Quick Facts

  • $2.5 Million in FDIC Insurance
  • Daily Liquidity
  • 2:30 pm ET Cut-off time
  • Eliminates some risks associated with some money market mutual funds, such as liquidity fees

Liquid Insured Deposits

Liquid Insured Deposits (LIDs) is a leading FDIC-insured sweep program that enables your customers to protect their cash holdings with up to $2.5* million of FDIC insurance. With cash allocations and the demand for FDIC insurance at high levels, Liquid Insured Deposits can help your firm remain competitive in its offerings and provide a tool for financial advisors to gather assets and grow their books of business.

LIDs can be an effective asset gathering program and could be an important component of your business for your high net worth, retiree, business, and offshore customers.

FDIC Protection

Receive up to $2.5 million in FDIC protection ($5 million for joint accounts); cash balances up to the program maximum are guaranteed by the FDIC, which is backed by the full faith and credit of the U.S. Treasury

Simplicity

FDIC-insured accounts are outside of the scope of money market mutual fund reform, which enables you and your clients to spend more valuable time focusing on preserving and growing wealth instead of analyzing the outcome of regulatory mandates

Eligibility

LIDs is available to a variety of account types, including individual, joint, corporate/business, public funds, IRA, UGMA/UTMA, offshore, and trust accounts

Flexibility

Tiered interest rate structure is available so you can reward clients that have placed larger amounts with your firm with potentially higher returns

Convenience

Daily liquidity allows your clients to access their cash when needed

Liquid Insured Deposits works in a similar manner to a money fund sweep. However, instead of available cash in your clients’ accounts being swept into money market mutual funds, it is sent daily into deposit accounts held at FDIC-insured banks in the program.

For Client Use

FDIC Flyer for Businesses

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FDIC Flyer for Individuals

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Company Background

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*Your client’s cash can be FDIC-insured up to $5 million for a joint account and $2.5 for most other account types.

Your funds in the Liquid Insured Deposits (“LIDs”) program are swept by your broker-dealer and deposited into deposit accounts at receiving banks participating in the LIDs program (“participating banks”). The deposit accounts at those participating banks are insured by the Federal Deposit Insurance Corporation (“FDIC”) for up to the current standard maximum deposit insurance amount (“SMDIA”) of $250,000 per eligible depositor, per participating bank, for each ownership capacity or category, including any other balances the depositor may hold at that participating bank directly or indirectly through other intermediaries, including other broker-dealers, for a total LIDs program maximum of up to $2.5 million of FDIC insurance.  If your cash balances exceed that program maximum, the amount exceeding the maximum may not be insured, and allocation to certain program participating banks may exceed $250,000.   If you hold any funds at a participating bank outside the LIDs program, when combined with your deposits held at that participating bank through the LIDs program, the total amount of your deposits at that participating bank could exceed the SMDIA for an ownership capacity or category, and those excess funds will not be FDIC insured. 

The LIDs program is provided to you by your broker-dealer subject to the terms, conditions and disclosures included in the Terms and Conditions for the LIDs program (which you can obtain from your broker-dealer). Before enrolling in the LIDs program, you should carefully read those Terms and Conditions as they contain important disclosures, terms, risks, limitations and information relating to the LIDs program.  No representations or warranties, express or implied, are provided with respect to the LIDs program, except as expressly set forth in those Terms and Conditions. If you are subject to any restrictions or requirements relating to the placement or deposit of your funds, you are solely responsible for determining whether your use of the program satisfies those restrictions and requirements. 

Please contact your broker-dealer to obtain the list of banks or other institutions into which your funds may be placed pursuant to the particular LIDs program offered to you by your broker-dealer.  You should regularly review that bank list and immediately notify your broker-dealer if you do not want to allocate funds to any particular bank or institution. 

 

 

Kathleen Owen

Vice President, Relationship Management
212-830-5218
kowen@rnt.com

Copyright © 2022 Reich & Tang Deposit Networks, LLC.  All rights reserved.  The Liquid Insured Deposits (“LIDs”) program is offered to you by your broker-dealer, subject to the Terms and Conditions for the LIDs program (which you can obtain from your broker-dealer).   Reich & Tang Deposit Solutions, LLC (“R&T” or “we”) provides administrative, recordkeeping and/or other services to broker-dealers that offer the LIDs program to their customers.  R&T’s services for the LIDs program are provided to the broker-dealer subject to the terms and conditions of the written agreements entered into between R&T and the broker-dealer, and R&T provides no representations or warranties, express or implied, except as expressly set forth in those agreements. R&T is not a depository or bank and the LIDs program is NOT, itself, an FDIC-insured product.  Rather, under the LIDs program, a broker-dealer can sweep its customers’ funds to deposit accounts at receiving banks (“participating banks”) that are insured by the Federal Deposit Insurance Corporation (“FDIC”) for up to the current standard maximum deposit insurance amount (“SMDIA”) of $250,000 per eligible depositor, per participating bank, for each ownership capacity or category, including any other balances the depositor may hold at that participating bank directly or indirectly through other intermediaries, including other broker-dealers, for a total LIDs program maximum of up to $2.5 million of FDIC insurance.  Click here for a list of the banks and savings associations with which R&T has a business relationship for the placement of deposits by a broker-dealer under the LIDs program, and into which a broker-dealer may place its customers’ deposits (subject to the terms of the LIDs program and any opt-outs by the broker-dealer or its customer).  Reich & Tang® and R&T® are registered marks of Reich & Tang Deposit Networks, LLC.