House panel OKs passage of amended dormant bank accounts bill

The House Committee on Commerce is recommending passage of a new version of a bill amending the law that allows the CNMI government to access dormant and inactive bank accounts and unclaimed funds for depositors’ accounts. The bill strengthens the intent to prevent banks from raiding accounts so that account holders won’t lose their money.

The committee version of House Bill 18-94, authored by Rep. Edmund Villagomez (Cov-Saipan), redefines an “inactive” savings account as one that does not have deposits or withdrawals for 24 months since the last transaction on the account.

A checking account is considered “inactive” if no deposits, issuance of checks, or withdrawals are made to and from the account for six months since the last transaction on the account, under HB 18-94, HD1 that amends Public Law 17-69.

A passbook savings account, meanwhile, is considered “inactive” if there are no deposits or withdrawals for 24 months since the last transaction on the account.

“If an account is inactive, and the depositor cannot be located, a bank shall transfer the balance of the account to the Commonwealth Treasurer for the account of the depositor. The transfer shall be in accordance with the Commonwealth Department of Commerce regulations,” the amended bill said.

Four of the seven members of the Commerce Committee signed off on the report recommending passage of HB 18-94 in the form of House Draft 1. They included chairman Villagomez, vice chair Ralph Yumul (Ind-Saipan), vice speaker Frank Dela Cruz (Ind-Saipan), and Rep. Mario Taitano (Ind-Saipan).

The committee said that prior to Public Law 17-69, there were already statutes governing dormant and inactive bank accounts to be transferred to the CNMI Treasury but banks made no such transfers “because of the fact that the statute stated that banks may transfer fund, not necessarily requiring them to transfer dormant/inactive accounts to the CNMI Treasury.”

The panel added that prior to P.L. 17-69, banks did not inform customers when their accounts have been declared dormant or inactive.

Historically, banks charge dormant or inactive accounts a fee of $15 to $20 a month, quickly diminishing the account balances and eventually zeroing the bank account.

The committee said HB 18-94, in the form of House Draft 1, will rectify technical language within the existing statutes in order for banks to provide information on dormant or inactive accounts and to transfer such funds to the CNMI Treasury.

Committee members said the amended bill will address the many complaints regarding dormant and inactive accounts when it comes time for the depositor’s heirs or legal representatives to collect what rightfully belongs to them “through the hard work of their predecessors.”

The House Committee on Commerce worked with the Department of Commerce’s banking director to amend the bill.