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On 26 May 2021, the second reading of the Dormant Assets Bill [HL] is scheduled to take place in the House of Lords.


A dormant asset is a financial product that has not been used for many years and which the provider has not been able to reunite with its owner. The Dormant Bank and Building Society Accounts Act 2008 established a scheme that distributes such assets from bank and building society accounts to good causes, while retaining funds to meet any future claims on them. Accounts must be dormant for 15 years to be transferred to the scheme. It has so far distributed £745 million.

The bill’s purpose is to extend this scheme to a range of other financial assets, including long-term insurance, pensions, collective investment schemes, client money and securities assets. The Government estimates this could generate a further £880 million for good causes.

The scheme operates on three main principles:

  • reunification first: a firm’s first priority is to trace and reunite people with their assets;
  • full restitution: at any point, asset owners can reclaim the amount that would have been due to them had a transfer into the scheme not occurred; and
  • voluntary participation: firms can choose whether to contribute to the scheme and to what extent.

These would remain unchanged under the bill, as would much of the scheme’s operational detail. However, each new category of asset would have its own tailored definition of dormancy. Other measures in the bill include:

  • providing the Government with the power to bring further assets into the scheme through secondary legislation, rather than through further primary legislation;
  • making it a requirement for firms participating in the scheme to make attempts to reunite assets with their owners; and
  • removing some restrictions on how the assets are distributed to good causes in England.

The bill follows a series of reviews and consultations on the scheme. These have included a report by ‘industry champions’, to ensure that changes are led by the financial services industry.

Documents to download

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