Bankers Trust pays fine for moving money from unclaimed accounts

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Can you trust your bank to hand over money that sat in a dormant checking account for years?

Legally, financial institutions are required to give that money to the state after a designated period of inactivity, which varies from state to state. In reality, some don’t.

That was the case with
Bankers Trust Corp. In March, the New York-based company pleaded guilty in a U.S. District Court to funneling $19.1 million in unclaimed checks and other credits into its coffers to improve its performance record during a time of financial scandal.

Attorneys for the bank allege that pressure to meet revenue and expense targets forced bank officers and employees to divert the money from dormant accounts to beef up the bank’s revenue base.

Employees who were not aware of the money shift discovered the falsified record-keeping in 1996. Bank officials elected to come forward. The bank allegedly had been padding its bottom line with unclaimed money since 1986.

Bankers Trust agreed last month to pay a $60 million fine to the federal authorities and $3.5 million to the state of New York.

The lesson for consumers?

“Contact your bank at the end of each year to find out if you have any money owed to you,” advises Jean Ann Fox, director of consumer protection at the Consumer Federation of America, a Washington, D.C.-based consumer rights group. “Make sure they have your current address and phone number so they won’t be able to say they couldn’t reach you.”