposits are funds in an account with no activity for a long period. After ten years of that dormancy, the law requires the bank to escheat the balance to the government as unclaimed property. The bank has tried to locate the owner, but once the ten-year mark passes, the money is no longer held by the bank and is turned over to the state. The rightful owner (or heirs) can still claim it later by going through the government agency that holds unclaimed funds. This is why the correct outcome is that the deposit escheats in favor of the government. Reinstating the deposit to the owner isn’t permitted after escheatment, and claiming that nothing happens wouldn’t align with the established rule for dormant accounts.