I walked into the bank lobby to deposit a check the other day and saw a big sign meant to reassure customers about Federal Deposit Insurance Corp. protection.
Unfortunately, the sign actually misled them.
"Deposits guaranteed by FDIC up to $250,000," it said in big blue letters. Then in smaller black type: "Through Dec. 31, 2009."
Which got me thinking: If banks are giving out wrong information, no wonder so many people don't know about the new law.
I am talking about a law Congress approved May 19 extending the $250,000 FDIC insurance limit through Dec. 31, 2013. Previously, lawmakers had temporarily increased the basic limit on FDIC coverage from $100,000 to $250,000 per depositor per insured bank through Dec. 31, 2009.
Despite this important new action by Congress, I have seen at least a dozen news articles in print and online afterward — not to mention three bank newspaper ads and now the sign at my bank — still giving the old and now erroneous expiration date.
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I've also gotten several e-mails and letters from readers with more than $100,000 in bank CDs who thought they would lose FDIC coverage after Dec. 31.
But with the extended deadline, "if you (or your family) have $250,000 or less in all of your deposit accounts at the same insured bank, you don't need to worry about your insurance coverage — your deposits are fully insured through at least 2013," says the Spring 2009 issue of FDIC Consumer News, the agency's quarterly newsletter.
As the newsletter points out, you may actually qualify for more than the basic insurance coverage at one insured bank because the FDIC provides separate insurance coverage for deposits held in different "ownership categories" such as single accounts and joint accounts.
For detailed information about FDIC insurance coverage limits, go to the Web site www.myfdicinsurance.gov or call the FDIC toll-free number 1-877-275-3342.
Also, certain retirement accounts, including bank IRA deposits, will continue to be protected separately up to $250,000 even after 2013 because that is the permanent coverage limit previously set by Congress for these accounts in 2006.
As to FDIC coverage after 2013, while I'm not in the prediction business I expect there will be intense consumer pressure to make the higher limits permanent, or at least give depositors plenty of warning if the limit is to revert to $100,000.