TreasuryDirect refuses to confirm transactions
Thursday, March 16th, 2006
Categorized as: Treasury Direct
I purchased $25,000 worth of Series I Savings Bonds electronically in January. After four emails, two phone calls, and three letters to TreasuryDirect, they have told me that they refuse to send me a written confirmation that my account even exists. In fact, in one of my letters, I asked for the confirmation under the Freedom of Information Act, and offered to pay up to $25 for the written confirmation, which they unequivocally denied. This doesn’t give me the feeling that my money is secure. Had I known this was their policy, I never would have purchased the Savings Bonds.
– Barry in Rhode Island
Given that people who invest in Savings Bonds and other Treasury securities are looking for an investment with as little risk as possible, several of TreasuryDirect’s policies are pretty scary. You’ve discovered one of them.
Another is that they don’t notify you if any of the details of your account are changed, for example, the associated bank account or your address. This kind of notification is a standard security practice for financial companies such as brokerage firms or mutual fund companies.
Another is that Regulation E doesn’t apply to Treasury Direct. This is the banking regulation that says if a thief gets your credit card number, your liability is limited.
If a thief gets your TreasuryDirect details, changes the bank account, and cashes in your funds, you likely won’t know until months later when you receive the 1099-INT tax form telling you how much interest income you earned. Meanwhile, the Treasury is adamant that it will not cover your losses.
I’ve brought these issues up with my contacts at the Treasury, but the conversations always end the same way. If you aren’t willing to take the risk, don’t use TreasuryDirect.
I don’t think this is a satisfactory answer. Do you? Leave your comments below.