UNCLAIMED BALANCES LAW (RA 3936, AS AMENDED BY PD 679)

CONCEPTS/IDEAS

The Republic Act. 3936 also known as Unclaimed Balances Act was approved on the 29th day
of November 1932 and became effective January of 1933. It states that accounts that fall within
the classification of Unclaimed Balances shall be subject to government escheat. It was further
amended on April 2 of 1975 through Presidential Decree No. 679 by former president Ferdinand
E. Marcos for purposes of simplifying the procedures for escheat of unclaimed balances to
reduce the cost of publication.

It is obligatory of every bank to report, in a sworn statement, to the Treasurer of the Philippines
(who will, in turn, inform the Solicitor General) of deposits that have not been touched (no
deposit or withdrawal made) for a period of 10 years or held in favor of persons known to be
dead.

Procedure:
1. A notice to the depositor will be given at his last known place of residence or post office
address.
2. The bank will then report, through a sworn statement, to the Treasurer
of the Philippines the existence of such deposits.

Information required in the Sworn Statement: (NADI)

1. The Names and last known place of residence or post office addresses of the
persons in whose favor such unclaimed balances stand;
2. The Amount and the date of the outstanding unclaimed balance and whether the
same is in money or in security, and if the latter, the nature of the same;
3. The Date when the person in whose favor the unclaimed balance stands died, if
known, or the date when he made his last deposit or withdrawal;
4. The Interest due on such unclaimed balance, if any, and the amount thereof.

3. Posting Requirement: the above-mentioned sworn statement shall be posted in a

conspicuous place in the premises of the bank, building and loan association, or trust
corporation concerned for at least sixty (60) days from the date of filing thereof.

4. The Solicitor General will then initiate the proper escheat proceedings in court.
5. A copy of the complaint and summons shall be served upon the president, cashier or
managing officer of each defendant bank, building and loan association or trust corporation
and a publication of such summons a newspaper of general circulation.

6. After trial, and it is determined that such balances are unclaimed, the court shall render
judgment declaring such balances escheated in favor of the Government.
7. Such unclaimed balances, together with the increase and proceeds thereof, shall be
deposited with the Treasurer of the Philippines to the credit of the Government of the
Republic of the Philippines to be used as Congress may direct.

Enumerations:

Information that will show in the copy of the sworn statement:

A. The names and last known place of residence or post office addresses of the persons in
whose favor such unclaimed balances stand;
B. The amount and the date of the outstanding unclaimed balance whether the same is in
money or in security, and if the latter, the nature of the same;

Group 3:
Amurao, Edson Caballes, Luis Navarro, John Michael
Bandiola, Eden Campos, Kristia Valbarez, Mcvenz
Benitez, Vhal Edar, Ruchell Villacorta, Paul
 UNCLAIMED BALANCES LAW (RA 3936, AS AMENDED BY PD 679)

C. The date when the person in whose favor the unclaimed balance stands died, if known, or
the date he made his last deposit or withdrawal; and
D. The interest due on such unclaimed balance, if any, and the amount thereof.

Definition of Terms:

1. Unclaimed Balances - Include credits or deposits of money, bullion, security, or other

evidence of indebtedness of any kind, and interest thereon with banks, buildings and
loan associations, and trust corporations, in favor of any person known to be dead or
who has not made further deposits or withdrawals during the preceding 10 years
or more.
2. Applicant - pertains to the depositor or his successor-in-interest who requests for the
reactivation of the account which was reported by his depository bank to the Treasurer
of the Philippines pursuant to the Unclaimed Balances Law.
3. Procedure - refers to the course of action to be complied with by the applicant in order
that his request be given due course.
4. Covered Institution - refers to all banks, trust companies, savings and mortgage banks,
mutual building and loan associations, all banking institutions of every land, covered
under RA No. 3936, as amended by P.D 679, which reported to the Treasurer of the
Philippines as unclaimed the account being applied for reactivation.
5. Affidavit of Undertaking - is a sworn statement executed by the responsible authorized
officer of the bank absolving the Bureau of Treasury from any liability that may arise due
to the granting of the Applicant’s request for activation.

Example Scenario::

Case 1

NorthSouth Bank has noticed a bank account that still has no other following deposits
since it was opened about 12 years ago, the balance of which is 450,000 pesos this is inclusive
of an interest of 50,000 pesos. Last deposit made was January 5, 2009. What must the bank do
with the dormant account they have?

Answer:

Report a sworn statement under oath by its respective managing officers to the treasurer
of the Philippines with the corresponding vital information about the unclaimed deposit:

• The name and the last known whereabouts of the person who owns such an account.

• The information whether such a person has died, if actually known.

• The amount of the unclaimed balance, which is a total of 450,000 pesos, the last time
when the depositor made a deposit, which is of January 5, 2009.

• The amount of outstanding interest that the account has, which is known to be 50,000
pesos.

After which, the bank must communicate to the said depositor based on the initial
information they have, and eventually post the copy of the sworn statement for at least 60 days

Group 3:
Amurao, Edson Caballes, Luis Navarro, John Michael
Bandiola, Eden Campos, Kristia Valbarez, Mcvenz
Benitez, Vhal Edar, Ruchell Villacorta, Paul
 UNCLAIMED BALANCES LAW (RA 3936, AS AMENDED BY PD 679)

in the bank premises after the date of filing. This must be absolutely highlighted.

Reason:

Unclaimed balances Act (P.D. 679) is requiring banks, ‘’building and loan associations"
and "trust corporations’’ to report on unclaimed balances that such institutions hold. This shall
apply on deposits by people who are known to be dead, or dormant accounts where there are
no further withdrawals or deposits during the preceding 10 years or more. From which, the bank
as in the example above, must file a sworn statement to the treasurer of the Philippines
containing information about:

• The names and last known place of residence or post office addresses of the persons in
whose favor such unclaimed balances stand;

• The amount and the date of the outstanding unclaimed balance and whether the same is
in money or in security, and if the latter, the nature of the same;

• The date when the person in whose favor the unclaimed balance stands died, if known,
or the date when he made his last deposit or withdrawal; and

• The interest due on such unclaimed balance, if any, and the amount thereof.

Case 2

After 12 years of being in a coma, Aang was informed that his deposit of 215,000 pesos
is under an escheat proceedings in the Manila RTC that started when he woke up. Aang has no
descendants or ascendants in his knowledge. He wants to exert his claim in the deposits, from
when can he exercise such a claim?

Answer/Reason

Within 60 days from the publication of the list of unclaimed balances by the clerk of the
Manila RTC, this serves as a tool to safeguard the interest of Aang as a depositor.

Group 3:
Amurao, Edson Caballes, Luis Navarro, John Michael
Bandiola, Eden Campos, Kristia Valbarez, Mcvenz
Benitez, Vhal Edar, Ruchell Villacorta, Paul