Interest (Ribis) Declaration and Agreement



This declaration relates to “interest” paid by Community Trust Company (“Community Trust”) to its Jewish clients. The beneficial owners of Community Trust (the “Beneficial Owners”) hereby advise their Jewish clients:


  1. They are obligated to structure the business so that they do not pay Ribis (defined as engaging in an interest-bearing loan) to their Jewish clients.
  2. The mechanism that they have chosen to use is commonly known as “Derech Knas” and functions in similar manner to a Heter Iska Kloli. For this Heter Iska to work, its structure must be understood and must be binding on both sides.
  3. This declaration binds the beneficial owners of Community Trust and all of its Jewish clients depositing with Community Trust so that when a Jewish client deposits money, the client agrees to invest according to the structure described below (as an “Investor”).
  4. When the Investor deposits money, Community Trust will supply the Investor with pure silver on the following terms:
    1. in exchange for the monies received, Community Trust agrees to arrange and deliver to the Investor pure silver on the same day as the monies are received, at the prevailing market price (the “Silver Amount”);
    2. if Community Trust fails to hand over the entire Silver Amount at the agreed upon time pursuant to 4(a) above, the Beneficial Owners hereby obligate themselves to pay the cash value of the unpaid Silver Amount (the “Cash Value”) by 9:00am ET the following day plus an additional percentage of the value (referred to hereinafter as “Interest”, the rate of which is the applicable annual interest rate divided by 365 (or 366 on a leap year)), as a penalty payable within a month;
    3. if the Cash Value remains unpaid by 5:00 P.M. ET, Community Trust will arrange for and deliver the Silver Amount to the Investor by 12:00 A.M. at the prevailing market price and that if it fails to hand over the Silver Amount by 12:00 A.M., the Beneficial Owners hereby obligate themselves to pay the Cash Value of the unpaid Silver Amount by 9:00am ET the following day plus the Interest, payable within a month;
    4. Once interest is paid into the Investor’s account, the cumulative sum becomes the Cash Value, and will be rolled over in the same way (i.e. a purchase with a condition stipulating that failure to deliver the Silver Amount on time will incur a penalty);
  5. As long as Community Trust owes money to the Investor, this daily rollover arrangement will continue for a maximum of twenty-five (25) years from day the funds were deposited.
  6. The Investor retains the right to demand the entire amount owed immediately upon default and the penalties will be payable in full. This means that even if Community Trust makes an early repayment, these penalties will be payable in full even if such payment was made due to the Investor demanding payment immediately upon default.
  7. The system used in this agreement follows the heter (approbation) mentioned in the Shulchan Aruch HaRav, authored by the Alter Rebbe, HaRav Shneur Zalman of Liadi, Hilchos Ribis (the Laws of Ribis), Seif/Paragraph 46.
  8. Community Trust has accepted the above by means of a Kinyan Sudar (a form of creating a binding legal agreement in Halacha/Jewish law) in a Beis Din Choshuv.
  9. In the event of any conflict between the terms of this agreement and the terms of any other agreement assumed by the two parties with regard to these funds, the terms of this agreement shall prevail.
  10. The parties agree that any dispute arising out of or in connection with this agreement will be submitted exclusively to a Beis Din situated in Crown Heights, Brooklyn, New York USA in accordance with and subject to, halacha. For clarity, the parties accept that the Beis Din will have exclusive jurisdiction with respect to any issues or disputes raised by either party with respect to this agreement.
  11. It is agreed that the Beneficial Owners hereby bind themselves electronically.