Wednesday, April 28, 2010

CT House passes bill banning dormancy fees

State Rep. Ryan Barry (D-Manchester), House Chairman of the legislature’s Banks Committee, says HB 5045 would prohibit a financial institution from imposing a dormancy fee on an inactive deposit account for which periodic statements are not provided if the primary account holder has another active account with them.

It now goes to the state Senate, where it died last year.

“This bill protects all consumers, and in particular senior citizens who have fixed incomes,” Barry said. “If a customer has at least one active account with a bank, the bank should not charge an inactive account fee on another account that the customer maintains with the bank. This is only fair to the customer and certainly not burdensome on a bank.”

It is not unusual for senior citizens to have two or more passbook accounts and be subject to dormancy fees of up to $25 for each of their accounts, he said.

To avoid dormancy fees, the customer must be the primary account holder on a second account maintained primarily for personal, family, or household purposes. The account must also be currently filed in the institution's records for tax reporting purposes.

If signed into law by the governor, the provisions would take effect Oct. 1.

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