Forgotten Money
A CALL for assistance, published simultaneously in all the newspapers of New York City, came from an unexpected source — the City’s largest mutual savings bank. It drew attention to a long list of depositor-owners of that bank who had forgotten, or ignored, deposits totaling $300,000. These were men and women who had ‘laid up in store for themselves a good foundation against the time to come,’ but had failed to recall the sum held for them, or to tell their heirs where to find it. Silent people these, from whom no word had been received; who had disappeared so completely that the hunting down of all clues by bank authorities had finally culminated in this unusual request.
Such an appeal was not only a successful gesture; it set a precedent which savings banks generally were willing to follow in such a hurry that the repercussions extended throughout the state. Old, old record departments came awake, with clouds of names shaken out of ancient files, each one representing a real person for whom a futile search had been made.
Some idea of the number of these longlost depositors may be gained from the fact that one of the oldest savings institutions, the Bank for Savings, chartered in 1819, required twenty-four columns of an evening paper to record its unfound claimants to funds left with the bank; and the Union Dime Savings Bank had 3700 depositors who had never claimed sums amounting to $250,000. The Emigrant Industrial Savings Bank, however, topped that figure with nearly half a million dollars; and the Seamen’s Bank for Savings, long the target of the sightseeing guide who pointed it out as ‘holding millions of dollars belonging to sailors lost at sea,’ actually held $300,000 of unclaimed money. Among the missing of the Central Savings Bank was the eighth depositor to open an account during the first day of the bank’s business in 1859. He was among 2266 lost actors, merchants, attorneys, educators, housewives, labor leaders, and depositors who had become soldiers in the Civil War and had given their service units as their last address.
The accumulated compound-interest dividends had increased the initial capital deposited in one account from $754 to $7048 — and it was collected!
It would seem inevitable that the same name should be included in more than one list, as savings banks in New York are limited in the amount they may accept from a single depositor and may have but one branch bank. The private secretary of one very active lawyer, after reading his name in two lists published, found six bankbooks of different banks wrapped and tied in a twenty-year-old newspaper deep in one of the recesses of his safe. He did not remember having any of them. His collection was nothing compared with that of the traveling man whose hobby had been ‘a bank account in every city visited.’ His personal effects disclosed that he possessed five hundred passbooks, some containing but a single entry.
These moneys, if unclaimed, and those held by the various banking institutions in the state (totaling $5,413,790) which had not been claimed over a period of twenty-two years by July 1937, were designated as abandoned accounts, and in accordance with a new state banking law were turned over to the State Comptroller on December 1, 1937. Previous to this there had been no provision for the disposal of these funds. The banks had retained all the deposits in their active ledgers, crediting regularly the interest dividends up to the close of a certain period, — ten or twenty years generally, — after which they were called dormant accounts. Interest payments then ceased in some states, and lists of owners were advertised only in the year each account reached the age of dormancy. For instance, in New York the savings banks reported to the State Superintendent of Banks those inactive accounts of $10 or more which had become twenty years old (the period is now fifteen years for dormant accounts and twenty-two years for abandoned accounts), and the trust companies, private banking houses, investment and commercial banks, reported any deposit of $50 or more which had been inactive for five years.
One such sum was held by a trust company with whom a broker had placed $21,000 in opening a trading account for use abroad. He sailed for Europe and later took return passage on the ill-fated Titanic. He left not the smallest clue of a family connection.
Nor would the heirs of another depositor have been found had it not so happened that he had formed a partnership, and the partner, reading his friend’s name among those recently published, notified the bank of his death, in 1921. He was surprised to learn that his former associate had left $9000 in the bank.
With no place to put their troublesome dormant accounts, bankers found themselves obliged to decide whether to take continuous action in trying to find the lost, or merely to transfer the accounts as they became dormant to inactive ledgers. They could not dispose of them to members of a depositor’s family without proof of death. As one banker remarked, ‘If a young man desires to leave his money with us, and then when he has reached the age of sixty years returns for it, he has every right to expect to find it here.’
In some banks these ‘sleeping’ accounts have remained undisturbed, the funds being invested as usual; but in other banks they have involved strenuous detective work on the part of a staff of researchers, who have had to deal with secrecy, suspicion, ambition, adventure, and sudden death.
The search has frequently provided quiet humor, as in the now famous account of Johanna Murphy, who died or disappeared in 1824, sometime after leaving a share of the Bank of Manhattan, founded in 1799, in custody of that bank. When Johanna acquired the stock its value was $50; and in the passing of time a stock dividend credited her account as two shares at a par value of $50 each, with a market value of $320. Up to 1925 she had been credited with 200 dividends on her stock, and so her account continued to grow and grow. So did her popularity. Determined claimants as heirs persisted, even to starting a case at court, quickly withdrawn when it was explained that Johanna was a colored woman.
Another owner of an account amounting to $4000 was finally discovered in a state institution for the insane. A brother knew of his incarceration, but steadfastly refused to give the bank any information, although he presented the passbook regularly for interest entries. When the bank found the owner, he boasted that he not only owned that bank but several others, leading to the discovery that his fort une came to $20,000.
The president of one bank personally conducted a long and expensive hunt which culminated in the discovery of a very old blind man, with a helpless, bedridden brother, living in extreme poverty in Ireland. Many searches have ended just around the corner; for instance, when two presidents of neighboring banks were discovered as owners of long-dormant deposits.
Adventurers and veterans of wars have returned to find their former bank closed, and, without making any inquiries which would direct them to the State Banking Department, they have hastily concluded that their money was ‘closed out,’ too. Undoubtedly bank mergers have left hundreds of depositors unfamiliar with the new name of their bank. Sometimes old people die without making a will, perhaps without possessing a single relative, and feel that the bank should keep their small hoard in return for protecting it.
Again, families have been wiped out by accidents at sea and by automobile fatalities, while other families have been so busy living that the small trust funds created by young parents have become forgotten as the children have grown up and opened accounts of their own.
Even the depression failed to stir the memory of some of these men and women. A practising physician absolutely refused a sum of money which had been accumulating compound interest for him in the bank where he left $50 when a student at college. He says he does not believe there is such a sum belonging to him.
This inexplicable forgetfulness has prompted one woman bank executive to caution her staff against permitting a single lost depositor to escape their search. The East River Savings Bank has not been mentioned thus far because this bank in 1936, through remarkable diligence, succeeded in finding every absentee owner, although the search was carried, clue by clue, to depositors or heirs residing in Algeria, the British Isles, Norway, and Argentina. This bank had no names to publish that year, and possibly would have had none this past year if the law had not unexpectedly stepped up the period of dormant account publication from twenty-year to fifteen-year accounts, leaving little time to close over a hundred deposits.
‘The law may be satisfied with a minimum of effort,’ this bank woman explained, ‘but the depositor whose name has been published, with consequent ragging by friends who offer to be his banker or suggest he needs a guardian, develops a defensive state of mind, and cordially denounces the bank. A friend is lost, an enemy made, and only the state is satisfied.’
Some of these bank researchers have been engaged in the work for many years; one official, connected with the oldest savings bank on Long Island, first became interested more than fortyfive years ago in helping the bank to discover the legal claimants for four hundred dormant accounts. This man was born in London, and it is probable that his familiarity with the agony column prompted his interest in this kind of sleuthing. A London paper offered him free space for notices which would attract the attention of any heirs in Great Britain, and many clues were found, leading to prisons, army posts, and the colonies.
To this man, who has become a genealogist, the great mystery is not that people forget they have money in the bank, but that those found living often refuse to come into the bank or to send in their passbooks for interest posting — which would keep the account from becoming dormant and reportable. Another veteran researcher uncovered one answer to that mystery when he found a depositor who had refrained from touching, or indeed having anything to do with, the first money he had earned in this country.
Understandably, bankers have welcomed with a sigh of relief the recodification of the state finance law, simplifying, as it does, the status of the ancient accounts in their institutions.