Bank mergers swallow CDs

Cashing out a certificate of deposit usually is as simple as going to the bank and leaving with your money.

When Kevin McQuaite of Allentown went to cash out his investments, his bank couldn't find a record of them.

He consulted with state officials and an attorney and got help from the Watchdog before he tracked down what happened to them. Their location had been hidden by multiple bank mergers and acquisitions.

McQuaite said his mother had purchased CDs for him and his brother between 1984 and 1995, at Meridian and American banks in Reading. Last year, he decided to cash out.

Meridian and American banks no longer exist, and now are part of Wells Fargo/Wachovia. McQuaite visited a branch in Allentown, and said the bank could find no record of the CDs. He was told to contact the state, as old CDs often are escheated to the Treasury Department as unclaimed property.

McQuaite sent the treasury copies of the certificates. Several weeks later, the state told him it also had no record of the CDs. Check with Wachvoia, he was told. So back he went.

He couldn't understand what was so difficult, as he'd successfully cashed out certificates of deposit from another bank that had ceased to exist because of acquisitions and mergers.

But he dutifully returned to Wachovia and filled out a form for unclaimed CDs. Several weeks later, he said, the branch manager again told him there was no trace of the investments, so they must have been cashed out already.

"I know I did not cash them and my mother had forgotten she even had them until we searched for her will," McQuaite told me in an e-mail seeking help. "I worked at a bank many years ago and with all their record keeping and checks and balances I found it hard to believe there was no record of them on file or being cashed."

He turned to an attorney, who also was told by Wachovia there was no record of the investments, meaning they must have been cashed.

Then he turned to the Watchdog. I contacted James Baum, a Wachovia spokesman. Through the diligence of Baum and others at the bank, McQuaite learned the location of his certificates.

They weren't with Wachovia at all. And unknown to him, he had already cashed them out.

They were with Citizens Bank, which had no connection to Meridian or American banks where the investments were purchased decades ago.