My SD IRA custodian just stole my money! **need advice**

[Andy M.]

Backstory: My SD IRA custodian (American Pension Services) went into receivership earlier this year. They have been sorting through the whole mess and apparently the owner made some bad choices and 25 million is missing. The courts have decided to allocate the loss across every account holder by taking 10% of their funds to cover the loss.

Yep, it sucks, but here we are.

Here is the advice I need from you seasoned SD IRA pros.

1. I need a new custodian, who do you recommend? I want someone simple to work with, and speed of transactions is important.

2. Should I move towards an LLC with checkbook control? I didn't set up my current accounts that way. But it seems to favor speed, but also takes away a layer of separation.

Thanks!

[Dmitriy Fomichenko]

@Andy M. 

unfortunately this is one of the disadvantage when third party is involved :-( 

And sadly APS is not the only company which misappropriated the funds, see this article in The Wall Street Journal about major players Equity Trust and Entrust being sued:

http://online.wsj.com/news/articles/SB100014240527...

Self-directed IRA LLC will eliminate this problem because custodian no longer holding assets/funds of the IRA, but instead you as the manager of the LLC (owned by your IRA) control it.

But there is even better option: self-directed, trustee managed Solo 401k plan. With this investment vehicle you don't need a custodian, you are in total control, you have checkbook access to your retirement funds, and few other major benefits... Here is an article with more details that I wrote recently on BP blog:

http://www.biggerpockets.com/blogs/2810/blog_posts...

In order to establish Solo 401k you need self-employment or business activity, but looking at your profile it seems that you would be good fit for it.