Can I Reopen A Closed Bank Account?

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Banks are a powerful financial institution in our modern world. Not only do banks hold all of our money, but they also control our accounts and allow us to access our funds.

And because of this influence, banks are also capable of suspending our money or even closing our bank accounts entirely.

Can I Reopen A Closed Bank Account

But why do banks close personal accounts, and how can you reopen a bank account when it has been closed? 

Down below we have compiled together some handy information covering the subject of bank accounts and their closure.

Here you will find everything that you need to know about the various reasons why banks close accounts, and how you may be able to reopen your account after it has been suspended. 

Why Did The Bank Close My Bank Account?

If you have discovered that your bank account has been closed, then there could be a variety of reasons for the closure.

In the world of banking, there are three main reasons why a bank would choose to close your account – and we have outlined each of them down below. 

Fraudulent Activity

The bank is always watching your accounts and funds, so if they notice something that seems strange or suspicious, they may decide to close your account to cease any fraudulent activity.

However, in some cases, the bank may choose to simply suspend your account until you can confirm that no criminal activity is taking place. 

Different banks have different definitions of suspicious activity, so we have collected various suspicious activities and composited them in the following list. 

– Large amounts of money being transferred to and from overseas. 
– Frequent transactions by account holders with no employment status. 
– Multiple bank accounts being listed under one name.
– Suspicious surges in account activity or deposited funds. 
– Cash deposits being taken out that are just under $10,000
– Accounts being opened in different countries with the holder’s information.

Can I Reopen My Bank Account? (from Fraudulent Activity)

When your bank account is closed due to suspicious or fraudulent activity, it will file a report with the Department of Treasury.

If this report is accepted, then you will not be able to reopen your closed account, as you will then be branded as a suspicious person. 

But this does not mean that all hope is lost. Banks understand that in certain situations things are not what they seem, and most will contact you before they close your account.

If this is the case, then you will be provided with the opportunity to prove that no criminal activity has taken place. If you have legitimate evidence or records that disprove any suspicious activity, then you may be able to keep your account open. 

However, you should also know that banks have the right to close your account for any reason.

If your bank considers you a suspicious individual or even a risk, then they may want to cut all contact and business with you. 

Inactive Accounts

As we previously discussed, the bank is constantly monitoring your account.

So if the bank notices that your account has been inactive for an extended period of time, then they may register your account as being dormant.

Branding an account as dormant is not the same as closing one – for the dormant account will still exist but you will be unable to access it. 

Can I Reopen A Closed Bank Account?

When a long period of inactivity has passed, the bank will eventually collect your money and send it to the government as unclaimed funds.

This will traditionally happen when your account has been inactive for 3-5 years. If you discover that your funds have been sent to the government, then you can contact the treasury department to make a claim. 

The amount of time you can keep your inactive account will vary depending on laws and the bank’s own policies. Most banks will register your account as dormant after 6-12 months of inactivity.

Can I Reopen My Bank Account? (from Inactive Account)

The easiest way to reopen an inactive account is by making a transaction within a certain period of time. However, we recommend that you contact your bank to ensure that the transaction is valid.

Banks will usually contact you when your account is being registered as dormant, during which time the bank will provide you with all the information you need to reactivate your account. 

If your account has been classified as dormant, then you can submit a written request to your local bank to have it reopened. Your bank will not charge you for the reactivation of your account. 

Excessive Overdrafts

When you make transactions that amount to more than the funds you have in your account – you could overdraw your account, which means you will have a negative balance.

When a bank registers your account as negative, they will allow it to remain negative for a period of time before they decide to close it. This period of time can vary depending on different banks and can range from 30 days to 3 months. 

Most banks will often charge you with pricey overdraft fees, while other banks will implement a limit on the number of overdraft transactions you can make. 

Can I Reopen My Account? (from Excessive Overdrafts)

Unfortunately, in this particular case reopening your bank account depends entirely on the policies of your bank.

Most banks will allow you to reopen your account after you have paid back the negative fees, which includes any transactions or overdraft fees that may not have gone through.

You can check your bank’s policies for specific information regarding their stance on the subject. 

However, if your account was closed due to a large number of recurring overdrafts, then you may not be able to reopen it. During this time, your bank may also brand you as a risk, which could make it difficult to open a bank account with another company. 

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