MONTREAL -- Millions of Canadians unknowingly have billions of dollars worth of their money and assets being held by companies and government agencies, available for recovery.
The Bank of Canada alone is holding nearly $1 billion from bank accounts and Canada Savings Bonds, but experts estimate unclaimed assets across the country could top $4 billion to $7 billion.
Canada is way behind other developed countries in having comprehensive unclaimed property legislation for all its residents, says accountant Brenda Potter Phelan.
"A country so progressive, so socially minded as Canada I find it hard to stomach that we don't have some safeguards. In the U.S. and around the world they find this a main part of consumer protection,'' she said from Cambridge, Ont., where she runs a website and blog called Legacy Trackers.
Quebec and Alberta are the only provinces with comprehensive laws, while British Columbia has a voluntary system. But Ontario is studying the adoption of its own system that could shine the light on a large treasure of unclaimed assets, including insurance policies, stocks and pensions.
Story continues below
Nowhere do people pay with plastic more than in Canada. An RBS report from 2011 found that paying by plastic -- credit, debit and bank cards -- amounts to 40 per cent of transactions, on average, across world economies. But the rate in Canada was 68 per cent, making the country the world leader in plastic payment.
Observers in the U.S. and elsewhere declared Canada a trailblazer when the Harper government announced in its budget this year that it's eliminating the penny. Canada isn't the first to do this -- Australia got rid of its penny decades ago, for instance, and various currencies around the world often eliminate their lowest denominations due to inflation. But the decision to kill the copper coin is nonetheless a sign that physical currency is less important to the economy than it used to be -- and central banks are beginning to notice the costs involved with it. Photo: Jeff Golby wears an oversized model of a pennyas he collects donations of pennies for local charities during Canada Day festivities in Vancouver, B.C., on Sunday July 1, 2012. (THE CANADIAN PRESS/Darryl Dyck)
Even our paper money is turning plastic. The Bank of Canada unveiled Canada's first plastic bill -- a new $100 -- last fall. The $50 bill went plastic this past March, and the $20 followed quickly in May. The plastic bills are meant to be more durable and include a variety of new security features, including a translucent strip. But they've already been through a few controversies: One involved the discovery that the new plastic bills may melt in heat; another involved a controversial decision by the BoC to eliminate an "Asian-looking" person from the original design of the $100 bill. Photo: Minister of Finance Jim Flaherty and Bank of Canada Governor Mark Carney show off the new $20 bank bill during a ceremony in Ottawa, ON Wednesday May 2, 2012. (THE CANADIAN PRESS/Adrian Wyld)
Perhaps the elimination of the penny made the Royal Canadian Mint realize that the age of physical coins may be coming to an end. The agency responsible for Canada's coins launched a new project this spring, called "MintChip," in which it's researching the creation of a "digital coin" shoppers could use for transactions under $10. On its face, the idea is similar to BitCoin, the virtual currency, but when a national mint develops something like this, it's a clear sign we're into a new era when it comes to money. Photo: The Canadian Press
A study carried out by Leger Marketing for PayPal earlier this year found that 71 per cent of Canadians are comfortable with never having to use cash to make purchases, up a stunning 44 percentage points from 2011, when only 27 per cent of Canadians said the same. We're going to go out on a limb and suggest this survey could be somewhat unreliable, but another survey, carried out by RBC this spring, found that three-quarters of women and two-thirds of men typically carry less than $50 in their wallet and rely on electronic transactions for purchases. Photo: The Canadian Press
As Wired points out in this gushing article, Canada's Interac system is a world-leading digital currency system. Nothing like it exists in the U.S., where you can pay by debit card at the cash register or pay user fees at a bank machine. While other countries have proprietary trading systems owned by banks, forcing withdrawal fees on customers and costs on retailers, the not-for-profit Interac costs so little it overtook cash as the preferred method of payment for Canadians all the way back in 2000. Photo: The Canadian Press
The Canadian Bankers association is working on a unified, standardized system for smartphone payments in Canada -- something that could well evolve into an "Interac for the smartphone age." Experts say that before smartphone payment can become standard, the phones themselves have to be equipped with Near Field Communication which allows phones to be swiped near readers to complete a transaction. Analysts say that technology is only a few years off. Photo: The Canadian Press
In Canada, the total value of unclaimed assets is unknown but experts believe the numbers are staggering and growing.
The Bank of Canada's unclaimed accounts grew 52 per cent over five years to reach $532 million as of December, with 93 per cent of accounts worth less than $1,000. The bank returned only $14 million to owners last year.
Non-redeemed Canada Savings Bonds and Canada Premium Bonds totalled $391 million as of March 31. The Office of the Superintendent of Bankruptcy Canada holds some $18 million.
Quebec has about $300 million of unclaimed financial and other assets, while B.C. and Alberta have tens of millions each.
Online searches can be conducted in each of those provinces and with the Office of Superintendent of Bankruptcy, but all Canadians can look at the Bank of Canada website.
Searches conducted during research for this story identified more than $10,000 of unclaimed financial assets for family and friends.
"I am very surprised,'' Syma Shaffer said when told about the discovery of nearly $1,400 from a Montreal bank account closed in 1991.
Federally regulated banks are required to hand over unclaimed deposit accounts, term deposits & GICs and negotiable items such as drafts, money orders and certified cheques to the central bank after a decade of trying to notify the owner.
Excluded are non-Canadian currency accounts, RRSPs, credit union balances, gold or silver certificates, safety deposit boxes, insurance payments, court payments, stocks and dividends, wages and real estate deposits, most of which are covered by provincial legislation.
The largest single unclaimed account totalling $552,000 was transferred from a Royal Bank branch in Montreal. Its owner, Manuel Vinhas, had two dormant accounts worth nearly $677,000.
The bank wouldn't comment on specific cases, citing privacy issues.
Greg Crone was elated when informed he had more than $6,600 of assets being held, likely from a deposit related to a 2003 car purchase.
But the Ontario resident couldn't understand how RBC was unable to locate him after a move to another city since he has the same bank account.
"It's pretty shocking. When they want to find you because you're late on a payment or something they have no trouble finding you,'' he said in an interview.
Experts say it's not uncommon for people to lose track of their assets, forgetting old bank accounts or paid up life insurance policies. People often move without forwarding their mail for more than a year and many people die without their heirs knowing much about their finances.
"Some people live quite private lives and they die unexpectedly and people don't even know to look,'' said Darren Jack, chairman of a task force for the Unclaimed Property Professionals Organization.