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Ken Tumin founded the Bank Deals Blog in 2005 and has been passionately covering the best deposit deals ever since. He is frequently referenced by The New York Times, The Wall Street Journal, and other publications as a top expert, but he is first and foremost a fellow deal seeker and member of the wonderful community of savers that frequents DepositAccounts.

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Custodial CD Special with a Top 10-Year CD Rate

POSTED ON BY

Update 7/3/2013: This custodial CD special has ended and is no longer available.

A CD with a top rate is being offered through the custodial CD program of Jumbo CD Investments, Inc. It's a 10-year CD with a 2.38% interest rate. Minimum deposit is $100,000, and it has a 6-month early withdrawal penalty. It’s nationally available, and compared to other nationally available CDs, it’s a clear rate leader. As of 6/18/2013, the highest CD rate that doesn’t require an active checking account is 2.00% APY for a 10-year CD at Apple Federal Credit Union. The highest at an internet bank is 1.90% APY for a 10-year CD at Discover Bank. Both Apple and Discover have much larger early withdrawal penalties. To see how these CDs compare when you factor in the EWP, refer to our CD Early Withdrawal Penalty calculator.

Update: We have been informed by the bank that this CD deal will end on June 28th.

This isn’t the typical type of CD that you get from your local bank or credit union. You have to go through a custodian bank. However, both the custodian bank and the issuing bank are FDIC members, and the CD will be FDIC-insured by the issuing bank (assuming you keep the amount under the FDIC limit). Unlike the typical brokered CD, you can’t sell this on the secondary market if you need to redeem the CD early. The issuing bank will just charge you a 6-month early withdrawal penalty.

This CD is available for both personal and business accounts. Joint and trust accounts can also be established and used to increase the amount that is FDIC insured.

I’ve always tried to share with you the best CD deals even when they’re not the typical bank CD. That’s the reason I’ve always included credit unions. I’ve also mentioned brokered CDs when they have offered higher rates. In this case, you can get a higher rate than what’s currently available from credit unions, internet banks or from the typical brokered CDs.

This CD will be held by an FDIC bank, but it won’t be purchased directly from the bank. You have to go through a custodian bank (which is also a FDIC member). The bank that issues the CDs doesn’t want to deal with retail deposits directly, and that’s the reason for the custodian bank.

This CD offering is available through the CD placement service, Jumbo CD Investments, Inc. Chris Duncan from Jumbo CD Investments reached out to me to promote this deal. Since it's a good deal, I decided to help promote it.

Chris Duncan has worked for Jumbo CD Investments since 1999, and over the years Chris has often shared his CD experiences at DepositAccounts.com and at my Bank Deals blog before DA. You can learn more about Chris and Jumbo CD Investments at their About-Us page.

Chris provided me the steps that you’ll go through if you’re interested in this CD:

  • Review the CD offer at Jumbo CD Investments at this link, and give them a call
  • Jumbo CD Investments will send you a custodial agreement from the bank that will serve as the custodian. Jumbo CD Investments will also provide you information on the bank that will issue the CD. You’ll be able to confirm that both banks are FDIC members. You can also use DA’s Bank Health Ratings page to check on their financial health.
  • Fax the completed custodial agreement to Jumbo CD Investments along with your w-9 and an authorized signer resolution.
  • Place your order with Jumbo CD Investments and wire transfer your funds to the custodian bank to purchase your FDIC-insured CD.
  • Jumbo CD Investments will notify the bank and provide them with all of the setup documents.
  • This completes the CD opening process. You will receive a confirmation from the custodian bank.
  • After the CD is opened, interest can either be paid monthly via check or a direct deposit to another bank account (via ACH) from the custodian bank.
  • The custodian bank will send you monthly statements with no fees.
  • When the CD matures or is closed early, you can choose to have the principal and interest wired back to your own bank without any fee.

It's not common for this type of deal to be made available to retail investors. If this is interesting to you, check out the Jumbo CD Investments’ special page and click on the "Get Started" button. From there you can contact Chris and learn more about the CD details. Also, feel free to ask questions in the comments of this post. Chris will be happy to answer your questions.

  Tags: CD rates

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Comments
64 comments.
Comment #1 by ChrisCD posted on
ChrisCD
I'm leaving a comment to subscribe to this post and be notified of any new comments or questions and do my best to answer them promptly.

cd :O)

3
Comment #2 by OldGuy posted on
OldGuy
I suppose this service is well worth looking into, particularly to see if there are any advantages over the brokered CDs offered online.  Right now, Fidelity is offering a bunch a 10-year, non-callable CDs (with $1,000 minimums) whose rates exceed 2.38%.  Beal Bank seems to be at the top at 2.55%.

https://fixedincome.fidelity.com/ftgw/fi/FICorpNotesDisplay?name=CD

7
Comment #3 by lou posted on
lou
One comment and one question:

Is the the 2.38% net of all fees?

OldGuy, the reason why this CD is attractive compared to broker CDs is because of the 6 month early withdrawal penalty. With a brokered CD, you assume the interest rate risk of having your CD depreciate substantially if interest rates go up in the next ten years.

5
Comment #4 by ChrisCD posted on
ChrisCD
@lou - Yes, the 2.38* is net of all fees.  There are no placement fees to the investor or management fees from the custodian bank.  Ken also provided a link to the DA early withdrawal penalty calculator to show what you would net after varoius terms if you do close it early.

@oldguy - Yes there are some brokered CDs that are paying higher rates.  But as Lou pointed out, those do not have a fixed penalty for early closure.

cd :O)

2
Comment #5 by OldGuy posted on
OldGuy
Thanks #1 and #3 for the explanation.  After what Ally Bank did with its deposit account agreement language last fall, not to mention various other moves to retroactively change CD account provisions, I've pretty much had it with relying on EWP provisions (except, perhaps, survivor options).  I know those who read this site are all over the map on this question, and I don't intend to reignite the debate over EWPs in this context.  Just trying to spark discussion of this particular instrument, which is intriguing.

I suppose also that brokered CDs, in addition to having something of a market, have some limited SIPC coverage if the broker goes belly-up.  I guess with another bank as "custodian" of your CD you're just relying on the same sort of asset segregation and fidelity bond protection you would have, say, with a safe deposit box.

4
Comment #6 by ChrisCD posted on
ChrisCD
@oldguy - This bank has already allowed people with lower paying CDs to pay the penalty, get their funds back, and open up a new CD with the higher rate and longer-term.  So they don't have a problem with allowing for it.  Matter of fact, they recently asked for information on what other banks penalties are and left theirs intact.  The penalty is clearly stated on the confirmations and there is no such clause such as "if the bank consents".  It is about as a sure thing as they come.  They realize a large part of what makes the offer attractive is the penalty.  They wanted a considerable amount of deposits and would have received far less if the penalty were higher.

FDIC insurance works the same through a custodian bank as it does if the CD were done directly or through a brokerage company.  It is called pass-through insurance.  Tomorrow when I get back to work I will add a comment with the specific clause from the FDIC.  So this deposit is considerably safer then your safe deposit box.  The FDIC does not cover contents in your Safe Deposit Box.

And yes, a registered brokered CD does have a potential secondary market, however, your loss may be far greater than a fixed penalty.  Also SIPC does not cover against investment losses, only insures delivery of cash and elgible securities in cases where the broker goes belly-up.

I hope that helps.

cd :O)

4
Comment #7 by OldGuy posted on
OldGuy
Thanks, Chris.

As for the EWP bugaboo (I guess we can't really avoid talking about it), I think some of us worry about the standard clause in deposit account agreements stating something like "we may amend or modify any provision of this agreement upon providing the notice required by law."  The Truth in Savings Act allows changes in EWPs with 30 days' notice.  I think the confirm you describe, though, strengthens the position that no EWP change can be made retroactively because the specific term in a contract should trump the general term.  And, as you say, the circumstances of the offer--e.g., clear reliance in the offering on this key fact of early withdrawal rights--also strengthens your case.

My understanding of "pass-through" insurance is that it provides me coverage when the issuing bank, not the custodian bank, fails and there's been some defalcation (e.g., dishonest or inaccurate recordkeeping) by the custodian.  It's the same with CDs held by a broker who is dishonest or doesn't follow recordkeeping rules.  In fact, I don't like my property being held by any intermediary custodian, unless the law requires it (like IRA accounts).

I'll be interested to hear what your view is. 

  

4
Comment #8 by OldGuy posted on
OldGuy
 

My sentence on pass-through insurance, I see, is a mess.  What I tried to say is that I thought the FDIC doesn't insure me if the custodian, as opposed to the issuing bank, fails and I haven't been properly recorded as the owner of my CD on the custodian's records (either through fraud or incompetence).  Perhaps your structure is such that my CD is considered a “deposit” on the books of both the issuer and custodian bank.  I’ve never specifically looked at this issue before.

 

1
Comment #9 by ChrisCD posted on
ChrisCD
If people are interested, they can complete our contact form and I will email a copy of the safekeeping receipt that the bank produces.  That should alleviate some of the fears of changes and retroactive changes.  And I don't blame people for the concern.  :O)

When it comes to pass-through insurance, you are correct, the bank has to have proper record keeping procedures.  As an FDIC insured bank, the custodian is audited to ensure proper record keeping.  If the custodian bank fails, a new custodian would be appointed by the FDIC.  If they merge or are taken over the new bank either maintains the program until the last CD matures or they transfer it to another bank that wants the program.  Both are extremely rare, in our experience.

I wish this structure were different, but it is not.  You are having to rely on the competence of the bank.  The only thing I can offer in this regard is the opportunity to talk to the custodian.  Of course with any deposit you choose to make you are having to rely on the competence of the bank.  :O)

I wish I could offer this CD as a direct CD, but I can not.  So like an IRA, in this case, a custodial relationship is required. 

1
Comment #10 by OldGuy posted on
OldGuy
Thanks, Chris.  I'm actually interested in 10-year instuments (CDs, highly-rated corporates and, hopefully one day before I die, Treasuries again).  I'm happy to know now about your site.

4
Comment #11 by paoli2 posted on
paoli2
I'm not interested in putting anything into 10 year CDs but does this mean we might see higher rates for the 5 years soon?   I'm wondering if this is not just a fluke to get people locked into long terms so they can't take advantage of the other rates if they go up.  I guess all we can do is keep monitoring other terms to see if they follow suit.

5
Comment #12 by ChrisCD posted on
ChrisCD
I know the term is long, but it really is the penalty that makes it a good deal.  Andrews FCU is the closest at a 1.91% APY with a 6-mo EWP.  And this rate is 47 BPs above that.  The FOMC re-iterated that they will keep Fed Funds low until unemployment is below 6.5% and inflation concerns pick-up.

"When the Committee decides to begin to remove policy accommodation, it
will take a balanced approach consistent with its longer-run goals of maximum employment and inflation of 2 percent."

Their may be blips of volatility, but overall it looks like low rates are here for a while. 

Paoli, thank you for your thoughts.  I do appreciate them.

cd :O)

1
Comment #13 by psjf posted on
psjf
Lou, based on your comment, it seems that you have some familiarity with these.  Have you bought a custodial CD in the past?  If so, what/how was your experience?  Curious if anyone else has utilized one of these and whether it went smoothly or not - especially at the outset and upon maturity.  The rate/EWP is (unfortunately) compelling, but this approach is new to me, along with the brokered CDs discussions on here from a few days back.  

 

1
Comment #14 by cactus posted on
cactus
Give that the minimum amount is $100K, why is the underlying bank so relucvtant to deal directly with custmers that they are willing to offer a high rate and pay both Sauk Valley Bank and to Mr. Duncan?

2
Comment #15 by OCSteve (anonymous) posted on
OCSteve
I contacted Chris (via e-mail inquiry) at Jumbo CD Investments and did some research on the underlying Bank and found out that it was a large special credit card specific Bank.  Their Banking charter allows only for deposits in amount of $100,000 and over.  Given that the underlying bank has only one brick/morter branch, and that they generally raise brokered deposits (from their recent FFIEC Call Report) or utilize on-line rate posting services, I can see why they prefer not to directly deal with retail customers.  It would take too many Bank employees and having Chris' firm manage the information/account requirement flow, this would be worth the fee that the underlying Bank is willing to pay to Chris' firm.  Using the Sauk Valley Bank, the underlying Bank is free to keep their identity more quiet, in case they want to raise certain maturity funds for a specific purpose, without affecting their other offerings/target customer types (institution vs. personal).

When you contact Chris, he will send you via e-mail many items about his firm's background, his resume of experience in this business line, several other bank specific agreements, etc.  My impression is that Chris is very good at what he does, has been doing it for several years and it may warrant our review.  However, a 10-year horizon seems a little long to me personally, but with the 6-month EWP penalty for early withdrawal, it might be worth it to some of the readers of this blog.

3
Comment #16 by Anonymous posted on
Anonymous
One problem I see with this CD is that they pay you the interest monthly, meaning that the interest does not accumulate.  So the CD penalty table that shows you what rate you have may not apply because there is no compound interest. 

2
Comment #17 by Anonymous posted on
Anonymous
Most CDs I see normally have interested added monthly so that in the end, the amount of interest your CD has always increases due to compound interest.  But by paying it out monthly, the amount of interest paid will always be the same, and if you withdraw the CD early, you're actually losing out on the prinicple rather than interest as you already got paid the interest and must pay taxes for it.  But I don't think you can get credit for losing principle when closing this CD early.

 

2
Comment #18 by ChrisCD posted on
ChrisCD
@Cactus - great questions.  It comes down to the required information that a bank has to collect and maintain on personal accounts.  By only accepting institutional deposits it keeps the paperwork they need down to a minimum.  It becomes ours (and Sauk Valley's) responsibility to make sure all information is collected before a deposit is made.  This saves them a lot of time dealing with missing paperwork and dealing with the various verifications that are required for personal accounts.

 

2
Comment #19 by ChrisCD posted on
ChrisCD
@OCSteve - Thank you for the initial review.  I appreciate it.

@16 - no the interest does not accumulate.  So the question is, will the interest you earn be more than a compounding CD?  Is that difference enough to deal with it monthly.

@17 - I will have to do research on whether or not the penalty can offset future taxes, since taxes had already been paid.  However, I do believe even with a CD that compounds the interest, you have to pay taxes on the interest earned whether or not you have received it. 

cd :O)

1
Comment #20 by lou posted on
lou
psjf, all the CDs I own I have purchased directly from credit unions or banks. I don't own any brokered CDs or any through a custodial bank, but It doesn't mean I wouldn't consider it if the terms were sufficiently attractive.

CD penalties can be deducted on the 1040, and, yes, you have to pay taxes on compounded interest in a taxable account.

I noticed that the 10 year treasury hit 2.41% today. Because of the interest rate risk, I would not be interested in it even at this rate. As for the CD that Chris is selling, I like that you can get out with only a six month penalty. Too bad you can't reinvest the interest.

1
Comment #21 by Anonymous posted on
Anonymous
I plan on keeping my funds in the full 10 years.  Givin the 2.38% yield for this CD vs the current 2.42% yield on the 10 year Treasury, why would I want to invest my money with 3 different parties involved in this "Custodial CD" ???????  

 

5
Comment #22 by ChrisCD posted on
ChrisCD
@21 -- If you are planning on holding the treasury or the CD for the full 10-years, it probably doesn't make sense.  The only advantage the CD has is the 6-month penalty.  Also, I believe the US Treasuries are State Tax exempt.  So unless rates move the other way, you are probably better off with the treasury.

2
Comment #23 by lou posted on
lou
ChrisCD, I think your CD is a much better bet than the 10 year treasury. Who really thinks the interest rate for the 10 year treasury won't get much higher than 2.41% in the next ten years. Much better to pay the 6 month penalty and not lose the opportunity of investing the money in a CD with a higher rate.

3
Comment #24 by Anonymous posted on
Anonymous
I hear that the CD deal ends on June 28.  I don't know if everything must be completed by that date for the offer to be valid, or would it be honored if you're still in process?

2
Comment #25 by ChrisCD posted on
ChrisCD
@24 - The funds must be received by the 28th.  After reviewing the information, the paperwork and account with the custodial bank can be completed in a day. And the funds could be wired the following day.  So once you are comfortable with the information it doesn't really take that long.

@lou - I appreciate your comments.  The 6-month EWP on the CD helps account for the fact that we don't have a crystal ball.  I don't think anyone could have imagined the longer-term treasury rates moving as high as they already did.  Bloomberg is still showing a 2.41%, but I don't think it has updated yet today.

1
Comment #26 by psjf posted on
psjf
Lou, thanks for the response.  I hear you on having the known EWP with this type of instrument vs. going with treasuries.  As bleak as the rate environment appears to be for the near term, there is no way I'm "risking" locking in 2.41% for 10 years without a known escape downside (e.g. defined EWP).  Unfortunately, a $100K minimum is just a little rich for me on an approach that i don't have any experience with yet and was curious if anyone else had any firsthand experience and could speak to what i'm missing, if anything.     

1
Comment #27 by ChrisCD posted on
ChrisCD
@psjf - I can offer three things. 1) a contact person at the custodial bank, 2) a reference from a personal investor that worked with us through a different custodian, and 3) references from our credit union clients that use us to help them find CDs. 

If you believe that would be helpful complete our contact form on the site or send me a PM from here.  I will only use your email to send you that info. 

cd :O)

1
Comment #28 by lou posted on
lou
Wow, the 10 year treasury is now 2.5%. I wonder if this is a secular change in rates or a temporary blip?

3
Comment #29 by paoli2 posted on
paoli2
Lou:  What happened with the 10 yr CD blip is the reason I could never tie up a large sum of money in 10 year CDs.  I think this is a time  for "watching" and waiting to see what else may be on the horizon.  It could mean I might miss a good deal but those are the chances one must take in these erratic financial times.

2
Comment #30 by lou posted on
lou
latest 10 year treasury rate:   2.54%

3
Comment #31 by KevinM posted on
KevinM
I scanned and did not see the answer to this question: is this available in IRA accounts? I assume not, since interest must be paid out, and there is no mention of the custodial transfer process typically used for IRA accounts.

Thanks,

Kevin

2
Comment #32 by ChrisCD posted on
ChrisCD
Kevin,

If you have an account with a company that allows for self-directed IRAs and outside investments it could work.  But Sauk Valley itself is not able to open an IRA account for you at this time.  Sorry.  Another reader has an account with Pensco and it looks like they would be able to do it.  They are going to call us Monday or Tuesday so I will report back.  However, timing may be too short to set-up an accocunt with them and get everything situated.  I don't know anything about Pensco, but we have worked with other similar companies in the past.  At least the info may be helpful for the future.

cd :O)

2
Comment #33 by Anonymous posted on
Anonymous
Maybe I watch American Greed too much but this deal sounds iffy to me. I'd stay away.

2
Comment #34 by ChrisCD posted on
ChrisCD
@33 - Considering we are offering a contact at both the custodian bank and the underlying bank you can confirm whether or not it is iffy. 

cd :O)

1
Comment #35 by Mark in Orlando (anonymous) posted on
Mark in Orlando
Sounds like a Ponzi... why would I need a "custodian" if I want to open a bank CD?

1
Comment #36 by ChrisCD posted on
ChrisCD
@Mark - First, do you think Ken would sponsor a post and take the time to promote a CD that is a Ponzi scheme?  I guess you could argue that I pulled the wool over his eyes, but I think Ken has been doing this long enough to know what he is doing.

Second, call my bluff.  Send me a PM and I will be happy to provide you contact information for both banks.   

Are the CDs that Charles Schwab, Fidelty, Vanguard, etc. a Ponzi scheme.  This works basically the same way.  Are brokered CDs for Goldman Sachs a Ponzi scheme because they go through such entities?  No.  Goldman Sachs find it much more effecient than dealing with tons of phone calls and reems of paperwork.  Some banks do both.  CIT Bank takes in a lot of brokered funds and they also take in funds direct.  They like diversifying their sources.

Why do you need a custodian?  You don't.  But that is the only way this particular CD is available to individuals.  We sent the bank about $35MM which has consisted of about 97% from institutional investors.  I read the forums here and blog posts and could see that people were on the lookout for some higher rates.  So I gave the info to Ken and he thought it could be a good opportunity for the DA readers. 

cd :O)

 

2
Comment #37 by Anonymous posted on
Anonymous
Mark:   Chris has 6 kids, a beautiful wife and teaches Bible Study.  Could Maddof say that?  Seriously, I don't like an intermediary between me and my CDs so this is not for me.  It's just a personal thing and nothing against Chris.   The main amount one needs to get a bit higher rate is too high for my liking.  I like to start smaller even with my new banks and credit unions until I know they are right for me.

2
Comment #38 by ChrisCD posted on
ChrisCD
@37 - Thank you for the kind words.  I won't pretend that Sunday School teachers never cheat people (although this one isn't :O) ).    And of course this CD isn't for everyone.  But, before labeling it a Ponzi scheme, ask for the info and make the calls. 

cd :O)

1
Comment #39 by Anonymous posted on
Anonymous
Chris (Re #36),

Possibly investors don't call Charles Schwab, Fidelty, Vanguard, etc. a Ponzi scheme because they have complete disclosure.  If I want a CD, I can get all the info about it on the brokers website, do my research and call them with questions. 

You are offering what appears to be a "good deal" but no disclosure.  If it's legitimate why don't you just post the information for all of us to review.  You asked a few posters to PM you for "some" info.  Why so secretive?

Many of us, if not everyone, have learned to check everything in detail since 2000.  Are you trying to make sure we can not find a way to get the CD without three parties being involved?  I'm sure everyone is getting a cut of the action.

 

2
Comment #40 by Anonymous posted on
Anonymous
#39  .  It is very obvious to me  why Chris doesn't give full disclosure in this forum about the CD the way we can get it with Fidelity and Vanguard CDs.  There could be readers who would see it and try to get the CD on their own cutting out the "Custodian".  Ok, so Chris works for this company as the Custodian and that is the way he probably makes some money.  You really expect him to give up what is basically his job?   When we want to disclose something to another poster on here which we don't want everyone to know, we PM them, right?  I think Chris is trying to protect his job as Custodian by handling it this way.  To be honest, this is not the way I prefere to buy CDs no matter if the rate is better.  I am too independent natured to want a Custodian involved.  However, there must be certain savers who want and need someone like Chris to be involved or he would not be able to do what he is doing.   Frankly, I was surprised Ken basically gave  Chris his ok to solicit in this group knowing the group as he should.   Many of us have a tendency to question even articles posted much less someone who offers CDs as Chris is doing.  I am not questioning Chris's intentions.  I just really question whether this group is the best place for him to  be offering his type of CDs.

3
Comment #42 by Anonymous posted on
Anonymous
#40  I agree with your comments.  I'm disappointed this was promoted on this website the way it was without any information regarding any fees (if any) that Chris and/or Jumbo CD Investments receives.

I checked the "Better Business Bureau, In the San Francisco Bay Area and Northern Coastal California."  I would have thought they would have been accredited.

Results:
This Business is not BBB Accredited Jumbo CD Investments, Inc.

1
Comment #41 by Anonymous posted on
Anonymous
I ask a simple question.  If you are planning on buying a 10 year term fixed income investment, would you buy this somewhat complicated CD or just buy a 10 year treasury which currently has a rate of 2.54% (16 basis points more than this CD that is being offered)?

3
Comment #44 by Anonymous posted on
Anonymous
#41  The only advantage this CD has is the 6-month penalty.  As I see it, too many disadvantages.

1
Comment #43 by lou posted on
lou
Chris has been a longtime and valuable poster at depositsaccount.com. I have looked at his website and I am convinced his company is legitimate and honest. If I saw a product from his company that made sense for me I would not hesitiate to do business with Chris, although i would do my due diligence first before I bought the CD. The use of the custodian doesn't bother me but I do wish the interest could be reinvested.

To #41, I would never buy a  2.54% 10 year treasury without an early withdrawal penalty. I am fairly certain we will see much higher rates in the next ten years.

Because of the 6 month penalty, this is not a bad deal. I think Chris mentioned there is no language giving the bank the right to refuse an early withdrawal. I would be interested in knowing if partial withdrawals are allowed. Think of it this way: if you hold the CD for one year, you would be the beneficiary of a 1.19% one year CD.

2
Comment #45 by ChrisCD posted on
ChrisCD
The BBB doesn't work for free.  Accredation is not free.  We simply choose not to seek it. 

People in any line of business don't work for free.  We are no different.  I knew this would be a tough crowd and we were as open as we could be while protecting the time of both entities we are working with. Ken (as I did) felt some of you would find this an attractive rate.  We were very upfront about the process.  Even the title of the post was clear that this wasn't an ordinary direct CD.  Some places would have just posted a title with the enticing rate.  But both Ken and I have more integrity then to try to fool the readers of this site.

It is funny that you mention how upfront Schwab and others are.  I have an account at Schwab.  I went to their website.  They don't provide a list of banks unless I log-in.  Setting up an account with Schwab (who acts as your custodian for CDs among other investments) is quote similar to the custodian bank (FDIC insured by the way).

And yes Treasury rates moved higher, making the the offer less attractive, but it still has the 6-month penalty option.  Treasuries do not.  Some asked if they allow partial withdrawals, they do not.

Many sites make money from ads.  Some of those pay on a per click basis, some of those pay when an account is created/funded.  This is the type that pays when an account is created/funded.

Some banks accept CDs of any size.  Some only work with larger amounts.  As someone mentioned early on, the underlying bank, by charter can only accept CDs that are $100,000 or more.  That already leaves many people out.  For that reason, the bank found it more beneficial to hire a company to help manage the process.  Because of the requirements for taking individual deposits, they also decided to only take institutional deposits.  Thus the only way it could be made available to individuals was to utilize the custodian bank. 

One of the early comments on this blog was from someone who contacted us.  In the email we sent them we provided them everyting they needed to determine if this deal was legitimate or not.  We will do the same for anybody else that contacts us. 

I appreciate the supportive comments from OC Steve and Lou.  And thank you to Ken for allowing us to bring this opportunity to your readers.

cd :O)

1
Comment #46 by Gina (anonymous) posted on
Gina
In my capacity as a credit union CEO, I have worked with Chris for approximately twleve years now and have purchased millions of dollars of certifiicates from him (including cusodial relationships).  I can't say enough about Chris and his firm!  I have always been impressed by their level of integrity and detailed disclosure. 

6
Comment #47 by Anonymous posted on
Anonymous
#46,  Right!!  Do you think we're senile?

1
Comment #48 by KevinM posted on
KevinM
Just want to thank Ken for bringing this to our attention, and to Chris for making it available to non-institutional investors.

Unfortunately I don't have $100K in taxable accounts looking for a safe home, but if I did, I would definitely have at least done the due diligence, and based on what I've seen posted here, I would have invested. I even looked at my existing CDs to see if breaking any of them made sense; one did (Barclays @1.85% with EWP of 90 days of interest), but that would've only gotten me half way to the $100K. Most of my CDs not in IRAs already are paying 2.4% or more.

Chris and Ken, I hope the negative comments here don't discourage you from bringing other such deals to our attention in the future.

Kevin

5
Comment #49 by Anonymous posted on
Anonymous
Has anyone on this site purchased the CD described above since June 18, 2013?  A simlpe "Yes" or "No" would be sufficient.

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Comment #50 by ChrisCD posted on
ChrisCD
@KevinM - I don't plan on going anywhere.  I do wish we had, had more time so some of the folks who had done the CD could post their own reviews.   I hope over the next couple of weeks a couple of those will appear and people will at least take the time to check us out.

Comment #46 is from a client of mine which I can independently verify if anyone wants to send me a PM.  I asked them to leave a note so that folks would come to realize we are not a fly-by-night organization. 

We do hope to have other deals that we can offer to readers of this blog.  Who knows we may even come up with a direct one at some point.  I realize starting with a direct one may have been better, but I also knew people were looking for better rates and this was the only way we could bring this offer to the table.

cd :O) 

 

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Comment #51 by KenBDG posted on
KenBDG
I have confirmed Gina's credentials (commenter #46).

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Comment #52 by lou posted on
lou
Chris, keep posting any CD deals your company may have in the future with or without a custodian. Don't let a few curmudgeon posters deter you from posting. I am sure that I speak for many of us who welcome your posts and look forward to seeing what CD deals you're offerring.

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Comment #53 by Anonymous posted on
Anonymous
@ChrisCD - Are you willing to disclose the number of people who purchased this CD(s) as a result of this post?

1
Comment #54 by Jeff Christman (anonymous) posted on
Jeff Christman
I just thought I would leave a quick note about this post. I am the CFO of a credit union with a large CD investment portfolio. I have dealt with Chris and Jumbo CD's for about 10 years. Not only have I  developed a great professional relationship with Chris but I also count him as a friend. He has always handled my account professionally and completely above board. I totally understand this investment may not be right for you and you may not be interested in it but you should not questions the validity of the investment or the integrity of Chris or Jumbo CD's. This is a great firm to work with.

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Comment #55 by Anonymous posted on
Anonymous
Am I supposed to be impressed with these ceo and cfo titles?  Real CEOs and CFOs don't have the time or interest to frequent these websites.

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Comment #56 by ChrisCD posted on
ChrisCD
@55 - you are right; as far as having time.  They really don't, but they took the time to help give some people some assurance that we are a real company, dealing with real banks, and real CDs.  I gave Ken the info he needed to verify they are a real CEO and CFO. Both of them have been clients and friends for years and both have used our custodial and direct CD programs.

@53 - We had four inquiries.  One was from OCSteve who provided a review of the process he received to help other readers.  One completed the CD.  One is pending. 

Additionally we received a request from a couple before this post went live and they both did one. 

We are working on a new deal for July.  Hopefully, it won't be under as much time pressure.

cd :O)

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Comment #57 by Anonymous posted on
Anonymous
What is your fdic registered number so I can check fdic qualifications at fdic.gov?

2
Comment #58 by Anonymous posted on
Anonymous
#57:  Are you kidding?  This guy isn't about full public disclosure.  He'll want you to PM him.

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Comment #59 by ChrisCD posted on
ChrisCD
I am not the bank.  I don't have an FDIC number.  We are not employees of Sauk Valley B&T.  Jumbo CD Investments is an independent company.

Sauk Valley B&T's (the custodian) FDIC#: 35131. 

I will provide the FDIC# for the underlying bank via PM or by sending us an email through our website.  I have already indicated why we aren't making that publically available. 

I will also provide you contact information at both banks.  However, at this point, it would be unlikely that a CD could be completed unless we worked quickly and I don't want you to feel that much pressure.  Nevertheless, future offerings may also be utilizing Sauk Valley so doing some due diligence now would still be a good idea.

cd :O)

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Comment #60 by ChrisCD posted on
ChrisCD
@58 - Interesting.  I have provided my name, a thumbnail picture, a link to our company website (which has a bigger picture), the custodian bank, the fact that it is a custodial CD, etc, etc, etc.  In addition, we gave all of the information to Ken so that he could do his due diligence before this went live back on June 18.

One of the readers did do a cursory review (OCSteve).  I guess you could say he sacrificed his email address to us to get the info.  He was kind enough to honor the request to not post the underlying bank's info publically, but provided quite a bit of background on them. 

I'm sorry it has not been enough to satisfy your concerns.  I hope that at somepoint in the future we can earn your trust.

cd :O)

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Comment #61 by Anonymous posted on
Anonymous
I would like to say that I am someone who has bought the custodial CD from Chris as a result of this post, and I can also honestly say that things went very smoothly without any hitches.  Chris was nothing short of a class act who was very prompt in answering questions and helping to get this done.  I understand our nature to be skeptical, and have dealt with others before, but in all honesty Chris is the real deal.  I would not hesitate to call on his services again. 

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Comment #62 by doitmyself (anonymous) posted on
doitmyself
I'm the type of person that needs to verify investments through my own "Checklist".  My initial screening takes less than 5 minutes.  This one failed on my first 2 items on the list.

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Comment #63 by Anonymous posted on
Anonymous
Do it:  Can you share what your first two items were that caused it to fail?  I think if you are going to post against Chris you should at least let us know why.  Thanks.

1
Comment #64 by doitmyself (anonymous) posted on
doitmyself
Anonymous - #63

I believe you're mistaken. I made one post (#62) and this one.  Therefore, I made no post against Chris or the firm he works for and see no need to discuss my reasons.

As a matter of fact, I don't see any post that made negative comments about Chris.

 

Take care.

 

 

mistaken

1
Comment #65 by paoli2 posted on
paoli2
#64:  If you think Chris's business is so great why did you have to put it through your 5 step Checklist and then post that it failed "the first two"?  Saying it "failed" is not a positive endorsement from my understanding so I was curious about which parts it "failed" on. 

If you don't think so many of the other posts were negative why do you think Chris has bent over backwards trying to prove to us he is legit.  He even got his CEOs to vouch for him and "they" got criticized!  It seems your idea of a negative post and mine are quite differently but I don't think Chris is jumping for joy from the responses he has gotten so far.

1
Comment #66 by doitmyself (anonymous) posted on
doitmyself
paoli2  You stated in post #65:

"If you think Chris's business is so great why did you have to put it through your 5 step Checklist and then post that it failed "the first two"?"

Where did I state that?  Or did you write the post in your sleep?

3
Comment #67 by paoli2 posted on
paoli2
#66:  Sorry but I don't write or read posts in my sleep.  I am not that gifted.  But I do know what is still posted under your name:

"I'm the type of person that needs to verify investments through my own "Checklist".  My initial screening takes less than 5 minutes.  This one failed on my first 2 items on the list."

Since this thread is mainly about ChrisCD and his Custodial Accounts, was I wrong to believe you were posting about verifying these investments throught some checklist you have.  By stating it "failed" the first 2 items, I would understand you were not putting it in a category of investments you were interested in.     If someone was reading posts trying to decide one way or the other about Chris's CDs, I think your post was not going to help them decide "for" them.  What does "fail" mean to you?  If it failed your test and I read so many of the other posts not exactly thrilled by these type of CDs, I would not think I should be going in that direction.  If there is any other interpretation of what you posted, I would be interested to know what it is.  Did it PASS the other 3 of your tests on the checklist and you didn't bother to post that?   Before you call me down on what I responded, I think you need to reread what you really posted and how it can be understood.

1
Comment #68 by doitmyself (anonymous) posted on
doitmyself
paoli2:  Your need to read more carefully:

You stated in post #65:

"If you think Chris's business is so great why did you have to put it through your 5 step Checklist and then post that it failed "the first two"?"

 

Where did I state that "Chris's business is so great" as you stated in your post.  I never commented on Chris or his business.

2
Comment #69 by paoli2 posted on
paoli2
#68  I did not say YOU wrote that you thought Chris's business was so great I was making an inference to what "I" understood your post to be saying.  In other words, "If you "had" thought his business was so great you would not have had to put it through your checklist.  By posting it had failed the checklist, it gave me the opinion that you would not be using his services.  The point is that words can mean diffferent things to different people and I was just referring to what your words meant to "me".  If you meant something else then that is fine.  However, words are words and when something "fails" it always means it doesn't "pass" from my understanding. 

We go round and round on this one post and yet you still refuse to share what your 5 criterias are that you test an investment by.  I would really be interested in knowing since it might be helpful to myself and others.  BTW, I think everyone should have criterias by which they decide whether or not they will take part in an investment.  It can be financially dangerous not to.  I think you are wise to do this.  I just would personally be interested in knowing what they are.  Thanks.

1
Comment #70 by doitmyself (anonymous) posted on
doitmyself
paoli2:

You have implied you have your own personal checklist or something similar to evaluate investments (CDs, etc).

Please share yours, then I'll post the 5 initial quick checks I do.

1
Comment #72 by paoli2 posted on
paoli2
#70  I'll meet you in the middle.  Just post the first two you said he failed and I will tell you if they are the same two reasons he would have lost out in my list.  Just curious.

1
Comment #73 by doitmyself (anonymous) posted on
doitmyself
#72  You're hilarious!

I already know why you rejected them.

1
Comment #74 by paoli2 posted on
paoli2
#73  Thanks!  I usually charge for entertainment but tonight is freebie night. :)

Sorry to disappoint you but you have no idea why I rejected Chris's CDs.  You must not be too good at playing poker.  You don't get to see my hand until you show yours.

1
Comment #75 by doitmyself (anonymous) posted on
doitmyself
#74  Thanks for not charging me.  My budget for entertainment is exhausted for this week.  New budget starts tomorrow (entertainment doesn't qualify for emergency fund).

As I previously said, I already know why you rejected them regardless of what you think.  Want to find out if we agree?  Then show your hand.

You're probably right about playing poker, since I don't.  But I do a **** good job at investing!

I tend to believe my list uses methods you never heard of, since I've been in the IT profession for over 30 years and have had a PC since 1985.

1
Comment #76 by doitmyself (anonymous) posted on
doitmyself
#74  Bye the way.  If you saw my resume, your mouth would drop and your false teeth would fall out!

1
Comment #77 by paoli2 posted on
paoli2
#76   False teeth???  You must be looking at yourself in the mirror or you're posting from your nursing home!   If you saw MY resume what was left of your hair on what may soon be a bald head would fall off!  So either put up or close up.  Your resume can never come up to what I have managed to achieve out of practically nothing with my $3.00 course!  The trophy goes to me so find something else to win for yourself! 

Poor dear ChrisCD must think we are truly nuts.  All he wants to do is earn a living with finances and now he is seeing how off the wall it can make people.  (Except "me".  I managed to win the game and keep my sanity too.)    So poster person, either share and maybe learn more from a pro or I'll just say goodnight to you and go chew on a piece of taffy since I still have ALL my teeth!  If you hurry, you can still get to the drugstore and get some of that stuff to save what's left of your hair. :)

1
Comment #78 by doitmyself (anonymous) posted on
doitmyself
#77  Your right, it's probably time for you to say goodnight, since it's past your nighty night time. 

Besides I need to start working on my consulting job of installing software on web servers in CA, IL, and NJ tonight.  All from the luxury of my home.

Been nice chatting with you.  And the entertainment was both hilarious and free.  Maybe next time I'll feel sorry for you and give you some free financial education.




P.S.  I have a full head of hair, and same with my parents.  I guess it's good genes.

1
Comment #79 by paoli2 posted on
paoli2
#78  Good Morning.  You may have a full set of hair but "I" have "wisdom" and you can't buy that.  So what you really are is a young financial advisor doing computer consultations until he can get more customers??   BTW, the last time I paid for financial advice, it only cost me $3.00 and what it was worth to me no financial advisor could ever match.  You don't have to "feel sorry" for me.  If you have been posting long enough on DA, you would know Paoli has "teeth" and can take care of herself.  However.......I would love to find out that you are not just blowing smoke and have something worthwhile to share.  So.......IF you are willing to share, I will be willing to read it and maybe just maybe even be able to compliment you on something.  Probably on having a full head of hair ??  :)  So wake up and put up.  I have an appointment to go to.  (Yes!  The Nursing Home lets us out once a month to go to appointments or see an old Roy Rogers movie or to get our plates tightened! :)  Later.

1
Comment #71 by paoli2 posted on
paoli2
Sorry Charlie but you were the one who first introduced Checklists in this thread.  If you want to know mine, you'll have to show yours first.  I bet my list is far more accurate than yours anyway since I have been at this so much longer than you have.  We may even have some of the same checks.  Do your fellow posters a favor and share yours with them.  

1
Comment #80 by ChrisCD posted on
ChrisCD
Boy, I go home for the weekend and all heck breaks loose.  :O)

Anyway, it appears I'm no closer to winning either of you over. So if you both want to help me out, how about we call it a draw and both of you post your lists.  :O)

Just to be clear, this particular offer is closed, but we hope to have another one in the near future.

Have a great week everyone.

cd :O)

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