Labour donor looks to unlock dormant £2.5bn

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The Independent Online

A commission headed by the Labour Party donor Sir Ronald Cohen started its look yesterday at how billions of pounds in dormant bank accounts can be returned to their owners or siphoned off to worthy causes.

About £2.5bn is thought to have been sitting in Britain's banks untouched for at least 10 years.

The Government, angered when it emerged this year that some banks had been using the cash to flatter profits, wants to redistribute the money. If owners cannot be traced, it will be put into deprived communities.

Matthew Pike, the secretary of the Commission on Unclaimed Assets, said: "We want to seize the historic opportunity this money provides to make a profound difference to the lives of the most disadvantaged communities across the UK."

A similar initiative in the Republic of Ireland in 2001 saw about 60 per cent of funds in dormant accounts returned to owners. In the US, some states hold the cash for seven years before spending it.

The plans have infuriated banks, who have questioned the Government's right to redistribute the funds and are fretting over the administrative burden it may entail. Gordon Brown is tipped to use Monday's pre-Budget report to define "dormant" accounts as those untouched for at least 10, possibly 15, years.

The commission will consult banks, consumer groups and charities. Sir Ronald said: "Our first concern must be to reunite consumers with their money whenever possible. As for the money that remains unclaimed, we must never forget it is neither the Government's nor the banks' property."

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