About the palm beach letter

Is it a scam? is it real? 770 Truths and half-truths

A few years ago, I created some blogs and videos talking about the “770 account,” and I tried to be as straightforward as possible.  Since then, Tom Dyson and other publishers have called it by different names: The Invisible Account, The Babylonian Code, Manhattan’s Secret Vault, The Underground Account, and now, the 702 Account. It has also been called names such as the IBC and Bank on Yourself (to name a few).

So why are there so many different names for the same account? One word – MARKETING!  Many people, including Tom Dyson, have come up with different names in order to catch people’s attention and sell a subscription for information that is public. I would recommend buying a book that will explain how the “770 account” works – it will cost less, and you will get a lot more information than you would from a subscription.

But let’s examine what Tom Dyson wrote in his teaser: “The 770 Account.”

He has made several good points about the account, but are all of those points true? Or is this a big scam?

I want to examine a few key points and explain what the “770 account” is.

First of all, I want to mention that Tom Dyson is in the business of making money (who isn’t?), and as a business man, he wants to tease people with a lot of information in order to get more subscribers and possibly (I am not sure about this), get some type of compensation.

Having said that, I have to say that all Tom Dyson’s points about this “mysterious” account are partially true, but he pitched all the benefits in such a way that can deceive people.

For example, these are my responses to some of his key points:

Imagine if you had an account that…

1) Paid 40-60 times more than your bank.

Doesn’t that sound amazing? Too good to be true? Well, it is actually true; let me explain. Your bank is probably paying you an interest rate of 0.01% for your savings account (and Tom Dyson mentions that in his article). So how much is 60 times more? If you do the math, that would be just 0.6%. That doesn’t sound that great anymore, right? A little deceitful, don’t you think?

But, how about if a bank is paying a 0.08% interest rate (which is hard to find these days) for a regular savings account? Well, 60 times that is 4.8% - now that is not too bad, but it is still not what a normal person imagines when he or she hears “60 TIMES MORE THAN YOUR BANK!”   When a normal person reads this, he/she thinks he is going to become a millionaire soon! 

2) You could withdraw from at any time, without penalty.

Sign me up! But wait – is that true? Again – it is, but Tom Dyson is not giving you all the information; he is just teasing you with the good news without telling you the restrictions.

This is a long term strategy, so it doesn’t work as a savings account. For the first few years, you don’t have all your money liquid. The first year, you may have only 70% liquid, so if you close the account that year, you will lose 30% of your money. The second year, you may have 80% liquid, etc.  It will take from 4 to 10 years, and sometimes more (depending on how well your agent can structure this system for you), for you to “break even” or have full liquidity over your money. After that, you can withdraw from it at any time, without penalties. But there is a caveat: You cannot just close the account after 10-20 years and expect to get all the profits tax-free. You need to leave the account open at all times, otherwise you will have to pay income taxes on the profit. 

3) You didn’t have to report to the IRS.

True…. But it depends what type of “770 account” you get. If the system is not structured correctly, the company will have to report everything to the IRS, and there will be taxes to pay and maybe some penalties as well.

4) Wouldn’t drop in value in a stock market crash.

Where are we? Disneyland?   Well, actually, this is true … but not all “770 accounts” are like it. You have to be careful – there are some accounts where their growth depends on the stock market, and even though they say it won’t drop in value – it will!  Trust me.  So it all depends on the type of “702 account” you are getting.

5) Could let you retire 100% tax free.

Same thing – depends on the type of “770 account.”

Some other teasers are:

They are a favorite of the 1% in Washington, Wall Street, and Corporate America.

He is right – there is a book I strongly recommend titled: “The Pirates of Manhattan,” by James Dyke.  He talks about this in detail.

This is a little hard to prove (which is why I recommend reading that book). After all, this is the “invisible account.” However, it is easier to prove that banks utilize this “770 account” because they have to report their balance sheet to the FDIC.  So you can go to FDIC.GOV and search for those balance sheets.  If you need help finding these, please send me an email, and I can tell you step by step how to find them. But just for example, Bank of America has $20 billion dollars in this “770 account,” which is more than they have in stocks and real estate combined.

Government restricts the advertising of these 702 Accounts to the public.

Wow, sounds like we need the secret service to get this information for us! 

This is just an exaggeration or manipulation of the information – this is not completely true.  This particular instrument is announced every day on TV, Radio, etc., but you just don’t know you can use it the way Tom Dyson is announcing it. So the way the government restricts the advertising of these accounts only applies if the accounts are announced AS investment accounts. And this leads me to disclose exactly what a “770 account” is:

A “770 account” is permanent life insurance with a twist (I will explain what kind of twist).

Just like a “401K” was named after the 401k section of a chapter in the IRS code, Tom Dyson thought it would be cool to come up with a different name and use the Tax Code number that talks about Life Insurance – section 7702. So one number less and voila! He named it the 702 account, which he previously named the 770 account.

So I know what you are thinking. “How does a life insurance policy give me all these benefits? I always heard that life insurance is the worst investment instrument.”

And you are right – for the most part. 99% or more of life insurance policies focus on the death benefit part. Everybody wants to get the most death benefit for the least premium amount.  If we reverse that approach, and concentrate on the least amount of death benefit you can get (within IRS limits) for the maximum premium amount you can pay, then you can have all the benefits Tom Dyson is talking about.

Is it that simple? It is not, and most life insurance agents don’t even know how you can structure a policy in such a way. There are riders/options that you need to implement, and it can take hours to figure out the best way to structure a policy.

I have been doing this for many years, and by the grace of God, I have mastered “the art” of structuring policies for maximum cash accumulation. 

Now, I am not telling you that you have to use me as your agent in order to get one of these “702 accounts.” There are other agents out there that can help you, but you cannot use your average life insurance agent. I can say that less than 1% of agents have the knowledge and experience to properly set up this type of policy, so be careful, and don’t make a rushed decision.

So how do you know if you are getting a good policy for maximum cash accumulation purposes? Let me tell you what I personally do for my clients: It will take my average client about 5 years to break even, which means that it will take 5 years for the cash value to have the same value (or more) than the total premium paid. After 5 years, you could say that the death benefit didn’t cost you anything. At that point, the policy should be able to give you a rate of return of 5-6% tax-free. My clients can decide to pay the premium for 10 years or less, and not have to pay premiums ever again.

Also, the type of account that Tom Dyson is talking about, is “Whole Life Insurance,” NOT “Universal Life Insurance.” A Universal Life Insurance policy will rely on the stock market, it doesn’t have strong guarantees, and you could lose money if the stock market has a bad year.

So if your agent can give you all those things, you found a good agent. But if you want to make sure you are getting a good policy, you can send me the actual illustration/proposal from your agent, and I will give you my unbiased opinion. I have been receiving a lot of proposals, and sometimes they are good proposals, but most of the time they are not.

If you have any questions, please send me an email at edgar@arceofinancial.com

God bless you!


Edgar I. Arceo

The Hesed Financial Group


2002 Timberloch Place, Suite 200

​The Woodlands, TX 77385

(855) 702-7702