Dormant accounts CSSF guidelines - Circular 15/631


Circular CSSF 15/631 - Guidelines for the definition and treatment of dormant accounts

December 2015

CSSF Circular 15/631 of 28 December 2015 on dormant or inactive accounts refers to the business relationship between the professional subject to the prudential supervision of the CSSF and the bank account holders, regardless of the accounts’ nature: cash accounts, securities accounts, e-money accounts, safes…

Obligations of the professional to avoid accounts becoming dormant

Pursuant to MiFID/MiFIR and AML/CFT requirements, each professional should maintain regular contact, preferably at least annually, with its clients and monitor client relationships with vigilance.

The professional must set clear rules to determine when a relationship is considered to become inactive or an account to become dormant. At a minimum, the professional should consider the relationship with a client as inactive and therefore the client's account as dormant
(i) when there has been no communication from the client or his authorised representative during the last six years; and if
(ii) the client or his/her authorised representative has not initiated any transaction (transfer instruction, cash withdrawal or deposit, sale or purchase orders, etc.) on any of the accounts held by the professional during the last three years.

Obligations of the professional when an account becomes dormant

Monitor dormant accounts

In particular, when an account identified as dormant becomes active as a result of initiation of a transaction, this event should trigger an alert for the professional to verify that this renewed activity on the account is not of suspicious nature.

Seek to establish contact with the client or his/her heirs

The professional attempts to restore contact with the client by all appropriate means of communication, without prejudice to any specific provisions in the contract terms.

Any initiative to recontact the client and search for possible heirs that generates costs must be undertaken according to the principle of proportionality.

Administer the assets deposited on dormant accounts

Continue to administer the client's assets in compliance with the contractual obligations.

Charge justifiable and transparent administrative expenses as long as they remain higher than the value of the deposit, failing which they may proceed with the closure of the account.

Non-prescriptibility of the restitution requirement

Professionals are not authorised to appropriate the assets in their custody, whatever their amount, or to use them for purposes other than their restitution to the entitled beneficiaries.

Did you find this useful?