For more than a year now Charlie McCreevy has been examining the situation in relation to all dormant bank accounts, be they normal, bogus or highly illegal. And in spite of "potential legal and constitutional issues", he has decided to act.

When that happens, the banks and building societies will no longer be able to use a secrecy system that can work to disinherit the families and relatives of their customers.

In the late 1980s and early 1990s, it might have seemed a good idea to hide money in illegal offshore accounts from the Revenue Commissioners.

But if the people who opened such accounts - often with false names or addresses - died unexpectedly, their funds almost certainly went to enrich the banks and building societies involved.

Not that the issue is simple. According to the Central Bank, the deposits must remain as liabilities on the books of the banks and cannot be transferred to their reserves.

But the financial institutions do have ongoing use of the money and the next-of-kin lose out.

The rules of banking do not require those institutions to trace the owners of deposits lodged with them. It is normally up to clients or their next-of-kin to come looking for their money.

Last March, Mr McCreevy explained the Catch-22 situation to the Dail: " The banks' duty of secrecy prevents them from disclosing information on any account to a third party without the express consent of the account-holder".

So, if the account-holder is dead, no permission can be given. And without proper documentation to sustain a legal claim to ownership of deposits, the banks will not entertain demands from dependants.

Last year, as word seeped out about large-scale tax evasion through bogus and illegal accounts, the Department of Finance asked the financial institutions to conduct an investigation into the number and value of dormant deposit accounts. The report of the findings of that exercise has not been published. But officials are taking the information provided with a pinch of salt.

Legislation would probably be required to get at the full facts, one source said, because nobody really knew how much money was involved. As for the figure of £2 million accruing every 25 years - suggested by the banks as "an indicative estimate" - the source said that figure would be "very much on the low side."

The Minister for Finance was "very keen" to make progress on this issue and was likely to take action next year, he said.

The banks tell a different story.

The Irish Banks Information Service maintains that solicitors or appointed personal representatives are provided with a "tracing" or "checking" service to establish the existence of accounts.

And they say that, on noting the death of a customer, bank branches endeavour to draw the attention of the next-of-kin to the existence of an account.

Jim O'Keeffe of Fine Gael has been campaigning on the issue for years. The party spokesman on social, community and family affairs draws on his own experience as a solicitor when he says not all accounts are disclosed to representatives of the deceased.

He had personal experience where other accounts, in other branches of the bank, in joint names or in Irish versions of the name, were not initially identified in response to queries.

The days of personal banking, in which banks staffs knew their clients and notified their dependants when they died, had long passed, Mr O'Keeffe said. A system had to be put in place which guaranteed the next-of-kin their rightful inheritance.

The problem of dormant accounts is not confined to banking. And failure to trace next-of-kin can often lie with the original account-holder. Irish people are notoriously secretive where money is concerned. Husbands and wives frequently hide their financial affairs not only from the tax man, but from one another. In such circumstances, tracing accounts can be almost impossible.

The demutualisation of the Irish Permanent and First National building societies in recent years indicated the extent of the problem. In the Irish Permanent flotation in 1994, almost half of those people entitled to free shares did not initially take them up. But, by the time the shutters finally came down last year, that percentage of non-claimants had fallen to 8 per cent of customers. It still numbered about 12,000 accounts.

In the case of First Active this year, there was an initial take-up of over 80 per cent. But people may be waiting because claims for free shares can be made for three more years.

Failure to claim may involve change of address, death and a range of other reasons. But there are also accounts where the client specifically instructed that no communication should be made with him or her, probably in an attempt to hide the account from a spouse or children.

Banking secrecy allowed the Swiss banks to deny children of the Holocaust their rightful inheritance for decades. And while dormant funds in Irish financial institutions would be tiny by comparison, they are not the rightful property of banks or building societies.

One thing is clear: every bogus or illegal bank account is a corruption of the system and the Oireachtas should legislate to deal with the matter.