In the event of death, the bank closes a client’s bank account. This may present many challenges to the family that is left behind as they cannot access the accounts. However, all is not lost as the law makes provisions for such occurrences.
According to FNB’s head of growth, Johan Strydom, the Administration of Estates Act makes provision for the bank or the Master of the High Court to release funds from a deceased person’s bank account for the maintenance of their dependants and for funeral expenses.
Strydom said dependants must approach the court for a letter confirming that the bank can release funds if there are any in the account.
“Approach the Master if there are funds in the account. It is vital to do so immediately after death to ensure that the family does not endure any hardship,” he said.
Strydom said the Administration of Estates Act places a duty on the bank as the party in possession of the bank account to retain custody of the proceeds until an executor is appointed to administer the account.
“Even if you have granted your spouse or a trusted person Power of Attorney over your accounts this ceases with your death,” he added.
Despite being required by the law; the bank also freezes the accounts to prevent fraud. According to Strydom, there is a risk that someone may try to access the account, especially if the deceased had shared his/her pin number or online banking login details.
“Criminals may target a deceased person’s bank account because the account owner is no longer there to receive In-Contact messages and other notifications.”
Until next time,
The MoneyShop.co.za Team