Changes have been made to a draft law that will pave the way for ’dormant’ funds in accounts to be given to good causes.

Concerns over the provisions of the Dormant Assets Bill were raised when it was debated for the first time in the House of Keys last month.

But at the clauses stage last week, a number of amendments were approved in a bid to address those worries.

Treasury department member Bill Shimmins (Middle) is in charge of the Bill.

He explained: ’The aim of the bill is to enable dormant assets held by local banks to be transferred to a central fund and, subject to their being sufficient funds retained to meet any repayment claims, to allow a proportion of the amounts transferred to be distributed to good causes in the island.

’The Bill is underpinned by three core principles. Firstly, the transfer of a dormant asset to the central fund should be a last resort for assets whose owners cannot be traced. Secondly, customers’ rights should always be protected. Thirdly, dormant assets funds should be applied for public benefit.’

Mr Shimmins addressed concern that money that had been put in an account as a ’nest egg’ could be wrongly classified as ’dormant’.

He said: ’To be dormant, an account must have been open throughout a period of 15 years and during that period no transfers in or withdrawals from the account must have been carried out.

’As a further protection, if the account-holder holds additional accounts with the same licence-holder, any activity or contact in respect of the other accounts would preclude the inactive account as being classified as dormant.’

Where an account became inactive for ’genuine reasons’ but was not dormant, banks would follow their own trading procedures in seeking to clarify if the account was active.

Even after that a bank would have to attempt to contact the customer before classing an account as dormant and transferring funds.

Mr Shimmins and the Treasury supported an amendment from Ann Corlett (Douglas Central) to specify that a bank must make it clear its intention to close an account when notifying an account-holder of its dormant status.

Lawrie Hooper (LibVannin, Ramsey) tabled successfully a number of amendments that removed references in the bill to partial asset transfers.

He said: ’The aim of these amendments is to ensure that when the time limits that are outlined in the bill are reached the banks are required to transfer in full any balances of assets that exist directly to the fund, just to remove any potential for banks to transfer a small portion into the fund and retain the rest for themselves.

’It is purely a tidying-up, clarification exercise.’

The Bill provides for repayment should an account-holder be found after money has been transferred into the fund.

A further amendment was approved, giving Treasury the right to repay an account-holder an amount greater than had been transferred, if they were located after the transfer.

Treasury Minister Alfred Cannan said the measure had been added as a ’means for ensuring that an asset holder has a means of recourse where significant financial impairment has been suffered as a consequence of the treatment of their asset under the legislation’.

He said the provision would only be used in exceptional circumstances.

Banks will also be required, when returning funds to an account-holder who has established contact, to repay any fees deducted to cover costs in transferring a dormant assets.

The Bill will now require a third reading in the House of Keys before being passed to Legislative Council for further consideration.

An amendment was made to the Dormant Assets Bill in Legislative Council last week.

MLCs approved an amendment by Jane Poole-Wilson that will ’align the list of charitable purposes’ under the bill to the current Charities Act and allow it to be realigned once the Charities Registration and Regulation Bill, which is being debated by the House of Keys, becomes law.