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A Holland woman used automatic deposit for her account. Now it's gone due to 'inactivity'

In the state of Michigan, an automatic deposit is not recognized as activity, and after three years of no activity, the account goes to Unclaimed Property.

HOLLAND, Michigan — Holland resident Joy Kooyer has been dealing with an unusual banking issue. Last November, she received a letter from PNC Bank, stating her automatic deposit had been rejected. “Account Status Invalid” was listed as the reason. She checked online, only to realize the account, which had over $10,000, was gone.

Confused by all of this, Kooyer went to a local branch of PNC Bank to get some answers. She said the bank workers were just as puzzled, so they made some calls to figure out what was going on. Finally, the issue was identified. 

Kooyer and her husband had been using automatic deposit with the account, which was set up as a college savings account for their 8-year-old son. In the state of Michigan, an automatic deposit is not recognized as activity, and after three years of no activity, the account goes to Unclaimed Property.

“So I went online and made a claim,” Kooyer said. “It's really interesting because you just put in your last name and your zip code and the city you live in, and poof — it came up that that was an unclaimed property. That's how they label it.”

She said she was shocked that neither the banker nor the person she spoke with at Michigan Unclaimed Property had ever heard of this happening. She said she’s just glad she was not relying on those funds, because she’s still trying to regain access to her account.

“If I needed that money, I would not have access to it at all,” Kooyer said. “I'm going to have to wait 4 to 5 months to get this back, and that's without any hitches, that they actually approve the claim.”

In the meantime, Kooyer has had to prove the money is rightfully hers.

“I have to go through quite a process,” she said. “You have to get your birth certificate, my birth certificate and my son's birth certificate. We have to get social security cards, we have to get them notarized, all of this together and then send it off.”

In order to keep this from happening again, a representative from PNC bank gave Kooyer some advice:

“They have recommended that I make manual deposits, but that gets pretty cumbersome when you have many different accounts,” she said. “That's what automatic deposit is supposed to be for. They also made a recommendation that I could just do a quick withdrawal and then another deposit. You just have to do something like that once every 3 years to show activity, but I think what needs to happen is there needs to be an amendment to this law that an automatic deposit counts as activity. I think that's the bigger issue, and I wonder how many people realize that if they're just putting money into a savings account for a variety of reasons and they're not touching it in a three-year period, they are at risk also of having their money taken away. And I think a lot of people are not aware of that.

“It scares me to put my money in a bank in Michigan, knowing how easily that was gone. That's a lot to be taken,” Kooyer said. “There's a loophole in the system that's taking advantage of people who are really just trying to do a good job of saving money for future issues.”

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