Germany grapples with a growing conundrum: billions of euros are held in what are commonly known as "forgotten accounts." These are typically bank deposits or securities, such as stocks and bonds, that have seen no activity for extended periods. Estimates of these inactive assets range from 4,2 billion euros (4,9 billion USD), as reported by the German Federal Ministry of Education and Research in 2021, to potentially 9 billion euros.

The issue often arises when an account holder passes away, and their relatives or heirs are either unaware of the account's existence or struggle to identify it. The rise of online banking further complicates this, as physical documents are less common, and account information may only exist in digital formats like email inboxes or computer hard drives. Non-traditional financial assets, such as cryptocurrency or NFTs, present even greater tracking challenges.

Public sentiment in Germany strongly supports using these funds for social good. A recent survey, commissioned by the charity SOS Children's Villages (Germany), revealed that 86% of the public believes money from these accounts should be transferred to a fund for social projects after a reasonable timeframe. Only 8% think the government should take possession, while 2% suggested the funds should belong to banks.

Euro banknotes photographed on 30/5/2022. *Photo: Reuters*

Germany lacks a specific legal framework for handling assets in forgotten accounts, leading to diverse interpretations and approaches. Legally, these accounts do not automatically become the property of banks or the government. Banks are thus required to retain them indefinitely, as the ownership rights of the account holder or their heirs never expire. The government can only take possession if it is identified as an heir under inheritance law, rather than through abandoned property regulations.

This absence of a clear legal framework means banks largely determine how to handle forgotten accounts. Most institutions consider factors such as: the account holder has passed away and no heir can be found; there has been no contact from the customer for many years; or all contact information is outdated. This discretion allows banks to decide the extent of their efforts in searching for owners or heirs, with strict German personal data protection regulations posing a significant obstacle.

Past attempts to resolve this issue in Germany have faced hurdles. Nearly a decade ago, Norbert Walter-Borjans, head of the North Rhine-Westphalia State Finance Agency – Germany's most populous state – estimated that about 2 billion euros were in inactive accounts. He advocated for a national registry for forgotten assets, an idea that saw various efforts towards implementation. More recently, the government of Chancellor Friedrich Merz drafted a bill to establish a centralized, public online database, enabling heirs to search for asset information. However, this bill remains unfinalized.

Beatrice Eisenschmidt, a board member of VDEE – an association representing heir search professionals, headquartered in Berlin – emphasizes the need for a centralized database for inactive accounts. She points out that current search procedures are time-consuming and costly, requiring requests to numerous financial institutions. "Consequently, many heirs decide not to pursue the search procedures," Eisenschmidt said.

In contrast to Germany's unresolved situation, several other countries have established specific regulations for forgotten accounts:

• **United Kingdom:** Inactive accounts typically transfer to a fund supporting social and environmental projects after about 15 years. However, owners or heirs retain the right to claim reimbursement indefinitely.
• **France:** After 10 years of inactivity, accounts and life insurance contracts are transferred to CDC, a public financial institution. They officially become state property after an additional 20 years.
• **Switzerland:** Banks are required to preserve assets and manage inactive accounts. A centralized database for forgotten accounts assists in owner searches. If no contact is made after 60 years, account information is made public, and heirs have one year to claim it. After this period, all claims become invalid, and assets are transferred to the government.
• **United States:** State laws govern forgotten accounts. Banks must attempt to contact account holders after 3-5 years of inactivity. If unsuccessful, the state government – where the account holder's last known address was – takes possession. Assets are held by the unclaimed property authority, and owners can generally reclaim them at any time.

As Germany continues to navigate this complex issue, the experiences of other nations highlight potential pathways for managing billions of 'forgotten' euros and ensuring they either reach their rightful owners or contribute to public welfare.