What to do with unclaimed money after death?

Latvian commercial banks have thousands of accounts whose owners are dead. Because the leftover balance in the accounts is small, relatives do not form inheritance and the money is left where it was. Banks have to keep the money for 60 years before it can be transferred to the bank's income. The Finance Latvia Association calls for simpler legislation in the matter, Latvian Radio reported on March 8.

Residents usually arrange inheritance affairs with a notary if they own any real estate. But what about the funds in a deceased relative's bank account? Edgar Pastars, senior adviser on legal affairs at the Finance Latvia Association, said:

“As happens in life, they usually take the deceased's bank card and go withdraw money for the funeral. Usually a couple hundred, 300, 400 euros, which is not very legitimate either, but the financial sector understands these things and we do not report them if they are of a reasonable amount, of course. If the balance is not big, no relative goes after it, resulting in outstanding balances in the accounts of one hundred, two hundred, three hundred euros.”

The industry association is calling for improved regulation so it doesn't have to wait 60 years for the money to be credited to the bank's revenue. “This money should go into the state's revenue way sooner,” Pastars adds.

Gatis Litvins, managing director of the Latvian Council of Sworn Notaries, says that if there are a few hundred euros in the bank account, relatives do not start the inheritance process, and problems arise if deposits are in banks located abroad.

“Within the European Union, somehow a notary can trigger the instruments provided for in European Union law. But if the accounts are in third countries, then the situation is near hopeless. And the same goes for all these modern digital properties like cryptocurrency and so on. Right now, there is no possibility to find out that the deceased has owned such, if he or she has not notified his or her heirs in due time,” said Litvins.

Pastars further said that difficulties arise when deposits are located on Internet or “cloud banks”.

“They don't have a branch, all they have is an app. There's no phone number where to call and where someone would answer either. Contacts have been identified to turn to so the matter can be sorted out by writing a specific form of the letter, but it doesn't always happen quickly either,” Pastars said.

Litvins said that if a larger amount of money is left, heirs will deal with the situation, but the state needs to find some solution to do with small account balances.

“At this point, statistically, about 70 thousand people who have died have money left in their accounts. There should be a mechanism to get that money from banks to the Treasury if for a long time no one has come for that money. For banks, the biggest dream would be to foresee the simplified inheritance that account balances can also be removed by next of kin without an inheritance case,” said Pastars.

The Saeima is also discussing other issues related to inheritance – what to do about heirs having to take over debts of the deceased and how to arrange a European certificate of inheritance when Latvian residents die abroad.

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