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When A Broker Offers A Bank CD: It Pays To Do Some Research

Wednesday, May 22, 2013 - 3:44 PM
From the FDIC

"Use a reputable deposit broker. The FDIC does not have the authority to examine, approve or insure deposit brokers, who can be anyone from an individual transacting business alone from a home office to a major financial services firm..."   

"In one recent case, a high-rate brokered CD was issued by a foreign bank and therefore not protected by FDIC deposit insurance. However, the marketing materials for the CD included multiple misleading references to an FDIC-insured bank, and that led consumers to mistakenly believe that the investment was subject to FDIC insurance. In reality, the role of the FDIC-insured bank was limited solely to wiring collected deposits overseas to the issuing bank."

more at   FDIC: FDIC Consumer News Spring 2013 - Protecting Your Plastic from High-Tech Criminals
cactuscactus51 posts since
Jan 17, 2010
Rep Points: 384
1. Wednesday, May 22, 2013 - 6:57 PM
Any Brokers I have ever purchased CDs from make it quite clear that the purchaser is responsible for anything and everything to do with the CD.  It is not their responsibility to do our research.  I, have at times, told our brokers that they were selling CDs with terrible ratings but all they care about is if it is FDIC insured.  At least my brokers do only buy FDIC insured CDs to sell to customers.  But I always want to know the financial status of any bank I am getting it from and that is not their business.  They could care less.
paoli2paoli21,406 posts since
Aug 10, 2011
Rep Points: 6,152
2. Thursday, May 23, 2013 - 5:04 AM
brokers and lawyers the world would be a better place with less of them imho
MARK4MARK46 posts since
May 22, 2013
Rep Points: 12
3. Thursday, May 23, 2013 - 6:50 AM
This thread is a duplicate of one posted 5/22 9:38am. 
pearlbrownpearlbrown1,491 posts since
Nov 2, 2010
Rep Points: 6,490