What are Dormant Accounts?
- Definitions
- Dormant Accounts
Dormant accounts (usually checking or savings accounts) are those that have had no activity for a lengthy period of time. These accounts are considered to be sensitive in nature because they are more likely to be the target of embezzlement due to limited—or lack of—monitoring by the customer. Banks must implement proactive measures to deal with dormant accounts to reduce such risks.
From Dormant Account to Escheatment
A financial institution’s core system will flag an account when it becomes dormant. Then, the bank will usually place the dormant account into a restricted status. This allows only certain staff members to access the account, thereby reducing the risk of embezzlement.
After a set period of time, the bank will close the account, and funds are escheated to the state’s treasury. At that point, the customer (or his or her heir) must contact the state to reclaim the money. Escheatment times vary by state.
Protecting Dormant Accounts
As previously mentioned, banks usually try to limit staff access to dormant accounts in their core system. That being said, employees may still be able to retrieve dormant account information especially if the bank relies on paper documents that are still accessible to bank staff. Examples may include signature cards or other hard copy files.
To reduce the risk of employee theft, modern financial institutions are turning to electronic document management systems, such as AccuAccount. A system like AccuAccount can receive information from the core, identify dormant accounts, and automatically place dormant accounts into a restricted “branch.” This gives bank administrators the ability to confidently and instantly limit user access to dormant account information and related documentation.
Banking Resources
For more information about customer and account document management, be sure to check out our extensive resource library with free spreadsheets, whitepapers, and ebooks.
Browse our banking definitions page for more terminology.
Free Downloads

Banks Audit & Exam Prep Study

TicklerTrax Exception Spreadsheet
TicklerTrax™ Exception Spreadsheet Downloaded 1,000+ Times Looking for a free spreadsheet to track your financial institution’s exceptions? TicklerTrax might be the perfect tool for you! We’ve taken some of the basic logic from our top-rated document tracking system and boiled it

eBook: Compliance & Bank Document Management
Related Articles
“No, I Don’t Have That File”
Lisa: “Hey Tony, I’d like to borrow a loan file that you checked out. The customer is here, and I need to review a few things in his file.” Tony: “What loan ...
5 Pillars of an Effective Bank Document Tracking Strategy
Document tracking is sometimes viewed as a back-office function that deserves minimal strategic thought. Banks that hold this opinion tend to struggle with inef ...
Beehive Federal Credit Union Adopts Document Imaging with AccuAccount
We’re pleased to announce that Beehive Federal Credit Union has chosen AccuAccount for the document management needs of its commercial loan portfolio. Beehive F ...
The Definitive List of Bankers’ Banks
Thanks to community banks, consumers in the U.S. have an almost unparalleled number of options when deciding who they’re going to trust with their money: some 1 ...
3 Reasons Why Imaging is a Must for Banks in the COVID-19 Era
The coronavirus pandemic has impacted almost every aspect of life—and banking is no exception. Practically overnight, bankers across the country were thrust int ...
How to Spread Financial Statements Faster with Better Data Collection
Your financial institution has made a significant investment in its financial monitoring workflow. The latest credit spread software and a well-trained credit a ...
Bankers Online: What Is It?
Bankers Online (“BOL”) is a popular website that provides helpful content, tools, and resources for professionals who work at banks, credit unions, and related ...
5 Types of Commercial Loan Software
Commercial lending is a unique aspect of the banking industry. Unlike consumer loans, which are underwritten based on a snapshot of the customer’s current cr ...