It is no argument in favour of the CBN’s initiative, that countries across the world have an escheat arrangement in place.
In India’s case, the Depositor Education and Awareness Fund Scheme was set up in 2014 to “promote depositor interest and for any other relevant objectives considered required by the RBI”. On a monthly basis, banks remit to the fund the credit balance on accounts that have not been operated for over ten years.
Both of these principles invite further attention. Escheat arrangements set up the sovereign as natural heir in transactions between domestic entities that fail because there are no legal heirs. It worked when the sovereign was a king, and land was the property that reverted. In a democracy, where the will of the people is sovereign, escheat arrangements look like the pure property grab that they are. The absence of a statute of limitations on claims to the deposits simply reinforce this.
What should matter therefore in agreeing the propriety of escheat arrangements for dormant accounts is agreeing where the most gain to society from access to the funds will come from – banks or the government? So, while the argument, here, is that on the balance of available evidence, the CBN ought not to be the custodian of these funds. I am told that in our example, the 10-year minimum period makes the money in the pool too small to worry about.
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