QUESTION: Mr. Long, I’ve reviewed the webinar on self directed IRAs. Simple but possibly offensive question, Entrust is the “trustee” similar to Charles Schwab… If you go out/defunct, what happens to my money/assets that you are administrating?
ANSWER: Actually, the question is not offensive at all. In fact, it shows that you are the type of person for whom a self-directed IRA works best – someone who is careful and does his homework before making an investment decision.
To start with, we have changed our name from Entrust Retirement Services, Inc. to Quest IRA, Inc. as of December 1, 2011. As of January 1, 2012, we will no longer be a franchise of The Entrust Group, Inc. I have attached our announcement letter which explains this for your information, so I won’t type what’s in the letter again in this email.
Our role is not as the trustee or custodian, but rather as the third party administrator, serving as the agent and nominee of the custodian, First Trust Company of Onaga (FTCO), a Kansas trust company. For over 30 years accountholders have trusted First Trust Company of Onaga (FTCO) as their custodian of Self-Directed Custodial Accounts. FTCO serves as custodian for over 80,000 accounts with a market value in excess of $7 billion. FTCO works extensively with IRA Administrators like us to provide superior service for Individual Retirement Accounts, Health Savings Accounts and Educational Savings Accounts. I have attached a .pdf of the Kansas Secretary of State where you can find information on FTCO, as well as a Certificate of Good Standing for Quest IRA, Inc. for your reference.
So there is a significantly sized custodian who is backing us up and watching over what we do, as are their regulators indirectly through their examination of FTCO. Additionally, we are required to have fidelity bond coverage and errors and omissions insurance. Finally, our custodian requires us to have a Business Continuity Plan which includes not only disaster recovery planning but also succession planning in case of the death of the owner of the company (which is me).
We have been doing business now for 9 years, and have grown tremendously in assets and in number of accounts. We have approximately 36 employees in 2 states, and we are growing all the time. When you say “if you go defunct” please remember that your IRA assets are held separately at all times from our company assets, so if Quest IRA, Inc. goes defunct it does not mean that your assets disappear. Instead, either the custodian or another administrator would come in and take over administration of your assets.
I certainly applaud your wish to do your due diligence before entrusting us with your hard earned retirement dollars. I believe we have the strength and stability to operate successfully for many years to come, especially with FTCO as our custodian. As has been seen from some of the turmoil of recent years, the size of the firm does not necessarily guarantee security, but I believe Quest IRA, Inc. is as steady of a company as there can be.
If we can help you with your self-directed IRA needs, please let us know. I wish you happy holidays, and a healthy, happy and prosperous 2012!