Credit, Government, Personal Finance 

Emigrant Direct’s 60 Day Freeze Policy

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After reading a very informative post about Emigrant Direct’s 60 day account freeze clause at FiveCentNickel, I shot off an email to Emigrant to find out what the deal was with the clause. Essentially the response was that the clause was a requirement of the Patriot Act… email included below.

The curious clause was:

1. 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 response I received was:

Dear Client,
Thank you for your inquiry. We have never had to exercise this option. Since 9/11 the Patriot Act states that all banks include this statement in case of a Terrorist Attack. Otherwise transfers take 2-4 business days.

Thank you for banking with EmigrantDirect.

While I haven’t found in the Patriot Act where this clause is stated as being required, the idea is that this is supposed to combat money laundering and help with record-keeping. I don’t buy it 100% and since I don’t see it in many other T&C’s for banks, I’m only a little suspect. In the end, since I don’t think this will affect me, it doesn’t bother me.

{ 6 comments, please add your thoughts now! }

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6 Responses to “Emigrant Direct’s 60 Day Freeze Policy”

  1. Scott says:

    That’s interesting. I bet it would come into effect in a national emergency, when people might want their money most. I wonder if any of the other banks with high interest rates have the same thing?

  2. Guest says:

    ING does not seem to have that policy. I’ve thoroughly read through their agreement. Likewise, Countrywide Bank does not have that policy either. Emigrant is not entirely being truthful.

    Someone on FiveCentNickel said it is a New York Regulatory requirement. Perhaps it was put in after 9/11.

  3. Emigrant’s Dirty Little Explanation
    The other day I wrote about Emigrant Direct’s dirty little secret… A clause in their terms and conditions that allows them to require 60 days written notice of any withdrawal. Well, it seems that jim over at Blueprint for Financial Prosper…

  4. thc says:

    Financial institutions need to be very cautious these days about money laundering, especially on-line firms where no one really talks to the client. Money in and then out again in a short period of time is very suspicious.

  5. jack says:

    The fact that such a clause is not found in other financial institutions is irrelevant if the requirement is in gfact a legal one. those institutions are not required to publish laws in their disclosures, only policies. There are many requirements in the Patriot act that do indeed apply to financial institutions. These, as well as tens of thousands of other laws and banking regulations are not published in the consumer disclosures. If that were to happen your next credit card application would be the size of a phone book. If Emigrant is in fact including an important requirement of the Patriot Act for the consumer’s information, and others do not, then it is a credit to their opporation.

  6. Allan says:

    I’ve never had problem withdrawing money from my EmigrantDirect account. However, Presidential Bank reqires a written letter to withdraw money which caused me to close my account there.

    ING Direct is paying 4.5% APR, but they quoted 5.05%. The different between APR and quoted rate is the fee or profit they charge (margin). Normally, lenders spread this fee over the first year on mortgage loans, then the quoted rate kicks in for the rest of the loan’s life.

    HSBC has been steadily paying over 5% the past year.

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