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We are a regulated
financial institution
Insurance
Customer
cash
Track record
The US Patriot
and Bank Secrecy Acts
PENSCO Trust
Company recognizes the importance of financial and personal integrity
to our customers. Over the thirteen-year history of our Company, we have
endeavored to develop and maintain the necessary systems, controls, and
personnel necessary to perform our duties and responsibilities to our
customers in a safe and sound manner.
As the first independent (e.g. start-up) company ever approved by the
Internal Revenue Service as a non-bank custodian, PENSCO Trust had to prove
to the IRS that it had the wherewithal, knowledge and experienced personnel
to conduct a retirement services business. Similar submissions, review
and approval processes took place when the Company was accepted as a broker/dealer
and became a member of the National Association of Securities Dealers
(NASD) in 1997, and when we applied to the Banking Commissioner of New
Hampshire to establish a trust company in 2001. Each of these financial
regulators conducts an extensive review of our organization and track
record prior to accepting responsibility for our company as its regulator.
PENSCO Trust is proud to say that it has never been sanctioned, nor has any
employee been disciplined by any of our regulators.
The duties of the regulators vary somewhat between organizations and
entity types. However, there are many duties that they have in common,
including ensuring:
- The financial stability of each institution they regulate;
- The safety of customer funds;
- That each company has the appropriate financial controls, procedures,
personnel and policies, so as to reduce the likelihood of errors, fraud,
etc.;
- That each institution meets the requirement of all pertinent rules
and federal and state regulations that apply to its type of institution.
Regulators take their responsibility seriously. This is not only because
it is their duty to the public, but also because they are responsible
to step in if necessary, should an institution not meet its responsibilities.
As a result, they typically require monthly reporting from each institution
under their purview, and they conduct annual audits. Such audits are in
addition to the required audit of the company's books, records, financial
controls, etc., by the institution's external auditing firm. All of these
procedures are designed to prevent and/or detect major risks or problems
before they become serious. Regulators typically require detailed plans
to resolve any outstanding problems, and will also review the results
of such resolution.
It is therefore very important that you understand that the organization
you choose to hold your IRA is regulated and is in good standing. Some
organizations offering IRA services are not directly supervised by a federal
or state regulator. These organizations appoint a bank to act as their
nominal custodian or trustee (to fulfill the legal requirement to offer
IRA services). However, typically, the "administrator" (as such firms
are called) does much or all of the processing and record-keeping. The
risk is that there is no regulator supervising and reviewing the procedures,
controls and processing of these administrators. In many cases, such firms
have ultimately gotten into serious difficulty, gone out of business or
been guilty of outright fraud and theft of customer funds. So be sure
to check out the legal authority of any custodian/trustee with whom you
may do business.
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PENSCO Trust, as a regulated institution, is required to maintain certain insurance
policies. These policies include fidelity insurance (for employee theft,
fraud and dishonesty), generally called a "banker's blanket bond"; an
E & O (errors and omissions) bond; a D & O (Director's and Officer's)
policy; a general liability insurance (for loss of premises or other assets,
etc.), and a workman's compensation insurance policy for its employees.
In addition, a company may maintain additional insurance or increase the
amount of coverage on any of the required policies at its own discretion.
Regulators require periodic evidence that these policies are in effect
and at the appropriate levels for the size and type of business involved.
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Because PENSCO Trust is a non-depository trust company, all cash that PENSCO Trust
customers deposit with PENSCO Trust is deposited daily into a "Cash Reserve"
account (CRA) which is held at a bank that PENSCO Trust chooses. This account
is an interest bearing savings account that is FDIC insured up to $250,000.00,
as standard for all banks. This means that if one of PENSCO Trust Company's
depository banks should fail for any reason, the Federal Deposit Insurance
Corporation would ensure that all customers would receive their cash balances
up to $250,000.00.
PENSCO Trust only uses depository banks with an FDIC rating of either "adequately"
or "well' capitalized. The bank ratings are monitored continuously and
reported to the Board of Director's quarterly for review.
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PENSCO Trust is proud of its track record for leadership and performance in
the retirement industry. PENSCO Trust's mission is to maintain the highest level
of integrity, honesty, knowledge and customer service in its industry.
PENSCO Trust has the distinction of having been consistently on the Greater
Bay's Better Business Bureau's Honor Roll for complaint free operations
over its history.
PENSCO Trust prides itself on the execution of all properly authorized transactions
in a timely fashion. PENSCO Trust has been promising and delivering 48-hour
funding (for no extra charge) for the past thirteen years, while some
of its competitors still charge "expediting" fees for processing within
72 hours.
PENSCO Trust was the first company in its industry on the Internet, and the
first to allow customers to view their account information through its
web-site. PENSCO Trust prides itself on being responsive to customer inquiries,
and on the prompt and fair resolution of customer complaints. Our management
is always available to respond to priority concerns, or customer needs
in regards to their retirement accounts.
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The USA Patriot Act of 2002 (Patriot Act) was enacted into federal law
to strengthen the Bank Secrecy Act (BSA) in an effort to combat terrorism
in the aftermath of the terrorist attacks on September 11, 2001. For the
past several years, the federal regulators, with extensive BSA examination
programs, have been examining banks and thrifts for BSA compliance. However,
non-depository trust company regulators will review and assess BSA compliance
during their regular examinations of non-depository trust companies commencing
October 1, 2003. According to the guidelines of the Association of Independent
Trust Companies (AITCO) and the Banking Commissioner of New Hampshire,
the expectation to enforce the Patriot Act by their chartered members
amounts to implementation of the following policies by PENSCO Trust:
- Name of client
- Date of Birth
- Address
- Identification number (social security or tax ID number)
- Verifying client identity
- Maintain a record of the information obtained
- Determine if client appears on any list of suspected terrorists or terrorist organizations
Since PENSCO Trust is a non-depository trust company, we have always required prospective clients to submit the minimum information now required by this Act and we have implemented the Customer Identification Program herewith, as verification of that information. If the prospective client's identity cannot be verified utilizing the non-documentary method, PENSCO Trust will require a copy of the driver's license or passport.
As required by the regulations, we will retain all required records for a period of five (5) years from the date the account is closed. The description of the document that was relied upon and the methods used to verify the identity of the customer will be retained for five (5) years after opening the account.
PENSCO Trust is in compliance with maintaining copies of such items and safeguarding
them against disclosure under the privacy regulations adopted in 2001
under the Gramm-Leach-Bliley Act. All such records shall be filed or stored
in such a manner as to be accessible within a reasonable period of time.
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