It may not pay to go by the book

By MATHEW DEARNALEY

Like countless New Zealanders, Rick Poole was brought up believing his money was safe in the bank.

But he has since learned old bank books may not be worth the paper they are printed on, whatever they may assure depositors on their covers.

The Auckland man thought he had struck lucky when he unearthed a vintage Bank of New Zealand passbook from a bottom drawer, evidence of $1000 in investment deposits his late mother made for him in the late 1960s.

Although no withdrawals are recorded in the book, the bank has refused to pay him any money, telling the Banking Ombudsman that the funds were withdrawn in 1987 after the death of Mr Poole's mother.

Mr Poole says any money could have been withdrawn only by the Public Trust, but a letter from that agency confirms it received no funds from the investment account while administering his mother's estate.

He recollects being given the passbook by his mother before stowing it away for a rainy day, not setting eyes on it again until 1995.

On rediscovering it, he asked the issuing branch to transfer the $1000, plus interest since his mother's death, into his cheque account.

He was told the bank would check its old files. He heard nothing for eight months despite renewing his request, so complained to the then Banking Ombudsman, Nadja Tollemache.

Mrs Tollemache reported that the bank had made "exhaustive inquiries" but no longer had any record of what his mother might have instructed it to do with the investments once they matured.

The funds might have been paid into another of Mrs Poole's BNZ accounts, but banks were required to keep most records for only seven years, she said.

She also lacked jurisdiction to investigate events predating 1992.

An irked Mr Poole transferred his business to the PSIS investment society and TSB, the only remaining New Zealand-owned bank, saying they operated "much more efficient and professional businesses."

While the passbook included an instruction for interest to be paid by cheque to his mother, it also stipulated that each deposit was a separate investment for one year, to be rolled over automatically on maturity.

The book states further that it must be kept in a safe place and be presented whenever money is paid into, or withdrawn from, the bank.

"It is not so much the money as the principle of the thing - they just think, 'We are bigger than you are so you can go to the Ombudsman'."

BNZ spokeswoman Carol Young said it was hard investigating such an old case but there might have been a requirement to pay the funds to the Crown under the 1971 Unclaimed Money Act.

"We are currently attempting to investigate this," she said.

However, the legislation applies only to money which has languished in a recurring investment account for 25 years, and Mrs Poole made her deposits within 20 years of her death.

Weekend Herald reader Rhys Jones, of Hamilton, is also annoyed at losing $54 from an old Countrywide passbook account after it was depleted by monthly "maintenance fees" and closed without his knowledge.

He said the money was reinstated only after he made "thinly veiled threats" to move his mortgage.

National Bank spokeswoman Cynthia Brophy said it phased out passbook savings accounts when it bought Countrywide, replacing these with accounts whose holders received regular statements.

WestpacTrust no longer provides passbooks either, but the ASB Bank and ANZ still offer them, while the BNZ issues them only occasionally for customers to keep track of transactions rather than as formal bank records.

The banks - a Herald series

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