Background

A couple of days ago, I decided that it would make sense to buy T-bills to take advantage of the risk-free interest rate. At a time where the most common savings bank account interest rate is .01% (although some, such as Ally bank, offer up to 1.45%), the Treasury's 1-month Coupon Equivalent Rate of 1.75% looks rather appealing. If you're willing to loan your money to the Treasury for 3 months or 6 months, that rate increases to 1.95% and 2.08% respectively. Please see other rates here. Needless to say, that's a pretty nice improvement for a risk-free^TM investment. If the Federal Government defaults on its debt, you've got bigger issues.

Buying T-bills

While you can buy these from various private brokers, the Treasury is actually beginning to compete with these private companies, and you can purchase them directly from the source. This requires a TreasuryDirect account. Filling out the proper online forms isn't too painful, but after submitting, I was informed by email that my personal information could not, in fact, be verified. My personal theory is that my very common name paired with a lack of tax records created an issue in verifying my identity. Thus, I needed to fill out a form, get a signature guarantee, and mail it to the Treasury.

The Long Endeavour

For those who don't know, a signature guarantee is basically a specialized form of notarization. It must be issued by a Federally-insured, deposit-taking institution which has registered with one of three various databases. This all sounded perfectly reasonable, until I learned that none of the institutions will issue a signature guarantee to non-account holders (Not completely unreasonable given that they are held legally liable). For someone who lacks an account at one of these institutions, the prospects of getting a TreasuryDirect account just diminished.

I began this process by going to my local Well Fargo just to check it they would be willing to issue the guarantee to me. Naturally, they were confused from the start. It wasn't clear to them what I wanted it for or why it was necessary. Regardless, they did assure me that they would not issue it.

Next try: looking at the database of signature guarantors in hopes of finding one who would issue to me. Low-and-behold, the Federal Reserve Bank of Philadelphia is on the list. My hope was that this Federal Institution would issue them for free.

So I called the Fed and asked. The man who answered had absolutely no idea what I was asking about. He'd never even heard about signature guarantees before. None-the-less, he tried his best to transfer me to the proper department - the Research Library.

I ended up on the phone with a very confused librarian who was, although very nice, completely out of her depths to help me with signature guarantees. She gave me the consumer help line for the Fed.

Once I called, I was promptly informed that this number was for complaints against commercial banks. The lady would not, however, let me lodge a complaint against the Federal Reserve Bank of Philadelphia: "Sir, you'd have to call your local congressman for that".

Next stop was the help line for TreasuryDirect, in hope they could recommend somewhere for me and/or an alternative. The first young lady I spoke to was very nice and seemingly helpful. Apparently there was a "Paying Agent Stamp" which the Treasury provides to "most large banks" to stamp any bonds which are being redeemed (I assume Treasury bonds). She told me that this would be suitable for my form.

Back to Wells Fargo: "We've never heard about that, sir, and we're a very large bank".

I called the TreasuryDirect help line again just to confirm I had the name correct and that it would be available to non-account holders: "Well that's up to the private business, good luck" (Read, "drop dead").

How about Santander? The clerk who answered was very receptive and put me on hold to look for the "Paying Agent Stamp". She was able to find a stamp which appeared to match the description that the Treasury had given me, although no one knew the term "Paying Agent Stamp". She said that she'd have to email her branch manager to ask if I could use it for my form. Even if I was an account holder, they still would be hesitant to use it for anything except redeeming bonds, despite what the Treasury told me. That being said, I'm not even account holder, so it's really just luck of the draw at this point.

Conclusion

I still haven't heard back from the Santander employee, but with any luck, I'll only need to make an additional 10 phone calls and spend 3 more days attempting to get this stamp and/or signature guarantee. I may never be able to buy my T-bills, but I think there's a real lesson here: don't give your child the 11th most common first name if you already have the 3rd most common surname.