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Dollar Savings Direct: 2.05% APY Emigrant Clone
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Sometime in the last month or so, (or longer, I have no idea honestly) a new high yield savings bank appeared with little fanfare or press: Dollar Savings Direct. It’s a division of Emigrant Bank, FDIC Certificate #12054, which is the same parent company of Emigrant Direct. On the face of it, it appears there’s little difference besides interest rate and minimums. Dollar Savings Direct has a higher APY at 2.05% but has a minimum balance of $1,000 but no fees (if your balance falls under the minimum, you earn only 1%). If you go to their respective homepages, they’re designed with nearly the same elements (layout is the same except on Dollar Savings you have a picture of Benjamin Franklin versus a patriotic top hat, the buttons are basically the same, color-schemes, etc).
What’s the deal? Well, I called Dollar Savings Direct and chatted with a very nice CSR who explained the whole story. She confirmed that there was no difference other than APY and minimums, that was interesting. She also explained that Dollar Savings Direct was merely Banco Fortuna, Emigrant Bank’s foray into the Spanish-speaking banking market, rebranded in English. I suppose Emigrant’s foray wasn’t as productive as they had hoped. If you visit the Banco Fortuna homepage, it redirects you to Dollar Savings Direct, confirming the CSR’s explanation.
So, from someone who didn’t know about Banco Fortuna (or that it was going away), it appeared as though Emigrant Bank was trying to get more deposits without having to pay their existing Emigrant Direct customers. It now appears that isn’t the case.
The last question I had for the CSR was whether I could transfer between the two accounts and she said no. They were two separate banks, despite having the same FDIC certificate, so to transfer funds you’d need a checking account intermediary.
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The real question is why they didn’t just have Emigrant buy out the assets of Banco and use the Emigrant brand on it.
As an Emigrant Direct client, I still find it pretty frustrating — regardless of what they say, they are still getting new money without raising the rate for existing clients; regardless of what the actual bank’s name is, its all the same parent company… all seems very silly, and certainly doesn’t help make me feel like a valued customer (which is important when you are no longer a rate-leading bank)
I second Richard’s sentiment.
I’ve already moved most of my money out of Emigrant Direct to Countrywide.
(And after the BoA merger, I’m thinking I need to move it out of there as well…)
It does seem a bit shady, but I’m glad to find out about it.
Thanks!
I wrote an email to EmigrantDirect asking why they had set up Dollar Savings with a higher interest rate for essentially an identical account as EmigrantDirect. The rep wrote back explaining that the difference is that DollarDirect requires a $1000 minimum deposit, and explained how money could be transferred out of my EmigrantDirect to the linked account, then sent back to a newly-opened DollarSavings account. I wrote back that this seemed a counterproductive way to deal with EmigrantDirect depositors. If they want depositors to keep $1000 in an account do it by paying the premium interest rate when you maintain that balance. Don’t make me have to re-do all the automatic deposit and bill-payer arrangements I have already set up! Asked them to pass along the advice to their marketing department.
If you knew that Emigrant Direct’s parent company is BancoPopular (a bank in Puerto Rico, a country which primarily speaks Spanish), (this like pulling teeth from the CSR) you would understand that this new offering is no more exploiting the “Spanish population” than the old one was. Therefore the conclusion to the creation of dollarsavings is truly the fact of attracting new customers without paying loyal customers an additional dime….(not a Spanish thing)
I too emailed them asking why I needed to go through the time and pain of a new account application process when they account I have would otherwise qualify for that rate at the same bank. They answered that it was necessary and that I would have to move money around using an intermediary.
I made it simpler… I just transferred all but a buck to another online savings account I already had that had a slightly better rate than Emigrant anyway. I told them I would do that and I kept my promise. I hope they learned that customers see that as outrageous.
I also called them to ask why the discrepancy… it’s obviously a ploy for new deposits while screwing loyal customers. I wasn’t considering moving my money before, but now I am. Great job, Emigrant!
Shady. I’ve been a customer of EmigrantDirect for years, but this irks me. Throwing up a clone website with a different rate to bypass existing customers, wasting my time by asking me to open a new account…. No thanks.
Wow! I’ve been looking around at other online banks since Emmigrant’s rates have fallen so much in the past 6 months or so. I was initially happy that they were one of the highest when I opened my account 18 months ago. In my searching it seemed a lot of people had problems with other banks, but most had good experiences with Emmigrant. I was going to just stick with Emmigrant and hope the rates go up, but after seeing this I am going to look at moving all my money from Emmigrant to perhaps FNBO. This irks me. Time to do some research on FNBO.
The FED did a rate cut of 0.5% today but did anybody notice Dollar Savings actually increased their advertised rate to 4%. Hope this is all good , I was a bit alarmed to read on this blog that they are owned by Banco Popular when they say that Emigrant was started by Irish Emigrants and all the flag waving on the site. I am happy with the service but just hope there is no funny business and I am trying to get my savings back from the FDIC. The times we are in have left us all a bit scared about stability of the banks.
Emigrant probably needs to raise deposit levels after those like myself emptied our accounts after what they pulled with this different Web site.
They should have done what ING did a couple of years ago… they ran a “winter savings special” or some-such named program where all new deposits during the period got an extra half or full percentage point. Sure people may have moved money back out after the program, but at least existing customers could move new money in and get some benefit.
Emigrant gave the finger to its customers on this one. Fine by me, it was easy enough to move my money to another bank. I was with them for years and was happy, but the customer-hostile move was enough to have me bail. It was much easier to transfer my money out and fire them as one of my banks than it would have been to fill out new applications just to get the rate the same bank is offering… it was just stupid.
Emigrant is NOT affiliated in any way with BancoPopular. Why someone would post such false information is … nuts.
In fact Emigrant is the largets privately owned bank in the country…USA.
If you read the top of the blog it says Banco Fortuna and the link points to Dollar Savings Direct.So what is the relationship to the spanish bank.
EmigrantDirect and BancoFortuna are both divisions of Emigrant Bank in NY. In the summer of this year Emigrant Bank changed the name of BancoFortuna to DollarSavingsDirect and instead of continued focus on spanish speaking people, began offering a higher yielding deposit account catering to persons willing to make a minmium balance initial deposit.
NOTHING at all to do with BancoPopular.
There’s is also another difference between these acounts. Dollar pays interest monthly so if you close the account before interest is posted you loose the interest for that month. With Emigrant you could interest for every day your money is on deposit.
Look, i know it’s a pain if you’re an existing emigrant bankcusstomer to have to close out the account and open a new one at Dollar Savings Direct, but it’s worth it for the 4% interest rate. So i did it. the bank that has my checking account made things really complicated, they just couldn’t figure out how to link, or maybe they didn’t want to. anyway, ever since that was straightened out, i’ve been very happy with my new DSD account and online transfers are seamless, though it’s irritating it takes several days (apparently something common to many online banks) for my deposit to be “useable.”
Can anyone tell me if Dollars Savings Direct and Emigrant Direct are truly owned by Emigrant Bank and they shared the same FDIC certificate number 12054? I would like to see the FDIC certificate 12054 that covers Dollars Savings Direct but I have not obtained one yet.
When I transferred my money to Dollars Savings Direct in Oct. 08, to ensure that Dollars Savings Direct is truly FDIC ensured, I requested copy of the FDIC certificate to be mailed to me and I received email from Dollars Savings Direct that the FDIC certificate number is 12054 but they have not sent me the copy of the FDIC certificate.
When I checked FDIC website, it shows the certificate number 12054 is for Emigrant Bank, not for Dollar Savings Direct. I also see a separate FDIC certificate number 58440 for Emigrant Direct bank, a division of Emigrant bank. But I don’t see a separate FDIC certificate for Dollars Savings Direct. I asked them to explain it to me but received a standard email reply indicating the FDIC certificate number for Dollars Savings Direct is 12054 with no explanation of why Emigrant Direct maintains a separate FDIC number 58440 on FDIC website (www.fdic.gov), NOT 12054 and no FDIC certificate was sent.
Since Emigrant Direct bank (as Dollar Savings Direct), also a division of Emigrant Bank, maintains a separate FDIC certificate number as it is shown in FDIC website, I was wondering why they did not share the same FDIC certificate number with Emigrant Bank? EmigrantDirect’s FDIC certificate number is 58440, NOT 12054, while DollarsavingsDirect does not have its own FDIC certificate number.
Recently I received following response from Dollars Savings Direct:
“Dollar Savings Direct and EmigrantDirect are online divisions of Emigrant Bank. Emigrant Bank’s FDIC certificate number is 12054. Emigrant Bank at one time considered making EmigrantDirect its own financial institution and was issued a certificate number by the FDIC. That number was 58440. Management made a business decision to keep EmigrantDirect an online division of Emigrant Bank. Thus EmigrantDirect is covered by Emigrant Bank’s FDIC certificate number 12054.”
It all goes back to “buyer beware.”
I don’t see why this is such a big problem. You should always do your homework, and when you do, you’ll find that Dollar Savings Direct (DSD) has a higher rate than the old Emigrant Direct. I was with Emigrant Direct and simply closed that account once i created the new Dollar Savings Direct account.
As far as i know, DSD still offers the best rate so that’s why i’m still with them. Yes, it appears that Emigrant is trying not avoid having to give the higher 4% DSD rate to existing Emigrant Direct customers, but what else is new? Have you ever found a bank that didn’t try to maximize its profits and minimize yours?
If you’re irritated with this pratice, fine, complain to the bank, but don’t let your irritation stand in the way if just going with the best damn rate you can find. You’re just hurting yourself.
Thanks New Jersian for the research on Dollar Savings Direct. I also have my money with DSD and also share the same concerns. I like the higher rate but am concerned about whether it is in fact FDIC insured.Anyone who thinks this is overly paranoid check out the FDIC failed banks list, there are 23 so far this year as opposed to only a few in previous years.
http://www.fdic.gov/bank/individual/failed/banklist.html
Is there any way we can contact the FDIC directly to get an answer on whether they are in fact FDIC insured?
How about this: name one bank operating in the US that ISN’T FDIC insured.
Hi John,
To check if dollars savings direct is FDIC insured, you can contact FDIC directly. I received an email from FDIC indicating that DSD is an online division of Emigrant Direct Bank. Please let me know the outcome of your contacting FDIC.
I work for Citi (aka Citigroup, aka CitiFinancial, aka CitiMortgage, aka Citi…..etc etc) and I have a few Citi issued credit cards – - each of which has a different interest rate.
As “fern” stated earlier, every financial institution is looking to maximize their profits — not ours! How many times has your phone, cell, cable, electric, mortgage or insurance company contacted you and said “hey, we have a cheaper rate for you”? It has probably never happened (unless they offered you a new one, two or three year contract).
I too have been with Emigrant Direct for a few years and I’m more than grateful for the interest rate they offer(ed); it has beat the rates offered by my Credit Union rate big time! .25% VS 3.0% + — ya, that’s a major difference!
I’ll open a Dollar Savings Direct account and transfer most of my Emigrant Direct $$$ to that account, but I’ll keep my Emigrant Direct account open just in case their rates go higer than Dollar Savings. It’s all a ‘cat and mouse’ game and I’ll do what I can to maximize my “profit” (interest earnings)…
I’m glad I came across this page – - more $$$ for me!… LOL
I called up the FDIC at their 800 number and asked them particularly about DSD… The lady told me yes that is FDIC insured….
You guys call the 800 number and ask for yourself if you doubt it…..
Incidentally, that number is 877-ASKFDIC (877-275-3342).
I”m looking for a place to park some money for 3 months. In their Disclosure Statement they say the following”
“Refusal to Permit Withdrawal
The Bank may refuse to permit withdrawals in cases such as, but not limited to, the following:
The Bank chooses to exercise its legal rights to require up to 60 days advance written notice of any intended withdrawal from this Account and the 60 days have not passed since we received the required notice from you;
The withdrawal would consist of funds deposited in the form of a check or other instrument and is not yet available for withdrawal in accordance with the Bank’s Funds Availability Schedule.”
Has anyone experienced this?
They do place a hold on deposits for a week and it does not show up on balance available for a week. I have seen no problem with withdrawals , 2 business days max.
I recently came across a difference between Dollar Savings Direct (DSD) and Emigrant Direct (ED) (I opened a DSD account a little over a month ago). ED allows you to initiate transfers from another institution, but DSD does not. This means that I can, for example, pay my credit card bills from ED (though I have to stay under the 6 outgoing transactions per month limit) using the routing and account numbers, but this is not possible with DSD. I tried setting it up, and DSD rejected the transfer, and when I called them, they said that they do not allow such transfers. What I used to do was have my paycheck directly deposited into ED, and then have my credit cards draw from ED, so that I could maximize the time that my money was earning interest, and I was hoping to continue this scheme with DSD, but it doesn’t seem to be possible. If anyone has a work-around, please share.
On a separate note, I think those of you who are upset with ED are missing part of the picture. What you are not realizing is that ED would not be offering such a high rate if they had to pay it to all existing customers. You should be glad that they are offering such a high yield, given the current rate climate. Also, claims of “customer loyalty” are suspicious, because the only reason that anyone opened an ED account was because they used to offer the highest rates.
What you are not realizing is that ED would not be offering such a high rate if they had to pay it to all existing customers. >
If they had instead established the higher rate for $1000+ balances in existing ED accounts then what is the difference? That would be more expensive than setting up a new site, a new routing mechanism, and losing deposits from so many customers turned off by the move?
I moved several tens of thousands out because they did this. Banks need capital coming in now, not going out. Dumb move.
The difference is that if they automatically gave all customers the higher rate it would cost them more than having only some customers switch. Also, the DSD site is identical to ED, so they couldn’t have spent much developing it.
It’s of course hard to say how much they may have lost from alienated customers, but as I said before, I think customer loyalty for high-yield online savings accounts can’t be worth that much, since it’s so easy to transfer money around, and there’s a limited customer relationship.
The discussion regarding FDIC insurance and the relationship of DSD to Emigrant is addressed on the DSD web site. At the top of the DSD home page is the heading entitled “Account Highlights”. The last bullet under that heading says “Have a question? Visit our FAQ page.” Click on that FAQ bullet and then read the first two questions and the answers to those questions.
I recently put to the FDIC, at its online site, the question of whether money placed with Dollar Savings Direct “is or is not protected by FDIC”. This morning, I received the FDIC’s somewhat equivocal answer, which, after noting Dollar Savings Direct’s stated assertion that it is a “division of Emigrant Bank” (which is FDIC-insured), includes the response:
“[W]e cannot confirm that Dollar Savings Direct is Emigrant Bank’s affiliate.”
I set out below the entirety of the FDIC’s response, which opens by restating my question in full. By all means, read it for yourselves. I welcome comments on the significance of the FDIC’s answer.
Jeff
Date: January 2, 2009
Ref No: SCC2008W-* * * * * *-0
Dear [Jeff]:
Thank you for contacting the FDIC. In your email you asked the question:
“I have recently opened an ONLINE account with an institution that calls itself ‘Dollar Savings Direct, A Division of Emigrant Bank, since 1850′. The institution’s website, found here,
says ‘all accounts are FDIC insured, as applicable.’ I am trying to ascertain whether the money I have put into this institution is or is not protected by FDIC. Using your Bankfind feature, I see that there is no institution called ‘Dollar Savings Direct’.
(There is, I see, an institution called ‘Emigrant Bank’, which evidently does have an FDIC certificate, but that certificate may or may not be protecting the money I have invested; I simply cannot tell.)
(Note that your computer insists that I enter a City and State for the institution in question. I have accordingly entered ‘New York, NY.’ But please bear in mind that it is precisely because I have NOT entered a brick and mortar building but rather invested online with Dollar Savings Direct that the ambiguity, and hence my inquiry, presents itself.)
In any event, there is enough ambiguity to concern me deeply. I point out that Dollar Savings Direct is currently offering one of the highest APY rates (4.00%) in the entire country and surely many; many others have similarly invested large sums with this same institution. Surely, these many others are raising — or, at least should be raising — the same inquiry that I am. Thank you in advance for your response to my inquiry.
Because the matter is, clearly, a profoundly important one, I am sure you will understand how much the matter concerns me — as, again, it concerns, or certainly should concern, many other investors.”
[Here begins the substantive portion of the FDIC's answer:]
The FDIC requires all banks to provide the FDIC with their reported (or primary) website. Dollar Savings Direct has not reported a website to the FDIC. Emigrant Bank has reported their primary website as . In reviewing Emigrant Bank’s and Dollar Savings Direct’s websites, there are no direct links to one another’s site. On Dollar Savings Direct’s website,
,
it does state
“DollarSavingsDirect, a division of Emigrant Bank, Member FDIC, Certificate No. 12054”.
The FDIC has not been told specifically by either Emigrant Bank or Dollar Savings Direct that
is its primary website; therefore we cannot confirm that Dollar Savings Direct is Emigrant Bank’s affiliate.
If you have any further questions regarding deposit insurance coverage, please contact the FDIC Call Center at 1-877-275-3342, Monday through Friday, 8 AM to 8 PM Eastern Time.
If you wish to learn more about FDIC deposit insurance coverage, please see our brochure “Your Insured Deposits,” which provides answers to the most frequently asked questions about FDIC deposit insurance. This document can be found on our web page at: .
As part of our ongoing efforts to improve our service to the public, we would appreciate it if you would complete a short questionnaire on the level of service you received from this office. The questionnaire can be accessed at .
We hope this information is helpful to you.
Sincerely,
Federal Deposit Insurance Corporation
Division of Supervision and Consumer Protection
550 17th Street, N.W.
Washington, DC 20429
I thought I would post additionally the follow-up inquiry I have just put to the FDIC. If I receive a substantive response, I will post that, too.
Jeff
My follow-up inquiry to the FDIC, e-mailed a few moments ago:
Dear Sir or Madam:
Thank you for your initial response to my recent question.
The substance of your reply — that because
1) in apparent violation of FDIC requirements, Dollar Savings Direct has yet to inform you of its primary website and
2) Emigrant Bank has reported to you a primary website different than that maintained (though evidently not reported) by Dollar Savings Direct,
you “cannot confirm that Dollar Savings Direct is Emigrant Bank’s affiliate” — leaves me with a modicum of disconcerting ambiguity.
More particularly, and since Dollar Savings Direct is openly proclaiming that it is an affiliate (”division”) of Emigrant Bank and therefore that it is FDIC insured (”Yes, to the maximum allowed by law”),
https://www.dollarsavingsdirect.com/DollarSavingsDirectWeb/en/common/information/FAQ.jsp#2
and since you have stated that you are not satisfied that it is either (for the reason you cite above),
is it the FDIC’s intention to insist either that Dollar Savings Direct satisfy you that it is an affiliate of Emigrant Bank (and therefore covered by FDIC) or that Dollar Savings Direct cease proclaiming to the public that it is FDIC insured?
Again, I assure you that there is a great deal of public interest — in every sense of the phrase — in the FDIC’s position on this issue. I thank you for the response that you have initially made, and I look forward to your considered response to this important, follow-up question.
Jeffrey * * * * * *
Thanks Jeff.
I called FDIC today and had spoken to a FDIC deposit insurance specialist. She first asked me to call Dollar Savings Direct for the legitimacy of the relationship between the parent company and its division. After I asked if it is FDIC’s responsibility to enforce the requirement. She said that she would get back to me on Monday. I will share her response to other investors.
I visited Emigrant Direct website, http://www.emigrant.com. I did not see the link of DSD as its division on the website and they suppose to proclaim DSD is their online division and was also insured by FDIC in their primary website – http://www.emigrant.com. I called DSD, they said because it is so new, they did not have time to update their website yet.
These developments are really scary… when I look at the 1099 I’ll be getting, the Payer ID (tax id) is 13-5052245, or Emigrant Direct’s ID number.
Does anyone know if Emigrant Bank (the parent company of Dollar Savings Direct) use the same tax ID 13-5052245? If DSD shared the same tax ID with Emigrant Bank, then I believe they are the same business entity and FDIC insurance applies.
These developments are scary, what I am concerned is that if DSD goes belly up the FDIC won’t even react and they don’t know where our money is.I am considering moving to a brick and morter CD or at least a more reliable on-line account if we cannot get re-assuring answers soon.
Just one more thing I noticed in the FAQ’s on the dollar site the routing (ABA) # is 226070403. https://www.dollarsavingsdirect.com/DollarSavingsDirectWeb/en/common/information/FAQ.jsp#15
If you look that up, it is registered to Emigrant Bank.
http://www.routingnumbers.org/bank_routing_number_226070403.html
It’s strange the FDIC has no info on them, but so far with the tax ID # and ABA matching Emigrant, it sounds like they are legitimate. Curious to see the outcome of the FDIC rep getting back to “New Jersian” on Monday.
Thanks Adam to provide the information. I called DSD and wanted to establish second ACH link for another bank and was told the same routing (ABA) number. If it is the same ABA number with Emigrant Bank, it makes me feel better that DSD may be covered under FDIC. I am going to ask FDIC when they get back to me on Monday if parent company and the different divisions suppose to share the same ABA number.
FDIC has verified that Emigrant Direct is the online division of the Emigrant Bank but they can not identify DSD. They said that a bank does not have to notify FDIC about their online division. Some banks do and some don’t. In my call to FDIC on Friday, one person asked me to find out the legitimacy of the DSD with Emigrant Bank. I was wondering how can we obtain the legal documentation from Emigrant Bank about the relationship? I had asked Emigrant Bank but only obtained verbal verification that DSD is a division of Emigrant Bank.
Firstly, I am not sure about whether or not comments to this site must be approved before posting or not, but the same comment was very long with a lot of technical details (yes this adds to the discussion!) so I’m not sure if it got rejected for a posting limit or not. No error message or confirmation was given with the previous submission, and nothing was displayed after posting. Feel free to delete the previous post (with the same content as below) if it did go through.
I did whois queries for dollar savings, emigrant, and emigrant direct websites. This proves, at best, who is the legal registrant of the domain names in question (dollarsavingsdirect.com, emigrant.com, etc.) as well as where the DNS servers are, which would indicate where the websites are hosted. At the link below are all the technical details of what I found, but here is what it actually means:
Keep in mind that the definition of a domain name is the first part of a website address. Domain names, for example, would be google.com, odu.edu, dollarsavingsdirect.com, emigrant.com, and so forth.
This is what it means: dollarsavingsdirect.com, emigrant.com, and emigrantdirect.com All use Network Solutions and don’t provide their real physical address but instead a proxy service by Network Solutions (quite common for domain owners to use this service). All 3 have DNS services at Worldnic.
Since Network Solutions will provide said services to anyone (And I suppose worldnic as well) there is the POSSIBILITY that IF dollar savings is a “rogue bank” and lying about emigrant affiliation, they simply registered the domain in the same way and have DNS services at the same place (entirely likely)
Now, here is the scariest part: emigrant.com and emigrantdirect.com expire in 2013 but dollarsavingsdirect.com expires on MARCH 29, 2009. If dollar savings does not renew their domain name by that time, they will lose control of that domain name and it is highly likely some other entity will take control of dollarsavingsdirect.com and extort lots of money from the previous owners. (This scenario applies to the domain name ONLY and does not actually extend to any deposits or money put in the bank.)
Hope this helps, and thanks for reading so far. All the details on everything the whois queries said are at the following link: http://pastebin.com/f7cf6ebce
–Dave
Is it worth all of this worry for an extra ~1% (at best) from an online account?
I had an account with Dollar Savings Direct. It dropped to a one star rating after I opened the account.
It says it is The Emigrant Bank of New York, NY. If you do a search on this bank, you’ll that it too has the one star safe and sound rating from bankrate.com; the lowest rating in its peer group. This is because they lost money in the quarter ending Sept. 30, 2008 and were (are still I assume) apparently holding a lot of commercial real estate and construction loans
The worry about losing my money prompted me to close out this account which went along without incident luckily.
EMIGRANT BANK
NEW YORK, New York
Bankrate.com Star Rating: one star
more here: http://www.bankrate.com/brm/safesound/thrftmm.asp?fedid=137915
I personally do not believe that it worth the risk, especially considering that its FDIC certificate maybe be expiring fairly soon as is noted above by another poster.
Thanks but no thanks.
I believe the domain name is not the same as the bank server. It is unlikely that people can take money out of bank server even they did not renew the domain name. The previous poster (Dave) did not say that the FDIC certificate will expire fairly soon, but the domain name. We may be a little paranoid, if DSD shared the same tax ID with Emigrant Bank, then I believe they are the same business entity thus the FDIC insurance applies. I am not concerned if DSD is FDIC insured even the bank has one star rating.
So any suggestions on a safer on-line bank right now, looks like nobody comes close to 4% APY but I am willing to give up some returns for safety.I don’t like the idea of being locked into a CD for 6 to 12 months and looks like the rates on 6 months is pretty bad right now.
John,
I just opened a savings account with GMAC. The rate is at 3.2% for now. They are also selling 1-year CDs at 3.75% which is pretty good rate given the way things are right now.
I do have a friend that has accounts with GMAC and he told me that they are professional in the way they operate and that he is satisfied with their service.
GMAC is rated four stars (sound rating) by bankrate.com which makes me personally feel a lot better about having my money in an online account.
Here is a link to other possible online banks that have money market and/or savings accounts with their rating shown by bankrate.com.
http://www.bankrate.com/brm/rate/mmmf_highratehome.asp?params=US,416&product=33
I hope this helps.
The Jaundiced Eye
I believe DSD is in fact a division of Emigrant and therefore covered by the FDIC. But let’s consider a worst-case scenario: DSD is a “rogue” bank, it goes belly-up, and it turns out that it wasn’t FDIC insured, despite claiming that it was. I’d be willing to wager that the FDIC would still bail out the depositors. Why? Because people today have no confidence in the banking system. Everybody’s scared. If a bank falsely advertised itself as FDIC-insured and then depositors lost their money, the publicity would cause everyone else to question whether their own banks were lying about FDIC coverage. It might cause a panic. The Feds wouldn’t allow that to happen.
As recently as this past Friday morning (January 2nd), as I reported later that day on this site, the FDIC wrote me (in response to my earlier inquiry), noting that 1) it could not confirm that Dollar Savings Direct is, in fact, a division of Emigrant Bank and, therefore, 2) could not confirm that funds placed with DSD are protected by FDIC.
A few moments ago, the FDIC wrote back, replying to my follow-up inquiry (also posted on this site), stating that since Friday morning, “we have been able to ascertain that DollarSavingsDirect is a division of Emigrant Bank,” and that funds placed with either DSD or Emigrant Bank are protected under the same FDIC Certificate (No. 12054). I set out below the whole of the FDIC’s response to this key question.
Note that according to the FDIC, deposits in both DSD and Emigrant Bank will “will be added together to determine your maximum allowable FDIC insurance coverage.”
Note also that the legal “boilerplate” at the bottom of the FDIC’s reply states “The opinions expressed herein should only be considered advisory in nature. Such opinions are not binding upon the FDIC or its Board of Directors.” That said, the FDIC’s e-mailed reply nonetheless seems reassuring in a “real world” way. I hope this most recent information proves useful for those who read this site — and for all other prospective investors.
Jeff
Date: January 5, 2009
Ref No: SCC2009F-00****-0
Dear Mr. Jeffrey ******:
Thank you for contacting the FDIC. In your email you asked the following:
“Thank you for your initial response to my recent question. The substance of your reply – that because 1) in apparent violation of FDIC requirements, Dollar Savings Direct has yet to inform you of its primary website and 2) Emigrant Bank has reported to you a primary website different than that maintained (though evidently not reported) by Dollar Savings Direct, you “cannot confirm that Dollar Savings Direct is Emigrant Bank’s affiliate” – leaves me with a modicum of disconcerting ambiguity.
“More particularly, and since Dollar Savings Direct is openly proclaiming that it is an affiliate (“division”) of Emigrant Bank and therefore that it is FDIC insured (“Yes, to the maximum allowed by law”),
,
“and since you have state that you are not satisfied that it is either (for the reason you cite above), is it the FDIC’s intention to insist either that Dollar Savings Direct satisfy you that it is an affiliate of Emigrant Bank (and therefore covered by FDIC) or that Dollar Savings cease proclaiming to the public that it is FDIC insured?”
[Here begins the substantive portion of the FDIC's response today:]
Since your original correspondence, we have been able to ascertain that DollarSavingsDirect is a division of Emigrant Bank, and as such, they both have the same FDIC Certificate Number of 12054. Please be aware that if you have deposits in both Emigrant Bank and DollarSavingsDirect your funds are in the same FDIC insured institution and we will be added together to determine your maximum allowable FDIC insurance coverage.
If you have any further questions regarding deposit insurance coverage, please contact the FDIC Call Center at 1-877-275-3342, Monday through Friday, 8 AM to 8 PM Eastern Time.
If you wish to learn more about FDIC deposit insurance coverage, please see our brochure “Your Insured Deposits,” which provides answers to the most frequently asked questions about FDIC deposit insurance. This document can be found on our web page at: .
As part of our ongoing efforts to improve our service to the public, we would appreciate it if you would complete a short questionnaire on the level of service you received from this office. The questionnaire can be accessed at .
We hope this information is helpful to you.
Sincerely,
Federal Deposit Insurance Corporation
Division of Supervision and Consumer Protection
550 17th Street, N.W.
Washington, DC 20429
The opinions expressed herein should only be considered advisory in nature. Such opinions are not binding upon the FDIC or its Board of Directors. In addition, the information provided is not meant to be all inclusive and the opinions expressed herein are based upon the facts presented in the request. Any changes in the facts or circumstances may result in different conclusions.
Very reassuring. Thanks, Jeff.
You’re more than welcome, Steve.
Jeff,
Thanks for all the research, it is definitly re-assuring. Now the FDIC is aware of who DSD is and has confirmed their relationship to Emigrant. It was scary when somebody calls the FDIC and they could not confirm who DSD is or their relationship to Emigrant..This whole thing has spooked me enough to put money in several different accounts even if I don’t get the top rate.You know the old saying don’t put all your eggs in the same basket.Thanks again for all the help.
John C
The bottom line is this is NOT how you treat loyal customers. I took 100k out of emigrant direct and will never return to any emigrant entity again.
From the DSD website FAQs:
Is DollarSavingsDirect FDIC insured?
Yes, to the maximum allowed by law.
Since each of EmigrantDirect and DollarSavingsDirect is an online banking division of Emigrant Bank, any deposits you have at Emigrant Bank, EmigrantDirect or DollarSavingsDirect are aggregated and FDIC insured up to $250,000 per depositor. Keep in mind that individual and joint accounts are insured separately, so if you have both types of accounts with us, your total deposits can be insured up to $500,000; that’s up to $250,000 in all your individual accounts, and up to an additional $250,000 in your joint accounts.
Anyone know the history of gmacbank interest rates? I hate to open another account and get screwed next week with a major interest rate cut.
I don’t think there’s any way anyone can predict interest rates.
Steve,
FYI…a little more info to support that DSD is indeed a part of Emigrant Bank….I use Quicken to manage my financial accounts. I had am Emigrant account in 2005 and closed it in 2007 when their rates went south. I opened a DSD account in Dec 2008. The routing/ABA number for the DSD account is the same as the old Emigrant. In fact it caused a minor conflict when downloading the DSD account info to my Quicken account for the first time and Quicken prompted me to identify which “Emigrant Bank” account to associate this info with.
Bill
Bill,
I never had any real doubt about DSD’s legitimacy, but Jeff’s response earlier today from the FDIC was certainly reassuring. I’m convinced. I just hope the 4.00 percent rate continues for a while. Every time I go to the DSD website, I expect to see a lower rate, but so far so good.
Steve
There were a couple question marks in there and some worrisome items, but everything SEEMED to be in order. I think we all owe Jeff a word of thanks for looking it all up.
Thanks, Jim. Again, I was happy to elicit, finally, a reasonably definitive reading from the FDIC. It was, surely, for a very good cause.
Jeff
Thanks for doing all the leg work Jeff. Now if we only knew whether or not you are a DSD operative, that would really give me chills.
I am still not sure whether I should close my account or not, I am thinking of closing it! So that I can sleep soundly.
A DSD operative? I seriously doubt it.
A “DSD operative”? Not exactly, as they used to say in the Hertz commercials.
No, I’m just a concerned investor, like each of you — with enough gumption to press the FDIC to give, finally, a straight answer to a legitimate question that many were asking (and had reason to ask).
The correspondence that I had with the FDIC and posted here is straight “copy and paste” — that is, a verbatim rendition of what was said (less only my last name and 4 digits of the actual Reference No. assigned by the FDIC to my inquiry).
These things said, I agree fully with Charlie’s notion that under the circumstances, the FDIC’s (eventual) position on the issue is surely worthy of public dissemination. It was for that reason that I posted that position (again, verbatim) on this site. Finally, it is for that reason that I commend the moderator (Jim) for summarizing the FDIC’s most recent statement on the matter in the “update” atop this page.
Jeff
Suggestion: Either the posters themselves or the admin should remove all the posts about Dollar possibly not being FDIC insured or being a “rogue” bank, for the benefit of those who don’t read through the whole long thread or who conclude that “where there’s smoke there’s fire”. This thread has now been referenced at the WSJ’s Wallet column (That’s how I got here), so the misinformation is being spread around the world.
Destroying a reputation is a serious matter, ethically if not legally. Now that the accusations have been refuted with actual evidence, it would be helpful to clean out the junk.
I kept the comments and did one better, I put in a big notice at the top explaining that Dollar Savings Direct was FDIC insured. It’s a great suggestion, thank you.
Why in the world DSD / Emigrant keep it separate and no way for us to check?
They could annouce on Emigrant website that they also own DSD / launched DSD.
That will make us at an ease.
It IS on the Emigrant Website. Go to Emigrant.Com and click the Privacy Policy link. In the Policy is detail on the “Official Emigrant Family”. Included in the family is DollarSavingsDirect. As this Policy resides on the Emigrant site, it should allay your concerns about Dollar’s legitimacy as it relates to an Emigrant Bank relationship.
Nice work, Jeff…DSD should send you a toaster or a set of steak knives. Thanks for the legwork.
Thanks. I just opened a Dollar 4% account and I was worried when I started to read all the posts but am glad for the great service you performed in straightening it all out.
They are FDIC insured (that’s the good news) but today’s 4% customer could be left in the dust in the wake of another promotion, so one will have to “be vigilant” and keep an eye on “specials” offered by any of their affiliates.
Rick
I heard through the grapevine that the 4% rate was going to fall within the next day or two. Not sure where it will go other than down…
Does anyone else get the feeling this is a Madolf like Ponzi Scheme, but through online banks. I tried to find this bank of the FDIC website and there was no record of it. I don’t trust that this is a legit bank at all. This seems very risky.
I have a feeling the FDIC will clean their hands of this if the money goes away.
@Worried: What you should be “worried” about is being sued for libel, along with our (blameless) host. Accusing people or corporations of committing a felony with no evidence is serious stuff, and you are not as anonymous as you may think. If you are uncomfortable, your best course of action is either to contact the FDIC personally, as others have done, or to simply avoid this bank.
Go to Emigrant.Com and click the Privacy Policy link. In the Policy is detail on the “Official Emigrant Family”. Included in the family is DollarSavingsDirect. As this Policy resides on the Emigrant site, it should allay your concerns about Dollar’s legitimacy as it relates to an Emigrant Bank relationship.
I just called the FDIC and they told me over the phone that this bank is insured as a division of Emigrant.
I signed up for an account with DollarSavingsDirect and initiated a initial deposit of $2000. After the registration process was completed, I signed out from DSD and tried to log on again and could not. It said my password was wrong, even though I use Keepass to store all my passwords.
Has anybody gotten this problem. What should I do? I contacted DSD by email and no reply yet. Is my $2000 deposit at risk, since I cannot even login to my account anymore?
Thanks a bunch.
I talked with a DSD customer rep and everything is fine now. It seems the problem was my password had special characters like @#%”} the caused problems. I reseted my password to letters and numbers and everything is fine so far.
Their web interface is horrible but the 4% is very good. Also, customer rep was very helpful fwiw.
The only reason to stay with ED (an unfortunate abbreviation, I’ll admit) is the tie-in with their affiliated Mastercard (issued by Barclays Bank), which gives a 1.4% rebate on most charges if one keeps $10K in the ED account. Even though their APY is 2.5%, if one runs $10K in annual charges but pays in full every month, one’s effective APY is about 3.9%–not too shabby. But the 4.0% dodge on DD is unfair to people who keep higher balances with ED. Of course, ease of transfer of cash is important. Finally, as Bankrate.com itself points out, a one-star rating does not mean a bank is about to fold, just that it underperforms. Emigrant itself has 3 stars.
I have an account at ED and held out for the same reason- but now I’m switching to DSD at 4% and a new Schwab Visa which pays 2% cash back on all purchases (no caps).
Emigrant’s website (emigrant.com) includes a link to its Privacy Policy. This policy (on the Emigrant site) notes the following regarding the official Emigrant Family (you’ll note that a Dollar relationship is indeed cited):
This Consumer Privacy Policy is provided on behalf of the Emigrant Family of companies that offer consumer-related financial services: Emigrant Bank (providing a full range of banking products); its retail banking affiliates: Emigrant Savings Bank – Bronx/Westchester, Emigrant Savings Bank – Brooklyn/Queens, Emigrant Savings Bank – Long Island, and Emigrant Savings Bank – Manhattan; Emigrant Mortgage Company, Inc. (offering residential mortgage loans), Emigrant 1031 Direct (an affiliate of Emigrant Bank offering qualified 1031 intermediary services), Emigrant Agency, Inc. doing business as Emigrant Financial Services (featuring insurance, annuity, and mutual fund products), Personal Risk Management Solutions (a division of Emigrant Bank providing insurance advisory services), EmigrantDirect (a division of Emigrant Bank offering certain banking products and services via the Internet), New York Private Bank & Trust (a division of Emigrant Bank, offering private banking services), New York Private Bank & Trust, FSB, (an affiliate of Emigrant Bank offering trust services), and DollarSavingsDirect (a division of Emigrant Bank offering certain banking products and services via the Internet).
I also opened up a DollarSavingsDirect account. But I spoke to a customer service rep to clear up when interest is posted in the following case. If I want to take money out of the account during the middle of the month or before the last day of the month, what happens to the interest. The rep said that in order fot the interest to be credited, the funds must be in the account on the last day of the month, otherwise you lose the interest for that month. So, for me, this is money that I dont expect to access quickly and for the 4 percent which appears to be about the best around right now, will put up with that inconvenience. But I will have to remember that it will have to be the last day of the month or say the first of the month to do a withdrawal.
When you go the FAQ, it says that “Interest on the Dollar Savings Account is compounded daily and credited monthly. For more details, see our Account Disclosure.”
Castoro. Can you use the credit card to purchase the CD’s?
I’ve never seen a bank let you buy CDs with a credit card, there are fees they have to pay and those are substantial. That being said, if you have heard of one… I’d really like to see it!
Approval of Application by New York Private Bank & Trust Corporation and Emigrant Bancorp, Inc.
January 21, 2009
NEW YORK—The Federal Reserve Bank of New York Tuesday approved the application by New York Private Bank & Trust Corporation and Emigrant Bancorp, Inc., both of New York, New York, pursuant to Section 3 of the Bank Holding Company Act of 1956, as amended, to acquire all of the voting shares of DollarSavingsDirect.com, Ossining, New York.
According to standard procedure, the proposal cannot be completed for 15 days. The Reserve Bank acted under authority delegated by the Board of Governors of the Federal Reserve System.
What are the implications of this?
Has anybody noticed that the advertised rate has dropped to 3.5% APY where as the account still says 4% APY . Is the rate about to drop ?
@John: Yes, of course it will drop. No bank could sustain a 4% rate in today’s interest rate climate. It’s still a good deal at 3.5%, I think.
@Diana: Implications? None. This is the final documentation of what we’ve known all along, i.e. that DSD is an FDIC-insured subsidiary of Emigrant.
I don’t get it. On 1/23 you tell Diana that as “we’ve known all along, i.e. that DSD is an FDIC-insured subsidiary of Emigrant”
Okay but then 5 days later on 1/28 you indicate that you “called FDIC yesterday before sending Dollar another deposit, having noticed that Dollar is still not listed on the fdic.gov Web s”
Well if on 1/28 you weren’t yet convinced WHY on 1/23 did you forcefully assert “what we’ve known along”?
BTW – DSD IS insured via Emigrant Bank. As such the FDIC Insurance is issued in the name of the Parent Bank – not a Division.
Back to Rate Chasing again. Just as I open the Dollar Direct 4 percent account, it drops to 3.5. It never ends. So have now found 3.75 percent at Clear Sky Account (FDIC) which is the online savings offer put forward by Chesapeake Bank located in the Northern Neck of Virginia, 11 local brick and mortar banks in eastern Virginia. The rate is good through 3/31/09 and then ?. The location of the Clear Sky Account is in the Williamsburg, Va. area, phone 877-257-7594, not too far from where I live.
Thank you for the tip on Chesapeake Bank. Although I have successfully used ED for a few years now, the Clear Sky Account 3.75 return for a few months beats the 2.40 ED is currently offering. Hopefully, we’ll have more options by then.
The only caveat about the Clear Sky account is that it compounds interest monthly, not daily.
My internet server will not let me log on the Dollar Savings Site.
Has Dollar Savings Gone out of business?
No, it’s still there.
I called FDIC yesterday before sending Dollar another deposit, having noticed that Dollar is still not listed on the fdic.gov Web site, and that bankrate.com has them down to 1 star. FDIC assured me that Dollar is fully insured, under the Emigrant certificate. Their only caution is that deposits in the two banks are aggregated for purposes of the $250K insurance limit.
BTW, the FDIC rep gave me this information without pausing to look anything up; apparently they’re getting this question a lot.
Charlie,
Thanks for the extra verification. This is a much better situation that earlier when people called FDIC and they didn’t know who DSD were.We are still getting a decent rate in comparison to other banks. I also have a HSBC account but they just keep dropping rates for any excuse.Also opened a FNBO account but so far I am not impressed with them.
John, my call was prompted by the precipitous drop in rating at bankrate.com. I see that my reporting on it upset another member, but my feeling is that more information is better than less, especially for people like us who are daring to send significant funds out into the Internet cloud.
Good luck in your quest for good service and high interest. I’ve been impressed so far with GMAC Bank. You get friendly, helpful people when you call, but you give up 50 basis points for the privilege, compared to DSD.
No – what upset another member was you having the gall to tell Diana on 1/23 that “as we’ve known all along” DSD is FDIC insured, and then on 1/28 you are reporting that you just contacted the FDIC because you were concerned about whether DSD was FDIC insured. HUH??? Well if you weren’t sure on 1/28 then you must have had doubts on 1/23. That being the case you should have not responded to Diana on 1/23 as you did … I agree that the more information the better, which is what Diana was trying to obtain – until YOU shot her down with that “what we’ve known all along” nonsense. But I guess you know that now because your 1/23 response to Diana has strangely been deleted.
I just want to thank all of you. After a ton of research and especially finding sites like this one I moved my money over to DSD. I can’t begin to tell you how lovely the customer service reps are at this bank. They have been beyond informative, patient, kind, considerate, and extremely prompt. They have made banking amazingly convenient for me. DSD has also gone the extra mile for me when it came to linking my personal checking account and my high yield savings account with DSD in an extremely swift fashion. After I too had a problem with logging in due to using &%: silly characters, I called the bank, they immediately knew what the problem was, we fixed it, and I have not had any problems since. The ease of the website and calling customer service is even better than my local bank. It is DEFINITELY FDIC insured and I am so impressed with their extended security protocols on their site that you can have if you choose to. I recommend this bank and this high yield savings account to everyone I know. The only thing I am a little bit disappointed in is the drop in the varying interest rate from 4 to 3.5, however, from what I can find it is still the highest interest rate out there and the rate cannot be blamed on them when it is the FED that dictates rates in these difficult economic times. Again, I just want to THANK ALL OF YOU for your informative comments, let you know someone is INDEED READING/LISTENING, and say I just wish other sites like bankrate were recommending and more informative on DSD.
Is it true that in the application process they ask you for your username and pssword for the checking account you want to link?? I think I read that on someones review elsewhere or was that another bank ?? This would be a deal breaker for me
Scott, I was asked only for the routing number and account number of my checking account…information which is on public display on every check I write. They then sent a few tiny debits and credits via ACH, and asked me to verify the amounts, thus verifying that I have access to the account. This was over a month ago, so it’s possible they’ve changed the policy, but I doubt it.
Scott, I signed up to DSD a month ago. I was never asked for my banking username or password. They of course, do ask for your routing and account # like any other online financial institution.
Their rate has gone down from 4 to 3.5 to 3.2%. However they still have the best rate and even though their UI is not pretty, you get use to it and so far everything is good.
Since DSD is Emigrant we should not bother signing up for DSD. Emigrant lured accounts in during with a brief competitive rate during the early 2000’s interest rate lull and then dropped their rate to an abysmal low. It was a waste of time to sign up for Emigrant, and sincs Dollarsavingsdirect is the same bank they will do the same. Better go elsewhere.
At GOTALKMONEY.COM the money market top 10 shows WTDIRECT is a consistent performer. Also the clear sky bank mentioned sounds good…
I am perturbed about their account linking policy. I was able to easily link my checking account to my DSD account when opening it up. Then I tried to link my DSD account to another account I have so that I could originate the transfer from this other account and it could not be done. I was told that transfers can only originate from DSD and not the other way around. None of my other online accounts limit you in this way. Sounds fishy to me.
3.05% as of today (2/12/09)
Just the aftermath of the Fed rate or time to look elsewhere?
Yes, you’re right…rate continues to drop and it is becoming more and more difficult to find a good one without committing long term! Where else can you look?? I too opened a sizable account with DSD, only to see the rate drop significantly. What’s next…stuff the cash under one’s matress and watch it dissappear??
I just opened and funded my DSD account and I am a little angry. The entire sign up / tranfer set up process was smooth, but when I logged in today to verify that my initial funding had transferred from my BofA account I saw something that bothered me.
I initiated the ACH transfer on 2/12. The money left my BofA account and appeared in my DSD account on 2/13 BUT the DSD site say it is not “available” until 2/23.
A 10 DAY HOLD? Are they serious? I came over from CountryWide where the hold period was never more than 1-2 days.
I think this is dirty pool they are playing so they don’t have to pay interest.
Does anyone know if the 10 day hold is common for just the initial funding OR is it the standard hold period for ALL subsequent transfers as well?
If it is, I’m CLOSING MY ACCOUNT IMMEDIATELY.
They put a 7 day hold on mine which I just opened up about 1 week ago. My understanding is that interest is paid from the day it transfers and the hold period only applies to your ability to withdraw.
The 10 Day hold is for the initial deposit only. And as noted by Scott – Interest is paid from the day the funds are deposited; irrespective of any availability hold.
I don’t know exactly what the purpose of the long hold is; it’s not greed, as they do pay interest from day of deposit. I guess it removes any risk of the transaction being repudiated by the counterparty bank. I’m not too bothered by it, as there’s not much point in using these online banks unless you plan to keep the money there for a while.
However, note that as interest rates drop they are also converging to some degree. GMAC Bank, for example, is at 2.75% now, only 30 basis points away from DSD. Bankrate.com gives them four stars vs. one star for DSD. And I heard a rumor that GMAC gives new depositors a free Chevy Suburban just for opening the account..
I’ve been w/ dollar since Oct. and been happy with them except for the recent rate plunge, while emigrant still hasn’t yet. They do have the initial hold but in my experience say small deposits like $100 are available in a couple days, even though the site will say for longer. Larger deposits are held as long as they say I believe.
I have ing accounts, emigrant accts, have had hsbc, but emigrant/dollar have the best transfer times. If you schedule for a certain day it will be there that day. Ing has a day lag, hsbc was terrible.
Hopeful dollar will be worth it in the months to come. Wish I could’ve funded my dollar w/ emigrant since the checking acct go between makes it almost worthless when switching often.
Other than converting dollars to a different currancy, we have no option. If I can get a 1% return on my savings, I am thrilled. My only other optin is …well. there is none.
Dollar Savings Direct has now dropped to 2.65 percent from 3.05 percent. Down, down, down we go. Just when I get mucho dinero into this account, it drops. Have to keep an eye on the Clear Sky Account (Chesapeake Bank, Williamsburg, VA) which is still advertising 3.05 percent.
I opened my account less than a month ago and the rate has dropped 2 or 3 times already.
They must have attained their goal of a certain amount of deposits and each time they do they drop the rate….if everyone pulled their money out you would see how quickly it would reverse…As soon as the month ends I am out of there.
The claim of “America’s Highest Rate” is getting a bit thin, as it seems now to be based only on their $1,000 minimum deposit vs, say, 2.75% at GMAC Bank, which has a $5,0000 minimum and a **** quality rating at Bankrate.com, compared to * for Dollar Savings Direct.
It may be time to say goodbye to DSD.
I have become totally disillusioned with Emigrant/DSD because they REPEATEDLY start with a TEASER rate & then quickly DROP their rates! I THOUGHT that since it was described as a non-brick savings place that they would keep their rates higher for longer…but alas, JUST as they did dirty to me with a previous ED acct, they have DROPPED their rates from weeks to even days. I am transfering ALL of my $ back to my bank that has consistently offerd 2.7! So much for me chasing rates & good bye ED/DSD & whatever else they come up with FOREVER! Now known as the “BAD LUCK OF THE IRISH!”
The rest of what’s left in our $ savings will be transferred tomorrow.
In Jan., the site was hard to log on to. January was/is a high outflow month for us with estimated US/Ca taxes, credit cards from Christmas and other fixed payments. Twice after I had entered withdrawals, the screen never returned to our balance sheet. Transfers went throug with their normal delay, but I didn’t like the program not going back to our balance after the transfer was approve (not made).
Then, when we tried to transfer money at the end of Jan to transfer money to pay for the rest of our Christmas bills and an upcoming vacation, AT&T refused to allow us sign on to the site. AT&T’s info note said that the site was using a home computer.
I got hold a lady at $, and she said that they were working with the problem. I told her that we needed several thousand $’s to be transferred to handle due bills and our vacation.
Then, I had to send an email to get the money transferred. They did respond and transferred the money that night. This should have never happened.
We never got an explanation nor an apology from $.
Then their interest rate continued dropping.
So we are out of there when this final transfer happens.
So we will be looking for a higher rated online bank (higher than a 1 star rating) with a low minimum, a fair rate, and the ability to handle transfers when we need our money.
What online bank is the best with a low minimum, a good interest rate, good star ranking and handles transfers out as well as in with no problem?
Thanks
PS. A little side note re computers not working for Customers. We were checking out at Costco Friday. The two poor customers in front of us were trying to use their Costco Gift Cards they had received for Christmas.
There were no signs posted that their computor had a glitz and would not accept the gift cards. The customers were not told of this problem until the checker informed them after totalling their bill, their gift card could not be assessed. However, they could pay cash or pay by check with IDs.
Costco had several people, who appeared to management walking up and down the checkout stands informing the customers with gift cards of the problem.
I told the one that informed the two customers in front of me that what was being done was very bad. Costco had the money for those gift cards and now they weren’t honoring those cards. Also, customers like us without the gift cards were forced to stand in line while they explained their gift cards were not being accepted that day.
One of these women got upset with me, and I told her that they were practing temporary fraud by not having signs outside the door, inside the door and in front of the checkstands warning that the gift cards were not being accepted.
The bank I’ve been using nowadays is Everbank, they have a $1500 deposit requirement (if you have under that there’s a $4.95 fee), but they pay out better than Dollar Savings 34.51% guaranteed 3 month bonus rate then something lower, but blends to 2.73% first year APY) and they have four stars from Bankrate.
It’s the second bank listed on my high interest savings account profiles page:
http://www.bargaineering.com/articles/high-interest-savings-accounts-profiles.html
Here’s the Bankrate report:
http://www.bankrate.com/brm/safesound/commmm.asp?fedid=527954
That stinks about the Costco cards. At my Costco, they ask for membership cards before ringing you up, seems odd they’d wait until afterwards to do it there.
Jim, I think if you read the footnotes you will see that 2.73% isn’t their real rate after the bonus period after the bonus period ends. They come up with that figure by aggregating their 3 month rate on the first $50k, 3.51%, with their actual rate of 2.46% for the next 9 months. If you have more than $50k, or you are in your second year for any amount, you only get 2.46%.
Here are the gory details from their Web site:
Rates and Annual Percentage Yields (APYs) are current as of 2/20/2009 12:00:00 AM. Minimum opening deposit of $1,500 is required. In any month that your average monthly balance falls below $1,500, a $4.95 monthly fee applies. Fees may reduce earnings. This is a variable rate account and any of the rates may change at any time without notice. This bonus rate and New Account First-Year APYs are available to first-time EverBank account holders only and is limited to one account per household. The bonus rate of 3.51% will apply to the first $50,000 on deposit for the first three months after account opening (the “Bonus Period”) and may change at any time prior to account opening. New Account First-Year APY for Balances up to and including $50,000: This corresponds to an Annual Percentage Yield (APY) for the 12 month period after the account is opened (”New Account First-Year APY” or “First-Year APY”), based on the current ongoing rates shown here, the current bonus rate and the average collected daily balance on your account, of 2.73%. New Account First-Year APY for Balances greater than $50,000: During the Bonus Period, balances of $50,001 and greater will earn an interest rate of 3.51% for the first $50,000 and an interest rate of 2.43% for all amounts above $50,000, and all funds in the account will earn the applicable ongoing interest rate, currently 2.43%, after the Bonus Period ends. Assuming the highest balance in the account is $10,000,000, the range of First-Year APYs available for this highest tier, based on the bonus rate, the ongoing rate, and the average collected daily balance on your account for the 12 month period after the account is opened is 2.73%-2.46% APY. Without the Bonus Rate: Without this bonus offer, the current APY for this account as of 2/20/2009 12:00:00 AM is 2.46% regardless of deposit amount.
Shoot, you’re right, I mis-read and mis-wrote in my earlier comment, I’ll amend it in a moment.
3.51% for 3 months is still very solid though (if you don’t mind the hassle) but you are right, thanks for reading the fine print closer than I did.
One clarification to your last sentence, you still get 3.51% for your balance under $50k, it’s the dollars over $50k that get the 2.46% and not the promo rate.
“That stinks about the Costco cards. At my Costco, they ask for membership cards before ringing you up, seems odd they’d wait until afterwards to do it there.”
Jim, what really stunk about the Costco sham with its own gift cards was that the customers in front of me handed those gift cards to the Clerk before their purchases were processed.
After the clerk scanned the purchases got a total, they then informed the customers, “Due to a computer glitch, they couldn’t apply the charges for the current transaction.
The first customer growled a little and paid cash.
The second was a Grandfather trying to buy some items and lunch/pizza/drinks for his Grandkids. He refused pay for the items and the pizza and drinks. Needless to say he and his grandkids were disappointed. Being a grandfather, I verbally blasted the first Costco Manager who informed the guy that his gift card would not work, but he could pay cash.
The Costco people knew that their computer was not able to charge their Gift cards, and nothing was said until the customer after their purchases were scanned. It really stunk.
We had no problems, when we were checked out with our Costco card and charging our purchases to the card.
As a courtesy to those who are subscribed to this thread, with email notification of new posts, may I respectfully suggest that discussion be confined to Dollar Savings Bank and its competitors.
Thanks.
I second that, take the Costco blog elsewhere and lets confine it to on-line savings accounts.
I am just completely STUNNED that DSD has dropped from 3.1 to 2.65 in the past 10 days. WOW.
I just moved all of my money into DSD – in fact the funds are still not available yet. I am going to take Jim’s advice here and MOVE over to Everbank permanently. The whole DSD experience has been about the same as their rating – “1 star”.
Ooops…I meant to say move over to Everbank, not Emigrant!
Jim: I revised it for you.
I did a little research on Everbank and find the following items…..
1. If I read their website correctly, the 3.51% for 3 months is only on the first $50,000…above that the rate is 2.43%….the “First Year APR of 2.73% ” is a blend of the two for a $10,000 balance over 12 months…..the higher the balance…the less the actual First Year APR
2. This is a Money Market Account….are the FDIC coverages the same as a passbook saving account ??????
3. epinions reviewers have a pretty low score of Everbank 2 1/2 Stars….some complain it took 4 weeks to open an account….http://www.epinions.com/reviews/finc-Financial_Services-Online-Netbanks-Everbank….(sort by Review Date and a lot of the 1 Star ratings are recent)
4. Question..why doesn’t Everbank show up on a search of Bankrate’s MM and savings accounts?????…..
I must admit that an ETF on TIP with a 6.34% dividend yield (and the benefit of the current lower divided tax rate of 15%) is looking better every day….
1. You’re right, I didn’t read carefully enough the first time.
2. It’s FDIC ensured, money market FUNDs are the ones that aren’t insured (you buy those through a brokerage though).
3. I never read epinions (I take those reviews with a grain of salt) but opening an account does take time because of how their paperwork and depositing process is, it took me a week to open and another week to fund (since it was via mail). They get 4 stars from bankrate and I trust Bankrate over epinion reviewers.
4. I don’t know, Bankrate definitely reviews them because they have a 4 star Safe and Sound ranking.
Bill, I was composing my reply to Jim’s post above at the same time as yours was posted, but we’re making the same point – except that the calculation is on $10 million, not $10 thousand; they’re trying to show the maximum possible dilution of the first $50,000.
FDIC insurance on money markets is the same as on any other deposit in the bank.
As for TIPS ETFs, it’s important to be aware that while the yields may look great right now, the value of your investment will decline if interest rates rise, as they are sure to do eventually, so your capital loss will offset (or exceed!) your dividend earnings.
This weekend, March 1st, it’s adios, DollarSavingsDirect and it’s 2.65 percent. Setting sail for Clear Sky Account at Chesapeake Bank in Virginia. Rate still listed at 3.05 percent. My money has been in Dollar for about 3 weeks. I initiated a third transfer while the rate still showed 3.05 percent. And dont you know 2 days later after the transfer initiation, the rate dropped to 2.65 and you can’t stop the process. But come this weekend, March 1st, it will all be transferred back into my local bank and then to a new Clear Sky 3.05 account. And the rate game continues.
Fooled again, the Clear Sky account went down to 2.85 percent from 3.05 just as March 1st rolled in.
FYI…I found a site “http://www.money-rates.com/savings.htm” that lists many small banks not listed in bankrate.com website….
I have not researched these banks as yet and some have minimum balance requirements of $25k to $100k. However they are quoting saving accout APR rates of 3.51%., 3.3%, 3.25%..etc….certainly worth a look….
Below is the warning from AT&T/SBC Global.net re Provident-direct. They had the same warning on Dollar Savings, and I was unable to access my account to transfer funds. I had to contact them by phone and email to get the transfer done at the end of Jan..
Since then I transferred the remainder of my acct at $ Savings.
Why are these so called banks using a network reserved for home computers?
AT&T Toolbar Possible Fraud WARNING!
The requested website,
http://www.provident-direct.com/About-Provident/About-Provident-direct.html
is part of a network reserved for home computers and is possibly involved in fraud.
RECOMMENDATION: DO NOT provide sensitive information, such as a password
or credit card number, on this site. Disregard this warning ONLY if you are
absolutely sure the site is authentic.
Click ACCESS THIS TIME to proceed to the website if you believe it is authenic.
Click ALWAYS ACCESS to proceed to the website and not to be redirected to this page
next time this site is detected, if you believe it is authenic.
By selecting ACCESS THIS TIME or ALWAYS ACCESS, you continue at your own risk.
AT&T is not responsible for websites or content accessed through its service.
What would you like to do?
RE: “Why are these so called banks using a network reserved for home computers?”
Dave, to the best of my knowledge there is no such network, and I believe the problem is in the toolbar you are using, or conflict between that toolbar and some other protective software in your computer, not in the banks’ Web sites.
The authors of that warning message may be referring – in a confused and confusing way – to so-called non-routable IP addresses, which are generally used on the private side of routers. These addresses begin with 192. or 172. or 10. It seems likely that AT&T is seeing the address of your home computer itself (probably 192.168.xxx) and mistaking it for the address of the site.
My suggestion is that you delete the AT&T toolbar and instead rely on the built-in protections of the current versions of Internet Explorer or Firefox; or install the Google Toolbar in its place. These are all quite good, and they rarely generate false alarms.
Free fall rate drop – now down in 2.50% in a blink of an eye. Bye bye DSD.
@AN: Where are you going ?
ClearSkyAccounts that was mentionned by others is now at 2.45% (max, only 2.00% if you have less than 10K)
GMAC is only at 2.65%… not worth moving the money…
Where else ?
Whoa, DollarSavingsDirect now at 2.25 percent-
Just scheduled a transfer of all my funds out of DollarSavings back into my local checking account. So much for my one month enrollment in Dollar, but 2.25 percent is not worth it. At least it is still somewhat near the beginning of the month.
The Clear Sky Account webpage still shows 2.85 percent as of Saturday morning, 3-7.
And also looking now at Centennial Bank in Fountain Valley, California. Variable savings rates i.e. 50-100K at 3.05 percent, over 100K at 3.3 percent. Somewhat better than the Clear Sky 2.85 for over 100K.
Citibank is now at 2.1%, vs. 2.25 for Dollar. So if you have $100,000 to deposit, Citi will yield $150 bucks less than Dollar for the year. In return, you get walk-in convenience and a bank that, while deeply troubled, will never be allowed to fail by the Feds, saving the hassle of dealing with a possible FDIC rescue. Plus, your balance counts toward eliminating fees on other banking services.
Conclusion: This whole Internet banking sector is starting to look like more trouble than it’s worth.
Like driving an extra ten miles to find a gas station that sells regular for a penny a gallon cheaper.
I have finally decided to go for a GUARRANTEED 5.25 % return!!!!!…..take my savings and payoff my mortagage…..
Chasing these puny savings returns just isn’t worth the effort any more…..
“I have finally decided to go for a GUARRANTEED 5.25 % return!!!!!…..take my savings and payoff my mortagage…..”
Bill, where did you go and what is the website?
Thanks
Dave,
I believe that Bill is just deciding to pay off his mortgage that has a 5.25% interest rate. I don’t think he is talking about any savings accounts carrying 5.25% interest rate…
Dave & Jason,
Exactly…when I took out the adjustable mortgage 6 years ago it was at 4.3% for 5 years and my savings accounts were earning a healthy 5-6%…then last year the mortgage adjusted to 5.25% …not too bad of a rate….but now the savings accounts are down to a measly 2.25% …. the safety cushion of having cash at a 3% spread doesn’t make sense any more….Even if I need the cash for an emergency in the future, the cost of paying points and closing costs for a new 1st TD are still less than the cost of the 3% spread I’m currently paying….
Good Bye DSD….Hello mortgage burning party…..lol
Actually you CAN get that kind of money from a bank…but it involves the use of a mask and a gun.
Seriously, it’s not clear that paying off a mortgage right now is a wise thing to do. In today’s market there is no assurance that you can ever get your money back out in the form of a new mortgage or home equity loan. So, the payoff represents a more-or-less-permanent loss of liquidity.
In short, paying off a mortgage isn’t an alternative to savings account; it’s an alternative to buying a long-term cd or bond, and comparisons should reflect those (generally higher) rates. Retiring the mortgage may well make sense for Bill, but it’s not for people who may need to get their hands on the money in the next several years.
Noticed DollarSavingsDirect now at 2.05 percent. Can one percent be far behind.
This is one of the more dramatic freefalls I have seen since I began trying to invest larger dollar amounts ($125K+) in an online bank. I withdrew the vast majority of my DSD funds when they dropped to 2.5%, and the remainder when they were at 2.25%.
Tired of the fear (real or imagined) of one-star banking, my money is now split between ING Direct’s “Electric Orange” (1.95% for $100K+) and Capital One (2.01% for $10K+). Both are close enough to DSD’s rate, and my guess is that DSD will continue to plummet (EmigrantDirect is at 1.65%). Plus, both are rated at four stars or better on BankRate.
I already had the ING account and wanted to open a Clear Sky Account, but they aren’t accepting applications right now, so I went with Capital One. Too bad; I would have liked to give Clear Sky a try.
Clear Sky Accounts at Chesapeake Bank are now at 2.5 percent. I managed to open an account just before they closed the 3.75 percent rate which is good through March. Unfortunately,I was unable to get the bulk of my money out of DollarSavingsDirect in time to send to Clear Sky. But I was told that about April 1st, Clear Sky is going to start accepting new money again, so as of now I will go with them in April. They said they had am overwhelming response to the 3.75 percent rate and had to stop new accounts for a while.