The Government will be allowed to transfer hundreds of billions of pounds in forgotten money lying in disused investment and pension accounts towards charitable causes without the owners' permission if new recommendations are made law.

There is more than £200bn in lost assets waiting to be claimed, according to Inheritance Data, an asset-searching service.

But a report published today supported by the Treasury and the Department for Culture Media and Sport, recommends the money be subject to the dormant assets scheme, which is used to fund charitable causes via the National Lottery Community fund.

Under current rules, cash held in dormant bank and building society accounts is transferred into a holding fund after 15 years of inactivity, paying out a proportion of the assets to charities each year.

The holding fund has received more than £1.2bn from participating firms since it was set up in 2011, distributing hundreds of millions to charity.

Last year the Government commissioned work on how other parts of the finance industry, such as pensions, investments and insurance, could be incorporated into the scheme.

Currently, beneficial owners of lost assets are entitled to full restitutions and there is no time limit on when a claim can be made, even if they have already been transferred into the charitable fund.

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Under the commission's proposals, investments in funds will be deemed dormant if the investment provider has not been able to establish contact with its customer for at least 12 years and there has been no activity on the account.

For long-term assets such as pensions and insurance policies the rules will be different. They will become dormant either seven years after the owner dies or if it is clear a deceased owner has no next of kin.

Unclaimed cash left over from dividends on inactive broker accounts will become dormant after six years.

Rentokil, the FTSE 100 pest control company, recently said around £1m of its shares and dividends are dormant and estimated there is around £1bn in lost shares across the FTSE 100.

It is hoping to donate £250,000 of these dormant assets to charity each year under a new scheme supported by Frank Field MP, who said “unclaimed dividends are the corporate world’s coins down the sofa, but are like gold bars [for charities]".

The Government will now consider the commission's recommendations.

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