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Calling all floridians who can verify this is safe
Old 06-16-2015, 04:28 PM   #1
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Calling all floridians who can verify this is safe

There is a firm advertising a 5.15% fdic insured 6 month cd with 20 k minimum. Only gotcha is have to be a Florida resident. The firm of advisors is first financial group. Of course this looks great in our int. Rate environment. Can anyone in florida speak about this who has experience? Thank you.
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Old 06-16-2015, 04:39 PM   #2
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I can't imagine why a banking product would be limited to Florida residents. Also not clear why a CD is being offered through a financial advisory firm. Maybe an annuity sales scheme looking to generate leads?

If it looks too good to be true...
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Old 06-16-2015, 04:41 PM   #3
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Quote:
Originally Posted by Quantum Sufficit View Post
There is a firm advertising a 5.15% fdic insured 6 month cd with 20 k minimum. Only gotcha is have to be a Florida resident. The firm of advisors is first financial group. Of course this looks great in our int. Rate environment. Can anyone in florida speak about this who has experience? Thank you.
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Insured by FDIC, are you sure? Interest Calculation? Daily/Monthly/Annually? Would be nice to tell everyone the institution!
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Old 06-16-2015, 04:46 PM   #4
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I did not get the name of bank

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Old 06-16-2015, 04:47 PM   #5
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Yet. Just made a quick call waiting to board flight

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Old 06-16-2015, 05:15 PM   #6
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I confirmed that it is fdic insured 6 m cd. 20k min. Max 250k.

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Old 06-16-2015, 05:26 PM   #7
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Who confirmed that the product is FDIC insured? The FDIC? Or the salesperson who would make a commission? It sounds like a scam to me. Unless you verify yourself that it iis with an FDIC insured company, I wouldn't give them a penny unless you can afford to losre it.
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Old 06-16-2015, 06:03 PM   #8
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Here is a newspaper ad for the 5.15% CD from March 4, 2015. The fine print says it includes promotional incentive to obtain yield. Perhaps the promo only applies to a small part of the money deposited into the CD.

http://www.readfest.org/2015Portfoli...Full%20Run.PDF
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Old 06-16-2015, 06:14 PM   #9
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It's probably not a scam but will come with strings attached. They will limit how much you can put in the CD. You won't be able to renew it at such a good rate in 6 months. They will try to sell you on annuities and get management fees on the rest of your investments once they find out what your assets are.


It's no different than the timeshare sales approach of "stay at this hotel for free! (just listen to our 9 hour sales pitch)"
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Old 06-16-2015, 06:27 PM   #10
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This appears to be an old trick. Here is a blog about it:
Is a 3.45 Percent APY CD Too Good To Be True? - CBS News

and this one about that one:

New Marketing Trick: Short-term FDIC-Insured Bank CDs With Really High Rates — My Money Blog
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Old 06-16-2015, 07:34 PM   #11
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I suppose next someone's going to tell me that the Easter bunny isn't real.
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Old 06-17-2015, 08:23 AM   #12
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From First Financial Group FM Business Review in Fort Myers, FL - West Coast Florida BBB:


On October 10, 2011 BBB sent an inquiry to this company regarding its CD Investment offers to consumers. We requested that the company substantiate the advertised Annual Percentage Yield (APY) rates for its CD investments, including details about the "promotional incentive included to obtain yield."

The company responded by clarifying that it is not a bank, but an insurance agency that contracts with banks to offer customers CD's. The company's representatives are advisors for Bank of Internet, which meets FDIC insurance requirements.

The CD investment often has a lower APY than the company's advertised APY. However, the company fulfills the advertised APY by "buying up," or paying the customer the difference between, the bank rate and the promotional rate.

The BBB recommends that prior to purchasing a financial investment, please thoroughly research the investment and the companies involved. This should include contacting FDIC to ensure your investment is insured. FDIC can be reached at (877) 275-3342 or www.fdic.gov.
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Old 06-17-2015, 10:45 AM   #13
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I have seen this same ad in our local paper and inquired about it. I had to set up a special meeting with the sales person (say financial planner). After talking to First Financial about the details, I decided not to waste my time. Too many if's, and's or but's.
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Old 06-17-2015, 11:07 AM   #14
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I've watched too many episodes of "American Greed" to do business with anyone/thing that is not well known and generally of as good a reputation as one can get in the world of finance. I'll settle for standard rates from known firms; if I have to do research into their quality, I'm probably not interested.
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Old 06-17-2015, 11:29 AM   #15
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Evidently that pitch has been around for years. It's not really a scam, more a lure to get the "investor" into other much larger, less customer beneficial investments. They wouldn't keep doing it this long if it wasn't working, and technically legal.

Found this:
These investment companies DO NOT themselves provide the CDs. They basically limit the amount of deposits, and periods of time, so the advertised rate looks good, but the overall impact can be a whopping $50-$100 or so more than the market. These firms are paying that (adding it to the yield) to get you to come in to their shop and listen to all the products they want to sell you, such as annuities or life insurance products (all of which carry a 5% or higher immediate commission to them). So it's kinda like going to a presentation/seminar on a time-share condo to get a free steak dinner (value of about $10). YES - they are real, but is it worth your time and getting "the hard sell" treatment.

For the few extra dollars here, it is best to just avoid them and look toward the banking industry directly.

And another:
I work for First Financial Group and all the CD's are FDIC insured. This is not a scam, however with any promotion there are conditions. The banks we use limit the amount of the deposit or length of the offer. The banks use high rates to get new customers so you can not get the high rates twice from the same bank. That is why in the ads we are listed as CD locators, we will hunt for great rates all over and show you the best we find. You will get the rate in the paper and it will be insured.

As usual, if it sounds too good to be true...
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