Mortgage Killer Ex 2 Rev

Mortgage Killer: Another approach to Fight the Bank
Things to do list: All names are case sensitive-John Doe or JOHN DOE
The first thing to do is to nderstand !hat is reall" going on !hen a Bank #loans$ mone"% As
!ithot the nderstanding "o !ill have a hard time seeing !hat is stated in their letters as the"
are sing #code$ !ords developed &" la!"ers called #legalese$ that looks like English &t has
different meanings than the spoken !ord English% Ever" thing defends on !here "o are on
the timeline in having "or home taken a!a"% 'f "o have (st received "or NOT')E OF
DEFA*+T on the fact "o have missed , months of hose pa"ments then "o are in good
shape and sending the #NOT')E OF -E+F-E.E)*T'N/ )OND'T'ONA+ A))E0TAN)E$
shold slo! them do!n considera&l"% 1o have plent" of time to std" the D2D$s and Books
and 3ritings &efore proceeding !ith filing paper!ork% 'f "o have a NOT')E OF T4*-TEE
-A+E then "o have no time and "or hose !ill &e sold5 6ickl"5 pro&a&l" in ,7 da"s time%
1o need to file Bankrptc" paper!ork immediatel" or at an" time prior to the sale date to stop
the sale% 1o can find an online filing service for less than 8,77 and here$s a hint don$t state
"o &orro!ed more than 87 dollars from the &ank or the (dge !ill state "o have no e6it" in
the home and &mp it ot to &e sold% 1o can call the Bank an #alleged$ creditor as "o do not
have an" proof "et% Once filed "o !ill get instant protection from the Bank for at least ,7 da"s
and pro&a&l" more like 97 da"s% This !ill &e enogh time to get a defalt on "or paper!ork
"o !ill s&mit to the &ank and pt "o in a mch &etter position% 1o can !ithdra! from the
Bankrptc" later &efore the Jdge s!oops do!n to take an" assets% 'f a cople months have
gone &" since "o defalted on the Banks Notice then start the procedre and std" the D2D$s
and Books !hile "or in the process% A !ord a&ot attorne"s5 the" can &e sefl and !ork for
"or home &t never !ith the same determination that "o !ill have5 second the" have s!orn
an oath to the BA4 association that !ill case them to a&andon "or interests if the Jdge
re6ires them to5 as the" are o&edient to the (dge regardless and !ill lose their livel" hood &"
&eing dis&arred if the" don$t pla" along% 1o !ill &e considered a child5 a !ard of the cort5
incompetent to speak for "orself if "o hire an attorne" as he !ill have fll athorit" to speak
for "o even if it$s against "or !ishes unless you hire him as co-counsel meaning he !old
have to conslt "o &efore speaking or acting in cort% 'f "o do not kno! the s&(ect "o
cannot arge the s&(ect and !ill lose% 'f "o are !eak in spirit5 "o !ill co!er !hen the"
demean "o and attack "o in cort% 't is m" hope that no one ever has to appear to defend
their rights in cort as it is a den of vipers !ith a satanic atmosphere there5 ho!ever people
have &een victorios in cort against Banks !ith a good hearted (dge%
The follo!ing are the steps to follo! to start &ecoming free of the nconsciona&le contract "o
have !ith the Bank:
:% Find a Notar" !illing to follo! throgh on a series of presentments "o !ill make to
the original5 and assigned: lender5 trstee5 and &eneficiar" of "or home #loan$%
;% The Notar" !ill notari<e "or signatre on varios de&t validation letters =perfectl"
legal for them as that is their normal fnction to verif" signatre>atographs? and act as
the presenter &" doing the @proof of serviceA papers =see an eBample of a proof of
service in this disc? and "o !ill re6ire an" responses from the &ank to &e sent to "or
Notar" for verification as a ,
rd
part" !itness% The Notar" can do an"thing an"one else
can do and does not se their #seal$ or stamp on the proof of service5 it !old &e illegal
to do so5 the" are (st acting as a private part"% The &eat" of this is that the &ank
cannot claim the" !ere ignorant of the notar" &eing a dl" licensed notar" &ecase the"
can !itness the notar"s signatre and seal on the docments the notar" notari<ed =the
DEBT 2A+'DAT'ON letters?%
,% The first set of Notices "o !ill send to the &ank5 trstee and &eneficiar" are the
)OND'T'ONA+ A))E0TAN)E OF DEBT *0ON 04OOF OF )+A'C OF DEBT
=see this docment in this folder5 and the D34%
E% 1o !ill also send a D34 =6alified !ritten re6est? demanding more or less the same
proof of claim of de&t o!ed5 to !itness the original promissor" !et-ink signatre
docment5 copies of the loan application docments5 and the acconting for this alleged
#loan$% The" !ill &e happ" to sppl" these docments and "o need them%
F% The Notar" !ill make a proof of service and sign it sing their address as the retrn
address to send an" response the &ank5 trstee5 and &eneficiar" !old &e sending in
response to "or demands%
9% These notices !ill &e sent &" )ertified Cail !ith green signatre retrn cards to gather
cort admissi&le evidence% 1o can se *-0- track and confirm
http:>>!!!%sps%com>shipping>trackandconfirm%htm to verif" deliver" and ' !old
print off a cop" from Track and )onfirm a&ot F-G da"s after posting "or letters to
confirm deliver"% Also5 al!a"s name an individal part" as the recipient5 ie find ot
!ho the )FO =chief financial officer? is of the +oan servicer or Bank5 etc% /oogle it5
search it ot5 and if "o can$t find ot !ho it is (st address it to )FO )>O =care of? the
BANH OF ACE4')A or !hoever "or lender !as% That !a" "o can s&poena the
flesh and &lood man or !oman as "o cannot pt a corporation in (ail5 onl" people go
to prison% 1o !ant a man>!oman to s!eat going to (ail for not responding to "or
letters%
G% The D34$s grant 97 da"s to defalt &t mst &e ans!ered that the" received it and
ackno!ledge it5 !ithin ;7 calendar da"s after receipt% The De&t validation letter is a
#conterclaim$ as the" claim "o o!e a de&t5 so "o have a right to pt in a
#conterclaim$ against them% The response time =in corts? for a conterclaim is ;:
calendar da"s and failre to respond in ;: da"s reslts in a defalt (dgment%
I% After :E da"s from the time "o mailed the de&t validation letter5 mail the first
opportnit" to cre letter5 giving them a second chance to cre their #dishonor$ for
failing to ans!er "or demand for proof of claim% 3hen someone sends "o a demand
it is a dishonor if "o have a contract !ith them to not respond and ans!er the
6estions%
J% After ;: da"s from the time of their receipt of the De&t validation letter if the" don$t
respond or if the" fail to ans!er each point "o !ill send them a NOT')E OF
DEFA*+T that &arrs and estoppes them from claiming the" are the creditor and lent
"o an" #mone"$%
AFTE4 "o send the defalt "o have the right to state the" &reached "or original
contract for the mortgage% After all the mortgage paper!ork states @for a loan ' have
receivedA !hen in fact "o !ere never given a @loanA5 the !ord @loanA !as never defined
in the docment =promissor" note?5 and the" have failed to prove "o actall" #&orro!ed$
an" @mone"A or even an" @creditA from them% No! "o can la!fll" @cancelA the deed of
trst for case% 3hat caseK the fact that the" didn$t have the elements of a la!fl contract
in place5 ie% there !as no @fll disclosreA or a @meeting of the mindsA !herein "o !ere
told the" deposited "or #promissor" note$ and credited "o accont and created the fnds
from thin air that the" advanced to the #seller$% ;% the" didn$t give an" #vala&le
consideration$ 5 !hat did the" give "o of valeK 'n order for them to have given "o vale
the" !old have to sffer a #loss$% )old the" claim the" !old sffer a loss if "o don$t
pa" them mone" if the" created the mone" the" advanced from thin airK and ,% there !as
onl" one signatre>atograph on the contract and an" contract !here "o are the onl"
signer "o can cancel it as "o don$t need there approval as the" didn$t sign it% -ee Tom
-haf$s Bankers Canal contained on this disc for a fll discssion on the &anking loan
&siness% 'n addition to sending off the F'NA+ DEFA*+T "o send off the )ancelled Deed
of Trst as noted &elo!%
:7% -o "o take the )ertified cop" of the Deed of trst and stamp each page !ith the
cancellation stamp and make the docment nll and void throgh cancellation% -ee the
J0 cancellation articles =J0 Foreclosre free? in this folder% 1o have to ask for the +oan
application =origination? docments "o signed5 for "or #loan$ from the &ank and the"
!ill send "o copies% 1o !ill do the cancellation stamp on these as !ell as "o are
canceling "or loan application docments as !ell%
::% No! "o !ill need to file a NOT')E OF 04E-E42AT'ON OF 'NTE4E-T at the
cont" recorders office !ith a cop" of "or cancelled Deed of Trst5 and de&t
validation letters stating that "o have an interest in the real propert" ="or home
identified !ith the assessors information? for the total amont of the loan5 after all it
!as "or promissor" note that created the fnds5 so "o are technicall" the #lender$%
:;% 1o !ill also &enefit from proving the &ank sold "or mortgage to 3all street as a
Cortgage &acked secrit" and have a pooling and servicing agreement !ith a #trst$%
1o can get this information in a -ecriti<ation investigation for a&ot 8:F77% An
eBample is here http:>>!!!%consmerdefenseprograms%com> % C" friend =mortgage
&roker? in )alifornia can do them% 1o !ill get #proof$ the" sold "or note and once
the note and deed are separated the" have no la!fl athorit" to foreclose on the
propert"% Ho!ever in the !orld of evil5 !here the &ankers rn the contr"5 o!n the
contr"5 rn the corts5 and are ver" arrogant5 don$t &e srprised if the (dge refses to
#see$ an" of "or #evidence$ and decides to keep it from &eing presented% 1o can have
a #smoking gn$ and still not get (stice% Ho!ever there are plent" of (dges a!are of
the total scam5 are disgsted !ith all the greed and are rling against the &ankers and
their evil machinations% Have conviction5 hope and make "orself and "or interests
kno!n%
:,% 1o can tr" to do a freedom of information act re6est to the '4- to have them give
proof of the &ank getting paid the fll amont of the loan !hen it !as originated in the
form of a taB form :7JJO'D =this !ill sho! "or secret stra!man accont paid the
O4'/'ANA+ '--*E D'-)O*NT- O'D? and the '4- form !ill sho! the" collected it%
and again , "ears after the origination the" =the Bank? !ill appl" for a :7JJA =A L
a&andonement of the fnds and ac6isition of the fnds &" the &ank?5 lovel"5 the" get
paid the fll amont !hile claiming "o still o!e themK That is frad% 4emem&er
evidence of their frad can land them in (ail5 "o can file an FB' complaint for
fradlentl" stating that "o o!e them mone" !hen "o don$t5 "o can file a complaint
!ith /" )ottrel the chief investigator for the *- 0ostal -ervice for #mail frad$%
An"time someone lies and states "o have a de&t throgh the postal service &" sending
to "o in the mail it is mail frad and 6ite serios%
-o the a&ove is m" efforts at getting the &anks to fess p to &eing villains% ' have sent E notices
like the ones presented here and each and ever" time the &ank5 title compan" and &eneficiar"
have failed to respond !ith an"thing other that ncertified copies of the statements of
pa"ments5 loan applications and deed of trst and promissor" notes &t never an" affidavit that
the" #loaned$ an" of their mone" to the alleged #&orro!er$% The" !ill never give "o proof
to hang themselves !ith% The" like to state its "or falt that "o coldn$t pa" them the mone"
"o &orro!ed% ' agree5 ho!ever it$s their falt that the hose cost 8,775777 or 8F775777 or
!hatever5 &ecase !ithot the eas" mone" offered &" the &anks no one cold pa" that kind of
mone" and ever" seller !old have to settle for mch less% 3old that &e nice for "oK -re
!old5 't !old make the pa"ments to the seller =!ho shold get the mone" and interest? less
and ever"one !old &enefit% The seller !old have a tre right to foreclose &ecase he lent his
la&or5 not mone" printed p for free and the admonition of the Bi&le @the &orro!er is
s&servient to the lenderA !old hold tre% 1o have to actall" #&orro!$ real mone"5 real
la&or5 real vale &efore "o can &e a #&orro!er$% The &ankers have cased ever" !ar5 ever"
famine5 ever" depression5 ever" malad" all in the effort to ac6ire !ealth%
The recorder !ill have the Deed of Trst and "o need a #certified cop"$%
The first nm&er !ill &e the "ear =i%e% ;77E-EJE7I9I !old &e the "ear ;77E?% Ask the )lerk
for help finding it5 and for a @certified cop"A it costs more &t is proof of &eing an eBact cop"
of the original and !ill &e stamped to sho! it is a @certified cop"A %
'f "o have tro&le !ith "or )ont" 4ecorder filing docments "o can get them filed online
in teBas &" sending the #originals$ and the" !ill stamp them and retrn them to "o and post
them in a pdf form for #all$ to see on the !e&% Then "o cold post "or legal notice in the
ne!spaper 6alified for rnning legal notices and reference "or online postingK 3orth a shot%
4ecord online here: !!!%nationalrep&licregistr"%com> the" charge 8I for the :
st
page and
8; for each additional page5 a lot cheaper than the )ont" 4ecorder &t the cont" is the
a&lsolte preferred place to give notice%
:IEJ Flag To: )FO )>O From: John Doe )>O
MIDLAND FUNDING LLC CI!I"ANK #$$% &unnysi'e Lane
()*)"*+ ,-./0 1on'erlan' Cali2ornia
Los Angeles Cali2ornia 34--,---./05N6D 340/40/5 N6D
)OND'T'ONA+ A))E0TAN)E OF DEBT *0ON 04OOF OF )+A'C
)onter)laim in )ommon la!>NOT')E OF DEBT D'-0*TE
'5 John H% Doe5 one of the people
:
of the 4ep&lic of )alifornia5 -i Jris5 &eing dl" s!orn do depose and
sa": that ' am here&" presenting this )OND'T'ONA+ A))E0TAN)E OF DEBT *0ON 04OOF OF
)+A'C for alleged accont M:;...F7G:9E9G:7 C)C AN IF,...,I9E% ' re6ire proof of claim of an"
de&t ' am lia&le for5 evidenced &" a s!orn affidavit from a part" from C'D+AND F*ND'N/ ++)5
)'T'BANH5 C'D+AND )4ED'T CANA/ECENT 'N)% having direct kno!ledge of the de&t and
docments &elo! named5 here&" respectfll" demanded to &e presented% ' re6ire:
:% A certified cop" of the alleged +enders$ &alance sheet and =Federal 4eserve form? F4;7E95 sho!ing
the accont hereafter named #sorce$ that fnded the mone"
;
that an" advances of vala&le
consideration on &ehalf of JOHN H% DOE originated from%
;% The '4- form :7JJO'D relating to this transaction5 !hich !ill identif" the tre lender and sorce of
fnds5 and Form -,-A =registration? to sho! if5 !hen and !here the 0romissor" Note !as sold%
,% The E;E B-F prospects =secrit" filing?5 4)-- and 4)-B call schedles5 and FA- :;F5 :,,5 :E75 F5
and JF forms are re6ired%
E% The cancelled check or draft sho!ing the asset transfer into the accont that fnded the alleged
@loanA%
F% An affidavit from the part" having first hand kno!ledge that la!fl mone" !as advanced on &ehalf
of JOHN H% DOE and not credit
,
in the form of nla!fl &ills of credit or non-redeema&le privatel"
issed promissor" notes nder Title :; sec% E:: NF4N$sO%
9% An affidavit from a part" having first hand kno!ledge s!earing that C'D+AND F*ND'N/ ++)5
)'T'BANH5 C'D+AND )4ED'T CANA/ECENT 'N)% sffered a loss !hen John Doe did not
repa" the alleged mone" advanced on &ehalf of JOHN H% DOE%
G% The name5 position and claim to kno!ledge of agent=s? at C'D+AND F*ND'N/ ++)5 )'T'BANH5
C'D+AND )4ED'T CANA/ECENT 'N)%5 s!earing the affidavits re6ired a&ove%
I% The opportnit" to !itness the original !et-ink #secrit" instrment$ =Deed of Trst?5 and #promissor"
note$ that ' signed that created the alleged de&t% A cop" of the loan application% Failre to prodce the
original promissor" note and Deed of Trst !ill &e evidence of frad in claiming an" right to
foreclose
E
on JOHN H% DOE or John Doe%
J% The la!fl athorit" C'D+AND F*ND'N/ ++)5 )'T'BANH5 C'D+AND )4ED'T
CANA/ECENT 'N)% operated nder to loan an"thing other than gold or silver coin and create a
de&t o&ligation%
1
P%%%at the 4evoltion5 the so7ereignty 'e7ol7e' on the 8eo8leQ and the" are trl" the sovereigns of the contr"5 &t the" are sovereigns !ithot
s&(ects%%%!ith none to govern &t themselves%%%%P% )H'-HO+C v% /EO4/'A =*-? ; Dall E:J5 EFE5 : + Ed EE75 EFF RDA++ =:GJ,? ppEG:-EG;%
;
CONE1: 'n sal and ordinar" acceptation it means gol' sil7er5 or paper mone" sed as circlating medim of eBchange and 'oes not em9race
notes32e'eral reser7e notes55 &onds5 evidences of de&t5 or other personal or real estate% +ane v% 4aile"5 ;I7 H"%,:J5 :,, -%3%;d GE5GJ5I:% NBlacks
+a! E
th
revised =:J9I?pg ::FGO
,
)4ED'T: The a&ilit" of a &siness man to 9orro: money5 or o&tain goods on time5 in conse6ence of the favora&le opinion held &" the
commnit"5 or &" the particlar lender5 as to his solvenc" and relia&ilit"% 0eople v 3asservogle5 GG )al% :G,5 :J 0% ;G7Q in re Ford5 D%)% 3ash%5 :E
F%;d IEI5 IEJQ -tate eB rel% /lo&e-Democrat 0&% )o% 2 /ehner5 ,:9 Co% 9JE5;JE -%3% :7:G5 :7:I NBlacks +a! E
th
revised =:J9I? pg EE7O
A national bank has no power to lend its credit to any person or corporation Bowen v. Needles Nat. Bank, 94 F 925, 36 CCA
553, CERT!RAR "ENE" N 29 #.Ct $%24, 44 &E" 63'
E
+andmark National Bank v% Hesler5 -preme )ort of Hansas No% JI5EIJ =Opinion released Agst ;I5 ;77J?
:7% 0roof that the alleged original contract
F
=Deed of Trst? !as not nconsciona&le for failre to fll"
disclose all aspects of agreement5 failre to sign &" alleged lenders agent5 and failre to eBchange
vala&le consideration%
::% 0roof of compliance !ith the trth in lending la!s of the *nited -tates )ode5 Title :FS:97: et%se6%5
reglation T5 and the Fair De&t )ollection 0rocedres Act%
:;% ' &elieve the claim of a valid de&t o!ed &" JOHN H% DOE to C'D+AND F*ND'N/ ++) &"
C'D+AND is a crime re: :F *%-%)% S:9J; =e? @false5 deceptive5 an misleading representation5 in
connection !ith the collection of an" de&tA sch as the false representation of the character or legal
stats
9
of an" de&t and no evidence to the contrar" eBists%
:,% All attached docments on )drom @EBhi&itsA are added &" this reference for "or de diligence%
Failre to provide verified certified copies and or #originals$ of the re6ired docments !ithin t!ent" one =;:?
calendar da"s &" certified mail Nfor verification prposesO and or &" arraignment to !itness originals5 !ill &e
silent ac6iescence and tacit agreement that JOHN H% DOE or John Doe has no de&t to C'D+AND
F*ND'N/ ++)5 )'T'BANH5 C'D+AND )4ED'T CANA/ECENT 'N)% and that said compan" is
engaging in frad &" stating that the" are the #creditor$
G
5 that the" #loaned$ an" #mone"$
I
or that the" are
entitled to an" vala&le consideration from JOHN DOE or John Doe to satisf" a #de&t$ that !ithot restittion
!old other!ise create a pecniar" #loss$ to them
J
% 0lease take NOT')E that this is a criminal investigation of
the &siness practices of C'D+AND F*ND'N/ ++)5 )'T'BANH5 C'D+AND )4ED'T CANA/ECENT
'N)%5N%A%5 it$s agents5 officers5 emplo"ees5 and attorne"s to determine violations of the *nited -tates
criminal la!s% 1or claim of right in collection of a prported de&t appears to &e fonded pon a false record
in violation of *%-%)% Title :IS ;7G:5 ;7G, =falsif"ing records? and frtherQ claiming and possessing false
allegations and conterfeit secrities Nsecriti<ed promissor" noteO as !ell as n-s&stantiated claims of
o&ligation5 in violation of the Federal 4acketeer 'nflences and )orrpt Organi<ation =4')O?5 *%-%)% Title
:IS :J9: et%se6% and frther: sing the *%-% Cail to present sch frad and false instrment=s? amonting to
Cail Frad5 criminal condct falling nder Title :IS *%-%)% :,E:-Frads5 -!indles la!s% An" response shall
&e sent to Jane Doe NNotar"O )>O 0%O% BoB EI,E5 -anta 4osita5 )alifornia5 NJIG7,-EI,EO N>D Nor ,
rd
part"
!itnessO for verification prposes%
3ithot pre(dice5
B":UUUUUUUUUUUUUUU
Athori<ed representative of JOHN HEN41 DOE
-tate of )alifornia ?
)ont" of -onoma ?
-&scri&ed and s!orn to =or affirmed? &efore me on this UUUUU da" of UUUUUUUUU5 ;7:75
&" UUUUUUUUUUUUUUUUUUUUUUU5 proved to me on the &asis of satisfactor" evidence to &e
the person=s? !ho appeared &efore me%
Notar" 0&lic -ignatre Notar" 0&lic -eal
F
)ONT4A)T: An agreement &et!een t:o or more 8arties5 preliminar" step in making of !hich is offer &" one and acceptance &" other5 in :hich
min's o2 8arties meet an' concur in un'erstan'ing o2 terms% +ee v% Travellers$ 'ns%)o% of Hartford5 )onn%5 :G, -%)% :IF5 :GF -%E% E;J
't is an agreement creating o&ligation5 in !hich there mst &e competent parties5 s&(ect-matter5 legal consideration5 mtalit" of agreement5 and
mtalit" of o&ligation5 and agreement mst not &e so vage or ncertain that terms are not ascertaina&le% H%+ie&es V )o% 2% Hlengen&erg5 )% )%A%
)al%5 ;, F%;
nd
9::5 9:; NBlacks+a!Eth-:J9I5pg ,JEO
9
:F *%-%)% #,4$g) ;ali'ation o2 'e9ts: =a? =E? Wcollector :ill o9tain 7eri2ication o2 the 'e9t<=9> Dis8ute' 'e9ts: 'e9t collector shall cease<
collection o2 the 'e9t5 or an" dispted portion thereof5 ntil the de&t collector o9tains 7eri2ication of the 'e9t or a co8y o2 a ?u'gment<
)ollection activities and commnications that do not other!ise violate this s&chapter ma" contine dring the ,7-da" period referred to in
s&section =a> unless the consumer has notified the de&t collector in !riting that the de&t5 or an" portion of the de&t5 is dispted
G
@Neither5 as inclded in its po!ers not incidental to them5 is it a part of a &ank$s &siness to lend its credit% 'f a &ank cold lend its credit as !ell as
its mone"5 it might5 if it received compensation and !as carefl to pt its name onl" to solid paper5 ma@e a 'eal more than any la:2ul interest on
its mone" !old amont to% 'f not carefl5 the po!er !old &e the mother of panics5W 'ndeed5 lending credit is the eAact o88osite o2 len'ing
money !hich is the real &siness of a &ank5 for !hile the latter creates a lia&ilit" in favor of the &ank5 the former gives rise to a lia&ilit" of the &ank
to another% : Corse5 Banks and Banking5 Fth Ed% -ec 9FQ Cagee5 Banks and Banking5 ,rd Ed% -ec% ;EI%A American EBpress )o% v% )iti<ens -tate
Bank5 :JE N3 E;J%
I
CONE1: 'n sal and ordinar" acceptation it means gol' sil7er5 or paper mone" sed as circlating medim of eBchange and 'oes not em9race
notes5 &onds5 evidences of de&t5 or other personal or real estate% +ane v% 4aile"5 ;I7 H"% ,:J5 :,, -%3%;d GE5 GJ5I:% NBlacks +a! E
th
Ed% pg ::FGO
NFederal 4eserve Notes are not mone" as the" are #notes$O
J
see: First National "an@ o2 Montgomery 7) Berome Daly Dec% J5 :J9I =Jstice )ort5 )redit 4iver To!nship5 -cott )ont"5 Cinnesota?
N*!ICC *F FAUL! AND *((*D!UNI!E !* CUDC
'5 John H% Doe5 one of the people
:7
of the 4ep&lic of )alifornia5 -i Jris5 &eing dl" s!orn do depose and
sa": that ' am here&" presenting this NOT')E OF FA*+T AND O00O4T*N'T1 TO )*4E for alleged
accont M:;...F7G:9E9G:7 C)C AN IF,...,I9E% On UUUUUUUUUUUUU5;7:7 ' had m" Notar" send the
a&ove named part" a @)OND'T'ONA+ A))E0TAN)E OF DEBT *0ON 04OOF OF )+A'C OF
DEBT 2A+'DAT'ONA dated UUUUUUUUUUUUU5;7::5 sent )ertified Cail M UUUUUUUUUUUUUUU5;7::%
't stated in part:
@Failre to provide verified certified copies and or #originals$ of the re6ired docments !ithin t!ent" one =;:? calendar
da"s &" certified mail Nfor verification prposesO and or &" arraignment to !itness5 !ill &e silent ac6iescence and tacit
agreement that JOHN H% DOE or John Doe has no de&t to C'D+AND F*ND'N/ ++)5 )'T'BANH5 C'D+AND
)4ED'T CANA/ECENT 'N)% and that said compan" is engaging in frad &" stating that the" are the #creditor$
::
5 that
the" #loaned$ an" #mone"$ or that the" are entitled to an" vala&le consideration from JOHN DOE or John Doe to satisf"
a #de&t$ that !old other!ise create a pecniar" #loss$ to them%A
Neither '5 nor m" Notar" N,
rd
part" !itnessO has received a response that meets the conditions re6ired &" the
)OND'T'ONA+ A))E0TAN)E and therefore said part" is in dishonor and the time to cre "or dishonor
&" ade6atel" responding is a&ot to eBpire% This NOT')E and /4A)E is a cortes" to give the a&ove noted
addressee the opportnit" to cre their dishonor%
3ithot pre(dice5
B":UUUUUUUUUUUUUUUUU-
Athori<ed representative of JOHN DOE
)ont" of -onoma ?
10
P%%%at the 4evoltion5 the so7ereignty 'e7ol7e' on the 8eo8leQ and the" are trl" the sovereigns of the contr"5 &t the" are
sovereigns !ithot s&(ects%%%!ith none to govern &t themselves%%%%P% )H'-HO+C v% /EO4/'A =*-? ; Dall E:J5 EFE5 : + Ed EE75
EFF RDA++ =:GJ,? ppEG:-EG;%
::
@Neither5 as inclded in its po!ers not incidental to them5 is it a part of a &ank$s &siness to lend its credit% 'f a &ank
cold lend its credit as !ell as its mone"5 it might5 if it received compensation and !as carefl to pt its name onl" to
solid paper5 ma@e a 'eal more than any la:2ul interest on its mone" !old amont to% 'f not carefl5 the po!er
!old &e the mother of panics5W 'ndeed5 lending credit is the eAact o88osite o2 len'ing money !hich is the real
&siness of a &ank5 for !hile the latter creates a lia&ilit" in favor of the &ank5 the former gives rise to a lia&ilit" of the
&ank to another% : Corse5 Banks and Banking5 Fth Ed% -ec 9FQ Cagee5 Banks and Banking5 ,rd Ed% -ec% ;EI%A
American EBpress )o% v% )iti<ens -tate Bank5 :JE N3 E;J%
N*!ICC *F FINAL DCFAUL!6DCFUAL! 6 N*!ICC *F C&!*((CL6C&!*((CL
I Bohn F) Doe one o2 the 8eo8le
#$
o2 the De8u9lic o2 Cali2ornia &ui Buris 9eing 'uly s:orn 'o 'e8ose an' say:
that I am here9y 8resenting this N*!ICC *F FINAL DCFAUL! N*!ICC *F C&!*((CL 2or allege' account
G#$+++.-/#,%,/#- MCM AN 0.H+++H0,% against MIDLAND FUNDING LLC 2or 'ishonoring the
IC*NDI!I*NAL ACCC(!ANCC *F DC"! U(*N (D**F *F CLAIM *F DC"! ;ALIDA!I*NJ 'ate'
KKKKKKKKKKKKK$-## sent 9y Notary Bane Doe 9y Certi2ie' mail GKKKKKKKKKKKKKKKKKK an' recei7e' 9y
MIDLAND FUNDING LLC as sho:n on the green signature recei8t car' onKKKKKKKKKKKKKKK$-##) An' also
'ishonoring the IN*!ICC *F FAUL! AND *((*D!UNI!E !* CUDCJ 'ate' KKKKKKKKKKKK$-## an' sent 9y
Notary Bane Doe 9y Certi2ie' Mail G KKKKKKKKKKKKKKKKKKKK an' recei7e' 9y MIDLAND FUNDING LLC as
sho:n 9y the green signature recei8t car' on KKKKKKKKKKKKKKKK$-#-)
Attache' is the AFFIDA;I! *F N*N-DC&(*N&C 2rom Notary Bane Doe)
MIDLAND FUNDING LLC is here9y esto88e' an' 9arre' 9y Nihil Dicit
#H
acLuiescence
#%
an' latches
#.
2rom
claiming a 'e9t o:e' to it 9y B*FN D*C or Bohn Doe an' is 9arre' 2rom ta@ing a la:2ul or legal action against
B*FN D*C or Bohn Doe 2or collection o2 allege' 'e9t claiming to 9e the cre'itor)
1ithout 8re?u'ice
"y: KKKKKKKKKKKKKKKKKKKKKKKK
AuthoriMe' re8resentati7e 2or B*FN D*C
)ont" of -onoma ?
12
P%%%at the 4evoltion5 the so7ereignty 'e7ol7e' on the 8eo8leQ and the" are trl" the sovereigns of the contr"5 &t the" are
sovereigns !ithot s&(ects%%%!ith none to govern &t themselves%%%%P% )H'-HO+C v% /EO4/'A =*-? ; Dall E:J5 EFE5 : + Ed EE75
EFF RDA++ =:GJ,? ppEG:-EG;%
:,
N'+ D')'T: He sa"s nothing% This is the name of the (dgment !hich ma" &e taken as of corse agisnt a defendant !ho omits to
plead or ans!er the plaintiff$s declaration or complaint !ithin the time limited% 'n some (risdictions it is other!ise kno! as
(dgment @for !ant of a plea%A /ilder v% Cc'nt"re5 ;J TeB% J:Q Falken v% Hosatonic 4% )o%5 9, )onn% ;FI5 ;G A% :::GQ 36il&r v%
Ca"nard5 9 )olo% EI9 NBlks+a!Eth5$9I5pg%::JFO
:E
AD*'E-)EN)E: Ac6iescence and laches are cognate &t not e6ivalent terms% The former is a s&mission to5 or resting
satisfied !ith5 an eBisting state of things5 !hile latches implies a neglect to do that !hich the part" oght to do for his o!n &enefit
or protection% Hence laches ma" &e evidence of ac6iescence% +aches imports a merel" passive assent5 !hile ac6iescence implies
active assent% 'n re 3il&r$s Estate5 ,,E 0a% EF5 F A%;
nd
,;F5,,:%AAc6iensenceA relates to inaction dring performance of an act
!hile @lachesA relates to dela" after act is done% Ba" Ne!fondland )o% v 3ilson V )o%5 ;EDel%)h%,75 E A%;d 99I59G:5 9G,%
@ac6iescence is a species of estoppel%A Bankers$ Trst )o% v% 4ood5 ;:: 'o!a5 ;IJ5;,, N%3%GJE5 I7;5 G, A%+%4% :E;:
NBlks+a!EthEd%5$9I5pg%E7O
:F
+A)HE-5 E-TO00E+ B1: A failre to do something !hich shold &e done or to claim or enforce a right at a proper time%
Htchinson v% Henne"5 )%)%A%N%)%5 ;G F%;d ;FE5 ;F9% A neglect to do something !hich one shold do5 or to seek to enforce a
right at proper time% Jett5 :G: H"% FEI5 :II -%3% 99J59G;% A species of @e6ita&le estoppelA or @estoppel &" matter in pais%A -ee
titles @E6ita&le EstoppelA and @'n 0ais5 Estoppel 'nA%NBlks+a!5EthEd%5$9I5 pg :7:9O

%
Fn )odes from )alifornia civil code
)alifornia interesting codes
)'2 S:G::% 'ntent to Defrad 0&lic
One !ho practices a deceit !ith intent to defrad the p&lic5 or a particlar class of persons5 is deemed to have
intended to defrad ever" individal in that class5 !ho is actall" misled &" the deceit% NAdded :IG;%O
)'2 S:G:;% 4etrn of *nla!fll" O&tained 0ropert"
One !ho o&tains a thing !ithot the consent of its o!ner5 or 9y a consent a2ter:ar's rescin'e' or &" an
nla!fl eBaction !hich the o!ner cold not at the time prdentl" refse5 mst restore it to the person from !hom it !as
ths o&tained5 nless he has ac6ired a title thereto sperior to that of sch other person5 or nless the transaction !as
corrpt and nla!fl on &oth sides% NAdded :IG;%O
)'2 S:G:,% 3ithot Demand
The restoration reLuire' 9y the last section must 9e ma'e :ithout 'eman'5 eBcept !here a thing is o&tained
&" mtal mistake5 in !hich case the part" o&taining the thing is not 9oun' to return it until he has notice o2 the
mista@e) NAdded :IG;%O
)'2 S:G:7% Deceit
A deceit5 !ithin the meaning of the last section5 is either:
:% The sggestion5 as a fact5 of that !hich is not tre5 &" one !ho does not &elieve it to &e treQ
;% The assertion5 as a fact5 of that !hich is not tre5 &" one !ho has no reasona&le grond for &elieving it to &e
treQ
,% The sppression of a fact5 &" one !ho is &ond to disclose it5 or !ho gives information of other facts !hich are
likel" to mislead for !ant of commnication of that factQ or5
E% A promise5 made !ithot an" intention of performing it% NAdded :IG;%O

1FCDC D*C& !FC FDAUD "CGINN F"I FILC&
This docment is meant to take the reader do!n a road the" have likel" never traveled% This is a la"man$s
eBplanation of !hat has &een happening in this contr" that most have no idea or inkling of% 't is intended to give
the reader an overvie! of a s"stemic Frad in this contr" that has reached epic proportions and
0rovoke action to eradicate this scorge that has descended pon the people of America% Depending on !hat "or
sitation is5 "o5 anger or otright disgst at !hat "o are a&ot to learn% The follo!ing information is spported
!ith facts5 eBhi&its5 and la! and is not mere opinion% +et$s start or (orne" of discover" !ith the prchase of a
home and s&se6ent steps in the financial process throgh the life of
the @mortgage loanA% 't all starts at the @closingA !here !e gather !ith other people that are @involvedA in the
process to sign the docments to prchase or ne! home% Do !e reall" kno! !hat goes on at the closingK Are !e
ever told !ho all the participants are in that entire processK Are !e trl" given @fll disclosreA of all the varios
aspects of that entire transaction regarding !hat5 for most people5 is the single largest prchase the" !ill make in
their entire lifeK +et$s start !ith the ver" first part of the transaction% 3e have a virtal stack of papers placed in
front of s and !e are instrcted !here !e are spposed to start signing or initialing on those @closing
docmentsA% There seems to &e so man" different docments !ith enogh legal langage that !e cold read for
hors (st to get throgh them the first time5 mch less &egin to fll" nderstand them% Are !e given a cop" of all
these docments at least G da"s prior to the closing so !e can read and std" these docments so !e fll"
nderstand !hat it is that !e are signingK
And agreeing toK That has never happened for the average consmer and prchaser of a propert" in the last ,7
"ears or more if it ever has at all% 3H1K 3e have a stack of docments placed &efore s at the @closingA that !e
haven$t ever seen &efore and are instrcted !here to sign or initial to complete the transaction and @get or ne!
homeA% 3e depend on the real estate agent5 in most cases5 to &ring the parties together at the closing after !e have
spplied enogh financial data and other re6ested information so
that the @lenderA can determine !hether !e can 6alif" for or @loanA% O&viosl" !e have the @three da" right of
rescissionA &t do !e reall" stop to read all the docments after !e have (st prchased or home and !ant to
move inK 's the thoght that there might &e something !rong !ith !hat !e have (st signed a
primar" thoght in or mind at that timeK Did !e trst the people involved in the transactionK Are !e natrall"
focsing on getting moved into or ne! home and getting settled !ith or famil"K
3ho are the pla"ers involved in the transaction from the perspective of the consmer prchasing a propert" and
signing a @Cortgage NoteA and @DeedA or similar @-ecrit" 'nstrmentA at the closingK There is5 of corse5 the
seller5 the real estate agent=s?5 title insrance compan"5 propert" appraiser !ho is spposed to
properl" determine the vale of the propert"5 and the most o&vios one &eing !ho !e &elieve to &e @the lenderA in
the transaction% 3e are led5 &" all involved5 to &elieve that !e are5 in fact5 &orro!ing mone" from the @lenderA
!hich is then paid to the crrent o!ner of the propert" as compensation for them
relin6ishing an" @claim of o!nershipA to the propert" and transferring that @claim of o!nershipA to s as the
prchaser% 't all seems so simple and clear on its face and then the transaction is completed% After the @closingA
ever"one is all smiles and "o &elieve "o have a ne! home and have to r epa" the @lenderA5 over a period of
"ears5 the mone" !hich "o &elieve "o have @&orro!edA%
'- THE4E -OCETH'N/ 3E DON$T HNO3K
Ever"thing appears to &e relativel" simple and straightfor!ard &t is that reall" the caseK )old it &e that there are
other pla"ers involved in this !hole transaction that !e kno! nothing a&ot that
have a ver" s&stantial financial interest in !hat has (st occrredK )old it &e that those pla"ers that !e are
totall" that falls into the categor" of criminal condctK 't is !ell-esta&lished la! that Frad vitiates =makes void?
an" contract that arises from it% Does this mean that this intentional @lack of disclosreA of the tre natre of the
contract !e have entered into is Frad and !old make the mortgage contract voidK
on its faceK )old it &e that the Frad cold actall" &e @stdied concealment or misrepresentationA that makes
those involved in the act responsi&le and acconta&leK 3hat happens to the @NoteA once it is deposited in the &ank
and is converted to @mone"AK Are there different kinds of mone"K There is mone" of eBchange and mone" of
accont% The" are t!o ver" different things% -ee attached =EBhi&it @BA para ::?5 Affidavit of EBpert 3itness
3alker Todd% 3alker Todd eBplains in his eBpert !itness affidavit that the &anks actall" do convert signatres
into mone"% The definition of @mone"A according to the *niform )ommercial )ode: "Money" means a medium of
exchange authorized or adopted by a domestic or foreign
government and includes a monetary unit of account established by an intergovernmental organization or by
agreement between two or more nations% Cone" can actall" &e in different forms other than !hat !e are
accstomed to thinking% 3hen "o sign "or name on a promissor" note it &ecomes mone" !hether "o are
talking a mortgage note or a credit card applicationX Did the &ankers ever @discloseA this to sK 3ere !e ever
taght an"thing a&ot this in the school s"stem in this contr"K )old it &e that this !hole idea of &eing a&le to
convert or signatre to mone" is a @stdied concealmentA or @misrepresentationA !here those involved &ecome
responsi&le if !e are harmed &" their actionsK 3hat "or home and the" come at a later date and foreclose and
take it from "oK 3old "o consider "orself to &e harmed in an" !a"K 3e !ill &ring this p again ver" shortl"
&t !e need to look at the other docment that is signed at the @closingA that is of great significance%
!FC DCCD *F !DU&!
3h" do !e need a Deed of TrstK 3hat eBactl" '- a Deed of Trst or other similar @-ecrit" 'nstrmentAK 't
spells ot all the details of the contract that "o are signing at the @closingA5 inclding sch things as insrance
re6irements5 preservation and maintenance and all of the financial details of ho!5 !hen5 !here and !h" "o are
going to make pa"ments to the @lenderA for "ears and "ears% 3ait a minteXXXXX Cake pa"ments to the
@lenderAKKKK 3h" do "o have to make pa"ments to the @lenderAKKK Didn$t !e (st esta&lish the fact that "or
hose !as paid for &" 1O*5 !ith "or @Cortgage NoteA that is converted to mone" &" THE BANH
DE0O-'T'N/ 'TK 's there something !rong !ith this pictreK 3e have (st paid for or @homeA &t no! !e are
told !e have to sign a Deed of Trst or similar @-ecrit" 'nstrmentA that &inds s to pa" the @lenderA &ackK 0a"
the @lenderA &ack for !hatK Did the" loan s an" mone"K 4emem&er the part a&ot &anks not &eing a&le to loan
@their or their depositors mone"A nder FEDE4A+ +A3K 3hat a&ot: @'n the federal corts5 it is !ell esta&lished
that a national &ank has no po!er to lend its credit to another &" &ecoming sret"5 indorser5 or garantor for him%A
Farmers and Miners Bank v. Bluefield Nat l Bank5 :: F ;d I,5 ;G: *%-% 99JQ @A national &ank has no po!er to
lend
its credit to an" person or corporation%A Bowen v. Needles Nat. Bank5 JE F J;F5 ,9 ))A FF,5 certiorari denied in
;7 -%)t :7;E5 :G9 *- 9I;5 EE +ED 9,GK 3hat is happening here !ith this @Deed of TrstA or similar @-ecrit"
'nstrmentA that sa"s !e have to pa" all this mone" &ack and if !e don$t5 the" can foreclose and take or homeK
3h" do !e have to have this kind of agreement !hen !e have alread" paid for or home throgh or @Cortgage
NoteA !hich !as converted to mone" B1 THE BANHK )old this possi&l" &e another eBample of @stdied
concealment or misrepresentationA !here those involved
cold &e held acconta&le for their condctK 3hat happens to this Deed of Trst or similar @-ecrit" 'nstrmentA
after !e sign itK 3here does it goK Does it go into the valt for safekeeping like !e
might thinkK -ee attached EBhi&it @)A for s&stantiall" more information%
3HO A4E THE OTHE4 0+A1E4-K 3e have alread" fond ot that the @NoteA doesn$t go into the valt
for safe keeping &t instead is deposited into an accont at the &ank and &ecomes mone"% 3here does the Note go
thenK This is !here things get 2E41 interesting &ecase "or @Cortgage NoteA is then sed to access "or
Treasr" Accont =that "o kno! nothing a&ot? and get credit in the amont of "or Cortgage NoteA from "or
@0repaid Treasr" AccontA% 'f the" process the @NoteA and get paid for it then the" have received the fnds from
1O*4 accont at Treasr" to pa" for 1O*4 home correctK The" then trn arond and &ndle the @NoteA and sell
it to investors on 3all -treet and get paid againX No! let$s see !hat happens to the @Deed of TrstA or similar
@-ecrit" 'nstrmentA after "o have signed it% 1o ma" &e 6ite srprised to kno! that not onl" does it not go
into @safekeepingA it is immediatel" -O+D as an 'N2E-TCENT -E)*4'T1 to one of an" nm&er of investors
tied to 3all -treet% There is a read"5 and !aiting5 market for all of the @mortgage paperA that is prodced &" the
&anks% 3hat happens is the @Deed
of TrstA or other similar @-ecrit" 'nstrmentA is &ndled and -O+D to a &"er and the BANH /ET- 0A'D
FO4 THE 2A+*E OF THE CO4T/A/E A/A'NXX Haven$t the &ankers (st transferred an" risk
on that mortgage to someone else and the" have their mone"K That is a prett" slick !a" of doing thingsX The"
A+3A1- get their mone" right a!a" and ever"one else connected to the transaction
has the lia&ilitiesX 's there something !rong !ith TH'- pictreK Ho! can it possi&l" &e that the &ank has no!
&een paid three times in the amont of "or @prportedA mortgageK Ho! is it that "o still have to pa" "ears and
"ears on this @prportedA loanK 3as an" of this disclosed to "o &efore "o signed the @Deed of TrstA or other
similar @-ecrit" 'nstrmentAK 3old "o have signed AN1 of those docments inclding the @Cortgage NoteA if
"o kne! that this is !hat !as actall" happeningK Do "o think there !ere an"
@copiesA of the @Cortgage NoteA and @Deed of TrstA or other similar @-ecrit" 'nstrmentA made dring this
processK Are those @copiesA (st for the records to &e pt in a file some!here or is there another prpose for themK
)AN 4E04OD*)'N/ A NOTE O4 DEED OF T4*-T BE '++E/A+K
3e have alread" esta&lished that the @Cortgage NoteA and the @Deed of TrstA or other similar @-ecrit"
'nstrmentA are @-ecritiesA &" definition nder the la!% -ecrities are reglated &" the -ecrities and EBchange
)ommission !hich is an agenc" of the Federal /overnment% There are ver" strict reglations a&ot !hat can and
cannot &e done !ith @-ecritiesA% There are ver" strict reglations that appl" to the reprodction or @cop"ingA of
@-ecritiesA: The )onterfeit Detection Act of :JJ;5 0&lic +a! :7; FF75 in -ection E:: of Title ,: of the )ode
of Federal 4eglations5 permits color illstrations of *%-% crrenc" provided: The illstration is of a si<e less
than three forths or more than one and onehalf5
in linear dimension5 of each part of the item illstrated The illstration is one sided All negatives5 plates5
positives5 digiti<ed storage medim5 graphic files5 magnetic medim5 optical storage devices5 and an" other thing
sed in the making of the illstration that contain an image of the illstration or an" part thereof are destro"ed
and>or deleted or erased after their final se Other O&ligations and -ecrities
0hotographic or other likenesses of other *nited -tates o&ligations and secrities and foreign crrencies are
permissi&le for an" non fradlent prpose5 provided the items are reprodced in &lack and !hite and are less
than three 6arters or greater than one and one half times the si<e5 in linear dimension5 of an" part of the original
item &eing reprodced% Negatives and plates sed in making the likenesses mst &e destro"ed after their se for
the prpose for !hich the" !ere made%
!itle #0 U&C O %/$ Uttering counter2eit o9ligations or securities
3hoever5 !ith intent to defrad5 passes5 tters5 p&lishes5 or sells5 or attempts to pass5 tter5 p&lish5 or sell5 or
!ith like intent &rings into the *nited -tates or keeps in possession or conceals an" falsel" made5 forged5
conterfeited5 or altered o&ligation or other secrit" of the *nited -tates5 shall &e fined nder this title or
imprisoned not more than ;7 "ears5 or &oth%
!itle #0 U&C O %/H Dealing in counter2eit o9ligations or securities
3hoever &"s5 sells5 eBchanges5 transfers5 receives5 or delivers an" false5 forged5 conterfeited5 or altered
o&ligation or other secrit" of the *nited -tates5 !ith the intent that the same &e passed5 p&lished5 or sed as tre
and genine5 shall &e fined nder this title or imprisoned not more than ;7 "ears5 or &oth%
!itle #0 U&C O %/% (lates stones or analog 'igital or electronic
images for counterfeiting obligations or securities 3hoever5 !ith intent to defrad5 makes5 eBectes5 ac6ires5
scans5 captres5 records5 receives5 transmits5 reprodces5 sells5 or has in sch person$s control5 cstod"5 or
possession5 an analog5 digital5 or electronic image of an" o&ligation or other secrit"
of the *nited -tates is gilt" of a class B felon"%
Are these reglations al!a"s adhered to &" the @lenderA !hen the" have possession of these @originalA
-E)*4'T'E- and make reprodctions of them &efore the" are @sold to investorsK Ho! mch has &een in the
media in the past ; "ears a&ot people demanding to see the @!et ink signatre NoteA !hen there is a
foreclosre action initiated against themK 1o hear it all the time% 3h" is that sch a &ig isseK -holdn$t the
@lenderA &e a&le to (st &ring the @NoteA and the @Deed of TrstA or similar @-ecrit" 'nstrmentA to the )ort and
sho! that the" have the original docments and are the @holder in de corseA and therefore have a legal right to
forecloseK To foreclose the" mst have BOTH the @Cortgage NoteA and @Deed of TrstA or other similar
@-ecrit" 'nstrmentA O4'/'NA+ DO)*CENT- in their possession at the time
the foreclosre action is initiated% Frthermore5 '- there a real honest to goodness o&ligation to &e collected onK
3h" is it that there is sch a pro&lem !ith @lost Cortgage NotesA as is claimed &" nmeros lenders that are
tr"ing to foreclose toda"K Ho! cold it &e that there cold &e so man" @lostA docments all of a sddenK )old it
&e that the docments !eren$t reall" lost at all5 &t !ere actall" trned into a sorce of revene that !as never
disclosed as &eing a part of the transactionK To &elieve that so man" @originalA docments cold &e legitimatel"
@lostA in sch a short period of time stretches the credi&ilit" of sch
claims &e"ond &elief% )old this &e the reason that CE4- =Cortage Electronic 4egistration -"stems? !as formed
in the :JJ7$s as a !a" to spposedl" @transfer o!nership of a mortgageA !ithot having to have the @original
docmentsA that !old &e re6ired to &e presented to the varios cont" recordersK )old it &e the" HNE3
THE1 3O*+DN$T HA2E THE O4'/'NA+ DO)*CENT- FO4 4E)O4D'N/ and had to devise a s"stem to
get arond that re6irementK 3hen the foreclosre action is filed in the cort the
attorne" for the prported @part" of interestA5 sall" the @lenderA !ho is foreclosing5 files a @)O01A of the
@Deed of TrstA or similar @'nvestment -ecrit"A !ith the )omplaint to &egin foreclosre proceedings% 's that
@)O01A of the @-ecrit" 'nstrmentA !ithin the @reglationsA of Federal +a! nder :I *%-%)% S EGEK 's it
sall" the same si<e or ver" nearl" the same si<e as the original docmentK 1es it is and !ithot 6estion it is a
)O*NTE4FE'T -E)*4'T1X 3ho !as it that prodced that )O*NTE4FE'T -E)*4'T1K 3ho !as involved
in taking that )O*NTE4FE'T -E)*4'T1 to the )ort to file
the foreclosre actionK 3ho is it that is no! legall" in possession of that )O*NTE4FE'T -E)*4'T1K Has
ever"one from the original @lenderA do!n to the )lerk of the )ort !here the foreclosre is
no! &eing litigated &een in possession or is crrentl" in possession of that )O*NTE4FE'T -E)*4'T1K 3hat
a&ot the Trstees !ho are involved in the process of selling foreclosed properties in non(dicial
statesK 3hat a&ot the fact that there is no (dicial proceeding in those states !here the docmentation prported
to &e legal and proper to &ring a foreclosre action can &e verified !ithot eBpensive litigation &" the alleged
@&orro!erAK All the trstee has to do is send a letter to the alleged @&orro!erA stating
the" are in defalt and can sell their propert" at p&lic action% 't is (st A--*CED that the" have the
@O4'/'NA+A docments in their possession as re6ired &" la!% 'n realit"5 in almost ever" sitation5
the" do NOTXXX The" are sing a )O*NTE4FE'T -E)*4'T1 as the &asis to foreclose on a propert" that !as
paid for &" the person !ho signed the @Cortgage NoteA at the closing ta&le that !as
converted to mone" &" the &ank% 3hen it is demanded the" prodce the actal @original signed docmentsA the"
almost al!a"s refse to do so and ask the )ort to @take their !ord for itA that the" have BOTH of the original
docments !hich are a&soltel" re6ired to &e in their possession to &egin foreclosre actions%
Almost ever" time the people that are &eing foreclosed on are a&le to convince the )ort =in (dicial foreclosres?
to demand that those @original docmentsA &e prodced in )ort &" the 0laintiff5
the foreclosre action stops and it is o&vios !h" that happensX THE1 DON$T HA2E THE @O4'/'NA+A
DO)*CENT-% The" have5 instead5 s&mitted a )O*NTE4FE'T -E)*4'T1 to the )ort as their
@proof of claimA to attempt to n(stl" enrich themselves throgh a &latantl" fradlent foreclosre action% One
often cited eBample of this !as the decision handed do!n &" *% -% Federal District )ort
Jdge )hristopher A% Bo"ko of Ohio5 !ho on Octo&er ,:5 ;77G dismissed :E foreclosre actions at one time !ith
scathing footnote comments a&ot the actions of the 0laintiffs and their attorne"s% -ee =EBhi&it @EA?% Not long
after that came the dismissal of ;9 foreclosre cases in Ohio &" *%-% District )ort Jdge Thomas C% 4ose !ho
referenced the Bo"ko rling in his decision% -ee =EBhi&it @FA?% Ho! man" other (dges have not &een so &rave as
to stand on the principles of la! as Jdges Bo"ko and 4ose did5 &t
need to start doing so TODA1K Has an" of this foreclosre activit" crossed state lines in commnications or other
activitiesK Have there &een at least t!o predicate acts of Frad &" the parties involvedK Have the people involved
sed an" t"pe of electronic commnication in this Frad sch as telephone5 faBing or emailK 't is o&vios that
those 6estions have to &e ans!ered !ith a resonding 1E-X 'f that is the case5 then the Frad that has &een
discssed here falls nder the 4')O stattes of Federal +a!% Didn$t the" eventall" take do!n the mo& for
4acketeering nder 4')O stattes "ears agoK 's it time to take do!n the @NE3 COBA !ith 4')O once againK
Ho! cold this kind of sitation ever occr in this contr"K
)old it &e that this !hole entire process cold &e @stdied concealment or misrepresentationA !here the parties
involved are responsi&le nder the la! for their condctK )old it &e that it is no @accidentA that so man" @!et ink
signatreA Notes cannot &e prodced to &ack p the foreclosre actions that are devastating
this contr"K )old it &e that the over!helming se of )O*NTE4FE'T -E)*4'T'E-5 as prported evidence of a
de&t in foreclosre cases5 is B1 DE-'/N and @stdied concealment or misrepresentationA so as to strip the people
of this contr" of their propert" and assetsK )old it &e that a 2E41 s&stantial nm&er of Banks5 Cortgage
)ompanies5 +a! Firms and Attorne"s are gilt" of otright massive Frad5 not onl" against the people of this
contr"5 &t of massive Frad on the )ort as !ell &ecase of this
)O*NTE4FE'T'N/K Ho! cold one possi&l" come to an" other conclsion after learning the facts and
nderstanding the la!K Ho! man" other people are implicated in this CA--'2E F4A*D sch as Trstees and
-heriffs that have sold literall" millions of homes after foreclosre proceedings &ased on these )O*NTE4FE'T
-E)*4'T'E- s&mitted as evidence of a prported o&ligationK Ho! man" (dges kno! a&ot this Frad
happening right in their o!n cortrooms and never did an"thingK Ho! man" of them have
actall" &een 0A'D for making (dgments on foreclosresK 3oldn$t that &e a felon" or at the ver" least5
misprision of felon"5 to kno! !hat is going on and not act to stop it or make it kno!n to athorities in a position
to investigate and stop itK Ho! is it that so man" &anks cold recover financiall"5 so rapidl"5 from the financial
de&acle of ;77I7J5 !ith foreclosres still rnning at record levels5 and "et pa" &ack taBpa"er mone" that !as
sho!ered on them and do it so 6ickl"K )old it &e that !hen the" take &ack a propert" in foreclosre !here the"
never risked an" mone" and actall" !ere n(stl" enriched in the previos
transaction5 that it is eas" to make hge sms &" reselling that propert" and then &eginning the !hole
@*nconsciona&leA process all over again !ith a ne! @&orro!erAK Ho! is it that (st three "ears ago a loan !as
availa&le to virtall" almost an"one !ho cold @fog a mirrorA !ith no docmentation of income or a&ilit" to repa"
a loanK )ommon sense makes "o ask ho! @lendersA cold possi&l" take those kinds of risks% )old it &e that the
a&ilit" to @repa" a loanA !as not an isse at all for the lenders &ecase the"
!ere going to get their profits immediatel" and risk a&soltel" nothing at allK )old it &e that5 if an"thing5 the"
stood to make even more mone" if a person defalted on the @alleged loanA in a short period of timeK The" cold
literall" o&tain the propert" for nothing other than some legal fees and cort filing costs throgh
foreclosre% The" cold then resell the propert" and reap additional n(st profits once againX One does not need
to have &een a finance ma(or in college to figre ot !hat has &een happening once "o are enlightened to the
FA)T-%
3HAT A)T'ON- HA2E 0EO0+E TAHEN TO A2O'D +O-'N/
THE'4 HOCE- 'N FO4E)+O-*4EK
There have &een a nm&er of different actions taken &" people to keep from losing their homes in foreclosre% The
first and most !idel" sed tactic is to demand that the part" &ringing the foreclosre action does5 in fact5 have the
standing to &ring the action% The most important isse of standing is !hether that part" has actal possession of
the @original !et ink signatreA docments from the closing sho!ing the" are the @holder in de corseA% As
previosl" mentioned5 in almost A++ cases the 0laintiff &ringing the action refses to make these docments
availa&le for inspection &" the Defendant in the foreclosre action so the" can5 in fact5 determine the athenticit"
of those docments that are claimed to &e @originalA and prportedl" giving the legal right to foreclose% The fact
that the )orts allo! this to happen repeatedl"
!ithot demanding the 0laintiff &ring the A!et ink signatre docmentsA into the cort for inspection &" the
Defendant5 &egs the 6estion of !hether some of the (diciar" are involved in this Frad% 3here is de process
nder the la! for the Defendant !hen the 0laintiff is NOT 4ED*'4ED &" the )ort to meet that &rden of proof
of standing5 !hen demanded5 to &ring their action of foreclosreK One other option that has &een sed more and
more fre6entl" in recent months to deal !ith foreclosre actions is the issing of a
@Bonded 0romissor" NoteA or @Bill of EBchangeA as pa"ment to the alleged @lenderA as satisfaction of an"
amonts allegedl" o!ed &" the Defendant% As !as earlier descri&ed5 a @NoteA is mone" and as the &anks
demonstrated after the closing5 it can &e deposited in the &ank and converted to mone"% -OCE of the @Bonded
0romissor" NotesA and @Bills of EBchangeA are5 in fact5 negotiated and credit is given to the acconts specified
and all trns ot !ell% -ee =EBhi&it @BA para :;? The pro&lem that has occrred is that CAN1 of the @lendersA sa"
that the @Bonded 0romissor" NotesA and @Bills of EBchangeA are &ogs docments and are !orthless and
fradlent and the" refse to give credit for the amont of the @NoteA the" receive as pa"ment of an alleged de&t
even thogh the" are given specific instrctions on ho! to negotiate the @NoteA% 'sn$t it interesting that THE1 can
take a @NoteA that THE1 print and pt &efore "o to sign at the closing ta&le and deposit it in the &ank and it is
converted to mone" immediatel"5 &t the @NoteA that 1O* isse is !orthless and fradlentK The onl" difference
is 3HO 04'NT- THE NOTEXXXX The" are &oth signed &" the same @&orro!erA and it is that person$s credit that
&acks that @NoteA%
The @lendersA don$t !ant the people to kno! the" can se "or @0repaid Treasr" AccontA5 (st as the &anks do
!ithot "or kno!ledge and consent% -ee =EBhi&it @DA? for more information on@Bills of EBchangeA% The fact
that -OCE of the @Bonded 0romissor" NotesA are negotiated and acconts are settled5 proves &e"ond a shado! of
a do&t that the" are legal -E)*4'T'E- (st like the one that the &ank got from the @&orro!erA at the closing%
3h" then aren$t A++ of the @NotesA processed and credit given to the acconts and the foreclosre dismissedK
Becase &" doing so "o !old &e lo!ering the National De&t and the &ankers !old make less mone"XXXX One
ver" interesting thing that happens !ith these @Bonded
0romissor" NotesA or @Bills of EBchangeA that are s&mitted as pa"ment5 is that the" are 2E41 4A4E+1
4ET*4NED TO THE '--*E4 "et credit is not given to the intended accont% The" are not retrned5 and the
isser is told the" are @&ogs5 fradlent and !orthlessA &t the" are NOT 4ET*4NEDX 3h" !old someone
keep something that is allegedl" @&ogs5 fradlent and !orthlessAK )old it &e that the" are instances% There
cold &e no other eBplanation for the failre to retrn the allegedl" @!orthlessA docments 3H')H A4E
A)T*A++1 -E)*4'T'E-XXX Does the fact that the" keep the @NoteA that !as s&mitted and refse to credit the
accont that it !as !ritten to satisf"5 rise to the level of THEFT OF -E)*4'T'E-K This is (st one more eBample
of the Frad that is so o&vios% This is &t one more eBample of the rthless natre of those !ho !old defrad
the people of this contr"% )ON)+*-'ON- One of the incredi&le aspects of this !hole de&acle is the fact that the
ver" people !ho are participants in this Frad are victims
as !ell% Ho! man" &ank emplo"ees5 (dges5 cort clerks5 la!"ers5 process servers5 -heriffs and others have
mortgagesK Ho! man" of the people !ho !ork in la! offices5 )orthoses5 -heriffs Departments and other
entities that are directl" involved in this Frad have &een fradlentl" foreclosed on themselvesK Ho!
NOT 4EA++1 @BO/*-5 F4A*D*+ENT AND 3O4TH+E--A and the @lenderA has5 in fact5 actall" negotiated
them for 1ET E2EN CO4E *NJ*-T EN4')HCENTK That is eBactl" !hat happens in man" man" people in
or militar"5 la! enforcement5 firefighting and medical fields have lost their homes to this FradK Ho! man" of
"or friends or neigh&ors have lost their homes to these fradlent foreclosresK Ever"one !ho has a mortgage is
a 2')T'C of this frad &t some of the most honest5 trsting5 hardest
!orking and most dedicated people in this contr" have &een the &iggest victims% 3ho are those !ho have &een
the ma(or &eneficiaries of this massive FradK Those !ith the @sperior kno!ledgeA that ena&les them to take
advantage of anotherYs ignorance of the la! to deceive them &" @stdied concealment or
misrepresentationA% This grop of &eneficiaries incldes man" on 3all -treet5 large investors5 and most
notoriosl"5 the &ankers at the top and the la!"ers !ho !ork so hard to enhance their profits
and protect the Frad &" them from &eing eBposed% The time has no! come to make those having sperior
kno!ledge !ho HA2E taken advantage of anotherYs ignorance of the la! to deceive them
&" stdied concealment or misrepresentation to &e held responsi&le for that condct% This isn$t (st an idea% 't is
THE +A3 and it is time to enforce it starting !ith the criminal aspect of the fradX *nder the doctrine of
@4espondeat -periorA the people at the top of these organi<ations are responsi&le for the actions of
those in their emplo"% That is !here the investigations and arrests need to start% 3hat is it going to take to pt a
stop to the destrction of this contr" and the lives of the people !ho live hereK 't is going to
take an prising of the people of this contr"5 as a !hole5 to finall" sa" that the" have had enogh% The
information presented here is &t one part of the &eginning of that prising and the &eginning of the end of the
Frad pon the people of America% 't is o&vios5 as has &een pointed ot here5 !ith spporting evidence5 that
Frad is rampant% 1o no! kno! the stor" and can no longer sa" "o are totall" ninformed a&ot this s&(ect%
This is onl" an otline of !hat needs to5 and !ill5 &ecome common kno!ledge to the people and la! enforcement
agencies in this contr"% 'f "o are in la! enforcement it is 1O*4 D*T1 to take !hat "o have &een given here
and move for!ard !ith "or o!n intense investigation and
root ot the Frad and stop the theft of people$s homes% 1or failre to do so !old make "o an accessor" to the
frad throgh "or inaction no! that "o have &een noticed of !hat is occrring% 'f "o are an attorne" and
receive this information it !old do "o !ell to take it to heart5 and nderstand there is no place for "or
participation in this Frad and if "o participate "o !ill likel" &ecome lia&le for s&stantial damages5 if not more
severe conse6ences sch as prison% 'f "o are in the (diciar" "o !old
do !ell to start follo!ing the letter of the la! if "o haven$t &een5 and start making A++ of those in "or )ort do
like!ise5 lest "o find "orself looking for emplo"ment as so man" others are5 if "o
are not incarcerated as a reslt of "or participation in the frad% 'f "o are part of the la! enforcement
commnit" that enforces legal matters regarding foreclosre "o !old do !ell to make sre that A++ things
have &een done legall" and properl" rather than (st taking the position @' am (st doing m" (o&A and trn a &lind
e"e to !hat "o no! kno!% 'f "o are a &anker5 "o mst kno! that "o are no! going to start &eing held
acconta&le for the destrction "o have !reaked on this contr"% 1o have ever" right to &e5 and shold &e5
afraidWW%ver" afraid% 'f "o are one of the rthless foreclosre la!"ers that has pra"ed on the nmeros people
!ho have lost their homes5 "o need to &e afraid also% 2er"5 2E41 afraid% 3hen people learn the trth a&ot !hat
"o have done to them "o can eBpect to see retaliation for !hat "o have
done% 0eople are going to !ant to see those !ho defraded them &roght to (stice% !hese are not threats by any
stretch of the imagination% These are ver" simple o&servations and the std" of hman &ehavior sho!s s that
!hen people find ot the" have &een defraded in sch a grand manner as this5 the" tend to
&ecome rather angr" and search for those !ho perpetrated the frad pon them% The foreclosre la!"ers and the
&ankers !ill &e standing clearl" in their sights% The 6estion of 3HE4E DOE- THE F4A*D BE/'N has &een
ans!ered% 't &egan right at the closing ta&le and !as perpetated all the !a" to the loss of propert" throgh
foreclosre or the incredi&le pa"ment of ;7 or ,7 "ears of pa"ments and interest &"
the alleged @&orro!erA to those !ho !old conspire to commit Frad5 collsion and conterfeiting and practice
@stdied concealment or misrepresentationA for their o!n n(st enrichment% The simplest of analogies: 3hat
!old happen if "o !ere to make a copy of a 8:77 Federal 4eserve Note and go to 3almart and attempt to se it
to fradlentl" ac6ire items that "o !antedK 1o more than likel" !old &e arrested and charged !ith
conterfeiting nder Title :I *-) S EGE and go to prison% 3hat is
the difference5 other than the magnitde of the frad5 &et!een that scenario and someone !ho makes a copy of a
mortgage secrit"5 and sing it throgh foreclosre5 attempts to fradlentl" ac6ire a propert"K -holdn$t the" &e
treated eBactl" the same nder the la!K The ans!er is o&vios and no! it is starting to happen% !itle "# $%& '
()( 3hoever5 !ith intent to defrad5 makes5 eBectes5 ac6ires5 scans5 captres5 records5 receives5 transmits5
reprodces5 sells5 or has in sch person$s control5 cstod"5
or possession5 an analog5 digital5 or electronic image of an" o&ligation or other secrit" of the *nited -tates is
gilt" of a class B felon"% PFrad vitiates the most solemn )ontracts5 docments and even (dgmentsP N*%-% vs%
Throckmorton5 JI *- 9:5 at pg% 9FO% @'t is not necessar" for rescission of a contract that the part" making the
misrepresentation shold have kno!n that it !as false5 &t recover" is allo!ed even thogh misrepresentation is
innocentl" made5 &ecase it !old &e n(st to allo! one !ho made false representations5 even innocentl"5 to
retain the frits of a &argain indced &" sch representations%A N3hipp v% 'verson5 E, 3is ;d :99O% PAn" false
representation of material facts made !ith kno!ledge of falsit" and !ith intent that it shall &e acted on &" another
in entering into contract5 and !hich is so acted pon5 constittes Yfrad5Y and entitles part" deceived to avoid
contract or recover damages%P Barnsdall 4efining )orn% v% Birnam 3ood Oil )o% J; F ;9 I:G% A thorogh reading
of the attached eBhi&its !ill enlighten one even more5 inclding EBhi&it @/A%+isting of Attached EBhi&its A% Deed
of Trst Template From Freddiemac%com =)alifornia? B% Affidavit of 3alker Todd EBpert 3itness )%
Cemorandm of +a! Bank Frad D% Cemorandm of +a! 0oints of Athorit" Bills of EBchange E% *% -%
District )ort Jdge )hristopher A% Bo"ko Decision F% *% -% District )ort Jdge Thomas C% 4ose Decision /%
-ecriti<ation is '++E/A+
CAhi9it "
A22i'a7it o2 1al@er !o'' CA8ert 1itness
NoteQ Emphasis added to this affidavit !ith 1ello! HighlightingX
-TATE OF C')H'/AN
'N THE )'4)*'T )O*4T FO4 THE )O*NT1 OF OAH+AND
?
BANH ONE5 N%A%5 ? )ase No% 7,-7EGEEI-)T
?
0laintiff5 ? Hon% E%% -osnick
?
v% ? AFF'DA2'T OF 3A+HE4 F% TODD5
? E.0E4T 3'TNE-- FO4 DEFENDANT-
HA4-HA2A4DHAN DA2E and ?
04AT'CA DA2E5 (ointl" and severall"5 ?
?
Defendants% ?
UUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUU
Harshavardhan Dave and 0ratima H% Dave Cichael )% Hammer =0E:G7F?
)>o F:;I Echo 4oad 4"an O% +a!lor =09E9J,?
Bloomfield Hills5 C' EI,7; Dickinson 3right 0++)
Defendants5 in propria persona Attorne"s for Bank One5 N%A%
F77 3ood!ard Avene5 -ite E777
Detroit5 Cichigan EI;;9
=,:,? ;;,-,F77
No! comes the Affiant5 3alker F% Todd5 a citi<en of the *nited -tates and the -tate of
Ohio over the age of ;: "ears5 and declares as follo!s5 nder penalt" of per(r":
:% That ' am familiar !ith the 0romissor" Note and Dis&rsement 4e6est and Athori<ation5
dated Novem&er ;,5 :JJJ5 together sometimes referred to in other docments filed &"
Defendants in this case as the @alleged agreementA &et!een Defendants and 0laintiff &t
called the @NoteA in this Affidavit% 'f called as a !itness5 ' !old testif" as stated herein% '
make this Affidavit &ased on m" o!n personal kno!ledge of the legal5 economic5 and
historical principles stated herein5 eBcept that ' have relied entirel" on docments provided to
me5 inclding the Note5 regarding certain facts at isse in this case of !hich ' previosl" had
no direct and personal kno!ledge% ' am making this affidavit &ased on m" eBperience and
eBpertise as an attorne"5 economist5 research !riter5 and teacher% ' am competent to make
the follo!ing statements%
04OFE--'ONA+ BA)H/4O*ND D*A+'F')AT'ON-
;% C" 6alifications as an eBpert !itness in monetar" and &anking instrments are as follo!s%
For $- years I :or@e' as an attorney an' legal o22icer 2or the legal 'e8artments o2 the
Fe'eral Deser7e "an@s o2 Ne: Eor@ an' Cle7elan') Among other things5 ' !as assigned
responsi&ilit" for 6estions involving &oth novel and rotine notes5 &onds5 &ankers$
acceptances5 secrities5 and other financial instrments in connection !ith m" !ork for the
4eserve Banks$ discont !indo!s and parts of the open market trading desk fnction in Ne!
1ork% 'n addition5 for nine "ears5 ' !orked as an economic research officer at the Federal 4eserve Bank of
)leveland% ' &ecame one of the Federal 4eserve -"stem$s recogni<ed eBperts on the legal histor" of central
&anking and the pledging of notes5 &onds5 and other financial instrments at the discont !indo! to ena&le the
Federal 4eserve to make advances of credit that &ecame or cold &ecome mone"% ' also have read eBtensivel"
treatises on the legal and financial histor" of mone" and &anking and have p&lished several
articles covering all of the s&(ects (st mentioned% ' have served as an eBpert !itness in several trials involving
&anking practices and monetar" instrments% A smmar" &iographical sketch and resme inclding frther details
of m" !ork eBperience5 readings5 p&lications5 and edcation !ill &e tendered to Defendants and ma" &e made
availa&le to the )ort and to 0laintiff$s consel pon re6est%
/ENE4A++1 A))E0TED A))O*NT'N/ 04'N)'0+E- ,% Banks are re6ired to adhere to /enerall" Accepted
Acconting 0rinciples =/AA0?% /AA0 follo!s an acconting convention that lies at the heart of the do&le-entr"
&ookkeeping s"stem called the Catching 0rinciple% This principle !orks as follo!s: 1hen a 9an@ acce8ts
9ullion coin currency chec@s 'ra2ts 8romissory notes or any other similar instruments =hereina2ter
IinstrumentsJ> 2rom customers an' 'e8osits or recor's the instruments as assets it must recor' o22setting
lia9ilities that match the assets that it acce8te' 2rom customers) !he lia9ilities re8resent the amounts that
the 9an@ o:es the customers 2un's acce8te' 2rom customers) 'n a fractional reserve &anking s"stem like the
*nited -tates &anking s"stem5 most of the fnds advanced to &orro!ers =assets of the &anks? are create' 9y the
9an@s themsel7es and are not merel" transferred from one set of depositors to another set of &orro!ers%
4E+E2AN)E OF -*BT+E D'-T'N)T'ON- ABO*T T10E- OF CONE1
E% From m" std" of historical and economic !ritings on the s&(ect5 ' conclde that a common misconception
a&ot the natre of mone" nfortnatel" has &een perpetated in the *%-% monetar" and &anking s"stems5
especiall" since the :J,7s% 'n classical economic theor"5 once economic eBchange has moved &e"ond the &arter
stage5 there are t!o t"pes of mone": in &oth Erope and the *nited -tates5 confsion a&ot the distinctiveness of
these t!o concepts has led to persistent attempts to treat mone" of accont as the e6ivalent of mone" of
eBchange% 'n realit"5 especiall" in a fractional reserve &anking s"stem5 a comparativel" small amont of mone" of
eBchange =e%g%5 gold5 silver5 and official crrenc" notes? ma" spport a vastl" larger 6antit" of &siness
transactions denominated in mone" of accont% The sm of these transactions is the sm of credit eBtensions in the
econom"% 3ith the eBception of cstomar" stores of vale like gold and silver5 the monetar" &ase of the econom"
largel" consists of credit instrments% Against this 9ac@groun' I conclu'e that the Note 'es8ite some
language a9out Ila:2ul moneyJ eA8laine' 9elo: clearly contem8lates 9oth 'is9ursement o2 2un's an'
e7entual re8ayment or settlement in money o2 account =that is money o2 eAchange :oul' 9e :elcome 9ut is
not reLuire' to re8ay or settle the Note>) The factal &asis of this conclsion is the reference in the
Dis&rsement 4e6est and Athori<ation to repa"ment of 8JF5J7F%:9 to Cichigan National Bank from the
proceeds of the Note% That !as an eBchange of the credit of Bank One =0laintiff? for credit apparentl" and
previosl" eBtended to
Defendants &" Cichigan National Bank% Also5 there is no reason to &elieve that 0laintiff !old refse a
s&stittion of the credit of another &ank or &anker as complete pa"ment of the Defendants$ repa"ment o&ligation
nder the Note% This is a case a&ot eBchanges of mone" of accont =credit?5 not a&ot eBchanges of mone" of
eBchange =la!fl mone" or even legal tender?% F% 'ronicall"5 the Note eBplicitl" refers to repa"ment in @la!fl
mone" of the *nited -tates of AmericaA =see @0romise to 0a"A clase?% Traditionall" and legall"5 )ongress defines
the phrase @la!fl mone"A for the *nited -tates% +a!fl mone" !as the form of mone" of eBchange that the
federal government =or an" state? cold &e re6ired &" statte to receive in ; pa"ment of taBes or other de&ts%
Traditionall"5 as defined &" )ongress5 la!fl mone" onl"
inclded gold5 silver5 and crrenc" notes redeema&le for gold or silver on demand% 'n a &anking la! conteBt5
la!fl mone" !as onl" those forms of mone" of eBchange =the forms reserves of a national &ank prior to :J:,
=date of creation of the Federal 4eserve Banks?% %ee* +a!fl Cone"5 +ebster,s New -nternational .ictionary =;d
ed% :JF7?% In light o2 these 2acts I conclu'e that (lainti22 an' De2en'ants eAchange' reci8rocal cre'its
in7ol7ing money o2 account an' not money o2 eAchangeP no la:2ul money :as or 8ro9a9ly e7er :oul' 9e
'is9urse' 9y either si'e in the co7ere' transactions) This conclsion also is consistent !ith the &ookkeeping
entries that nderlie the loan accont in dispte in the
present case% Coreover5 it is p<<ling !h" 0laintiff !old retain the archaic langage5 @la!fl mone" of the
*nited -tates of America5A in its other!ise modern-seeming Note% 't is possi&le that this langage is merel" a
legac" from the pre-:J,, era% Codern credit agreements might inclde repa"ment langage sch as5 @The
repa"ment o&ligation nder this agreement shall contine ntil pa"ment is received in fully and finally collected
funds5A !hich avoids the entire 6estion of @'n !hat form of mone" or cre'it is the repa"ment o&ligation deKA /.
0egal tender5 a related concept &t one that is economicall" inferior to lawful money &ecase it allo!s pa"ment in
instrments that cannot &e redeemed for gold or silver on demand5 has &een the form of mone" of eBchange
commonl" sed in the *nited -tates since :J,,5 !hen
domestic private gold transactions !ere sspended =ntil :JGE?%% Basicall"5 legal tender is !hatever the
government sa"s that it is% The most common form of legal tender toda" is Federal 4eserve notes5 !hich &" la!
cannot &e redeemed for gold since :J,E or5 since :J9E5 for silver% %ee* ,: *%-%)% -ections F:7,5 F::I =&?5 and
F::J =a?% Note: ' 6estion the statement that fed reserve notes cannot &e redeemed for silver since :J9E% 't !as
Johnson !ho declared on :F Carc" :J9G that after :F Jne :J9G that Fed 4es Notes !old not &e eBchanged for
silver and the practice did stop on :F Jne :J9G Z not :J9E% ' &elieve this to &e error in the teBt of the athor$s
affidavit% ). 0egal tender under the $niform &ommercial &ode 1$.&.&.25 -ection :-;7: =;E? =Official )omment?5
is a concept that sometimes srfaces in cases of this natre%% The referenced
Official )omment notes that the definition of money is not limited to legal tender nder the *%)%)% Money is
defined in -ection :-;7: =;E? as @a medim of eBchange athori<ed or adopted &" a domestic or foreign
government and incldes a monetar" nit of accont esta&lished &" an intergovernmental organi<ation or &"
agreement &et!een t!o or more nations%A The relevant Official )omment states that @The test adopted is that of
sanction of government5 !hether &" athori<ation &efore isse or adoption after!ard5 !hich recogni<es the
circlating medim as a part of the official crrenc" of that government% The narro! vie!
that mone" is limited to legal tender is re(ected%A Ths5 ' conclde that the *%)%)% tends to validate the classical
theoretical vie! of mone"% HO3 BANH- BE/AN TO +END THE'4 O3N )4ED'T 'N-TEAD OF 4EA+
CONE1 I% 'n m" opinion5 the &est sorces of information on the origins and se of credit as mone" are in Alfred
Carshall5 CONE15 )4ED'T V )OCCE4)E ;EJ-;F: =:J;J? and )harles 0% Hindle&erger5 A F'NAN)'A+
H'-TO41 OF 3E-TE4N E*4O0E F7-F, =:JIE?% A s"nthesis of these sorces5 as applied to the facts of the
present case5 is as follo!s: As commercial &anks and discont hoses =private &ankers? &ecame esta&lished in
parts of Erope =especiall" /reat Britain? and North America5 &" the mid-nineteenth centr" the" commonl"
made loans to &orro!ers &" eBtending their o!n credit to the &orro!ers or5 at the &orro!ers$ direction5 to third
parties% The t"pical form of sch eBtensions of credit !as drafts or &ills of eBchange dra!n pon themselves
=claims on the credit of the dra!ees? instead of
, dis&rsements of &llion5 coin5 or other forms of mone"% 'n transactions !ith third parties5 these drafts and &ills
came to serve most of the ordinar" fnctions of mone"% The third parties had to determine for themselves !hether
sch @credit mone"A had vale and5 if so5 ho! mch% The Federal 4eserve Act of :J:, !as drafted !ith this
model of the commercial econom" in mind and provided at least t!o mechanisms =the discont !indo! and the
open market trading desk? &" !hich certain t"pes of &ankers$ credits cold &e eBchanged for Federal 4eserve
credits5 !hich in trn cold &e !ithdra!n in la!fl mone"% )redit at the
Federal 4eserve eventall" &ecame the principal form of monetar" reserves of the commercial &anking s"stem5
especiall" after the sspension of domestic transactions in gold in :J,,% Ths5 credit mone" is not alien to the
crrent official monetar" s"stemQ it is (st rarel" sed as a device for the creation of Federal 4eserve credit that5 in
trn5 in the form of either Federal 4eserve notes or &anks$ deposits at Federal 4eserve Banks5 fnctions as mone"
in the crrent monetar" s"stem% 'n fact5 a means &" !hich the Federal 4eserve eBpands the mone" sppl"5 loosel"
defined5 is to set &anks$ reserve re6irements =crrentl"5 sall" ten percent of demand lia&ilities? at levels that
!old encorage &anks to eBtend ne! credit to
&orro!ers on their o!n &ooks that third parties !old have to present to the same &anks for redemption5 ths
leading to an eBpansion of &ank-created credit mone"% 'n the modern econom"5 man" non-&ank providers of credit
also eBtend &ook credit to their cstomers !ithot previosl" setting aside an e6ivalent amont of monetar"
reserves =credit card line of credit access checks issed &" non-&anks are a good eBample of this t"pe of credit?5
!hich also cases an eBpansion of the aggregate 6antit" of credit mone"% The discssion of mone" taken from
Federal 4eserve and other modern sorces in paragraphs :: et se6% is
consistent !ith the accont of the origins of the se of &ank credit as mone" in this paragraph%
AD;ANCC& *F "ANK CDCDI! A& !FC CQUI;ALCN! *F M*NCE J% 0laintiff apparentl" asserts that the
Defendants signed a promise to pa"5 sch as a note=s? or credit application =collectivel"5 the @NoteA?5 in eBchange
for the 0laintiff$s advance of fnds5 credit5 or some t"pe of mone" to or on &ehalf of Defendant% Ho!ever5 the
&ookkeeping entries re6ired &" application of /AA0 and the Federal 4eserve$s o!n !ritings shold trigger close
scrtin" of 0laintiff$s apparent assertions that it lent its fnds5 credit5 or mone" to or on &ehalf of Defendants5
there&" casing them to o!e the 0laintiff 8E775777% According to
the &ookkeeping entries sho!n or other!ise descri&ed to me and application of /AA05 the Defendants allegedl"
!ere to tender some form of money =@la!fl mone" of the *nited -tates of AmericaA is the t"pe of mone"
eBplicitl" called for in the Note?5 secrities or other capital e6ivalent to mone"5 fnds5 credit5 or something else
of vale in eBchange =mone" of eBchange5 loosel" defined?5 collectivel" referred to herein as @mone"5A to repa"
!hat the 0laintiff claims !as the money lent to the Defendants% It is not an unreasona9le argument to state that
(lainti22 a88arently change' the economic su9stance o2 the transaction 2rom that contem8late' in the
cre'it a88lication 2orm agreement note=s> or other
similar instrument=s> that the De2en'ants eAecute' there9y changing the costs an' ris@s to the De2en'ants)
At most5 the 0laintiff eBtended its o!n credit =mone" of accont?5 &t the Defendants !ere re6ired to repa" in
money =mone" of eBchange5 and lawful money at that?5 :hich creates at least the in2erence o2 ineLuality o2
o9ligations on the t!o sides of the transaction =money5 inclding lawful money5 is to &e eBchanged for bank
credit?% CODE4N A*THO4'T'E- ON CONE1 ::%To nderstand !hat occrred &et!een 0laintiff and
Defendants concerning the alleged loan of money or5 more accratel"5 credit5 it is helpfl to revie! a modern
Federal 4eserve description of a &ank$s lending process% %ee5 David H% Friedman5 CONE1 AND BANH'N/ =Eth
ed% :JIE?=apparentl" alread" introdced into this case?: @The commercial &ank lending process is similar to that of
a thrift in that the receipt of cash from depositors increases &oth its assets and its deposit lia&ilities5 !hich ena&les
it to make additional loans and investments. E% % % 3hen a commercial &ank makes a &siness loan5 it accepts as
an asset the &orro!er$s
de&t o&ligation =the promise to repa"? and creates a lia&ilit" on its &ooks in the form of a demand deposit in the
amont of the loan.A =)onsmer loans are fnded similarl"%? Therefore5 the &ank$s original &ookkeeping entr"
shold sho! an increase in the amont of the asset credited on the asset side of its &ooks and a corresponding
increase e6al to the vale of the asset on the lia&ilit" side of its &ooks% !his :oul' sho: that the 9an@ recei7e'
the customers signe' 8romise to re8ay as an asset thus monetizing the customers signature an' creating
on its 9oo@s a lia9ility in the 2orm o2 a 'eman' 'e8osit or other
'eman' lia9ility o2 the 9an@) The &ank then sall" !old hold this demand deposit in a transaction accont on
&ehalf of the cstomer% 'nstead of the &ank lending its money or other assets to the cstomer5 as the cstomer
reasona&l" might &elieve from the face of the Note5 the &ank created fnds for the cstomer$s transaction accont
!ithot the cstomer$s permission5 athori<ation5 or kno!ledge and delivered the credit on its o!n &ooks
representing those fnds to the cstomer5 mean!hile alleging that the &ank lent the cstomer money% 'f 0laintiff$s
response to this line of argment is to the effect that it ackno!ledges that
it lent credit or issed credit instead of mone"5 one might refer to Thomas 0% Fitch5 BA44ON$- B*-'NE--
/*'DE D')T'ONA41 OF BANH'N/ TE4C-5 @)redit &anking5A ,% @Bookkeeping entr" representing a deposit
of fnds into an accont%A Bt 0laintiff$s loan agreement apparentl" avoids claiming that the &ank actall" lent the
Defendants money% The" apparentl" state in the agreement that the Defendants are o&ligated to repa" 0laintiff
principal and interest for the @2ala&le consideration =mone"? the &ank gave the cstomer =&orro!er?%A The loan
agreement and Note apparentl" still delete an" reference to the &ank$s receipt of actal cash vale from the
Defendants and eBchange of that receipt for actal cash
vale that the 0laintiff &anker retrned% #$)Accor'ing to the Fe'eral Deser7e "an@ o2 Ne: Eor@ money is
anything that has 7alue that 9an@s an' 8eo8le acce8t as moneyP money 'oes not ha7e to 9e issue' 9y the
go7ernment) For eBample5 David H% Friedman5 ' BET 1O* THO*/HT% % % % J5 Federal 4eserve Bank of Ne!
1ork =Eth ed% :JIE?=apparentl" alread" introdced into this case?5 eBplains that &anks create ne! mone" &"
depositing 'O*s5 promissor" notes5 offset &" &ank lia&ilities called checking accont &alances% 0age F sa"s5
@Cone" doesn$t have to &e intrinsicall" vala&le5 &e issed &" government5 or &e in an" special form% % % %A :,%The
p&lication5 Anne Carie +% /onc<"5 CODE4N CONE1 CE)HAN')- G-,,5 Federal 4eserve Bank of )hicago
=rev% ed% Jne :JJ;?=apparentl" alread" introdced into this case?5
contains standard &ookkeeping entries demonstrating that money ordinaril" is recorded as a &ank asset5 !hile a
&ank liability is evidence of money that a &ank o!es% The &ookkeeping entries tend to prove that &anks accept
cash5 checks5 drafts5 and promissor" notes>credit agreements =assets? as money deposited to create credit or
check&ook mone" that are &ank liabilities5 !hich sho!s that5 a&sent an" right of setoff5 &anks o!e money to
persons !ho deposit money%% Cash =money o2 eAchange> is money an' cre'it or 8romissory notes =money o2
account> 9ecome money :hen 9an@s 'e8osit 8romissory notes :ith the
intent o2 treating them li@e 'e8osits o2 cash) %ee5 :; *%-%)% -ection :I:, =l2=:? =definition of @depositA nder
Federal Deposit 'nsrance Act?% The 0laintiff acts in the capacit" of a lending or &anking instittion5 and the
ne!l" issed credit or mone" is similar or e6ivalent to a promissor" note5 !hich ma" &e treated as a deposit of
mone" !hen received &" the lending &ank%% Federal 4eserve Bank of Dallas p&lication CONE1 AND
BANH'N/5 page ::5 eBplains that !hen &anks grant loans5 the" create ne! mone"% The ne! mone" is created
&ecase a ne! @loan &ecomes a deposit5 (st like a pa"check does%A CODE4N CONE1 CE)HAN')-5 page 95
sa"s5 @3hat the" N&anksO do !hen the" make loans is to accept
promissor" notes in eBchange for credits to the &orro!ers$ transaction acconts%A The neBt sentence on the same
page eBplains that the &anks$ assets and lia&ilities increase &" the amont of the loans% F
)OCCENTA41 AND -*CCA41 OF A4/*CENT :E% 0laintiff apparentl" accepted the Defendants$ Note and
credit application =mone" of accont? in eBchange for its o!n credit =also mone" of accont? and deposited that
credit into an accont !ith the Defendants$ names on the accont5 as !ell as apparentl" issing its o!n credit for
8JF5J7F%:9 to Cichigan National Bank for the accont of the Defendants% One
reasona&l" might arge that the 0laintiff recorded the Note or credit application as a loan =mone" of accont? from
the Defendants to the 0laintiff and that the 0laintiff then &ecame the &orro!er of an e6ivalent amont of mone"
of accont from the Defendants% #.) !he (lainti22 in 2act ne7er lent any o2 its o:n 8re-eAisting money cre'it
or assets as consi'eration to 8urchase the Note or cre'it agreement 2rom the De2en'ants) =4o&ertson Notes: '
add that !hen the &ank does the forgoing5 then in
that event5 there is an tter failure of consideration for the @loan contractA%? 3hen the 0laintiff deposited the
Defendants$ 8E775777 of ne!l" issed credit into an accont5 the 0laintiff created from 8,975777 to 8E775777 of
ne! mone" =the nominal principal amont less p to ten percent or 8E75777 of reserves that the Federal 4eserve
!old re6ire against a demand deposit of this si<e?% The 0laintiff received 8E775777 of credit or mone" of
accont from the Defendants as an asset% /AA0 ordinaril" !old re6ire that the 0laintiff record a lia&ilit"
accont5 crediting the Defendants$ deposit accont5 sho!ing that the 0laintiff o!es 8E775777 of mone" to the
Defendants5 (st as if the Defendants !ere to deposit cash or a
pa"roll check into their accont% :9% The follo!ing appears to &e a dispted fact in this case a&ot !hich ' have
insfficient information on !hich to form a conclsion: ' infer that it is alleged that 0laintiff refsed to lend the
Defendants 0laintiff$s o!n mone" or assets and recorded a 8E775777 loan from the Defendants to the 0laintiff5
!hich arga&l" !as a 8E775777 deposit of mone" of accont &" the Defendants5 and then !hen the 0laintiff
repaid the Defendants &" pa"ing its o!n credit =mone" of accont? in the amont of 8E775777 to third-part"
sellers of goods and services for the accont of Defendants5 the Defendants !ere repaid their loan to 0laintiff5 and
the transaction !as complete% :G% ' do not have sfficient kno!ledge of the facts in this case to form a conclsion
on the follo!ing dispted points: None of the follo!ing material facts are disclosed in the credit application or
Note or !ere advertised &" 0laintiff to prove that the Defendants are the tre lenders and the 0laintiff is the tre
&orro!er% !he (lainti22 is trying to use the
cre'it a88lication 2orm or the Note to 8ersua'e an' 'ecei7e the De2en'ants into 9elie7ing that the o88osite
occurre' an' that the De2en'ants :ere the 9orro:er an' not the len'er) The follo!ing point is ndispted:
The Defendants$ loan of their credit to 0laintiff5 !hen issed and paid from their
deposit or credit accont at 0laintiff5 &ecame mone" in the Federal 4eserve -"stem =s&(ect
to a redction of p to ten percent for reserve re6irements? as the ne!l" issed credit !as
paid prsant to !ritten orders5 inclding checks and !ire transfers5 to sellers of goods and
services for the accont of Defendants%
)ON)+*-'ON
:I% Based on the foregoing5 0laintiff is sing the Defendant$s Note for its o!n prposes5 and it
remains to &e proven !hether 0laintiff has incrred an" financial loss or actal damages =' do
not have sfficient information to form a conclsion on this point?% 'n an" case5 the inclsion
of the @la!fl mone"A langage in the repa"ment clase of the Note is confsing at &est and
in fact ma" &e misleading in the conteBt descri&ed a&ove%
9
AFF'4CAT'ON
:J% ' here&" affirm that ' prepared and have read this Affidavit and that ' &elieve the foregoing
statements in this Affidavit to &e tre% ' here&" frther affirm that the &asis of these &eliefs is
either m" o!n direct kno!ledge of the legal principles and historical facts involved and !ith
respect to !hich ' hold m"self ot as an eBpert or statements made or docments provided to
me &" third parties !hose veracit" ' reasona&l" assmed%
Frther the Affiant sa"eth naght%
At )hagrin Falls5 Ohio
Decem&er F5 ;77, UUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUU
3A+HE4 F% TODD =Ohio &ar no% 779EF,J?
EBpert !itness for the Defendants
3alker F% Todd5 Attorne" at +a!
::9E -heer&rook Drive
)hagrin Falls5 Ohio EE7;;
=EE7? ,,I-::9J5 faB =EE7? ,,I-:F,G
e-mail: !estoddRadelphia%net
[mailto:!estoddRadelphia%net\
N*!ADE& ;CDIFICA!I*N
At )hagrin Falls5 Ohio
Decem&er F5 ;77,
On this da" personall" came &efore me the a&ove-named Affiant5 !ho proved his identit" to me to
m" satisfaction5 and he ackno!ledged his signatre on this Affidavit in m" presence and stated that he
did so !ith fll nderstanding that he !as s&(ect to the penalties of per(r"%
UUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUU
Notar" 0&lic of the -tate of Ohio
G
CAhi9it C
Memoran'um o2 La: "an@ Frau'
MCM*DANDUM *F LA1 R "ANK FDAUD
' have5 throgh research5 learned the follo!ing to &e tre and most likel" applies to me5 !hich is the reason ' have
re6ested and demanded @the &ankA to validate their claims and prodce prsant to applica&le la!% This
CECO4AND*C serves to spport m" sspicions and identif" criminal facts% The @&ankA allegedl" @loaned me
their mone"A !hen in realit" the" deposited =credited? m" promissor" note and sed that deposit to @pa" m"
sellerA% -orce and reasoning after revie!ing the original file clearl" sho!s this
fact5 !hich is the reason for the @&ankA refsing and failing to validate and to prodce as stiplated &" la!%
Ho!ever5 the trth is ot and there is plent" of la! &acking p the fact that the &ank is criminal%
F*DCCL*&UDC AC!I*N& AND CA&C& LA1FULLE DI&MI&&CD =N*! LC!!ING "ANK
F*DCCL*&C 1I!F*U! LA1FUL ;ALIDA!I*N AND (D*DUC!I*N> "E !FC C*UD!& DUC !*
"ANKS& FAILUDC !* ;ALIDA!C T (D*DUCC A& &!I(ULA!CD "E LA1 AND C*MMI!!CD
I"ANK FDAUDJ AGAIN&! !FC "*DD*1CD FD*M !FC "AD A&&*CIA!I*NS& *FFICIAL 1C"
&I!C :... 3this &ourt has the responsibility to assure itself that the foreclosure plaintiffs have standing and that
sub4ect matter 4urisdiction re5uirements are met at the time the complaint is filed. 6ven without the concerns
raised by the documents the plaintiffs have filed* there is reason to 5uestion the existence of standing and the
4urisdictional amount3. 7ver 89 cases are covered by
the B:; at< http:>>!!!%a&anet%org>rpte>p&lications>ereport>;77I>,>Ohioforeclosres%pdf
:% @A national &ank has no po!er to lend its credit to an" person or corporation % % %A Bo!en v% Needles Nat% Bank5
JE F J;F ,9 ))A FF,5 certiorari denied in ;7 -%)t :7;E5 :G9 *- 9I;5 EE +ED 9,G%
;% )ontr"!ide Home +oans5 'nc% v Ta"lor - Ca"er5 J%5 -preme )ort5 -ffolk )ont" > J>7G
,% American Brokers )ondit v% TACA++OA - Jdge -)HA)H ;IJan;77I Arora +oan -ervices v%
CA)0HE4-ON - Jdge FA4NET' : :Car;77I
E% @A &ank ma" not lend its credit to another even thogh sch a transaction trns ot to have &een of &enefit to
the &ank5 and in spport of this a list of cases might &e cited5 !hich-!old look like a catalog of ships%A
NEmphasis addedO Norton /rocer" )o% v% 0eoples Nat% Bank5 :EE -E F7F% :F: 2a :JF%
F% @'n the federal corts5 it is !ell esta&lished that a national &ank has not po!er to lend its credit to another &"
&ecoming sret"5 indorser5 or garantor for him%AY Farmers and Ciners Bank v% Blefield Nat Yl Bank5 :: F ;d I,5
;G: *%-% 99J%
9% Bank of Ne! 1ork v% -'N/H - Jdge H*4TT :EDec;77G
G% Bank of Ne! 1ork v% TO44E- - Jdge )O-TE++O ::Car;77I
I% Bank of Ne! 1ork v% O4O-)O - Jdge -)HA)H :JNov;77G )iti Cortgage 'nc% v% B4O3N - Jdge
FA4NET' :,Car;77I
J% @The doctrine of ltra vires is a most po!erfl !eapon to keep private corporations !ithin their legitimate
spheres and to pnish them for violations of their corporate charters5 and it pro&a&l" is not invoked too oftenW%
Tinc )ar&onate )o% v% First National Bank5 :7, 3is :;F5 GJ N3 ;;J% American EBpress )o% v% )iti<ens -tate
Bank5 :JE N3 E,7%
P't has &een settled &e"ond controvers" that a national &ank5 nder federal +a! &eing limited in its po!ers and
capacit"5 cannot lend its credit &" garanteeing the de&ts of another% All sch contracts entered into &" its officers
are ltra vires % % %P Ho!ard V Foster )o% v% )iti<ens NatYl Bank of *nion5 :,, -) ;7;5 :,7 -E GFJ=:J;9?%
:7% @% % % checks5 drafts5 mone" orders5 and &ank notes are not la!fl mone" of the *nited -tates %%%A -tate v%
Neilon5 G, 0ac ,;E5 E, Ore :9I%
::% American Brokers )ondit v% TACA++OA - Jdge -)HA)H :: -ep;77G )ontr"!ide Cortgage v%
BE4+'*H - Jdge )O-TE++O : ,Car;77I
:;% Detsche Bank v% Barnes-Jdgment Entr"
:,% Detsche Bank v% Barnes-3ithdra!al of O&(ections and Cotion to Dismiss Detsche Bank v% A+ECAN1
Jdge )O-TE++O 7GJan;77I Detsche Bank v% Ben(amin )4*T Z Jdge H*4TT ;:Ca";77I Detsche Bank v%
1o&anna )4*T - Jdge H*4TT ;:Ca";77I Detsche Bank v% )ABA4O1 - Jdge )O-TE++O 7;Apr;77I
Detsche Bank v% )A-TE++ANO- > ;77GN1-lipOpF7JGI*>- Jdge -)HA)H ::Ca";77G
:E% Detsche Bank v% )A-TE++ANO-> ;77IN1-lipOpF77,,*> - Jdge -)HA)H :EJan ;77I
:F% H-B) v% 2alentin - Jdge -)HA)H calls them liars and dismisses 3'TH pre(dice ]]
:9% Detsche Bank v% )+O*DEN > ;77GN1-lipOpF : G9G*> Jdge -)HA)H : I-ep;77G
:G% Detsche Bank v% ETA/*' - Jdge -)HA)H ;:Dec;77G Detsche Bank v% /4ANT - Jdge -)HA)H
;FApr;77I Detsche Bank v% HA44'- - Jdge -)HA)H 7FFe&;77I
:I% Detsche Bank v% +a)rosse5 )ede5 DT) )omplaint
:J% Detsche Bank v% N')HO++- - Jdge H*4TT ;:Ca";77I Detsche Bank v% 41AN - Jdge H*4TT
;JJan;77I Detsche Bank v% -AC0-ON - Jdge H*4TT :9Jan;77I
;7% Detsche v% Carche - Order to -ho! )ase to 2A)ATE Jdgment of Foreclosre Z :: Jne;77J
;:% /CA) Cortgage ++) v% CATTHE3- - Jdge H*4TT :7Jan;77I /CA) Cortgage ++) v% -E4AF'NE -
Jdge )O-TE++O 7IJan;77I H-B) Bank *-A NA v% )'04'AN' Jdge )O-TE++O 7IJan;77I H-B) Bank
*-A NA v% JA)H - Jdge )O-TE++O 7;Apr;77I 'nd"Cac Bank F-B v% 4ODNE1-4O-- - Jdge H*4TT
:FJan;77I +a-alleBank NA v% )HA4+E*- - Jdge H*4TT 7,Jan;77I +a-alleBank NA v% -CA++- - Jdge
H*4TT 7,Jan;77I 0HH Cortgage )orp v% BA4BE4 - Jdge H*4TT :FJan;77I 0ropert" Asset Canagement v%
H*A1TA 7FDec;77G ;;% 4ivera5 'n 4e -ervices ++) v% -ATTA4 > ;77GN1-lipOpF : IJF*> - Jdge -)HA)H
7JOct;77G
;,% *-Bank NA v% A*/*-TE - Jdge H*4TT ;GNov;77G *-Bank NA v% /4ANT - Jdge H*4TT :EDec;77G
*-Bank NA v% 4O*NDT4EE - Jdge B*4HE ::Oct;77G *-Bank NA v% 2'++A4*E+ - Jdge H*4TT
7:Fe&;77I
;E% 3ells Fargo Bank NA v% HAC0TON - Jdge H*4TT 7, Jan;77I ;F% 3ells Fargo5 +itton +oan v% Farmer
3'TH 04EJ*D')E Jdge -chack Jne;77I
;9% 3ells Fargo v% 4e"es 3'TH 04EJ*D')E5 Frad on )ort V -anctions Jdge -chack Jne;77I
;G% Detsche Bank v% 0ea&od" Jdge Nolan =4eglation T? 'nd"mac Bank5F-B v% Bo"d - -chack J% Janar" ;77J
;I% 'nd"mac Bank5 F-B v% Bethle" - -chack5 J% Fe&rar" ;77J = The tale of man" hats?
;J% +a-alle Bank Natl% Assn% v Ahearn - Appellate Division5 Third Department =0ro -e?
,7% NE3 JE4-E1 )O*4T D'-C'--E- FO4E)+O-*4E F'+ED B1 DE*T-)HE BANH FO4 FA'+*4E TO
04OD*)E THE NOTE
,:% 3hittiker v% Detsche =CECO4AND*C 'N O00O-'T'ON TO DEFENDANT-$ COT'ON- TO D'-C'--2
3hittiker =0+A'NT'FF-$ OBJE)T'ON- TO 4E0O4T AND 4E)OCCENDAT'ON? 3hittiker =DEFENDANT
3E+TCAN5 3E'NBE4/ V 4E'- )O%5 +0A$- 4E-0ON-E TO 0+A'NT'FF-$ OBJE)T'ON- TO 4E0O4T
AND 4E)OCCENDAT'ON? 3hittiker =4E-0ON-E TO 0+A'NT'FF-$ OBJE)T'ON- TO CA/'-T4ATE
J*D/E 0EA4-ON$- 4E0O4T AND 4E)OCCENDAT'ON TO /4ANT 'T- COT'ON TO D'-C'--?
,;% Novastar v% -n"der ] 1lack of standing2 -n"der 1motion to amend w=pre4udice2 -n"der 1response to amend2
,,% 3ashington Ctal v% )it" of )leveland 1+:M$>s motion to dismiss2
,E% ;77I-Ohio-::GGQ D+J Ctge% )apital5 'nc% v% 0arsons =%? ;eversed for lack of standing?
,F% Everhome v% 4o!land
,9% Detsche - )lass Action =4')O? Bank of Ne! 1ork v% TO44E- Z Jdge )O-TE++O : :Car;77I
,G% Detsche Bank Ans!er 3hittiker
,I% Canle" Ans!er 3hittiker
,J% Jstice Arthr C% -chack
E7% Jdge Holschh- -ho! case
E:% Jdge Holschh- Dismissals
E;% Jdge Bo"koYs Detsche Bank Foreclosres
E,% 4ose )omplaint for Foreclosre ^ 4ose Dismissals
EE% OYCalle" Dismissals
EF% )it" Of )leveland v% Banks
E9% Do!d Dismissal
EG% EC) canYt find the note
EI% Oc!en canYt find the note
EJ% *- Bank canYt find the Note
F7% *- Bank - No Note
F:% He" Bank - No Note
F;% 3ells Fargo - Defective pleading
F,% )omplaint in Jack v% CE4-5 )iti5 Detsche
FE% /CA) v% Carsh
FF% Cassachsetts : 4o&in Ha"es v% Detsche Bank
F9% Florida: Detsche BankYs -mmar" Jdgment Denied
FG% TeBas: CE4- v% 1ong > ;nd )ircit )ort of Appeals - 0ANE+: +'2'N/-TON5 DA*0H'NOT5 and
C))O15 JJ%
FI% Nevada: CE4- crshed: 'n re Citchell
FJ% PNeither5 as inclded in its po!ers not incidental to them5 is it a part of a &ankYs &siness to lend its credit% 'f a
&ank cold lend its credit as !ell as its mone"5 it might5 if it received compensation and !as carefl to pt its
name onl" to solid paper5 make a great deal more than an" la!fl interest on its mone" !old amont to% 'f not
carefl5 the po!er !old &e the mother of panics5 % % % 'ndeed5 lending credit
is the eBact opposite of lending mone"5 !hich is the real &siness of a &ank5 for !hile the latter creates a lia&ilit"
in favor of the &ank5 the former gives rise to a lia&ilit" of the &ank to another% - Morse. Banks and Banking Fth Ed%
-ec 9FQ Magee* Banks and Banking5 ,rd Ed% -ec ;EI%P American EBpress )o% v% )iti<ens -tate Bank5 :JE N3
E;J%
97% P't is not !ithin those stattor" po!ers for a national &ank5 even thogh solvent5 to lend its credit to another in
an" of the varios !a"s in !hich that might &e done%P Federal 'ntermediate )redit Bank v% + YHerrison5 ,, F ;d
IE:5 IE; =:J;J?%
9:% PThere is no do&t &t !hat the la! is that a national &ank cannot lend its credit or &ecome an accommodation
endorser%P National Bank of )ommerce v% Atkinson5 FF E EG:%
9;% PA &ank can lend its mone"5 &t not its credit%P First NatYl Bank of Tallapoosa v% Conroe % :,F /a 9:E5 9J -E
::;E5 ,; +4A =N-? FF7%
9,% P%% % the &ank is allo!ed to hold mone" pon personal secrit"Q &t it mst &e mone" that it loans5 not its
credit%P -eligman v% )harlottesville Nat% Bank5 , Hghes 9EG5 Fed )ase No%:;5 9E;5 :7,J%
9E% PA loan ma" &e defined as the deliver" &" one part" to5 and the receipt &" another
part" of5 a sm of mone" pon an agreement5 eBpress or implied5 to repa" the sm !ith or !ithot interest%P
0arsons v% FoB :GJ /a 97F5 :G9 -E 9EE% Also see Hirklandv% Baile"5 :FF -E ;d G7: and *nited -tates v% Neifert
3hite )o%5 ;EG Fed -pp IGI5 IGJ%
9F% PThe !ord Ymone"Y in its sal and ordinar" acceptation means gold5 silver5 or paper mone" sed as a
circlating medim of eBchange % % %P +ane v% 4aile" ;I7 H" ,:J5 :,, -3 ;d GF%
99% PA promise to pa" cannot5 &" argment5 ho!ever ingenios5 &e made the e6ivalent of actal pa"ment %%%P
)hristensen v% Bee&e5 J: 0 :,,5 ,; *tah E79%
9G% @A &ank is not the holder in de corse pon merel" crediting the depositors accont%A Bankers Trst v%
Nagler5 ;;J N1- ;d :E;5 :E,%
9I% PA check is merel" an order on a &ank to pa" mone"%P 1ong v% Hem&ree5 G, 0;d ,J,
9J% PAn" false representation of material facts made !ith kno!ledge of falsit" and !ith intent that it shall &e acted
on &" another in entering into contract5 and !hich is so acted pon5 constittes Yfrad5Y and entitles part" deceived
to avoid contract or recover damages%P Barnsdall 4efining )orn% v% Birnam 3ood Oil )o% J; F ;9 I:G%
G7% PAn" condct capa&le of &eing trned into a statement of fact is representation% There is no distinction
&et!een misrepresentations effected &" !ords and misrepresentations effected &" other acts%P +eonard v% -pringer
:JG 'll F,;% 9E NE
,7:%
G:% @'f an" part of the consideration for a promise &e illegal5 or if there are several considerations for an
nsevera&le promise one of !hich is illegal5 the promise5 !hether !ritten or oral5 is !holl" void5 as it is
impossi&le to sa" !hat part or !hich one of the considerations indced the promise%A Cenominee 4iver )o% v%
Agsts -pies + V ) )o%5:EG 3is FFJ-FG;Q :,; N3 ::;;%
G;% @The contract is void if it is onl" in part connected !ith the illegal transaction and the promise single or
entire%A /ardian Agenc" v% /ardian Ct% -avings Bank5 ;;G 3is FF75 ;GJ N3 I,% G,% @'t is not necessar" for
recision of a contract that the part" making the misrepresentation shold have kno!n that it !as false5 &t
recover" is allo!ed even thogh misrepresentation is innocentl" made5 &ecase it !old &e n(st to allo! one
!ho made false representations5 even innocentl"5 to retain the frits of a &argain
indced &" sch representations%A 3hipp v% 'verson5 E, 3is ;d :99% GE% PEach Federal 4eserve &ank is a separate
corporation o!ned &" commercial &anks in its region %%%P +e!is v% *nited -tates5 9I7 F ;7 :;,J =:JI;?%
F*1 AND 1FE !FC "ANK& &CCDC!LE AND QUICKLE I&1I!CF CUDDCNCEJ
NOT FULFILL THE LOAN AGREEENT !THE "ONTRA"T# O$TAIN %OUR ORTGAGE NOTE
&ITHOUT IN'E(TING ONE "ENT TO FOR"E %OU TO LA$OR TO )A% INTERE(T ON THE
"ONTRA"T TO REFU(E TO FULFILL THE "ONTRA"T TO A*E %OU A +E)O(ITOR !NOT A
$ORRO&ER#
The oldest scheme throghot Histor" is the changing of crrenc"% 4emem&er the mone"changers in the temple
=B'B+E?K ,If -ou lend mone- to - .eo.le/ to t0e .oor among -ou/ -ou are not to act as a creditor to 0im1 -ou
s0all not c0arge 0im interest2 E3odus 44546. The" changed crrenc" as a &siness% 1o !old have to convert to
Temple crrenc" in order to &" an animal for sacrifice% The Temple Cerchants made mone" &" the eBchange%
The Bi&le calls it n(st !eights and measres5 and (dges it to
&e an a&omination% Jess cleared the Temple of these a&ominations% Or )hristian Fonding Fathers did the same%
Ben Franklin said in his ato&iograph"5 P%%% the ina&ilit" of the colonists to get the po!er to isse their o!n mone"
permanentl" ot of the hands of Hing /eorge ''' and the international &ankers !as the prime reason for the
revoltionar" !ar%A The "ear :J:, !as the third attempt &" the Eropean &ankers to get their s"stem &ack in place
!ithin the *nited -tates of America% 0resident Andre! Jackson ended the second attempt in :I,9% 3hat the"
cold not !in militaril" in the 4evoltionar" 3ar the" attempted to accomplish &" a &anking mone" scheme
!hich allo!ed the Eropean Banks to o!n the mortgages on nearl" ever" home5 car5 farm5 ranch5 and &siness at
no cost to the &ank% 4e6iring @3e the 0eopleA to pa" interest on the e6it" !e lost and the &ank got free% Toda"
people &elieve that cash and coins &ack p the all checks% 'f "o deposit 8:77 of cash5 the &ank records the cash as
a &ank asset =de&it? and credits a Demand Deposit Accont =DDA?5 sa"ing that the &ank o!es "o 8:77% For the
8:77 lia&ilit" the &ank
o!es "o5 "o ma" receive cash or !rite a check% 'f "o !rite a 8:77 check5 the 8:77 lia&ilit" "or &ank o!es
"o is transferred to another &ank and that &ank o!es 8:77 to the person "o !rote the check to% That person can
!rite a 8:77 check or receive cash% -o far there is no pro&lem% 4emem&er one thing ho!ever5 for the check to &e
valid there mst first &e a deposit of mone" to the &anks A&&C!&5 to make the check =lia&ilit"? good% The lia&ilit"
is like a F*LDING ACC*UN! claiming that mone" !as deposited to make the check good% Fere then is ho:
the s:itch in currency ta@es 8lace The &ank advertises it loans$ mone"% The &ank sa"s5 Psign hereP% Ho!ever the
&ank never signs &ecase the" kno! the" are not going to lend "o theirs5 or other depositorYs mone"% *nder the
la! of &ankrptc" of a nation5 the mortgage note acts like mone"% The &ank makes it look like a loan &t it is not%
It is an eAchange) !he 9an@ recei7es the eLuity in the home you are 9uying 2or 2ree in eAchange 2or an
un8ai' 9an@ lia9ility that the 9an@ cannot 8ay :ithout returning the mortgage note) I2 the 9an@ ha'
2ul2ille' its en' o2 the contract the 9an@ coul' not ha7e recei7e' the eLuity in your home 2or 2ree) !he 9an@
recei7es your mortgage note :ithout in7esting or ris@ing onecent) !he 9an@ sells the mortgage note
recei7es cash or an asset that can then 9e con7erte' to cash an' still re2uses to loan you their or other
'e8ositorsS money or
8ay the lia9ility it o:es you) On a 8:775777 loan the &ank does not give p 8:775777% The &ank receives
8:775777 in cash or an asset and isses a 8:775777 lia&ilit" =check? the &ank has no intention of pa"ing% The
8:775777 the &ank received in the alleged loan is the e6it" =lien on propert"? the &ank received !ithot
investment5 and it is the 8:775777 the individal lost in e6it" to the &ank% The 8:775777 e6it" the individal lost
to the &ank5 !hich demands he>she repa" pls interest% The loan agreement the &ank told "o to sign said +OAN%
The &ank &roke that agreement% The &ank no! o!ns the mortgage note !ithot loaning an"thing% The &ank then
deposited the mortgage note in an accont the" opened nder "or name !ithot "or athori<ation or
kno!ledge% The &ank !ithdre! the mone" !ithot "or athori<ation or kno!ledge sing a forged signatre% The
&ank then claimed the mone" !as the &anks$ propert"5 !hich is a fradlent conversion% The mortgage note !as
deposited or de&ited =asset? and credited to a Direct Deposit
Accont5 =DDA? =lia&ilit"?% The credit to Direct Deposit Accont =lia&ilit"? !as sed from !hich to isse the
check% The &ank (st s!itched the crrenc"% The &ank demands that "o cannot se the same crrenc"5 !hich the
&ank deposited =promissor" notes or mortgage notes? to discharge "or mortgage note% The &ank refses to loan
"o other depositorsY mone"5 or pa" the lia&ilit" it o!es "o for having deposited "or mortgage note% To pa" this
lia&ilit" the &ank mst retrn the mortgage note to "o% Ho!ever instead of the &ank pa"ing the lia&ilit" it o!es
"o5 the &ank demands "o se these npaid &anklia&ilities5 created in the alleged loan process5 as the ne!
crrenc"% No! "o mst la&or to earn the &ank crrenc" =npaid lia&ilities created in the alleged loan process? to
pa" &ack the &ank% 3hat the &ank received for free5 the individal lost in e6it"% 'f "o tried to repa" the &ank in
like kind crrenc"5 =!hich the &ank deposited !ithot
"or athori<ation to create the check the" issed "o?5 then the &ank claims the promissor" note is not mone"%
The" !ant pa"ment to &e in legal tender =check &ook mone"?% The mortgage note is the mone" the &ank ses to
&" "or propert" in the foreclosre% The" get "or real propert" at no cost% 'f the" accept "or promissor" note to
discharge the mortgage note5 the &ank can se the promissor" note to &" "or home if "o sell it% Their pro&lem
is5 the promissor" note stops the interest and there is no lien on the
propert"% 'f "o sell the home &efore the &ank can find ot and se the promissor" note to &" the home5 the &ank
lost% The &ank claims the" have not &oght the home at no cost% Destion is5 !hat right does the &ank have to
receive the mortgage note at no cost in direct violation of the contract the" !rote and refsed to sign or flfill% B"
demanding that the &ank flfill the contract and not change the crrenc"5 the &ank
mst deposit "or second promissor" note to create check &ook mone" to end the frad5 ptting ever"one &ack in
the same position the" !here5 prior to the frad5 in the first place% Then all the homes5 farms5 ranches5 cars and
&sinesses in this contr" !old &e redeemed and the e6it" retrned to the rightfl o!ners =the people?% 'f not5
ever" time the homes are refinanced the &anks get the e6it" for free% 1o and ' mst la&or ;7 to ,7 "ears fll
time as the &ankers sit &ehind their desks5 laghing at s &ecase !e are too
stpid to figre it ot or to force them to flfill their contract% The 8:775777 created inflation and this increases the
e6it" vale of the homes% On an average homes are refinanced ever" G :>; "ears% 3hen the home is refinanced
the &ank again receives the e6it" for free% 3hat the &ank receives for free the alleged &orro!er loses to the &ank%
According to the Federal 4eserve Banks$ o!n &ook of 4ichmond5 2a% titled @1O*4 CONE1A page seven5
I)))'eman' 'e8osit accounts are not legal ten'er)))J 'f a promissor" note is legal tender5 the &ank mst accept it
to discharge the mortgage note% The &ank changed the crrenc" from the mone" deposited5 =mortgage note? to
check &ook mone" =lia&ilit" the &ank o!es for the mortgage note deposited? forcing s to la&or to pa" interest on
the e6it"5 in real propert" =real estate? the &ank received for free% This cost !as not disclosed in N*!ICC !*
CU&!*MCD DCQUIDCD "E FCDCDAL
LA1 Fe'eral Deser7e Degulation U) 3hen a &ank sa"s the" gave "o credit5 the" mean the" credited "or
transaction accont5 leaving "o !ith the presmption that the" deposited other depositors mone" in
the accont% The fact is the" deposited "or mone" =mortgage note?% The &ank cannot mone"5 the" are to credit a
Demand Deposit Accont nder "or name5 so "o can !rite checks and spend "or mone"% 'n this case the"
claim "or mone" is their mone"% Ask a criminal attorne" !hat happens in a fradlent conversion of "or fnds
to the &ankYs se and &enefit5 !ithot "or signatre or athori<ation%
3hat the &anks cold not !in volntaril"5 throgh deception the" received for free% -everal presidents5 John
Adams5 Thomas Jefferson5 and A&raham +incoln &elieved that &anker capitalism !as more dangeros to or
li&erties than standing armies% *%-% 0resident James A% /arfield said5 @3hoever controls the mone" in an" contr"
is a&solte master of indstr" and commerce%P The )hicago Federal 4eserve BankYs &ook5ACodern Cone"
CechanicsA5 eBplains eBactl" ho! the &anks eBpand and contract the check&ook mone" sppl" forcing people into
foreclosre% This cold never happen if contracts !ere not violated and if !e receivede6al protection nder the
la! of )ontract%
F*1 !FC "ANK &1I!CFC& !FC CUDDCNCE
This is a repeat !orded differentl" to &e sre "o nderstand it% %ou must understand t0e currenc- s7itc0)
The &ank does not loan mone"% The &ank merel" s!itches the crrenc"% The alleged &orro!er created mone" or
crrenc" &" simpl" signing the mortgage note% The &ank does not sign the mortgage note &ecase the" kno! the"
!ill not loan "o their mone"% The mortgage note acts like mone"% To make it look like the &ank loaned "o
mone" the &ank deposits "or mortgage note =lien on propert"? as mone" from !hich to isse a check% No mone"
!as loaned to legall" flfill the contract for the &ank to o!n the mortgage note%
B" doing this5 the &ank received the lien on the propert" !ithot risking or sing one cent% The people lost the
e6it" in their homes and farms to the &ank and no! the" mst la&or to pa" interest on the propert"5 !hich the
&ank got for free and the" lost% The check is not mone"5 the check merel" transfers mone" and &" transferring
mone" the check acts +'HE mone"% The mone" deposited is the mortgage note% -f the bank never fulfills the
contract to loan money* then the bank does not own the mortgage note. The deposited mortgage note is still "or
mone" and the checking accont the" set p in "or name5 !hich the" credited5 from !hich to isse the check5 is
still "or mone"% The" onl" retrned "or mone" in the form of a check% 3h" do "o have to flfill "or end of
the agreement if the &ank refses to flfill their end of the agreementK 'f the &ank does not loan "o their mone"
the" have not flfilled the agreement5 the contract is void% Eou create' currency 9y sim8ly signing the
mortgage note) The mortgage note has vale &ecase of the lien on the propert" and &ecase of the fact that "o
are to repa" the loan% The &ank deposits the mortgage note =crrenc"? to create a check =crrenc"5 &ank mone"?%
Both crrencies cost nothing to create% B" la! the &ank cannot create crrenc" =&ank mone"5 a check? !ithot
first depositing crrenc"5 =mortgage note? or legal tender% For the check to &e valid there mst &e mortgage note or
&ank mone" as legal ten'er5 &t the &ank accepted crrenc" =mortgage note? as a deposit !ithot telling "o and
!ithot "or athori<ation% The &ank !ithdre! "or mone"5 !hich the" deposited !ithot telling "o and
!ithdre!
it !ithot "or signatre5 in a fradlent conversion scheme5 !hich can land the &ankers in (ail &t is pla"ed ot
in ever" )it" and To!n in this nation on a dail" &asis% 1ithout loaning you money the 9an@ 'e8osits your
money =mortgage note> :ith'ra:s it an' claims it is the 9an@Ss money an' that it is their money they
loane' you) 't is not a loan5 it is merel" an eBchange of one crrenc" for another5 the"Yll o!e "o the mone"5
!hich the" claimed the" !ere to loan "o% 'f the" do not loan the mone" and
merel" eBchange one crrenc" for another5 the &ank receives the lien on "or propert" for free% 3hat the" get for
free "o lost and mst la&or to pa" &ack at interest% 'f the &anks loaned "o legal tender5 the" cold not receive the
liens on nearl" ever" home5 car5 farm5 and &siness for free% The people !old still o!n the vale of their homes%
The &ank mst sell "or crrenc" =mortgage note? for legal tender so if "o se
the &ankYs crrenc" =&ank mone"?5 and !ant to convert crrenc" =&ank mone"? to legal tender the" !ill &e a&le to
make it appear that the crrenc" =&ank mone"? is &acked &" legal tender% The &ankYs crrenc" =&ank mone"? has
no vale !ithot "or crrenc" =mortgage note?% The &ank cannot sell "or crrenc" =mortgage note? !ithot
flfilling the contract &" loaning "o their mone"% The" never loaned mone"5 the" merel"
eBchanged one crrenc" for another% The &ank received "or crrenc" for free5 !ithot making an" loan or
flfilling the contract5 changing the cost and the risk of the contract !herein the" refsed to sign5 kno!ing that it
is a change of crrenc" and not a loan% 'f "o se crrenc" =mortgage note?5 the same crrenc" the &ank deposited
to create crrenc" =&ank mone"?5 to pa" the loan5 the &ank re(ects it and sa"s "o mst se
crrenc" =&ank mone"? or legal tender% The &ank received "or crrenc" =mortgage note? and the &ankYs crrenc"
=&ank mone"? for free !ithot sing legal tender and !ithot loaning mone" there&" refsing to flfill the
contract% No! the &ank s!itches the crrenc" !ithot loaning mone" and demands to receive "or la&or to pa"
!hat !as not loaned or the &ank !ill se "or crrenc" =mortgage note? to &" "or home in foreclosre5 The
4evoltionar" !ar !as foght to stop these &ank schemes% The &ank has a !ritten polic" to eBpand and contract
the crrenc" =&ank mone"?5 creating recessions5 forcing people ot of !ork5 allo!ing the &anks to o&tain "or
propert" for free% 'f the &anks loaned legal tender5 this !old never happen and the home !old cost mch less% 'f
"o allo! someone to o&tain liens for free and create a ne! crrenc"5 !hich is not legal tender and "o mst se
legal tender to repa"% This changes the cost and the risk% *nder this &ank scheme5 even if ever"one in the nation
o!ned their homes and farms de&t free5 the &anks !old soon receive the liens on the propert" in the loan process%
The liens the &anks receive for free5 are !hat the people lost in propert"5 and no! mst la&or to pa" interest on%
The interest !old not &e paid if the &anks flfilled the contract the" !rote% 'f there is e6al protection nder the
la! and contract5 "o cold get the mortgage note &ack !ithot frther la&or% 3h" shold the &ank get "or
mortgage note and "or la&or for free !hen the" refse to flfill the contract the" !rote and told "o to signK
-orr" for the redndanc"5 &t it is important for "o to kno! &" heart their @shell gameA5 ' !ill contine in that
redndanc" as it is imperative that "o nderstand the principle% The follo!ing material is case la! on the s&(ect
and other related legal isses as !ell as a smmar"% L*GIC A& C;IDCNCC The check !as !ritten !ithot
dedcting fnds from -avings Accont or )ertificate of Deposit allo!ing the mortgage note to &ecome the ne!
pool of mone" o!ed to Demand Deposit Accont5 -avings Accont5 )ertificate of Deposit !ith Demand Deposit5
-avings Accont5 and>or )ertificate of Deposit increasing &" the amont of the mortgage note% 'n this case the
&ankers sell the mortgage note for Federal 4eserve Bank Notes or other
assets !hile still o!ing the lia&ilit" for the mortgage note sold and !ithot the &ank giving p an"- Federal
4eserve Bank Notes% 'f the &ank had to part !ith Federal 4eserve Bank Notes5 and !ithot the &enefit of
checks to hide the fradlent conversion of the mortgage note from !hich it isses the check5 the &ank frad
!old &e eBposed% Federal 4eserve Bank Notes are the onl" mone" called legal tender% 'f onl" Federal 4eserve
Bank Notes are deposited for the credit to Demand Deposit Accont- -avings Accont5 )ertificate of Deposit5 and
if the &ank !rote a check for the mortgage note5 the check then transfers Federal 4eserve Bank Notes and the
&ank gives the &orro!er a &ank asset% There is no increase in the check &ook mone" sppl" that eBists in the loan
process% The &ank polic" is to increase &ank lia&ilitiesQ Demand Deposit Accont5 -avings Accont5 )ertificate of
Deposit5 &" the mortgage note% 'f the mortgage note is mone"5 then the &ank never gave p a &ank asset% The &ank
simpl" sed fradlent conversion of o!nership of the mortgage note% The &ank cannot o!n the mortgage note
ntil the &ank flfills the contract%
The check is not the mone"Q the mone" is the deposit that makes the check good% 'n this case5 the mortgage note is
the mone" from !hich the check is issed% 3ho o!ns the mortgage note !hen the mortgage note is depositedK
The &orro!er o!ns the mortgage note &ecase the &ank never paid mone" for the mortgage note and never loaned
mone" =&ank asset?% The &ank simpl" claimed the &ank o!ned the mortgage note !ithot pa"ing for it and
deposited the mortgage note from !hich the check !as issed% This is fradlent conversion% The &ank risked
nothingX Not even one penn" !as invested% The" never took mone" ot of an" accont5 in order to o!n the
mortgage note5 as proven &" the &ookkeeping entries5 financial ratios5 the &alance sheet5 and of corse the &ankYs
literatre% The &ank simpl" never complied !ith the contract%
'f the mortgage note is not mone"5 then the check is check kiting and the &ank is insolvent and the &ank still never
paid% 'f the mortgage note is mone"5 the &ank took or mone" !ithot sho!ing the deposit5 and !ithot pa"ing for
it5 !hich is fradlent conversion% The &ank claimed it o!ned the mortgage note !ithot pa"ing for it5 then sold
the mortgage note5 took the cash and never sed the cash to pa" the lia&ilit" it o!ed for the check the &ank issed%
The lia&ilit" means that the &ank still o!es the mone"% The &ank mst retrn the mortgage note or the cash it
received in the sale5 in order to pa" the lia&ilit"% Even if the &ank did this5 the &ank still never loaned s the &ankYs
mone"5 !hich is !hat YloanY means% The check is not mone" &t merel" an order to pa" mone"% 'f the mortgage
note is mone" then the &ank mst pa" the check &" retrning the mortgage note% The onl" !a" the &ank can pa"
Federal 4eserve Bank Notes for the check issed is to sell the mortgage note for Federal 4eserve Bank Notes%
Federal 4eserve Bank Notes are
non-redeema&le in violation of the *))% The &ank forces s to trade in non-redeema&le private &ank notes of
!hich the &ank refses to pa" the lia&ilit" o!ed% 3hen !e present the Federal 4eserve Bank Notes for pa"ment
the &ank (st gives s &ack another Federal 4eserve Bank Note !hich the &ank paid ; :>; cents for per &ill
regardless of denomination% 1hat a 8ro2it 2or the 9an@V The check issed can onl" &e redeemed in Federal
4eserve Bank Notes5 !hich the &ank o&tained &" selling the mortgage note that the" paid nothing for% The &ank
forces s to trade in &ank lia&ilities5 !hich the" never redeem in an asset% 3e
the people are forced to give p or assets to the &ank for free5 and !ithot cost to the &ank% This is fradlent
conversion making the contract5 !hich the &ank created !ith their polic" of &ookkeeping entries5 illegal and the
alleged contract nll and void% The &ank has no right to the mortgage note or to a lien on the propert"5 ntil the
&ank performs nder the contract% The &ank had less than ten percent of Federal 4eserve Bank Notes to &ack p
the &ank lia&ilities in Demand Deposit Accont5 -avings Accont5 or )ertificate of DepositYs% A &ank lia&ilit" to
pa" mone" is not mone"% 3hen !e tr" and
repa" the &ank in like fnds =sch as is the &anks polic" to deposit from !hich to isse checks? the" claim it is not
mone"% The &ankYs confsing and deceptive trade practices and their alleged contracts are nconsciona&le%
&UMMADE *F DAMAGC&
The &ank made the alleged &orro!er a depositor &" depositing a 8:775777 negotia&le instrment5 !hich the &ank
sold or had availa&le to sell for approBimatel" 8:775777 in legal tender% The &ank did not credit the &orro!erYs
transaction accont sho!ing that the &ank o!ed the &orro!er the 8:775777% 4ather the &ank claimed that the
alleged &orro!er o!ed the &ank the 8:7757775 then placed a lien on the &orro!erYs real propert" for 8:775777 and
demanded loan pa"ments or the &ank !old foreclose% The &ank deposited a non-legal tender negotia&le
instrment and eBchanged it for another non legal tender check5 !hich traded like mone"5 sing the deposited
negotia&le instrment as the mone" deposited% The &ank changed the crrenc" !ithot the &orro!erYs
athori<ation% First &" depositing non legal tender from !hich to isse a check =!hich is non-legal tender? and
sing the negotia&le instrment ="or mortgage note?5 to eBchange for legal tender5 the &ank needed to make the
check appear to &e &acked &" legal tender% No loan ever took place% 1hich shell hi'es the little 8eaN The
transaction that took place !as merel" a change of crrenc" =!ithot athori<ation?5 a negotia&le instrment for a
check% The negotia&le instrment is the mone"5 !hich can &e eBchanged for legal tender to make the check good%
An eBchange is not a loan% The &ank eBchanged 8:775777 for 8:775777% There !as no need to go to the &ank for
an" mone"% The cstomer =alleged &orro!er? did not receive a loan5 the alleged &orro!er lost 8:775777 in vale to
the &ank5 !hich the &ank kept and recorded as a &ank asset and never loaned an" of the &ankYs mone"% 'n this
eBample5 the damages are 8:775777 pls interest pa"ments5 !hich the &ank demanded &" mail% The &ank illegall"
placed a lien on the propert" and then threatened to foreclose5 frther damaging the alleged &orro!er5 if the
pa"ments !ere not made% A depositor is o!ed mone" for the deposit and the alleged &orro!er is o!ed mone" for
the
loan the &ank never made and "et placed a lien on the real propert" demanding pa"ment% Damages eAist in that
the 9an@ re2uses to loan their money) The &ank denies the alleged &orro!er e6al protection nder the la! and
contract5 &" merel" eBchanging one crrenc" for another and refsing repa"ment in the same t"pe of crrenc"
deposited% The &ank refsed to flfill the contract &" not loaning the mone"5 and &" the &ank refsing to &e repaid
in the same crrenc"5 !hich the" deposited as an eBchange for another crrenc"% A de&t tender offered and refsed
is a de&t paid to the eBtent of the offer% The &ank has no athori<ation to alter the alleged contract and to refse to
perform &" not loaning mone"5 &" changing the crrenc" and then refsing repa"ment in !hat the &ank has a
!ritten polic" to deposit% The seller of the home received a check% The mone" deposited for the check issed came
from the &orro!er not the &ank% The &ank has no right to the mortgage note ntil the &ank performs &" loaning the
mone"% 'n the transaction the &ank !as to loan legal tender to the &orro!er5 in order for the &ank to secre a lien%
The &ank never made the loan5 &t kept the mortgage note the alleged &orro!er signed% This allo!ed the &ank to
o&tain the e6it" in the propert" =&" a lien? and transfer the !ealth of the propert" to the &ank !ithot the &ankYs
investment5 loan5 or risk of mone"% Then the &ank receives the alleged &orro!erYs la&or to pa" principal and *sr"
interest% 3hat the people o!ned or shold have o!ned de&t free5 the &ank o&tained o!nership in5 and for free5 in
eBchange for the people receiving a de&t5 pa"ing interest to the &ank5 all &ecase the &ank refsed to loan mone"
and merel" eBchanged one crrenc" for another% This places "o in perpetal slaver" to the &ank &ecase the &ank
refses to perform nder the contract% The lien forces pa"ment &" threat of foreclosre% The mail is sed to eBtort
pa"ment on a contract the &ank never flfilled% 'f the &ank refses to perform5 then the" mst retrn the mortgage
note% 'f the &ank !ishes to perform5 then the" mst make the loan% The past pa"ments mst &e retrned &ecase
the &ank had no right to lien the propert" and eBtort interest pa"ments% The &ank note for t!o reasons% The
mortgage note !as deposited and the mone" !ithdra!n !ithot athori<ation &" sing a forged signatre andQ
t!o5 the contract !as never flfilled% The &ank acted !ithot athori<ation and is involved in a frad there&"
damaging the alleged &orro!er%
CAcer8ts From IMo'em Money MechanicsJ (ages H T ,
+hat Makes Money @aluableA -n the $nited %tates neither paper currency nor deposits have value as
commodities. -ntrinsically* a dollar bill is 4ust a piece of paper* deposits merely book entries. &oins do have some
intrinsic value as metal* but generally far less than face value. !hen* bankers discovered that they could make
loans merely by giving their promises to pay* or bank notes* to borrowers* in this way* banks began to create
money. More notes could be issued than the gold and coin on hand because only a portion of the notes
outstanding would be presented for payment at any one time. 6nough metallic money had to be kept on hand* of
course* to redeem whatever volume of notes was presented for payment. !ransaction deposits are the modem
counterpart of bank notes. -t was a small step from printing notes to making book entries crediting deposits of
borrowers* which the borrowers in turn could "spend" by writing checks* thereby "printing" their own money.
Notes/ e3c0ange 8ust li9e c0ec9s. Bow do open market purchases add to bank reserves and depositsA %uppose the
Federal ;eserve %ystem* through its trading desk at the Federal ;eserve Bank of New Cork* buys D"9*999 of
!reasury bills from a dealer in $.%. government securities. -n today>s world of &omputer financial transactions*
the Federal ;eserve Bank pays for the securities with an "electronic" check drawn on itself. @ia its "Fedwire"
transfer network* the Federal ;eserve notifies the dealer>s designated bank 1Bank :2 that payment for the
securities should be credited to 1deposited in2 the dealer>s account at Bank :. :t the same time* Bank :>s reserve
account at the Federal ;eserve is credited for the amount of the securities purchased. !he Federal ;eserve
%ystem has added D"9*999 of securities to its assets* which it has paid for* in effect* by creating a liability on itself
in the form of bank reserve balances. !hese reserves on Bank :>s books are matched by D"9*999 of the dealer>s
deposits that did not exist before. -f business is active* the banks with excess reserves probably will have
opportunities to loan the DE*999. 7f course* they do not really pay out loans from money they receive as
deposits. -f they did this* no additional money would be created. +hat they do when they make loans is to accept
promissory notes in exchange for credits to tile borrower>s transaction accounts. 0oans 1assets2 and deposits
1liabilities2 both rise by DE*999. ;eserves are unchanged by the loan transactions. But the deposit credits
constitute new additions to the total deposits of the banking system. 04OOF BANH- DE0O-'T NOTE- AND
'--*E BANH )HE)H-% THE )HE)H- A4E ON+1 A- /OOD A- THE 04OC'--O41 NOTE% NEA4+1
A++ BANH )HE)H- A4E )4EATED F4OC 04'2ATE NOTE-% FEDE4A+ 4E-E42E BANH NOTE- A4E
A 04'2ATE )O40O4ATE NOTE =)hapter EI5 EI -tat ::;? 3E *-E
NOTE- TO D'-)HA4/E NOTE-%
6xcerpt from booklet Cour Money* page )< 7ther M" Money +hile demand deposits* traveler,s checks* and
interestFbearing accounts with unlimited checking authority are not legal tender* they are usually acceptable in
payment for purchases of goods and services. The &ooklet5 @1or Cone"A5 is distri&ted free of charge% Additional
copies ma" &e o&tained &" !riting to: Fe'eral Deser7e "an@ o2 Dichmon' (u9lic &er7ices
De8artment ()*) "oA $/,$$ Dichmon' ;irginia $H$,#
CDCDI! L*AN& AND ;*ID C*N!DAC!&: CA&C LA1
GF% @'n the federal corts5 it is !ell esta&lished that a national &ank has not po!er to lend its credit to another &"
&ecoming sret"5 indorser5 or garantor for him%AY Farmers and Ciners Bank v% Blefield Nat Yl Bank5 :: F ;d I,5
;G: *%-% 99J%
G9% PA national &ank has no po!er to lend its credit to an" person or corporation % % % Bo!en v% Needles Nat% Bank5
JE F J;F ,9 ))A FF,5 certiorari denied in ;7 -%)t :7;E5 :G9 *- 9I;5 EE +ED 9,G%
GG% @The doctrine of ltra vires is a most po!erfl !eapon to keep private corporations !ithin their legitimate
spheres and to pnish them for violations of their corporate charters5 and it pro&a&l" is not invoked too often %% %A
Tinc )ar&onate )o% v% First National Bank5 :7, 3is :;F5 GJ N3 ;;J% American EBpress )o% v% )iti<ens -tate
Bank5 :JE N3 E,7%
GI% @A &ank ma" not lend its credit to another even thogh sch a transaction trns ot to have &een of &enefit to
the &ank5 and in spport of this a list of cases might &e cited5 !hich-!old look like a catalog of ships%A
NEmphasis addedO Norton /rocer" )o% v% 0eoples Nat% Bank5 :EE -E F7F% :F: 2a :JF%
GJ% P't has &een settled &e"ond controvers" that a national &ank5 nder federal +a! &eing limited in its po!ers and
capacit"5 cannot lend its credit &" garanteeing the de&ts of another% All sch contracts entered into &" its officers
are ltra vires % % %P Ho!ard V Foster )o% v% )iti<ens NatYl Bank of *nion5 :,, -) ;7;5 :,7 -E
GFJ=:J;9?%
I7% @% % % checks5 drafts5 mone" orders5 and &ank notes are not la!fl mone" of the *nited -tates %%%A -tate v%
Neilon5 G, 0ac ,;E5 E, Ore :9I%
I:% PNeither5 as inclded in its po!ers not incidental to them5 is it a part of a &ankYs &siness to lend its credit% 'f a
&ank cold lend its credit as !ell as its mone"5 it might5 if it received compensation and !as carefl to pt its
name onl" to solid paper5 make a great deal more than an" la!fl interest on its mone" !old amont to% 'f not
carefl5 the po!er !old &e the mother of panics % % % 'ndeed5 lending credit is the eBact opposite of lending
mone"5 !hich is the real &siness of a &ank5 for !hile the latter creates a lia&ilit" in favor of the &ank5 the former
gives rise to a lia&ilit" of the &ank to another% - Morse. Banks and Banking Fth Ed% -ec 9FQ Magee* Banks and
Banking5 ,rd Ed% -ec ;EI%P American EBpress )o% v% )iti<ens -tate
Bank5 :JE N3 E;J%
I;% P't is not !ithin those stattor" po!ers for a national &ank5 even thogh solvent5 to lend its credit to another in
an" of the varios !a"s in !hich that might &e done%P Federal 'ntermediate )redit Bank v% + YHerrison5 ,, F ;d
IE:5 IE; =:J;J?%
I,% PThere is no do&t &t !hat the la! is that a national &ank cannot lend its credit or &ecome an accommodation
endorser%P National Bank of )ommerce v% Atkinson5 FF E EG:%
IE% PA &ank can lend its mone"5 &t not its credit%P First NatYl Bank of Tallapoosa v% Conroe % :,F /a 9:E5 9J -E
::;E5 ,; +4A =N-? FF7%
IF% P%% % the &ank is allo!ed to hold mone" pon personal secrit"Q &t it mst &e mone" that it loans5 not its
credit%P -eligman v% )harlottesville Nat% Bank5 , Hghes 9EG5 Fed )ase No%:;5 9E;5 :7,J%
I9% PA loan ma" &e defined as the deliver" &" one part" to5 and the receipt &" another part" of5 a sm of mone"
pon an agreement5 eBpress or implied5 to repa" the sm !ith or !ithot interest%P 0arsons v% FoB :GJ /a 97F5
:G9 -E 9EE% Also see Hirkland v% Baile"5 :FF -E ;d G7: and *nited -tates v% Neifert 3hite )o%5 ;EG Fed -pp
IGI5 IGJ%
IG% PThe !ord Ymone"Y in its sal and ordinar" acceptation means gold5 silver5 or paper mone" sed as a
circlating medim of eBchange % % %P +ane v% 4aile" ;I7 H" ,:J5 :,, -3 ;d GF%
II% PA promise to pa" cannot5 &" argment5 ho!ever ingenios5 &e made the e6ivalent of actal pa"ment %%%P
)hristensen v% Bee&e5 J: 0 :,,5 ,; *tah E79%
IJ% @A &ank is not the holder in de corse pon merel" crediting the depositors accont%A Bankers Trst v%
Nagler5 ;;J N1- ;d :E;5 :E,%
J7% PA check is merel" an order on a &ank to pa" mone"%P 1ong v% Hem&ree5 G, 0;d ,J,%
J:% PAn" false representation of material facts made !ith kno!ledge of falsit" and !ith intent that it shall &e acted
on &" another in entering into contract5 and !hich is so acted pon5 constittes Yfrad5Y and entitles part" deceived
to avoid contract or recover damages%P Barnsdall 4efining )orn% v% Birnam 3ood Oil )o%% J; F ;9 I:G%
J;% PAn" condct capa&le of &eing trned into a statement of fact is representation% There is no distinction
&et!een misrepresentations effected &" !ords and misrepresentations effected &" other acts%P +eonard v% -pringer
:JG 'll F,;% 9E NE
,7:%
J,% @'f an" part of the consideration for a promise &e illegal5 or if there are several considerations for an
nsevera&le promise one of !hich is illegal5 the promise5 !hether !ritten or oral5 is !holl" void5 as it is
impossi&le to sa" !hat part or !hich one of the considerations indced the promise%A Cenominee 4iver )o% v%
Agsts -pies + V ) )o%5 :EG 3is FFJ% FG;Q :,; N3 ::;;% JE% @The contract is void if it is onl" in part
connected !ith the illegal transaction and the promise single or entire%A /ardian Agenc" v% /ardian Ct%
-avings Bank5 ;;G 3is FF75 ;GJ N3 I,%
JF% @'t is not necessar" for rescission of a contract that the part" making the misrepresentation shold have kno!n
that it !as false5 &t recover" is allo!ed even thogh misrepresentation is innocentl" made5 &ecase it !old &e
n(st to allo! one !ho made false representations5 even innocentl"5 to retain the frits of a
&argain indced &" sch representations%A 3hipp v% 'verson5 E, 3is ;d :99%
J9% PEach Federal 4eserve &ank is a separate corporation o!ned &" commercial &anks in its region %%%P +e!is v%
*nited -tates5 9I7 F ;7 :;,J =:JI;?%
JG% 'n a De&torYs 4')O action against its creditor5 alleging that the creditor had collected an nla!fl de&t5 an
interest rate =!here all loan charges !ere added together? that eBceeded5 in the langage of the 4')O -tatte5
Pt!ice the enforcea&le rate%P The )ort fond no reason to impose a re6irement that the 0laintiff sho! that the
Defendant had &een convicted of collecting an nla!fl de&t5 rnning a Ploan sharkingP operation% The de&t
inclded the fact that eBaction of a srios interest rate rendered the de&t nla!fl and that is all that is necessar"
to spport the )ivil 4')O action% Drante Bros% V -ons5 'nc% v% Flshing Nat Yl Bank% GFF F;d ;,J5 )ert% denied5
EG, *- J79 =:JIF?%
JI% The -preme )ort fond that the 0laintiff in a civil 4')O action need esta&lish onl" a criminal PviolationP
and not a criminal conviction% Frther5 the )ort held that the Defendant need onl" have cased harm to the
0laintiff &" the commission of a predicate offense in sch a !a" as to constitte a Ppattern of 4acketeering
activit"%P That is5 the 0laintiff need not demonstrate that the Defendant is an organi<ed crime figre5 a mo&ster in
the poplar sense5 or that the 0laintiff has sffered some t"pe of special 4acketeering in(r"Q all that the 0laintiff
mst sho! is !hat the -tatte specificall" re6ires% The 4')O -tatte and the civil remedies for its violation are
to &e li&erall" constred to effect the congressional prpose as &roadl" formlated in the -tatte% -edima5 -04+ v%
'mreB )o%5 EG, *- EGJ =:JIF?%
DCFINI!I*N& !* KN*1 1FCN C+AMINING A "ANK C*N!DAC!
"ANK ACC*UN!: A sm of mone" placed !ith a &ank or &anker5 on deposit5 &" a cstomer5 and s&(ect to &e
dra!n ot on the latterYs check%
"ANK: !hose &siness it is to receive mone" on deposit5 cash checks or drafts5 discont commercial paper5 make
loans and isse promissor" notes pa"a&le to &earer5 kno!n as &ank notes%
"ANK CDCDI!: A credit !ith a &ank &" !hich5 on proper credit rating or proper secrit" given to the &ank5 a
person receives li&ert" to dra! to a certain eBtent agreed pon%
"ANK DC(*&I!: )ash5 checks or drafts placed !ith the &ank for credit to depositorYs accont% 0lacement of
mone" in &ank5 there&"5 creating contract &et!een &ank and depositors%
DCMAND DC(*&I!: The right to !ithdra! deposit at an" time%
"ANK DC(*&I!*D: One !ho delivers to5 or leaves !ith a &ank a sm of mone" s&(ect to his order%
"ANK DDAF!: A check5 draft or other form of pa"ment%
ANK *F I&&UC: Bank !ith the athorit" to isse notes !hich are intended to circlate as crrenc"%
L*AN: Deliver" &" one part" to5 and receipt &" another part"5 a sm of mone" pon agreement5 eBpress or
implied5 to repa" it !ith or !ithot interest%
C*N&IDCDA!I*N: The indcement to a contract% The case5 motive5 price or impelling inflences5 !hich
indces a contracting5 part" to enter into a contract% The reason5 or material case of a contract%
CFCCK: A draft dra!n pon a &ank and pa"a&le on demand5 signed &" the maker or dra!er5 containing an
nconditional promise to pa" a certain sm in mone" to the order of the pa"ee% The Federal 4eserve Board defines
a check as5 "...a draft or order upon a bank or banking house purporting to be drawn upon a deposit of funds for
the payment at all events of* a certain sum of money to a certain person therein named* or to him or his order* or
to bearer and payable instantly on demand of."
QUC&!I*N& *NC MIGF! A&K !FC "ANK IN AN IN!CDD*GA!*DE
Did the &ank loan gold or silver to the alleged &orro!erK
Did the &ank loan credit to the alleged &orro!erK
Did the &orro!er sign an" agreement !ith the &ank5 !hich prevents the &orro!er from repa"ing the &ank in
creditK
's it tre that "or &ank creates check &ook mone" !hen the &ank grants loans5 simpl" &" adding deposit dollars
to acconts on the &ankYs &ooks5 in eBchange5 for the &orro!erYs mortgage noteK
Has "or &ank5 at an" time5 sed the &orro!erYs mortgage note5 Ppromise to pa"P5 as a deposit on the &ankYs &ooks
from !hich to isse &ank checks to the &orro!erK
At the time of the loan to the alleged &orro!er5 !as there one dollar of Federal 4eserve Bank Notes in the &ankYs
possession for ever" dollar o!ed in -avings Acconts5 )ertificates of Deposits and check Acconts =Demand
Deposit Acconts? for ever" dollar of the loanK
According to the &ankYs polic"5 is a promise to pa" mone" the e6ivalent of mone"K
Does the &ank have a polic" to prevent the &orro!er from discharging the mortgage note in Plike kind fndsP
!hich the &ank deposited from !hich to isse the checkK
Does the &ank have a polic" of violating the Deceptive Trade 0ractices ActK
3hen the &ank loan officer talks to the &orro!er5 does the &ank inform the &orro!er that the &ank ses the
&orro!ers mortgage note to create the ver" mone" the &ank loans ot to the &orro!erK
Does the &ank have a polic" to sho! the same mone" in t!o separate places at the same timeK
Does the &ank claim to loan ot mone" or credit from savings and certificates of deposits !hile never redcing the
amont of mone" or credit from savings acconts or certificates of deposits5 !hich cstomers can !ithdra! fromK
*sing the &anking practice in place at the time the loan !as made5 is it theoreticall" possi&le for the &ank to have
loaned ot a percentage of the -avings Acconts and )ertificates of DepositsK
'f the ans!er is PnoP to 6estion M:,5 eBplain !h" the ans!er is no% 'n regards to 6estion M:,5 at the time the loan
!as made5 !ere there enogh Federal 4eserve Bank Notes on hand at the &ank to match the figres represented
&" ever" -avings Accont and )ertificate of Deposit and checking Accont =Demand Deposit Accont?K
Does the &ank have to o&e"5 the la!s concerning5 )ommercial 0aperQ )ommercial Transactions5 )ommercial
'nstrments5 and Negotia&le 'nstrmentsK
Did the &ank lend the &orro!er the &ankYs assets5 or the &ankYs lia&ilitiesK
3hat is the complete name of the &anking entit"5 !hich emplo"s "o5 and in !hat (risdiction is the &ank
charteredK
3hat is the &ankYs definition of P+oan )reditPK
Did the &ank se the &orro!ers assmed mortgage note to create ne! &ank mone"5 !hich did not eBist &efore the
assmed mortgage note !as signedK
Did the &ank take mone" from an" Demand Deposit Accont =DDA?5 -avings Accont =-A?5 or a )ertificate of
Deposit =)D?5 or an" com&ination of an" Demand Deposit Accont5 -avings Accont or )ertificate of Deposit5
and loan this mone" to the &orro!erK
Did the &ank replace the mone" or credit5 !hich it loaned to the &orro!er !ith the &orro!erYs assmed mortgage
noteK
Did the &ank take a &ank asset called mone"5 or the credit sed as collateral for cstomersY &ank deposits5 to loan
this mone" to the &orro!er5 and>or did the &ank se the &orro!erYs note to replace the asset it loaned to the
&orro!erK
Did the mone" or credit5 !hich the &ank claims to have loaned to the &orro!er5 come from deposits of mone" or
credit made &" the &ankYs cstomers5 eBclding the &orro!erYs assmed mortgage noteK
)onsidering the &alance sheet entries of the &ankYs loan of mone" or credit to the &orro!er5 did the &ank directl"
decrease the cstomer deposit acconts =i%e% Demand Deposit Accont5 -avings Accont5 and )ertificate of
Deposit? for the amont of the loanK
Descri&e the &ookkeeping entries referred to in 6estion M:,% Did the &ankYs &ookkeeping entries to record the
loan and the &orro!erYs assmed mortgage note ever5 at an" time5 directl" decrease the amont of mone" or credit
from an" specific &ank cstomerYs deposit accontK
Does the &ank have a polic" or practice to !ork in cooperation !ith other &anks or financial instittions se
&orro!erYs mortgage note as collateral to create an offsetting amont of ne! &ank mone" or credit or check &ook
mone" or Demand Deposit Accont generall" to e6al the amont of the alleged loanK
4egarding the &orro!ers assmed mortgage loan5 give the name of the accont !hich !as de&ited to record the
mortgage% 4egarding the &ookkeeping entr" referred to in 'nterrogator" M:G5 state the name and prpose of the
accont5 !hich !as credited% 3hen the &orro!erYs assmed mortgage note !as de&ited as a &ookkeeping entr"5
!as the offsetting entr" a credit accontK
4egarding the initial &ookkeeping entr" to record the &orro!erYs assmed mortgage note and the assmed loan to
the &orro!er5 !as the &ookkeeping entr" credited for the mone" loaned to the &orro!er5 and !as this credit offset
&" a de&it to record the &orro!erYs assmed mortgage noteK
Does the &ank crrentl" or has it ever at an"time sed the &orro!erYs assmed mortgage note as mone" to cover
the &ankYs lia&ilities referred to a&ove5 i%e% Demand Deposit Accont5 -avings Accont and )ertificate of DepositK
3hen the assmed loan !as made to the &orro!er5 did the &ank have ever" Demand Deposit Accont5 -avings
Accont5 and )ertificate of Deposit &acked p &" Federal 4eserve Bank Notes on hand at the &ankK
Does the &ank have an esta&lished polic" and practice to emit &ills of credit !hich it creates pon its &ooks at the
time of making a loan agreement and issing mone" or socalled mone" of credit5 to its &orro!ersK
&UMMADE
The &ank advertised it !old loan mone"5 !hich is &acked &" legal tender% 's not that !hat the s"m&ol 8 meansK
's that not !hat the contract saidK Do "o not kno! there is no agreement or contract in the a&sence of mtal
consentK The &ank ma" sa" that the" gave "o a check5 "o o!e the &ank mone"% This information sho!s "o
that the check came from the mone" the alleged &orro!er provided and the &ank never loaned an" mone" from
other depositors%
I7e sho:n you the la: an' the 9an@s o:n literature to 8ro7e my case) All the &ank did !as trick "o% The"
get "or mortgage note !ithot investing one cent5 &" making"o a depositor and not a &orro!er% !he @ey to the
8uMMle is the 9an@ 'i' not sign the contract% I2 they 'i' they must loan you the money) I2 they 'i' not sign
it chances are they 'e8osite' the mortgage note in a chec@ing account an' use' it to issue a chec@ :ithout
e7er loaning you money or the 9an@ in7esting one cent)
Or Nation5 along !ith ever" -tate of the *nion5 entered into Bankrptc"5 in :J,,% This changes the la! from
Pgold and silverA legal mone" and @common la!A to the la! of &ankrptc"% *nder Bankrptc" la! the mortgage
note acts like mone"% Once "o sign the mortgage note it acts like mone"% The &ankers no! trick "o into thinking
the" loaned "o legal tender5 !hen the" never loaned "o an" of their mone"%
The trick is the" made "o a depositor instead of a &orro!er% The" deposited "or mortgage note and issed a
&ank check% Neither the mortgage note nor the chec@ is legal ten'er% The mortgage note and the check are no!
mone" created that never eBisted5 prior% The &ank got "or mortgage note for free !ithot loaning "o mone"5 and
sold the mortgage note to make the &ank check appear legal% The &orro!er provided the legal tender5 !hich the
&ank gave &ack in the form of a check) 'f the &ank loaned legal tender5
as the contract says for the &ank to legall" o!n the mortgage note5 then the people !old still o!n the homes5
farms5 &sinesses and cars5 nearl" de&t free and pa" little5 if an" interest% "y the 9an@s not 2ul2illing the contract
9y loaning legal ten'er they ma@e the allege' 9orro:er a 'e8ositor) !his is a 2rau'ulent con7ersion o2 the
mortgage note) A Frau' is a 2elony)
The &ank had no intent to loan5 making it promissor" frad5 mail frad5 !ire frad5 and a list of other crimes a
mile long% Ho! can the" make a felon"5 legalK The" cannotX Frad is fradX The &anks deposit "or mortgage
note in a checking accont% The deposit &ecomes the &ank$s propert"% The" !ithdra! mone" !ithot "or
signatre5 and call the mone"5 the &anks mone" that the" loaned to "o% The &ank forgot one thing% 'f the &ank
deposits "or mortgage note5 then the &ank mst credit "or checking accont claiming the &ank o!es "o
8:775777 for the 8:775777 mortgage note deposited% The credit of 8:775777 the &ank o!es "o for the deposit
allo!s "o to !rite a check or receive cash% The" did not tell "o the" deposited the mone"5 and the" forget to tell
"o that the 8:775777 is mone" the &anks o!e "o5 not !hat "o o!e the &ank% 1o lost 8:775777 and the &ank
gained 8:775777% For the 8:775777 the &ank gained5 the &ank received government &onds or cash of 8:775777 &"
selling the mortgage note% For the loan5 the &ank received 8:775777 cash5 the &ank did not give p 8:775777%
An"time the &ank receives a deposit5 the &ank o!es "o the mone"% 1o do not o!e the &ank the mone"% 'f "o or
' deposit an"oneYs negotia&le instrment !ithot a contract athori<ing it5 and !ithdra! the mone" claiming it is
or mone"5 !e !old go to (ail% 'f it !as or polic" to violate a contract5 !e cold go to (ail for a ver" long time%
1o agreed to receive a loan5 not to &e a depositor and have the &ank receive the deposit for free% 3hat the &ank
got for
free =lien on real propert"? "o lost and no! mst pa" !ith interest%'f the &ank loaned s legal tender =other
depositors$ mone"? to o&tain the mortgage note the &ank cold never o&tain the lien on the propert" for free% B"
not loaning their mone"5 &t instead depositing the mortgage note the &ank creates inflation5 !hich costs the
consmer mone"% 0ls the economic loss of the asset5 !hich the &ank received for free5 in
direct violation of an" signed agreement% 3e !ant e6al protection nder the la! and contract5 and to have the
&ank flfill the contract or retrn the mortgage note% 1e :ant the ?u'ges sheri22s an' la:ma@ers to
u8hol' their oath o2 o22ice an' to honor an' u8hol' the 2oun'ing 2athers U)&) Constitution) Is this too much
to as@N
3hat is the mortgage noteK The mortgage note represents "or ftre loan pa"ments% A promise to pa" the mone"
the &ank loaned "o% 3hat is a lienK The lien is a secrit" on the propert" for the mone" loaned%
Ho! can the &ank promise to pa" mone" and then not pa"K Ho! can the" take a promise to pa" and call it mone"
and then se it as mone" to prchase the ftre pa"ments of mone" at interest% 'nterest is the compensation
allo!ed &" la! or fiBed &" the parties for in7este' any money to receive your mortgage note% 3hat is it the" are
charging interest onK The &ank received an asset% The" never gave p an asset% Did the" pa" interest on the mone"
the" received as a depositK A check issed on a deposit received from the
&orro!er cost the &ank nothingK 3here did the mone" come from that the &ank invested to charge interest onK
The &ank ma" sa" !e received a &enefit% 3hat &enefitK 3ithot their &enefit !e !old
receive e6al protection nder the la!5 !hich !old mean !e did not need to give p an asset or pa" interest on
or o!n mone"X 3ithot their &enefit !e !old &e free and not enslaved% 3e !old have little de&t and interest
instead of &eing enslaved in de&t and interest% The &anks &roke the contract5 !hich the" never intended to flfill in
the first place% 3e got a check and a hose5 !hile the" received a lien and interest for free5 throgh a &roken
contract5 !hile !e got a de&t and lost or assets and or contr"% The
&enefit is the &anks5 !ho have placed liens on nearl" ever" asset in the nation5 !ithot costing the &ank one cent%
'nflation and !orking to pa" the &ank interest on or o!n mone" is the &enefit% -ome &enefitX
1hat a &hell Game) !he Follo:ing case :as an actual trial concerning the issues :e ha7e co7ere') !he
Bu'ge :as eAtraor'inary in-that he ha' a gras8 o2 the Constitution that I ha7ent seen o2ten enough in our
courts) !his is the real thing a9solutely true) !his case :as re7ie:e' 9y the Minnesota &u8reme Court on
their o:n motion) !he last thing in the :orl' that the "an@ers an' the Bu'ges :ante' :as case la: against
the "an@ers) Fo:e7er this case la: is real)
UUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUU
&!A!C *F MINNC&*!A IN BU&!ICC C*UD! C*UN!E *F &C*!! !*1N&FI( *F CDCDI! DI;CD
>MAD!IN ;) MAF*NCE BU&!ICC FID&! "ANK *F M*N!G*MCDE (lainti22 > CA&C N*: #4#%% ;s)
> BUDGMCN! AND DCCDCC
Berome Daly De2en'ant) >
The a&ove entitled action came on &efore the cort and a (r" of :; on Decem&er G5 :J9I at :7:77 a%m% 0laintiff
appeared &" its 0resident +a!rence 2% Corgan and !as represented &" its )onsel Theodore 4% Cell&"5
Defendant appeared on his o!n &ehalf% A (r" of Talesmen !ere called5 impaneled and s!orn to tr" the isses in
this case% +a!rence 2% Corgan !as the onl" !itness called for plaintiff and defendant testified as the onl" !itness
in his o!n &ehalf% 0laintiff &roght this as a )ommon +a! action for the recover" of the possession of lot :J5
Fairvie! Beach5 -cott )ont"5 Cinn% 0laintiff claimed titled to the 4eal 0ropert" in 6estion &" foreclosre of a
Note and Cortgage Deed dated Ca" I5 :J9E !hich plaintiff
claimed !as in defalt at the time foreclosre proceedings !ere started% Defendant appeared and ans!ered that
the plaintiff created the mone" and credit pon its o!n &ooks &" &ookkeeping entr" as the legal failre of
consideration for the Cortgage Deed and alleged that the -heriff$s sale passed no title to plaintiff% The isses tried
to the (r" !ere !hether there !as a la!fl consideration and !hether Defendant had !aived his rights to
complain a&ot the consideration having paid on the note for almost , "ears% Cr% Corgan
admitted that all of the mone" or credit !hich !as sed as a consideration !as created pon their &ooks that this
!as standard &anking practice eBercised &" their &ank in com&ination !ith the Federal 4eserve Bank of
Cinneapolis5 another private &ank5 frther that he kne! of no *nited -tates -tatte of +a! that gave the 0laintiff
the athorit" to do this% 0laintiff frther claimed that Defendant &" sing the ledger &ook created credit and &"
pa"ing on the Note and Cortgage !aived an" right to complain a&ot the consideration and that Defendant !as
estopped from doing so% At :;::F on Decem&er G5 :J9I the Jr" retrned a nanimos verdict for the Defendant%
No! therefore &" virte of the athorit" vested in me prsant to the Declaration of 'ndependence5 the North!est
Ordinance of :GIG5 the )onstittion of the *nited -tates and the )onstittion and la!s of the -tate Cinnesota not
inconsistent there!ith%
I! I& FCDC"E *DDCDCD ADBUDGCD AND DCCDCCD
That 0laintiff is not entitled to recover the possession of lot :J5 Fairvie! Beach5 -cott )ont"5 Cinnesota
according to the plat thereof on file in the 4egister of Deeds office% That &ecase of failre of a la!fl
consideration the note and Cortgage dated Ca" I5 :J9E are nll and void% That the -heriffs sale of the a&ove
descri&ed premises held on Jne ;95 :J9G is nll and void5 of no effect% That 0laintiff has no right5 title or interest
in said premises or lien thereon5 as is a&ove descri&ed%That an" provision in the Cinnesota )onstittion and an"
Cinnesota -tatte limiting the Jrisdiction of this )ort is repgnant to the )onstittion of the *nited -tates and
to the Bill of 4ights of the Cinnesota )onstittion and is nll and void and that this )ort has Jrisdiction to
render complete Jstice in this case% That Defendant is a!arded costs in the sm of 8GF%77 and eBection is
here&" issed therefore% A :7 da" sta" is granted% The follo!ing memorandm and an" spplemental
memorandm made and filed &" this )ort in spport of this (dgment is here&" made a part hereof &" reference%
B1 THE )O*4T Dated Decem&er J5 :J9J
CA4T'N 2% CAHONE1
Jstice of the 0eace )redit 4iver To!nship -cott )ont"5 Cinnesota
MCM*DANDUM
The isses in this case !ere simple% There !as no material dispte on the facts for the (r" to resolve% 0laintiff
admitted that it5 in com&ination !ith the Federal 4eserve Bank of Cinneapolis5 !hich are for all practical
prposes &ecase of their interlocking activit" and practices5 and &oth &eing Banking 'nstittions 'ncorporated
nder the la!s of the *nited -tates5 are in the +a! to &e treated as one and the same Bank5 did create the entire
8:E5777%77 in mone" or credit pon its o!n &ooks &" &ookkeeping entr"% That this !as
the )onsideration sed to spport the Note dated Ca" I5 :J9E and the Cortgage of the same date% The Cone" and
credit first came into eBistence !hen the" credited it% Cr% Corgan admitted that no *nited -tates +a! of -tatte
eBisted !hich gave him the right to do this% A la!fl consideration mst eBist and &e tendered to spport the note%
=-ee Anheser Bsch Bre!ing )o% v% Emma Cason5 EE Cinn% ,:I% E9 N3 FFI%? The Jr" fond there !as no
la!fl consideration and ' agree Onl" /od can create something
of vale ot of nothing% Even if defendant cold &e charged !ith !aiver or estoppel as a matter of la! this is no
defense to the plaintiff% The la! leaves !rongdoers !here it finds them% =-ee sections F75 F :5 and F; of Am Jr
;d PActionsP on page FIE%P? No action !ill lie to recover on a claim &ased pon5 or in an" manner depending
pon5 a fradlent5 illegal5 or immoral transaction or contract to !hich plaintiff !as a part"% 0laintiffs act of
creating is not athori<ed &" the )onstittion and +a!s of the *nited -tates5 is
nconstittional and void5 and is not la!fl consideration in the e"es of the la! to spport an" thing or pon
!hich an" la!fl rights can &e &ilt% Nothing in the )onstittion of the *nited -tates limits the (risdiction of this
)ort5 !hich is one of original (risdiction !ith right of trial &" (r" garanteed%
This is a )ommon +a! Action% Cinnesota cannot limit or impair the po!er of this )ort to render complete
(stice &et!een the parties% An" provisions in the )onstittion and la!s of Cinnesota !hich attempt to do so is
repgnant to the )onstittion of the *nited -tates and void% No 6estion as to the Jrisdiction of this )ort !as
raised &" either part" at the trial% Both parties !ere given complete li&ert" to s&mit an" and all facts and la! to
the (r"5 at least in so far as the" sa! it% No complaint !as made &" 0laintiff that 0laintiff did not receive a fair
trial% From the admissions made &" Cr% Corgan the path of
dt" !as made direct and clear for the (r"% Their verdict cold not reasona&l" have &een
other!ise% Jstice !as rendered completel" and !ithot prchase5 conforma&le to the la!
in this )ort on Decem&er G5 :J9I%
"E !FC C*UD! MAD!IN ;) MAF*NCE
Bustice o2 the (eace Cre'it Di7er !o:nshi8 &cott County Minnesota
Note: 't has never &een do&ted that a note given on a consideration5 !hich is prohi&ited &" la! is void% 't has
&een determined independent of Acts of )ongress5 that sailing nder the license of an enem" is illegal% The
emission of Bills of )redit pon the &ooks of these private )orporations for the prposes of private gain is not
!arranted &" the )onstittion of the *nited -tates and is nla!fl% -ee )raig v% R E peters reports J:;5 This
)ort can tread onl" that path !hich is marked ot &" dt"% C%2%C%
:U+GE ARTIN AHONE% +E"I(ION A( FOLLO&(
PFor the JsticeYs fees5 the First National Bank deposited R the )lerk of the District )ort the t!o Federal
4eserve Bank Notes% The )lerk tendered the Notes to me =the Jdge?% As Jdge m" s!orn dt" compelled me to
refse the tender% This is contrar" to the )onstittion of the *nited -tates% The -tates have no po!er to make &ank
notes a legal tender% Onl" gold and silver coin is a la!fl tender%P =-ee American Jrist on
Cone" ,9 sec%:,%? @Bank Notes are a good tender as mone" nless specificall" o&(ected to% Their consent
and sage is &ased pon the converti&ilit" of sch notes to coin at the pleasre of the holder pon presentation to
the &ank for redemption% 3hen the ina&ilit" of a &ank to redeem its notes is openl" avo!ed the" instantl" lose
their character as mone" and their circlation as crrenc" ceases%P =-ee American Jrist ,9-section J?% PThere is no
la!fl consideration for these Federal 4eserve Bank Notes to circlate as mone"% The &anks actall" o&tained
these notes for cost of printing - A la!fl consideration mst eBist for a Note% As a matter of fact5 the PNotesP are
not Notes at all5 as the" contain no promise to pa"%P =-ee :G American Jrist section IF5 ;:F? PThe activit" of the
Federal 4eserve Banks of Cinnesota5 -an Francisco and the First National Bank of Contgomer" is contrar" to
p&lic polic" and contrar" to the )onstittion of the *nited -tates5 and constittes an nla!fl creation of mone"5
credit and the o&taining of mone" and credit for no vala&le consideration% Activit" of said &anks in creating
mone" and credit is not !arranted &" the )onstittion of the *nited -tates%P PThe Federal 4eserve Banks and
National Banks eBercise an
eBclsive monopol" and privilege of creating credit and issing Notes at the eBpense of the p&lic !hich does not
receive a fair e6ivalent% This scheme is o&li6el" designed for the &enefit of an idle monopol" to ro&5 &lackmail5
and oppress the prodcers of !ealth% PThe Federal 4eserve Act and the National Bank Act are5 in their operation
and effect5 contrar" to the !hole letter and spirit of the )onstittion of the *nited -tates5 for the" confer an
nla!fl and nnecessar" po!er on private partiesQ the" hold all of or fello!
citi<ens in dependenceQ the" are s&versive to the rights and li&eration of the people%A PThese Acts have defiled
the la!fll" constitted /overnment of the *nited -tates% The Federal 4eserve Act and the National Banking Act
are not necessar" and proper for carr"ing into eBection the legislative po!ers granted to )ongress or an" other
po!ers vested in the /overnment of the *nited -tates5 &t on the contrar"5 are s&versive to the rights of the
0eople in their rights to life5 li&ert"5 and propert"%P =-ee -ection E9; of Title ,: *% -% )ode?%
PThe meaning of the )onstittional provision5 YNO -TATE -HA++ make an"thing &t /old and -ilver )oin a
legal tender Y pa"ment of de&tsY is direct5 clear5 nam&igos and !ithot an" 6alification% This )ort is !ithot
athorit" to interpolate an" eBception% C" dt" is simpl" to eBecte it5 as and to prononce the legal reslt% From
an eBamination of the case of Ed!ards v% Hearse"5 Federal 4eserve Bank Notes =fiat mone"? !hich are attempted
to &e made a legal tender5 are eBactl" !hat the athors of the
)onstittion of the *nited -tates intend to prohi&it% No -tate can make these Notes a legal tender% )ongress is
incompetent to athori<e a -tate to make the Notes a legal tender% For the effect of &inding )onstittion provisions
see )ooke v% 'verson% This fradlent Federal 4eserve -"stem and National Banking -"stem has impaired the
o&ligation of )ontract promoted disrespect for the )onstittion and +a! and has shaken
societ" to its fondation%P =-ee J9 *%-% )ode FJF and :7I C ,II and 9, C :EG? PTitle ,:5 *%-% )ode5 -ection
E,;5 is in direct conflict !ith the )onstittion insofar5 at least5 that it attempts to make Federal 4eserve Bank
Notes a legal tender% The )onstittion is the -preme +a! of the +and% -ection E9; of Title ,: is not a la!5 !hich
is made in prsance of the )onstittion% 't is nconstittional and void5 and ' so hold% Therefore5 the t!o Federal
4eserve Bank Notes are Nll and 2oid for an" la!fl prpose
in so far as this case is concerned and are not a valid deposit of 8;%77 !ith the )lerk of the District )ort for the
prpose of effecting an Appeal from this )ort to the District )ort%P PHo!ever5 of these Federal 4eserve Bank
Notes5 previosl" discssed 5 and that is that the Notes are invalid5 &ecase of a theor" that the" are &ased pon a
valid5 ade6ate or la!fl consideration% At the hearing schedled for Janar" ;;5 :J9J5 at G:77 0%C%5 Cr% Corgan
appeared at the trialQ he appeared as a !itness to &e candid5 open5 direct5
eBperienced and trthfl% He testified to "ears of eBperience !ith the Bank of America in +os Angeles5 the
Car6ette National Bank of Cinnesota and the First National Bank of Cinnesota% He seemed to &e familiar !ith
the operation of the Federal 4eserve -"stem% He freel" admitted that his Bank created all of the mone" and credit
pon its &ooks !ith !hich it ac6ired the Note and Cortgage of Ca" I5 :J9E% The credit first came into eBistence
!hen the Bank created it pon its &ooks% Frther5 he freel" admitted that no
*nited -tates +a! gave the Bank the athorit" to do this% This !as o&viosl" no la!fl consideration for the
Note% The Bank parted !ith a&soltel" nothing eBcept a little ink% 'n this case5 the evidence !as
on Janar" ;;5 :J9J that the Federal 4eserve Bank o&tained the Notes for this seems to &e conferred &" Title :;
*-) -ection E;7% The cost is a&ot J>:7th of a cent per Note regardless of the amont of the Note% The Federal
4eserve Banks create all of the mone" and credit pon their &ooks &" &ookkeeping entries &" !hich the" ac6ire
*nited -tates -ecrities% The collateral re6ired to o&tain the Note is5 &" section E:; *-)5 Title :;5 a deposit of a
like amont of &onds% Bonds !hich the Banks ac6ire &" creating mone" and
credit &" &ookkeeping entr"%P PNo rights can &e ac6ired &" frad% The Federal 4eserve Bank Notes are ac6ired
throgh the se of nconstittional stattes and frad%P PThe )ommon +a! re6ires a la!fl consideration for an"
contract or Note% These Notes are void for failre at a la!fl consideration at )ommon +a!5 entirel" apart from
an" )onstittional consideration% *pon this grond5 the Notes are ineffectal for an" prpose% This seems to &e
the principal o&(ection to paper fiat mone" and the case of its depreciation and failre do!n throgh the ages% 'f
allo!ed to contine5 Federal 4eserve Bank Notes !ill meet the same fate% From the evidence introdced on
Janar" ;;5 :J9J5 this )ort finds that as of Carch
:I5 :J9J5 all /old and -ilver &acking is removed from Federal 4eserve Bank Notes%P PThe la! leaves !rongdoers
!here it finds them% =-ee ' Cer% Jr ;nd on Actions -ection FF7?%P-laver" and all its incidents5 inclding 0eonage5
thralldom5 and de&t created &" frad is niversall" prohi&ited in the *nited -tates% This case represents &t
another refined form of -laver" &" the Bankers% Their position is not spported &" the
)onstittion of the *nited -tates% The 0eople have spoken their !ill in terms5 !hich cannot &e misnderstood% 't
is indispensa&le to the preservation of the *nion and independence and li&erties of the people that this )ort5
adhere onl" to the mandate of the )onstittion and administer it as it is !ritten% '5 therefore5 hold these Notes in
6estion void and not effectal for an" prpose%P =E? Janar" ,75 :J9J
Jdge Cartin 2% Cahone"
Jstice of the 0eace )redit 4iver To!nship
KKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKK
CDCDI! L*AN& AND ;*ID C*N!DAC!& (CDFCC! *"LIGA!I*N A& !* A
FUMAN "CING A& !* A "ANK
Frthermore5 this Cemorandm of la! is offered in order to advance nderstanding of the compleB legal isses5
present and em&odied in the )ommon +a!5 !ith athorities5 la! and cases in spport of5 !hich !ill constitte the
follo!ing facts: 0rivatel" o!ned &anks are making loans of PcreditP !ith the intended prpose of circlating
PcreditP as Pmone"P% Other financial instittions and individals ma" PlanderP &ank credit that the" receive
directl" or indirectl" from privatel" o!ned &anks% This collective activit" is nconstittional5 nla!fl5 in
violation of )ommon +a!5 *%-% )ode and the principles of e6it"% -ch activit" and nderl"ing contracts have
long &een held void5 &" -tate )orts5 Federal )orts and the *%-% -preme )ort% This Cemorandm !ill
demonstrate throgh athorities and esta&lished common la!5 that
credit Pmone" creationP &" privatel" o!ned &ank corporations is not reall" Pmone" creationP at all% 't is the trade
specialt" and artfl illsion of la! merchants5 !hich se old-time trade secrets of the /oldsmiths5 to entrap the
&orro!er and n(stl" enrich the lender throgh sr" and other nla!fl techni6es% 'sses &ased on la! and the
principles of e6it"5 !hich are !ithin the (risdiction of this )ort5 !ill &e addressed%
!FC G*LD&MI!F&
'n his &ook5 Money and Banking =Ith Edition5 :JIE?5 0rofessor David 4% Hamerschen !rites on pages F9 -9,:
PThe first &ankers in the modern sense !ere the goldsmiths5 !ho fre6entl" accepted &llion and coins for storage
%%% One reslt !as that the goldsmiths temporaril" cold lend part of the gold left !ith them % % % These loans of
their cstomersY gold !ere soon replaced &" a revoltionar" techni6e% 3hen people &roght in gold5 the
goldsmiths gave them notes promising to pa" that amont of gold on demand% The notes5 first made pa"a&le to the
order of the individal5 !ere later changed to &earer o&ligations%
'n the previos form5 a note pa"a&le to the order of Je&idiah Johnson !old &e paid to no one else nless Johnson
had first endorsed the note %%% Bt notes !ere soon &eing sed in an nforeseen !a"% The note holders fond that5
!hen the" !anted to &" something5 the" cold se the note itself in pa"ment more convenientl" and let the other
person go after the gold5 !hich the person rarel" did % % %The specie5 then tended to remain in the goldsmithsY
valts% % % % The goldsmiths &egan to reali<e that the" might profit handsomel" &" issing some!hat more notes
than the amont of specie the" held% % % These additional
notes !old cost the goldsmiths nothing eBcept the negligi&le cost of printing them5 "et the notes provided the
goldsmiths !ith fnds to lend at interest % % % %And the" !ere to find that the profita&ilit" of their lending
operations !old eBceed the profit from their original trade% The goldsmiths &ecame &ankers as their interest in
manfactre of gold items to sell !as replaced &" their concern !ith credit policies and lending activities % % %The"
discovered earl" that5 althogh an nlimited note isse !old &e n!ise5 the" cold
isse notes p to several times the amont of specie the" held% The ke" to the !hole operation la" in the p&licYs
!illingness to leave gold and silver in the &ankYs valts and se the &ankYs notes% This discover" is the &asis of
modern &anking: On page GE5 0rofessor Hamerschen frther eBplains the evoltion of the credit s"stem: P+ater the
goldsmiths learned a more efficient !a" to pt their credit mone" into circlation% The"
lent &" issing additional notes5 rather than &" pa"ing ot in gold% 'n eBchange for the interest-&earing note
received from their cstomer =in effect5 the loan contract?5 the" gave their o!n non-interest &earing note% Each
!as actall" &orro!ing from the other %%% The advantage of the later procedre ofY lending notes rather than gold
!as that % % % more notes cold &e issed if the gold remained in the valts %%% Ths5 throgh the principle of &ank
note issance5 banks learned to create money in the form of their own liability%P
NEmphasis AddedO
M*DCDN M*NCE MCCFANIC&
Another p&lication !hich eBplains modern &anking as learned from the /old smiths is Modern Money
Mechanics =Fth edition :JJ;?5 p&lished &" the Federal 4eserve Bank of )hicago !hich states &eginning on page
,: P't started !ith the goldsmiths %%%P At one time5 &ankers !ere merel" middlemen% The" made a profit &"
accepting gold and coins &roght to them for safekeeping and lending the gold and coins to &orro!ers% Bt the
goldsmiths soon fond that the receipts the" issed to depositors !ere &eing sed as a
means of pa"ment% YThen5 &ankers discovered that the" cold make loans merel" &" giving &orro!ers their
promises to pa"5 or &ank notes%%% 'n this !a"5 &anks &egan to create mone" %%% Demand deposits are the modern
conterpart of &ank notes % % % 't !as a small step from printing notes to making &ook entries to the credit of
&orro!ers !hich the &orro!ers5 in trn5 cold YspendY &" !riting checks5 there&" printing their own mone"%P
NEmphasis addedO
F*1 "ANK& CDCA!C M*NCE
'n the modern sense5 &anks create mone" &" creating Pdemand deposits%P Demand deposits are merel" P&ook
entriesP that reflect ho! mch la!fl mone" the &ank o!es its cstomers% Ths5 all deposits are called demand
deposits and are the &ankYs lia&ilities% The &ankYs assets are the valt cash pls all the P'O*sP or promissor" notes
that the &orro!er signs !hen the" &orro! either mone" or credit% 3hen a &ank lends its cash =legal mone"?5 it
loans its assets5 &t !hen a &ank lends its @creditA it lends its lia&ilities%
The lending of credit is5 therefore5 the eBact opposite of the lending of cash =legal mone"?% At this point5 !e need
to define the meaning of certain !ords like Pla!fl mone"A5 @legal tenderA5 @other mone"A and @dollarsA% The
terms PCone"P and PTenderP had their origins in Article :5 -ec% I and Article :5 -ec% :7 of the &onstitution of the
$nited %tates% :; *%-%)% S:F; refers to Pgold and silver coin as la!fl mone" of the *nited -tatesP and !as
nconstittionall" repealed in :JJE in-that )ongress can not 'elegate an" portion of their constittional
responsi&ilit" !ithot Amendment% The term Plegal tenderP !as originall" cited in ,: *%-%)%A% S,J; and is no!
re-codified in ,: *%-%)%A% SF:7, !hich states: P*nited -tates coins and crrenc" % % % are legal tender for all de&ts5
p&lic charges5 taBes5 and des%P The common denominator in &oth Pla!fl mone"P and Plegal tender mone"P is
that the *nited -tates /overnment isses &oth%
3ith Bankers5 ho!ever5 !e find that there are t!o forms of mone" - one is governmentissed5 and privatel"
o!ned &anks sch as 3A-H'N/TON C*T*A+5 and J0 CO4/AN )HA-E5 isse the other% As !e have alread"
discssed government issed forms of mone"5 !e mst no! scrtini<e privatel" issed forms of mone"% All
privatel" issed forms of mone" toda" are &ased pon the lia&ilities of the isser%
There are three common terms sed to descri&e this privatel" created mone"% The" are @creditA5 @demand
depositsA and @check&ook mone"A% 'n the -iBth edition of Blacks +a! Dictionar"5 p%,9G nder the term @)reditA
the term @Bank creditA is descri&ed as: @Cone" &ank o!es or !ill lend a individal or personA% 't is clear from this
definition that @Bank creditA !hich is the @mone" &ank o!esA is the &ankYs lia&ilit"% The term @check&ook mone"A
is descri&ed in the &ook @- Bet Cou !hought35 p&lished &" the privatel" o!ned
Federal 4eserve Bank of Ne! 1ork5 as follo!s: P)ommercial &anks create check&ook mone" !henever the" grant
a loan5 simpl" &" adding deposit dollars to acconts on their &ooks to eBchange for the &orro!ers 'O* % % % %P The
!ord PdepositP and Pdemand depositP &oth mean the same thing in &ank terminolog" and refer to the &ankYs
lia&ilities% For eBample5 the )hicago Federal 4eserves p&lication5 @Modern Money Mechanics3 states: PDeposits
are merel" &ook entries %%% Banks can &ild p deposits &" increasing loans %%% Demand deposits are the modern
conterpart of &ank notes% 't !as a small step
from printing notes to making &ook entries to the credit of &orro!ers !hich the &orro!ers5 in trn5 cold YspendY
&" !riting checks% Ths5 it is demonstrated in @Codern Cone" CechanicsA ho!5 nder the practice of fractional
reserve &anking5 a deposit of 8F5777 in cash cold reslt in a loan of credit>check&ook mone">demand deposits of%
8:775777 if reserve ratios set &" the Federal 4eserve are F_ =instead of :7_?%
'n a practical application5 here is ho! it !orks% 'f a &ank has ten people !ho each deposit 8F5777 =totaling
8F75777? in cash =legal mone"? and the &ankYs reserve ratio is F_5 then the &ank !ill lend t!ent" times this
amont5 or 8:57775777 in PcreditP mone"% 3hat the &ank has actall" done5 ho!ever5 is to !rite a check or loan its
credit !ith the intended prpose of circlating credit as Pmone"%P Banks kno! that if all the people !ho receive a
check or credit loan come to the &ank and demand cash5 the &ank !ill have to close its
doors &ecase it doesnYt have the cash to &ack p its check or loan% The &ankYs check or loan !ill5 ho!ever5 pass as
mone" as long as people have confidence in the illsion and donYt demand cash% 0anics are created !hen people
line p at the &ank and demand cash =legal mone"?5 casing &anks to fold as histor" records in several time
periods5 the most recent in this contr" !as the panic of :J,,%
!FC (D*CC&& *F (A&&ING CFCCK& *D CDCDI! A& M*NCE I& D*NC QUI!C &IM(LE
A deposit of 8F5777 in cash &" one person reslts in a loan of 8:775777 to another person at F_ reserves% The
person receiving the check or loan of credit for 8:775777 sall" deposits it in the same &ank or another &ank in
the Federal 4eserve -"stem% The check or loan is sent to the &ookkeeping department of the lending &ank !here a
&ook entr" of 8:775777 is credited to the &orro!erYs accont% The lending &ankYs check that created the &orro!erYs
loan is then stamped P0aidP !hen the accont of the &orro!er is credited a PdollarP amont% The &orro!er ma"
then PspendP these &ook entries =demand deposits? &" !riting checks to others5 !ho in trn deposit their checks
and have &ook entries transferred to their accont from the &orro!erYs checking accont% Ho!ever5 t!o highl"
6estiona&le and nla!fl acts have no! occrred% The first !as !hen t he &ank !rote the check or made the loan
!ith insfficient fnds to &ack them p% The second is !hen the &ank stamps its o!n @Not -fficient FndsA
check PpaidP or posts a loan &" merel"
crediting the &orro!erYs accont !ith &ook entries the &ank calls Pdollars%P 'ronicall"5 the check or loan seems
good and passes as mone" -- nless an emergenc" occrs via demands for cash - or a )ort challenge -- and the
artfl5 illsion &&&le5 &rsts%
DIFFCDCN! KIND& *F M*NCE
The &ook5 @- Bet Cou !hought35 p&lished &" the Federal 4eserve Bank of Ne! 1ork5 states: PCone" is an"
generall" accepted medim of eBchange5 not simpl" coin and crrenc"% Cone" doesn>t have to &e intrinsicall"
vala&le* be issued by a government or &e in an" special form%P NEmphasis addedO Ths !e see that privatel"
issed forms of mone" onl" re6ire p&lic confidence in order to pass as mone"% )onterfeit mone" also passes as
mone" as long as no&od" discovers itYs conterfeit% +ike !ise5 P&adP checks and
PcreditP loans pass as mone" so long as no one finds ot the" are nla!fl% 1et5 once the frad is discovered5 the
vales of sch @&ank mone"A like &ad check$s ceases to eBist% There are5 therefore5 t!o kinds of mone" --
government issed legal mone" and privatel" issed nla!fl mone"%
DIFFCDCN! KIND& *F D*LLAD&
The dollar once represented something intrinsicall" vala&le made from gold or silver% For eBample5 in :GJ;5
)ongress defined the silver dollar as a silver coin containing ,G:%;F grains of pre silver% The legal dollar is no!
kno!n as P*nited -tates coins and crrenc"%P Ho!ever5 the BankerYs dollar has &ecome a nit of measre of a
different kind of mone"% Therefore5 !ith Bankers there is a PdollarP of coins and a dollar of cash =legal mone"?5 a
PdollarP of de&t5 a PdollarP of credit5 a PdollarP of check&ook mone" or a
PdollarP of checks% 3hen one refers to a dollar spent or a dollar loaned5 he shold no! indicate !hat kind of
PdollarP he is talking a&ot5 since Bankers have created so man" different kinds%
A dollar of &ank Pcredit mone"P is the eBact opposite of a dollar of Plegal mone"P% The former is a lia&ilit" !hile
the latter is an asset% Ths5 it can &e seen from the earlier statement 6oted from - Bet Cou !hought5 that mone"
can &e privatel" issed as: PCone" doesnYt have to %%% &e issed &" a government or &e in an" special form%P 't
shold &e carefll" noted that &anks that isse and lend privatel" created mone" demand to &e paid !ith
government issed mone"% Ho!ever5 pa"ment in like kind nder natral e6it" !old seem to indicate that a de&t
created &" a loan of privatel" created mone" can &e paid !ith other privatel" created mone"5 !ithot regard for
@an" special formA as there are no stattor" la!s to dictate ho! either private citi<ens or &anks ma" create mone"%
"E 1FA! AU!F*DI!EN
B" !hat athorit" do state and national &anks5 as privatel" o!ned corporations5 create mone" &" lending their
credit --or more simpl" pt - &" !riting and passing P&adP checks and PcreditP loans as Pmone"PK No!here can a
la! &e fond that gives &anks the athorit" to create mone" &" lending their lia&ilities%
Therefore5 the neBt 6estion is5 if &anks are creating mone" &" passing &ad checks and lending their credit5 !here
is their athorit" to do soK From their literatre5 &anks claim these techni6es !ere learned from the trade secrets
of the /oldsmiths% 't is evident5 ho!ever5 that mone" creation &" private &anks is not the reslt of po!ers
conferred pon them &" government5 &t rather the artfl se of long held Ptrade secrets%P Ths5 nla!fl mone"
creation is not &eing done &" &anks as corporations5 &t nla!fll" &" &ankers%
Article I &ection #- 8ara) # o2 the "onstitution of t0e United (tates of America s8eci2ically states that no
state shall W))) coin money emit 9ills o2 cre'it ma@e any thing 9ut gol' an' sil7er coin a !en'er in (ayment
o2 De9ts5 pass an" Bill of Attainder5 eB post facto +a!5 or +a! impairing the O&ligations of )ontracts % %
PNEmphasis addedO
!he states :hich grant the Charters o2 state 9an@s also 8rohi9it the emitting o2 "ills o2 cre'it 9y not
granting such authority in 9an@ charters) 't is o&vios that P3e the peopleP never delegated to )ongress5 state
government5 or agencies of the state5 the po!er to create and isse mone" in the form of checks5 credit5 or other
P&ills of credit%P The Federal /overnment toda" does not athori<e &anks to emit5 !rite5 create5 isse and pass
checks and credit as mone"% Bt &anks do5 and get a!a" !ith itX Banks call their privatel" created mone" nice
sonding names5 like @creditA5 @demand depositsA5 or @check&ook mone"A% Ho!ever5 the tre natre of Pcredit
mone"P and PchecksP does not change regardless of the poetic terminolog" sed to descri&e them% -ch mone" in
common se &" privatel" o!ned &anks is illegal nder Art% :5 -ec%:75 para% : of the )onstittion of the *nited
-tates of America5 as !ell as nla!fl nder the la!s of the *nited -tates and of this -tate%
;*ID WUL!DA ;IDC&W C*N!DAC!&
The corts have long held that !hen a corporation eBectes a contract &e"ond the scope of its charter or granted
corporate po!ers5 the contract is void or Pltra viresP% 'n &entral !ransp. &o. v. Gullman5 :,J *%-% 975 :: -% )t%
EGI5 ,F +% Ed% FF5 the cort said: PA contract ultra vires &eing nla!fl and void5 not &ecase it is in itself
immoral5 &t &ecase the corporation5 &" the la! of its creation5 is incapa&le of making it5 the
corts5 !hile refsing to maintain an" action pon the nla!fl contract5 have al!a"s striven to do (stice
&et!een the parties5 so far as cold &e done consistentl" !ith adherence to la!5 &" permitting propert" or mone"5
parted !ith on the faith of the nla!fl contract5 to &e recovered &ack5 or compensation to &e made for it% 'n sch
case5 ho!ever5 the action is not maintained pon the nla!fl contract5 nor according to its
termsQ &t on an implied contract of the defendant to retrn5 or5 failing to do that5 to make compensation for5
propert" or mone" !hich it has no right to retain% To maintain sch an action is not to affirm5 &t to disaffirm5 the
nla!fl contract%P P3hen a contract is once declared ltra vires5 the fact that it is eBected ` does not validate it5
nor can it &e ratified5 so as to make it the &asis of sitor action5 nor does the
doctrine of estoppel appl"%P FH G; v. ;ichmond5 :,, -E IJIQ :F: 2a :JF% PA national &ank %%% cannot lend its
credit to another &" &ecoming sret"5 indorser5 or garantor for him5 sch an act Q is ltra vires % % %P Merchants>
Bank v. Baird :97 F 9E;%
!FC QUC&!I*N *F LA1FUL C*N&IDCDA!I*N
The isse of !hether the lender !ho !rites and passes a P&adP check or makes a PcreditP loan has a claim for
relief against the &orro!er is eas" to ans!er5 providing the lender can prove that he gave a la!fl consideration5
&ased pon la!fl acts% Bt did the lender give a la!fl considerationK !o gi7e a la:2ul consi'eration the
len'er must 8ro7e that he ga7e the 9orro:er la:2ul money such as coins or currency) Failing that he can
ha7e no claim 2or relie2 in a court at la: against the 9orro:er as the len'erSs actions :ere ultra 7ires or
7oi' 2rom the 9eginning o2 the transaction)
't can &e arged that @&adA checks or @creditA loans that pass as mone" are vala&leQ &t so are conterfeit coins
and crrenc" that pass as mone"% 't seems nconsciona&le that a &ank !old ask homeo!ners to pt p a
homestead as collateral for a Pcredit loanP that the &ank created ot of thin air% 3old this cort of la! or e6it"
allo! a conterfeiter to foreclose against a personYs home &ecase the &orro!er !as late in pa"ments on an
nla!fl loan of conterfeit mone"K 3ere the cort to do so5 it !old &e contrar" to all
principles of la!% The 6estion of vala&le consideration in the case at &ar5 does not depend on an" vale
imparted &" the lender5 &t the false confidence instilled in the P&adP check or PcreditP loan &" the lender% 'n a
cort at la! or e6it"5 the lender has no claim for relief% The argment that &ecase the &orro!er received
propert" for the lenderYs P&adP check or PcreditP loan gives the lender a claim for relief is not valid5 nless the
lender can prove that he gave la!fl vale% The seller in some cases !ho ma" &e holding the @&adA check or
@)reditA loan has a claim for relief against the lender or the &orro!er or &oth5 &t the
lender has no sch claim% "*DD*1CD DCLICF
-ince !e have esta&lished that the lender of nla!fl or conterfeit mone" has no claim for relief nder a void
contract5 the last 6estion shold &e5 does the &orro!er have a claim for relief against the lenderK First5 if it is
esta&lished that the &orro!er has made no pa"ments to the lender5 then the &orro!er has no claim for relief
#against the lender for mone" damages% Bt the &orro!er has a claim for relief to void the de&t he o!es the lender
for notes or o&ligations nla!fll" created &" an ltra vires contract for lending
PcreditP mone"%
!he 9orro:er the Courts ha7e long hel' has a claim 2or relie2 against the len'er to ha7e the note security
agreement or mortgage note the 9orro:er signe' 'eclare' null an' 7oi')
The &orro!er ma" also have claims for relief for &reach of contract &" the lender for not lending Pla!fl mone"P
and for @sr"A for charging an interest rate several times greater than the amont agreed to in the contract for an"
la!fl mone" actall" risked &" the lender% For eBample5 if on a 8:775777 loan it can &e esta&lished that the
lender actall" risked onl" 8F5777 =F_ Federal 4eserve ratio? !ith a contract interest rate of :7_5 the lender has
then loaned 8JF5777 of PcreditP and 8F5777 of Pla!fl mone"P% Ho!ever5
!hile charging :7_ interest =8:75777? on the entire 8:775777% The tre interest rate on the 8F5777 of Pla!fl
mone"P actall" risked &" the lender is ;77_ !hich 7iolates Usury la:s o2 this state)
I2 no Wla:2ul moneyW :as loane' then the interest rate is an in2inite 8ercentage) &uch techniLues the
9an@ers say :ere learne' 2rom the tra'e secrets o2 the Gol'smiths) !he Courts ha7e re8eate'ly rule' that
such contracts :ith 9orro:ers are :holly 7oi' 2rom the 9eginning o2 the transaction 9ecause 9an@s are not
grante' 8o:ers to enter into such contracts 9y either state or national charters)
ADDI!I*NAL "*DD*1CD DCLICF
'n Federal District )ort the &orro!er ma" have additional claims for relief nder P)ivil 4')OP Federal
4acketeering la!s =:I *%-%)% S :J9E?% The lender ma" have esta&lished a Ppattern of racketeering activit"P &"
sing the *%-% Cail more than t!ice to collect an nla!fl de&t and the lender ma" &e in violation of :I *%-%)%
S:,E:5 :,E,5 :J9: and :J9;% The &orro!er has other claims for relief if he can prove there !as or is a conspirac"
to deprive him of propert" !ithot de process of la! nder% =E; *%-%)% S:JI, =)onstittional 'n(r"?5 :JIF
=)onspirac"? and :JI9 =PHno!ledgeP and PNeglect to 0reventP a *%-% )onstittional 3rong?5 *nder :I
*%-%)%A%S ;E: =)onspirac"? violators5 Pshall &e fined not more than 8:75777 or imprisoned not more than ten =:7?
"ears or &oth%P
'n a De&torYs 4')O action against its creditor5 alleging that the creditor had collected an nla!fl de&t5 an interest
rate =!here all loan charges !ere added together? that eBceeded5 in the langage of the 4')O -tatte5 Pt!ice the
enforcea&le rateP% The )ort fond no reason to impose a re6irement that the 0laintiff sho! that the D efendant
had &een convicted of collecting an nla!fl de&t5 rnning a Ploan sharkingP operation% The de&t inclded the fact
that eBaction of a srios interest rate rendered the de&t nla!fl
and that is all that is necessar" to spport the )ivil 4')O action% Drante Bros% V -ons5 'nc% v% Flshing Nat Yl
Bank% GFF F;d ;,J5 )ert% denied5 EG, *- J79 =:JIF?% The -preme )ort fond that the 0laintiff in a civil 4')O
action5 need esta&lish onl" a criminal PviolationP and not a criminal conviction% Frther5 the )ort held that the
Defendant need onl" have cased harm to the 0laintiff &" the commission of a predicate
offense in sch a !a" as to constitte a Ppattern of 4acketeering activit"%P That is5 the 0laintiff need not
demonstrate that the Defendant is an organi<ed crime figre5 a mo&ster in the poplar sense5 or that the 0laintiff
has sffered some t"pe of special 4acketeering in(r"Q all that the 0laintiff mst sho! is !hat the -tatte
specificall" re6ires% The 4')O -tatte and the civil remedies for its violation are to &e li&erall" constred to
effect the congressional prpose as &roadl" formlated in the -tatte% -edima5 -04+ v% 'mreB )o%5 EG, *- EGJ
=:JIF?% Aside from an" legal o&ligation5 there eBists a societal and moral o&ligation enre to &oth the 0laintiff and
the Defendant in that if "o !ere to defse a Bom&5 and "o completed the task JJ_ correct5 "o are still dead%
/rantor &elieves that his position on the la! is sond5 &t fears grievos repercssions throghot the financial
commnit" if he shold prevail% The credit for mone" scheme is endemic throghot or societ" and cold have
devastating effects on the national econom"% /rantor &elieves that another approach ma" &e eBplored as follo!s:
(CDFCC! *"LIGA!I*N A& !* A FUMAN "CING That !hich is &orro!ed is !ealth% +a&or created that
!ealth5 so it is mone" not!ithstanding its form% )onsideration is promised in advance &" the 0romissor of the
Note5 in the natre of principal and interest pa"ments for the consideration provided &" the lender5 !hich is his
personal !ealth created &" his la&or% A Cortgage Note or 0romissor" Note secres the position of the lender and if
there is defalt on the promise to pa" then the &orro!er has agreed to accept the strict foreclosre
remed" provided &" state stattes% Then the &orro!er o&ligated themselves to pa" &ack the principal and pa" for
the se of it5 in the form of interest for the "ears over !hich the principal is to &e paid &ack% 1hen
8ayments sto8 there is a 8rima 2acie in?ury to the len'er% 3hen pa"ments stop the lender has strict foreclosre
procedre in state cort to remed" the pa" &ack of the &alance of the principal% Jdgment to foreclose on the
propert" is granted pon the mere proof that pa"ments have ceased as promised% The propert" is sold to cover the
npaid &alanceQ deficienc" (dgment ma" &e needed% All is right !ith the !orld% Here the lender !old &e
pre(diced if complete and s!ift remed" !ere not availa&le% A&sent sch remed" the government !old &e part"
to placing the lender into a condition of involntar" servitde
to the &orro!er% (CDFCC! *"LIGA!I*N A& !* A "ANK
'n "ears past &anks and savings and loans instittions en(o"ed the remed" otlined a&ove% The reason !as the"
!ere lending ot mone" &elonging to their depositors and there !as prima facie in(r" to the depositors pon the
mere proof that pa"ments had ceased% There&" the &ank as !ell as the government !old &e part" to creating a
condition of involntar" servitde pon the depositors if strict foreclosre remed" !ere not availa&le% Toda"
depositors are not in (eopard" of &eing in(red !hen a person &orro!s mone" from a &ank% The &ank does not
lend their mone"5 onl" their credit in the amont of the loan =paper acconting?% Hence no prima facie in(r"
eBists to either the depositors or the &ank pon the mere proof that pa"ments cease% 'n(r" is &ased pon the
pa"ments made as to the credit line%
(CDFCC! *D IM(CDFCC! *"LIGA!I*N
A perfect o&ligation is one recogni<ed and sanctioned &" positive la!Q one of !hich the flfillment can &e
enforced &" the aid of the la!% Bt if the dt" created &" the o&ligation operates onl" on the moral sense5 !ithot
&eing enforced &" an" positive la!5 it is called an Pimperfect o&ligation5P and creates no right of action5 nor has it
an" legal operation% The dt" of eBercising gratitde5 charit"5 and the other merel" moral dties are eBamples of
this kind of o&ligation% Ed!ards v% Heane"5 J9 *%-% FJF5 9775 ;E +%Ed% GJ,%
/overnment approved the Federal 4eserve Bank5 'nc%5 as the )entral Banking s"stem for the *nited -tates5 and
it$s polic" is revie!ed &" )ongress al&eit5 in a hapha<ard manner% The Federal 4eserve athori<es its @private
mone"A @Federal 4eserve Bank NotesA to &e sed &" lending instittions sch as mem&er &anks5 to operate pon
a s"stem of fractionali<ing% The natre of !hich is that the" do not lend either their mone" or the mone" of the
depositors5 the mone" is created ot of thin air5 &" the mere stroke of a pen% 3hen there is no consideration in
(eopard" of &eing retrned5 then the o&ligation is to make the &ank in(r" proof5 to the eBtent of the o&ligation5
!hich !old &e to make them !hole%
The onl" legal o&ligation is &ased pon the moral isse5 !hich nder the la! is an 'mperfect O&ligation5 to retrn
to them their propert"5 !hich isn$t !ealth5 &t credit% A 0romissor" Note is signed nder Peconomic complsionP
!hen5 the PloanP !ill not &e consmmated nless and ntil the &orro!er signs it% Ths5 performing the act of
signing a 0romissor" Note cannot &e considered volntar"% The discharging of the credit is &ased pon social5
economic5 and moral standards to make the &ank !hole5 if in(r" is claimed5 in an" cort action !here defalt on
the 0romissor" Note is on record and !here the &ank fails to verif" an in(r"5 the &ank cannot enforce a promise
to pa" consideration !here the" provided no consideration% For
the &ank to &e a&le to force pon the defendant an amont over and a&ove the credit5 is to force pon the
defendants a de&t that goes to the control of their la&or against their !ill% This condition !old &e 0eonage5 !hich
has &een a&olished in this contr"% =E; *%-%)% S :JJE5 and :I *%-%)% S:FI:%? The 6estion then arises as to !hen
is the o&ligation discharged5 to pt the &ank in a position5 !here there is no record of in(r" to itK
!FC CA&C I& CLCAD
Cons8iracy against rights: 'f t!o or more persons conspire to in(re5 oppress5 threaten5 or intimidate an" person
in an" -tate5 Territor"5 )ommon!ealth5 0ossession5 or District in the free eBercise or en(o"ment of an" right or
privilege secred to him &" the )onstittion or la!s of the *nited -tates5 or &ecase of his having so eBercised the
same Q or 'f t!o or more persons go in disgise on the high!a"5 or on the premises of another5 !ith intent to
prevent or hinder his free eBercise or en(o"ment of an" right or privilege so
secred - The" shall &e fined nder this title or imprisoned not more than ten "ears5 or &othQ and if death reslts
from the acts committed in violation of this section or if sch acts inclde kidnapping or an attempt to kidnap5
aggravated seBal a&se or an attempt to commit aggravated seBal a&se5 or an attempt to kill5 the" shall &e fined
nder this title or imprisoned for an" term of "ears or for life5 or &oth5 or ma" &e sentenced to death% N:I5 *-)
;E:O
De8ri7ation o2 rights un'er color o2 la:: 3hoever5 nder color of an" la!5 statte5 ordinance5 reglation5 or
cstom5 !illfll" s&(ects an" person in an" -tate5 Territor"5 )ommon!ealth5 0ossession5 or District to the
deprivation of an" rights5 privileges5 or immnities secred or protected &" the )onstittion or la!s of the *nited
-tates5 or to different pnishments5 pains5 or penalties5 on accont of sch person &eing an alien5 or &" reason of
his color5 or race5 than are prescri&ed for the pnishment of citi<ens5 shall &e fined nder this title or imprisoned
not more than one "ear5 or &othQ and if &odil" in(r" reslts from the acts committed in violation of this section or
if sch acts inclde the se5 attempted se5 or threatened se of a dangeros !eapon5 eBplosives5 or fire5 shall &e
fined nder this title or imprisoned not more than ten "ears5 or &othQ and if death reslts from the acts committed
in violation of this section or if sch acts inclde kidnapping or an attempt to kidnap5 aggravated seBal a&se5 or
an attempt to commit aggravated seBal a&se5 or an attempt to kill5 shall &e fined nder this title5 or imprisoned
for an" term of "ears or for life5 or &oth5 or ma" &e sentenced to death% N:I5 *-) ;E;O (ro8erty rights o2
citiMens: All citi<ens of the *nited -tates shall have the same right5 in ever" -tate and Territor"5 as is en(o"ed &"
!hite citi<ens thereof to inherit5 prchase5 lease5 sell5 hold5 and conve" real and personal propert"% NE; *-) :JI;O
Ci7il action 2or 'e8ri7ation o2 rights: Ever" person !ho5 nder color of an" statte5 ordinance5 reglation5
cstom5 or sage5 of an" -tate or Territor" or the District of )olm&ia5 s&(ects5 or cases to &e s&(ected5 an"
citi<en of the *nited -tates or other person !ithin the (risdiction thereof to the deprivation of an" rights5
privileges5 or immnities secred &" the )onstittion and la!s5 shall &e lia&le to the part" in(red in an
action at la!5 sit in e6it"5 or other proper proceeding for redress5 eBcept that in an" action &roght against a
(dicial officer for an act or omission taken in sch officerYs (dicial capacit"5 in(nctive relief shall not &e granted
nless a declarator" decree !as violated or declarator" relief !as navaila&le% For the prposes of this section5
an" Act of )ongress applica&le eBclsivel" to the District of )olm&ia shall &e considered to &e a statte of the
District of )olm&ia% NE; *-) :JI,O
Cons8iracy to inter2ere :ith ci7il rights: Depriving persons of rights or privileges: 'f t!o or more persons in
an" -tate or Territor" conspire or go in disgise on the high!a" or on the premises of another5 for the prpose of
depriving5 either directl" or indirectl"5 an" person or class of persons of the e6al protection of the la!s5 or of
e6al privileges and immnities nder the la!sQ or for the prpose of preventing or hindering the constitted
athorities of an" -tate or Territor" from giving or secring to all persons !ithin sch -tate or Territor" the e6al
protection of the la!sQ or if t!o or more persons
conspire to prevent &" force5 intimidation5 or threat5 an" citi<en !ho is la!fll" entitled to vote5 from giving his
spport or advocac" in a legal manner5 to!ard or in favor of the election of an" la!fll" 6alified person as an
elector for 0resident or 2ice 0resident5 or as a Cem&er of )ongress of the *nited -tatesQ or to in(re an" citi<en in
person or propert" on accont of sch spport or advocac"Q in an" case of conspirac" set forth in this section5 if
one or more persons engaged therein do5 or case to &e done5 an" act in frtherance of the o&(ect of sch
conspirac"5 !here&" another is in(red in his person or propert"5 or deprived of having and eBercising an" right or
privilege of a citi<en of the *nited -tates5 the part" so in(red or deprived ma" have an action for the recover" of
damages occasioned &" sch in(r" or deprivation5 against an" one or more of the conspirators% NE; *-) :JIF=,?O
Action 2or neglect to 8re7ent: Ever" person !ho5 having kno!ledge that an" of the !rongs conspired to &e
done5 and mentioned in section :JIF of this title5 are a&ot to &e committed5 and having po!er to prevent or aid in
preventing the commission of the same5 neglects or refses so to do5 if sch !rongfl act &e committed5 shall &e
lia&le to the part" in(red5 or his legal representatives5 for all damages cased &" sch !rongfl act5 !hich sch
person &" reasona&le diligence cold have preventedQ and sch damages ma" &e recovered in an action on the
caseQ and an" nm&er of persons gilt" of sch !rongfl neglect or refsal ma" &e (oined as defendants in the
actionQ and if the death of an" part" &e cased &" an" sch !rongfl act and neglect5 the legal representatives of
the deceased shall have sch action therefore5 and ma" recover not eBceeding 8F5777 damages therein5 for the
&enefit of the !ido! of the deceased5 if there &e one5 and if there &e no !ido!5 then for the &enefit of the neBt of
kin of the deceased% Bt no action nder the provisions of this section shall &e sstained !hich is not commenced
!ithin one "ear after the case of action has accred% NE; *-) :JI9O
C*UD!: The person and sit of the sovereignQ the place !here the sovereign so(orns !ith his regal retine5
!herever that ma" &e% NBlackYs +a! Dictionar"5 Fth Edition5 page ,:I%O
C*UD!: An agenc" of the sovereign created &" it directl" or indirectl" nder its athorit"5 consisting of one or
more officers5 esta&lished and maintained for the prpose of hearing and determining isses of la! and fact
regarding legal rights and alleged violations thereof5 and of appl"ing the sanctions of the la!5 athori<ed to
eBercise its po!ers in the corse of la! at times and places previosl" determined &" la!fl
athorit"% N's&ill v% -tovall5 TeB%)iv%App%5 J; -%3%;d :79G5 :7G7Q BlackYs +a!
Dictionar"5 Eth Edition5 page E;FO
C*UD! *F DCC*DD: To &e a cort of record a cort mst have for characteristics5 and ma" have a fifth%
The" are: a% A (dicial tri&nal having attri&tes and eBercising fnctions independentl" of the person of the
magistrate designated generall" to hold it NJones v% Jones5 :II Co%App% ;;75 :GF -%3% ;;G5 ;;JQ EB parte
/ladhill5 I Cetc% Cass%5 :G:5 per -ha!5 )%J% -ee5 also5 +ed!ith v% 4osalsk"5 ;EE N%1% E795 :FF N%E% 9II5 9IJO
NBlackYs +a! Dictionar"5 Eth Ed%5 E;F5 E;9O
&% 0roceeding according to the corse of common la! NJones v% Jones5 :II Co%App% ;;75 :GF -%3% ;;G5 ;;JQ EB
parte /ladhill5 I Cetc% Cass%5 :G:5 per -ha!5 )%J% -ee5 also5 +ed!ith v% 4osalsk"5 ;EE N%1% E795 :FF N%E% 9II5
9IJO NBlackYs +a! Dictionar"5 Eth Ed%5 E;F5 E;9O
c% 'ts acts and (dicial proceedings are enrolled5 or recorded5 for a perpetal memor" and testimon"% N, Bl% )omm%
;EQ , -teph% )omm% ,I,Q The Thomas Fletcher5 )%)%/a%5 ;E F% EI:Q EB parte Thistleton5 F; )al ;;FQ Er!in v%
*%-%5 D%)%/a%5 ,G F% EII5 ; +%4%A% ;;JQ Heininger v% Davis5 J9 Ohio -t% ;7F5 ::G
N%E% ;;J5 ;,:O
d% Has po!er to fine or imprison for contempt% N, Bl% )omm% ;EQ , -teph% )omm% ,I,Q The Thomas Fletcher5
)%)%/a%5 ;E F% EI:Q EB parte Thistleton5 F; )al ;;FQ Er!in v% *%-%5 D%)%/a%5 ,G F% EII5 ; +%4%A% ;;JQ Heininger v%
Davis5 J9 Ohio -t% ;7F5 ::G N%E% ;;J5 ;,:%O NBlackYs +a! Dictionar"5 E
th
Ed%5 E;F5 E;9O
e% /enerall" possesses a seal% N, Bl% )omm% ;EQ , -teph% )omm% ,I,Q The Thomas Fletcher5 )%)%/a%5 ;E F% EI:Q
EB parte Thistleton5 F; )al ;;FQ Er!in v% *%-%5 D%)%/a%5 ,G EII5 ; +%4%A% ;;JQ Heininger v% Davis5 J9 Ohio -t%
;7F5 ::G N%E% ;;J5 ;,:%O NBlackYs +a! Dictionar"5 Eth Ed%5 E;F5 E;9O
!a@ing into consi'eration all o2 the 'ocumentation containe' herein it is a9un'antly clear that no
2oreclosure action is :arrante' ?usti2ie' or la:2ul) !here is no in?ury to the 8ur8orte' len'er) A court o2
recor' shoul' 'eci'e :hat actions shoul' an' must 9e ta@en as a result o2 the unla:2ul actions o2 the
(lainti22) CAhi9it D Memoran'um o2 La: (oints o2 Authority "ills o2 CAchange
N*!ICC N*!ICC *F MCM*DANDUM *F LA1-(oints an' Authorities in &u88ort o2
International "ill o2 CAchange
PThose !ho constitte an association nation!ide of private5 nincorporated persons engaged in the siness of
&anking to isse notes against these o&ligations of the *nited -tates de themQ !hose 8ri7ate propert" is at risk
to collaterali<e the government$s de&t and crrenc"5 &" legal definitions5 a Pnational 9an@ing associationPQ sch
notes5 issed against these o9ligations o2 the Unite' &tates to that 8art o2 the 8u9lic 'e9t 'ue its (rinci8als
an' &ureties are re;uired <- la7 to <e acce.ted as ,legal tender, of .a-ment for all de<ts .u<lic and .ri=ate5
and are defined in la! as Po9ligations o2 the Unite' &tatesP5 on the same par and categor" !ith Federal reserve
notes and other crrenc" and legal tender o&ligations%P DC: Item ten'ere' 2or Discharge o2 De9t% !he
instrument ten'ere' to the 9an@ an' negotiate' to the Unite' &tates !reasury 2or settlement is an
I*9ligation o2 !FC UNI!CD &!A!C&5A nder !itle #0U&C &ect)0 representing as the definition provides a
@certificate of inde&tedness W%'ra:n u8on an authoriMe' o22icer o2 the Unite' &tates5A =in this case the
-ecretar" of the Treasr"?Aissue' un'er an Act o2 CongressA =in this case 8u9lic la: /H-#- FBD-#4$ o2 #4HH
and !itle H# U&C H#$H an' H# U&C .#-H> an' 9y treaty =in this case the UNI!CD NA!I*N&
C*N;CN!I*N *N IN!CDNA!I*NAL "ILL& *F C+CFANGC AND IN!CDNA!I*NAL
(D*MI&&*DE N*!C& =UNCI!DAL? and the Uni7ersal (ostal Union hea'Luartere' in "ern
&:itMerlan'?%
!I!LC #0 X (AD! I X CFA(!CD # X &ec) #) X &ec) 0%
&ec) 0) - *9ligation or other security o2 the Unite' &tates 'e2ine' !he term SSo9ligation or other security o2
the Unite' &tatesSS inclu'es all 9on's certi2icates o2 in'e9te'ness national 9an@ currency5 Federal 4eserve
notes5 Federal 4eserve &ank notes5 copons5 *nited -tates notes5 Treasr" notes5 gold certificates5 silver
certificates5 fractional notes5 certificates of deposit5 &ills5 checks5 or drafts for mone"5
'ra:n 9y or u8on authoriMe' o22icers o2 the Unite' &tates5 stamps and other representatives of vale5 of
!hatever denomination5 issue' un'er any Act o2 Congress5 and canceled *nited -tates stamps%
The 'nternational Bill of EBchange is legal tender as a national &ank note5 or note of a National Banking
Association5 &" legal and>or stattor" definition =UCC %-#-. #$CFD&ec) $$4)$ $#-)$ #$ U&C #0#H>5 issed
nder Athorit" of the *nited -tates )ode H# U&C H4$ .#-H5 !hich officiall" defines this as a stattor" legal
tender o&ligation of THE *NT'ED -TATE-5 and is issed in accordance !ith H# U&C H#$H
an' FBD-#4$ =#4HH> !hich esta&lish and provide for its issance as @0&lic 0olic"A in remed" for discharge of
e6it" interest recover" on that portion of the p&lic de&t to its 0rincipals5 and -reties &earing the O&ligation of
THE *N'TED -TATE-% This is a stattor" remed" for e6it" interest recover" de the principles and sreties of
the *nited -tates for 'ischarge o2 la:2ul 'e9ts in commerce in con?unction :ith U& o9ligations to that
8ortion o2 the 8u9lic 'e9t it is inten'e' to re'uce%Dring the financial crisis of the depression5 in :J,,
s&stance of gold5 silver and real mone" !as remo7e' as a fondation for or financial s"stem% 'n it s place the
su9stance of the American citi<enr": their real propert"5 !ealth5 assets
and prodctivit" that 9elongs to them !as5 in effect5 #8le'ge'$ &" the government and 8lace' at ris@ as the
collateral for U& 'e9t cre'it an' currency for commerce to fnction% This is !ell docmented in the actions of
)ongress and the 0resident at that time and in the )ongressional de&ates that preceded the adoption of the
reorgani<ational measres: &enate Document No) %H /Hr' Congress #st &ession5 stated5
P*nder the ne! la! the mone" is issed to the &anks in return for Go7ernment o9ligations 9ills o2 eAchange
'ra2ts notes tra'e acce8tances an' 9an@ers acce8tances) !he money :ill 9e :orth #-- cents on the 'ollar
9ecause it is 9ac@e' 9y the cre'it o2 the nation) It :ill re8resent a mortgage on all the homes an' other
8ro8erty o2 all the 8eo8le in the Nation%P =3hich la:2ully 9elongs to these private
citi<ens%? The National De&t is defined as @mortgages on the :ealth an' income o2 the 8eo8le o2
a country%A =Enc"clopedia Britannica5 :JFJ%? Their !ealth5 W% their income% The reorgani<ation is evidenced &":
The Emergenc" Banking Act5 Carch J5 :J,,5 Hose Joint 4esoltion :J;5 Jne F5 :J,, =p&lic la! G,-:7? And
the -eries of EBective Orders that srronded them: 97G,- 4eopening of Banks% Em&argo on /old 0a"ments and
EBports5 and +imitations on Foreign EBchange Transactions% Carch :75 :J,, 9:::-Transactions in foreign
eBchange are permitted nder /overnmental -pervision% April ;75 :J,, 9:7; - For&idding the hoarding of gold
coin5 gold &llion and gold certificates% April F5 On Decem&er ;,5 :J:,5 )ongress had passed PAn Act to provide
for the esta&lishment of Federal reserve &anks5 to frnish an elastic crrenc"5 to afford a means of redisconting
commercial paper5 to esta&lish a more effective spervision of &anking in the *nited -tates5 and 2or other
8ur8osesP% The Act is commonl" kno!n as the PFe'eral Deser7e ActP% One fo the prposes for enacting the
Federal 4eserve Act !as:
=,? to authoriMe Why8othecationW o2 o9ligations inclu'ing WUnite' &tates 9on's or other securities :hich
Fe'eral reser7e "an@s are authoriMe' to hol'P nder -ection :E=a?Q #$ U&CP ch) , H0 &tat) $.# &ect #%=a> The
term Phy8othecationP as stated in -ection :E=a? of the Act is defined: P:% Banking% *22er o2 stocks5 &onds5 or
other assets o!ned &" a part" other than the 9orro:er as collateral 2or a loan :ithout trans2erring title% 'f the
&orro!er trns the propert" over to the lender !ho holds it for safekeeping5 the
action is referred to as a pledge% 'f the &orro!er retains possession5 &t gi7es the len'er the right to sell the
8ro8erty in e7ent o2 'e2ault5 it is a tre h"pothecation% ;% -ecrities% The pledging of negotia&le secrities to
collaterali<e a &rokerYs margin loan% The &roker pledges the same secrities to a &ank as collateral for a &rokerYs
loan5 the process is referred to as rehy8othecation%P
3Dictionary *2 "an@ing !erms Fitch 8g) $$0 =#44/?O
As seen from the definitions5 in h"pothecation there is eLuita9le risk to the actual o!ner% -ection :9 of the
crrent Federal 4eserve Act5 !hich is codified at :; *-) E::5 declares that WFe'eral Deser7e NotesW are
Wo9ligations o2 the Unite' &tatesW) -o !e see the P2ull 2aith an' cre'itP of the Unite' &tates: !hich is the
su9stance of the American citi<enr": their real propert"5 !ealth5 assets and prodctivit" that 9elongs to them5 is
there&" hy8othecate' an' rehy8othecate' &" the *nited -tates to its o&ligations as !ell as to the Federal
4eserve 2or the issuance an' 9ac@ing o2 Fe'eral Deser7e Notes as legal ten'er Pfor all taBes5 cstoms5 and
other p&lic desP% !I!LC #$ X CFA(!CD H X &U"CFA (!CD +II X &ec) %##)
&ec) %##) - Issuance to reser7e 9an@sP nature o2 o9ligationP redemption Federal 4eserve notes5 to &e issed at
the discretion of the Board of /overnors of the Federal 4eserve -"stem for the prpose of making advances to
Federal reserve &anks throgh the Federal reserve agents as hereinafter set forth and for no other prpose5 are
athori<ed% !he sai' notes shall 9e o9ligations o2 the Unite' &tates an' shall 9e
recei7a9le 9y all national an' mem9er 9an@s an' Fe'eral reser7e 9an@s an' 2or all taAes customs an'
other 8u9lic 'ues% The commerce and credit of the nation contines on toda" nder financial reorgani<ation
=Bankrptc"? as it has since :J,,5 still &acked &" the assets and !ealth of the American
citi<enr": at ris@ for the go7ernments o&ligations and crrenc"% *nder the :Eth amendment and nmeros
-preme )ort precedents5 as !ell as in e6it"5 (ri7ate 8ro8erty can not 9e ta@en or 8le'ge' 2or 8u9lic use
:ithout ?ust com8ensation or 'ue 8rocess o2 la: % The *nited -tates can not 8le'ge or ris@ the
8ro8erty an' :ealth o2 its 8ri7ate citiMens 2or any go7ernment 8ur8ose :ithout legally 8ro7i'ing them
reme'y to reco7er :hat is 'ue them on their ris@% This principle is so !ell esta&lished in English common la!
and in the histor" of American (risprdence% The :Eth amendment provides: @no 8erson shall 9e 'e8ri7e' o2<
8ro8erty :ithout 'ue 8rocess o2 la:A%
And )orts have long rled to have one$s propert" legall" held as collateral or sret" for a de&t even !hen he still
o!ns it and still has it is to deprive him of it since it is at risk and cold &e lost for the de&t at an" time% The
*nited -tates -preme )ort said5 in *nited -tates v% 4ssell N:, 3all5 9;,5 9;GO
P(ri7ate 8ro8erty the Constitution 8ro7i'es shall not 9e ta@en 2or 8u9lic use :ithout ?ust com8ensation%A
PThe right o2 su9rogation is not fonded on contract% 't is a creature o2 eLuityQ is enforced solel" for the
prpose of accomplishing the ends of s&stantial (sticeQ an' is in'e8en'ent o2 any contractual relations
9et:een the 8arties)W Mem8his T L) D) D) Co) 7) Do: #$- U)&) $0/ H-#-H-$ =#00/>% !he rights o2 a surety
to reco7ery on his ris@ or loss :hen stan'ing 2or the 'e9ts o2
another !as reaffirmed again as late as :J9; in 0earlman v% 4eliance 'ns%)o%5 ,G: *%-%:,; !hen the )ort said:
<Jsureties com8elle' to 8ay 'e9ts 2or their 8rinci8al ha7e 9een 'eeme' entitle' to
reim9ursement e7en :ithout a contractual 8romise <An' 8ro9a9ly there are 2e: 'octrines 9etter
esta9lishe'<)))J "lac@s La: Dictionary .th e'ition 'e2ines IsuretyJ: @One !ho ndertakes to pa" or to 'o
any other act in e7ent that his 8rinci8al 2ails therein% Ever"one !ho incrs a lia9ility in 8erson or estate 2or
the 9ene2it o2 another5 !ithot sharing in the consideration5 stan's in the 8osition o2 a Isurety%A
)onstittionall" and in the la!s of e6it"5 the *nited -tates coul' not 9orro: or 8le'ge
the 8ro8erty an' :ealth o2 its 8ri7ate citiMens 8ut at ris@ as collateral 2or its currency an' cre'it :ithout
legally 8ro7i'ing them eLuita9le reme'y 2or reco7ery o2 :hat is 'ue them) The *nited -tates government5 of
corse5 did not violate the la! or the )onstittion in this !a"5 in order to collaterali<e its financial reorgani<ation5
&t did5 in 2act5 provide sch a legal remed" so that it has &een a&le to contine on since :J,, to h"pothecate the
8ri7ate !ealth and assets of those classes of persons &" !hom it is o!ned5 at ris@ 9ac@ing the go7ernments
o&ligations and crrenc"5 9y their im8lie' consent5 throgh the government having provided sch reme'y5 as
defined and codified a&ove5 for recover" of !hat is de them on their assets and !ealth at risk% The provisions for
this are fond in the same act of @0&lic 0olic"A FBD-#4$ 8u9lic la: /H-#- that sspended the gold standard for
or crrenc"5 a&rogated the right to demand
pa"ment in gold5 and made Federal 4eserve notes for the first time legal tender5 @9ac@e' 9y the su9stance or
Icre'it o2 the nationA% All *- crrenc" since that time is onl" cre'it against the real propert"5 !ealth and assets
&elonging to the private soverign American people5 ta@en and>or #8le'ge'$ &" THE
*N'TED -TATE- to its secon'ary creditors as security for its o&ligations% )onse6entl"5 those 9ac@ing the
nation$s credit and crrenc" cold not recover !hat !as de them 9y anything 'ra:n on Fe'eral Deser7e notes
:ithout eA8an'ing their ris@ an' o9ligation to themsel7es% An" recover" pa"ments &acked &" this crrenc"
!old onl" increase the 8u9lic 'e9t its citiMens :ere collateral 2or :hich an eLuita9le reme'y :as inten'e'
to re'uce5 and in e6it" !old not satisf" an"thing% And there !as no longer actual money o2 su9stance to 8ay
any9o'y% There are other serios limitations on or present s"stem% &ince the institution o2 these e7ents 2or
8ractical 8ur8oses o2 commercial eAchange there has 9een no actual money in circulation 9y :hich 'e9t
o:e' 2rom one 8arty to another can actually 9e
re8ai'% Federal 4eserve Notes5 althogh made legal tender for all de&ts p&lic and private in the reorgani<ation5
can onl" 'ischarge a de&t% De&t mst &e @8ai'A !ith 7alue or s&stance =i%e% gold5 silver5 &arter5 la&or5 or a
commodit"?% For this reason HJ4-:J; =:J,,?5 !hich esta&lished the @p&lic polic"A of or crrent monetar"
s"stem5 repeatedl" ses the technical term of @dischargeA in con(nction !ith @pa"mentA in la"ing ot p&lic
polic" for the ne! s"stem% A de&t crrenc" s"stem cannot pa" de&t%
-o from that time to the present5 commerce in the corporate *N'TED -TATE- and among s&-corporate s&(ect
entities has had onl" de&t note instrments &" !hich de&t can &e discharged and transferred in different forms%
The npaid de&t5 created and>or eBpanded &" the plan no! carries a 8u9lic lia9ility for collection in that !hen
de&t is discharged !ith de&t instrments5 =i%e% Federal 4eserve Notes inclded?5 &" or commerce5 de&t is
inadvertentl" &eing eA8an'e' instead of &eing cancelle'5 ths increasing the 8u9lic 'e9t% A situation
8otentially 2atal to any economy% )ongress and government officials !ho orchestrated the p&lic la!s and
reglations that made the 2inancial reorganiMation anticipated the long term effect of a de&t &ased financial
s"stem !hich man" in government feared5 and !hich !e face toda" in servicing the interest on trillions pon
trillions of dollars in *- )orporate p&lic de&t and in this same act made provision not onl" for the reco7ery
reme'y to satis2y eLuity to its -reties5 &t to simultaneously resol7e this 8ro9lem as :ell% -ince it is5 in fact5
the real propert"5 !ealth and assets of that class of persons that is the s&stance &acking all the other o&ligations5
crrenc" and credit of THE *N'TED
-TATE- and sch crrencies cold not &e sed to redce its o&ligations for e6it" interest recover" to its
0rincipals and -reties5 HJ4-:J; frther made the @notes of national &anks @and @national &anking associationsA
on a par !ith its other crrenc" and legal tender o&ligations%
No: T'T+E ,: 5 -*BT'T+E '2 5 )HA0TE4 F: 5 -*B)HA0TE4 ' 5 -ec% F:7,% says5 0egal tender -*nited -tates
coins and crrenc" =inclding Federal reserve notes and circlating notes of Federal reserve &anks and national
9an@s? are legal tender for all de&ts5 p&lic charges5 taBes5 and des% =emphasis added?
Bt this official definition for #legal tender$ !as first esta&lished in HJ4-:J; =:J,,? in the same act that made
federal reserve notes and notes of national &anking associations legal tender%
0&lic 0olic" HJ4-:J; JO'NT 4E-O+*T'ON TO -*-0END THE /O+D -TANDA4D AND AB4O/ATE THE
/O+D )+A*-E5 J*NE F5 :J,,
H%J% 4es% :J;5 G,rd )ong%5 :st -ession Joint resoltion to assre niform vale to the coins and crrencies of the
*nited -tates% As sed in this resoltion5 the term Io9ligationJ means an o9ligation =inclu'ing e7ery
o9ligation o2 an' to the Unite' &tates eAce8ting currency? pa"a&le in mone" of the *nited -tatesQ and the
term Icoin or currencyJ means coin or currency o2 the Unite' &tates inclu'ing Federal 4eserve notes and
circlating notes of Federal 4eserve &anks and national 9an@ing associations%
@All coins an' currencies o2 the Unite' &tates =inclu'ing Federal 4eserve notes and circlating notes o2
Federal 4eserve &anks and national 9an@ing associations? heretofore or hereafter coined or issed5 shall 9e legal
ten'er for all de&ts5 for p&lic and private5 p&lic charges5 taBes5 dties5 and des5A
3U&C !itle #$)$$# De2initions Z @The terms @national 9an@A and @national 9an@ing associationAW%shall &e
held to &e synonymous an' interchangea9le%AO Inotes o2 national 9an@sJ or Inational 9an@ing associationsJ
ha7e continuously 9een maintaine' in the o22icial 'e2inition o2 legal ten'er since Bune . #4HH to the 8resent
'ay :hen the term ha' ne7er 9een use' to 'e2ine Icurrency Jor Ilegal
ten'erJ 9e2ore that% 0rior to :J,, the forms of crrenc" in se that !ere legal tender !ere man" and varied:
-*nited -tates /old )ertificates Z *nited -tates Notes Z Treasr" Notes Z 'nterest &earing notes Z/old )oins of
*nited -tates Z -tandard silver dollars Z -&sidiar" silver coins Z minor coins - )ommemorative coins Z9ut the
list 'i' not inclu'e 2e'eral reser7e notes or notes o2 national 9an@s or
national 9an@ing associations despite the fact national &ank notes !ere a common medim of eBchange or
@crrenc"A and had &een5 almost since the fonding of or &anking s"stem and !ere &acked &" *nited -tates
&onds or other secrities on deposit for the &ank !ith the *- Treasr"% Frther5 2rom the time o2 their inclusion
in the 'e2inition they ha7e 9een 8hase' out ntil presentl" all provision in the *nited -tates )ode pertaining to
incor8orate' 2e'erally chartere' National "an@ing institutions issuing re'eeming re8lacing an'
circulating notes have all &een re8eale'%
U&C !I!LC #$ X CFA(!CD $ - NAT'ONA+ BANH- -*B)HA0TE4 2 - OBTA'N'N/ AND '--*'N/
)'4)*+AT'N/ NOTE- -ec%:7: to ::7% ;epealed% 0&% +% :7,-,;F5 title 2'5 -ec% 97;eF-::5 f;-EA5 gJ5 -ept% ;,5
:JJE5 :7I -tat% ;;J;5 ;;JE
-*B)HA0TE4 2' - 4EDEC0T'ON AND 4E0+A)ECENT OF )'4)*+AT'N/ NOTE-
-ec%:;:% ;epealed% 0&% +% :7,-,;F5 title 2'5 -ec% 97;fEB5 -ept% ;,5 :JJE5 :7I -tat% ;;J;
-ec%:;:a% 4edemption of notes nidentifia&le as to &ank of isse
-ec%:;;% ;epealed% 0&% +% JG-;FI5 -ec% F&5 -ept% :,5 :JI;5 J9 -tat% :79I
-ec%:;;a% 4edeemed notes of nidentifia&le isseQ fnds charged against
-ec :;, to :;9% ;epealed% 0&% +% :7,-,;F5 title 2'5 -ec% 97;e:;5 :,5 fE)5 95 -ept%
;,5 :JJE5 :7I -tat% ;;J;5 ;;J,
-ec:;G% ;epealed% 0&% +% IJ-FFE5 -ec% Ia5 -ept% 95 :J995 I7 -tat% 9,,
As state' in Money an' "an@ingJ %th e'ition 9y Da7i' F) Frie'man 8u9l) 9y the American "an@ers
Association5 page GI5 @!o'ay commercial 9an@s no longer issue currency <)I
't is clear5 federall" incorporated &anking instittions s&(ect to the restrictions and repealed provisions of Title :;5
are not those 8rimarily re2erre' to maintaine' in the current 'e2inition o2 Ilegal ten'erA%
The legal stattor" and professional definitions of @9an@A5 @9an@ingA5 an' I9an@erA sed in the *nited -tates
)ode and )ode of Federal 4eglations are not those commonl" nderstood for these terms and have made the
stattor" definition of @"an@A accordingl": UCC %-#-. 0A4T : P"an@P means a 8erson engage' in the
9usiness o2 9an@ingJ #$CFD &ec) $$4)$ Definitions =e? "an@ meansa@the term &ank also incldes any
8erson engage' in the 9usiness o2 9an@ing5A #$CFD &ec) $#-)$ Definitions% =d?A "an@ means any 8erson
engage' in the 9usiness o2 9an@ing%A U&C !itle #$ &ec) #0#H% ZDe2initions o2 "an@ an' Delate' !erms% Z =:?
Bank% Z The term YY9an@YY Z =A? @means an" national &ank5 -tate &ank5 and District &ank5 and an" Federal &ranch
and insred &ranchQA "lac@s La: Dictionary .th C'ition5 page :,,5 defines a @"an@erA as5 IIn general sense
8erson that engages in 9usiness o2 9an@ing) In narro:er meaning a 8ri7ate 8erson<<<P :ho is engage'
in the 9usiness o2 9an@ing :ithout 9eing
incor8orate') Un'er some statutes an in'i7i'ual 9an@er as 'istinguishe' 2rom a I8ri7ate 9an@erJ is a
8erson :ho ha7ing com8lie' :ith the statutory reLuirements has recei7e' authority 2rom the state to
engage in the 9usiness o2 9an@ing :hile a 8ri7ate 9an@er is a 8erson engage' in 9an@ing :ithout ha7ing
any s8ecial 8ri7ileges or authority 2rom the state) @
I"an@ingJ 's partl" and optionall" defined as @!he 9usiness o2 issuing notes 2or circulation<< negotiating
9ills%A "lac@s La: Dictionary .th C'ition5 page :,,5 defines @"an@ingA: I!he 9usiness o2 9an@ing as
'e2ine' 9y la: an' custom consists in the issue o2 notes <<inten'e' to circulate as money<<)) And
defines a @"an@ers NoteA as: @A commercial instrument resem&ling a &ank note in ever" particlar eBcept that
it is gi7en 9y a 8ri7ate 9an@er or unincor8orate' 9an@ing institution%A
Federal -tatte does not specificall" define @national 9an@J an' Inational 9an@ing associationA in those
sections :here these uses are legislate' on to eAclu'e a 8ri7ate 9an@er or unincor8orate' 9an@ing
institution% 't 'oes define these terms to the eAclusion of sch persons in the chapters and sections !here the
isse and circlation of notes &" national &anks has &een repealed or
2or9i''en% WIn the a9sence o2 a statutory 'e2inition courts gi7e terms their or'inary meaning%
PBass5 Terri +% v% -tolper5 Horit<insk"5 ::: F%,d :,;F5Gth)ir% Apps% =:JJ9?% As the *%-% -preme )ort noted5 P1e
ha7e state' time an' again that courts must 8resume that a legislature says in a statute :hat it means an'
means in a statute :hat it says there%A -ee5 e%g%5 *nited -tates v% 4on 0air Enterprises5 'nc%5 EIJ *%-% ;,F5 ;E:
-;E; =:JIJ?Q *nited -tates v% /olden&erg5:9I *%-% JF5 :7; -:7, =:IJG?Q P!he legislati7e 8ur8ose is eA8resse'
9y the or'inary meaning o2 the :or's use'%
@4ichards v% *nited -tates5 ,9J *%-%: =:J9;?% Therefore5 as noted a&ove5 the legal definitions relating to #legal
ten'er have &een !ritten &" )ongress and maintained as sch to &e &oth eAclusi7e5 !here necessar"5 and
inclusi7e5 !here appropriate5 to provide in its stattor" definitions of legal ten'er for the
inclusion of all those5 !ho &" definition of private5 nincorporated persons engaged in the &siness of &anking to
isse notes against the o&ligation of the *nited -tates for recover" on their risk5 !hose 8ri7ate assets and
propert" are &eing sed to collaterali<e the o&ligations of the *nited -tates since :J,,5 as collectivel" and
nationall" constitting a legal class of persons &eing a @national 9an@J or Inational 9an@ing associationJ :ith
the right to issue such notes against !he *9ligation o2 !FC UNI!CD &!A!C& 2or eLuity interest reco7ery
'ue an' accrue' to these (rinci8als an' &ureties o2 the Unite' &tates 9ac@ing the o9ligations o2 U&
currency an' cre'itP as a means 2or the legal ten'er 'ischarge o2 la:2ul 'e9ts in commerce as reme'y 'ue
them in con?unction :ith U& o9ligations to the 'ischarge o2 that 8ortion o2 the 8u9lic 'e9t :hich is
8ro7i'e' 2or in the 8resent 2inancial reorganiMation still in
e22ect an' ongoing since #4HH% N:; *-) E::5 :I *-) I5 :; *-)Q ch% 95 ,I -tat% ;F: -ect :E=a?5 ,: *-) F::I5
,:;,% !ith rights protected nder the :Eth Amendment of the *nited -tates )onstittion5 &" the *%-% -preme
)ort in *nited -tates v% 4ssell =:, 3all5 9;,5 9;G?5 0earlman v% 4eliance 'ns% )o%5 ,G: *%-%
:,;5:,95:,G =:J9;?5 The *nited -tates v% Hooe5 , )ranch =*%-%?G,=:I7F?5 and in conformit" !ith the *%-%
-preme )ort GJ *%-% ;IG =:IG7?5 :G; *%-%EI = :IJI?5 and as confirmed at ,7G *%-% ;EG=:J,J?%O
HJ4-:J; frther declared WW%Je7ery 8ro7ision<):hich 8ur8orts to gi7e the o9lige a right to reLuire
8ayment in gol' or a 8articular @in' o2 coin or currency<)is 'eclare' to 9e against (u9lic (olicyP an' no
such 8ro7ision shall 9e<)ma'e :ith res8ect to any o9ligation herea2ter incurre'%A Caking !a" for discharge
and recover" on *- )orporate p&lic de&t de the 0rincipals and -reties of THE *N'TED -TATE- providing as
@8u9lic 8olicyA for the discharge of @e7ery o9ligationJ Iinclu'ing e7ery o9ligation *F an' !* !FC
UNI!CD &!A!C&J I'ollar 2or 'ollarA5 allo!ing those &acking the *- financial reorgani<ation to recover on it
&" 'ischarging an o&ligation the" o!ed !* !FC UNI!CD &!A!C& or its s&-corporate entities5 against that
same amount o2 o9ligation *F !FC UNI!CD
&!A!C& o:e' to themP thus 8ro7i'ing the reme'y 2or the 'ischarge and or'erly reco7ery of e6it" interest
on *- )orporate p&lic de&t de the -reties5 0rincipals5 and Holders of THE *N'TED -TATE-5 discharging that
portion of the p&lic de&t :ithout eA8ansion o2 cre'it 'e9t or o9ligation on !FC UNI!CD &!A!C& or these
its 8rime-cre'itors it !as intended to satisf" e6ita&le remed" to5 &t gaining for each &earer of sch note5
discharge of o&ligation e6ivalent in vale #dollar for dollar$ to an"
and all @la:2ul money o2 the Unite' &tatesA%Those !ho constitte an association nation!ide of private5
nincorporated persons engaged in the &siness of &anking to isse notes against these o&ligations of the *nited
-tates de themQ !hose 8ri7ate propert" is at risk to collaterali<e the government$s de&t
and crrenc"5 &" legal definitions5 a Pnational 9an@ing associationPQ sch notes5 issed against these o9ligations
o2 the Unite' &tates to that 8art o2 the 8u9lic 'e9t 'ue its (rinci8als an' &ureties are re6ired &" la! to &e
accepted as Plegal tenderP of pa"ment for all de&ts p&lic and private5 and5 as !e have seen5 are defined in la! as
Po&ligations of the *nited -tatesP5 on the same par and categor" !ith Federal reserve notes and other crrenc" and
legal tender o&ligations% This is !hat is asserted in the tender presented to the &ank for deposit and the
government has said nothing to the contrar"% 3old !e 6estion that this is eBactl" !hat )ongress has provided
for in these stattes and codes on the p&lic de&t and o&ligations of the *nited -tates and that this is the remed"
codified in stattor" la! and definition !e have cited hereK Even thogh it is never discssed% *nder this remed"
for 'ischarge of the p&lic de&t an' recover" to its 0rincipals and -reties5 !1* 'e9ts that !old have &een
discharged in Federal 4eserve de&t note or checks dra!n on the same5 e6all" eA8an'ing the p&lic de&t &" those
transactions5 are discharged against a &INGLC 8u9lic 'e9t o2 the Cor8orate UNI!CD &!A!C& an' its su9-
cor8orate entities to its prime-creditor :ithout the eA8ansion an' use o2 Fe'eral Deser7e 'e9t note
instruments as currency an' cre'it5 and so5 :ithout the eBpansion of de&t and de&t instrments in the
monetar" s"stem and the eA8ansion o2 the 8u9lic de&t as &rden pon the entire financial s"stem and its
0rincipals5 and -reties the recover" remed" !as intended to relieve% Apparentl" their se is for the discharge and
non-cash accrual re'uction of *- )orporate p&lic de&t to the 0rincipals5 0rime )reditors and Holders of it as
provided in la! and the instrments !ill ltimatel" &e settled &" ad(stment and set-off in discharge
of a &earer$s o&ligation TO THE *N'TED -TATE- against the o&ligation OF THE *N'TED -TATE- for the
amont of the instrment to the original creditor it !as tendered to or !homever or !hatever instittion ma" &e
the final &earer and holder in de corse of it5 again5 ths discharging that portion of the p&lic de&t :ithout
eA8ansion o2 cre'it 'e9t or note on the 8rime-cre'itors o2 !FC UNI!CD &!A!C&
it !as intended to satisf" e6ita&le remed" to5 &t gaining for each endorsed &earer of it discharge of o&ligation
e6ivalent in vale #dollar for dollar$ of crrenc"5 measra&le in @la:2ul money o2 the Unite' &tatesA% Althogh
this has &een p&lic polic" as a remed" for the discharge of de&t in con(nction
!ith removal of gold5 silver and real mone" as legal tender crrenc" &" the same act of p&lic polic" in :J,,5 it
has &een a 'i22icult concept to commnicate for others to accept and to kno! !hat to do !ith it5 so its never
gained common se and for o&vios reasons the government has 'iscourage' p&lic nderstanding of the remed"
and recover" nder it and therefore it is little @no:n and not generall" accessed &" the p&lic% Bt it is still an
o&ligation the *nited -tates has 9oun' itself to and has provided for in stattor" la! and the *nited -tates still
accepts these non-cash accral eBchanges toda" as a matter of la! and e6it"% -o is the eBperience of man" !ho
have attempted to access the remed"% That the @p&lic policiesA of Hose Joint 4esoltion :J; of :J,, are still in
effect is evidenced &" the other provisions of @p&lic polic"A it esta&lished that !e can see along !ith these
discssed% No one !old attempt to demand pa"ment in gold or a particlar kind of coin or crrenc" in se or
think to !rite sch an o&ligation into a contract5 9ecause the gol' stan'ar' 2or currency is still sus8en'e' an'
the right to a gol'
clause to reLuire 8ayment in gol' is still a9rogate') "oth are also 8art o2 I8u9lic
8olicyJ esta9lishe' in FBD-#4$% The practical evidence and fact of the *nited -tates$ financial reorgani<ation
=&ankrptc"? is still ongoing toda"5 visi&le all arond s to see and nderstand% 3hen
Treasr" notes come de5 the"$re not paid% The" are re2inance' 9y ne: T-Bills and notes to &ack the crrenc"
and cover the de&ts% %%something that cannot &e done !ith de&t <<unless<) the 'e9tor is 8rotecte' 2rom
cre'itors in a 9an@ru8tcy reorganiMation that is reglarl" &eing restrctred to keep it going% Ever" time the
Federal de&t ceiling is raised &" )ongress they are restructuring the 9an@ru8tcy reorganiMation o2 the
go7ernments 'e9t so commerce can continue on% For o&vios reasons the *nited -tates government does not
like having to recogni<e all this% 't is a ver" sensitive and delicate matter% And fe! can speak or !ill speak
athoritativel" a&ot it5 as the &ank has fond ot% The recover" remed" is maintained in la! &ecase it has to &e
to satisf" e6it" to its prime creditors% At this late time5 the *nited -tates is neither eBpecting nor intending it to &e
generall" accessed &" the p&lic% 4egarding sch instrments tendered to the -ecretar"5 !hen p&lic officials are
pt in a position to legall" ackno!ledge or den" the athorit" or validit" of the instrments5 those in responsi&ilit"
:ill not 'eny or 'ishonor
it or an instrument o2 'ischarge 8ro8erly su9mitte' 2or that 8ur8ose% The isse is !hat has the government
said a&ot it no!K3hat is its polic" in 8racticeK And ho! does it finall" respond to sch claims of !hich it
receives thosands ever" da"K It is a 2act: Title ,: *-) ,:;, makes a stattor" pledge of the *nited -tates
government to pa"ment of o&ligations and interest on the p&lic de&t% T'T+E ,: 5 -*BT'T+E ''' 5 )HA0TE4 ,: 5
-*B)HA0TE4 '' 5 -ec% ,:;,% Z (ayment o2 o9ligations an' interest on the 8u9lic 'e9t=a> The faith of the
*nited -tates /overnment is pledged to pa"5 in legal tender5 principal
and interest on the o&ligations of the /overnment issed nder this chapter% =9> @!he &ecretary o2 the !reasury
shall pa" interest de or accred on the p&lic de&t%A
It is a 2act: Title ,: -ection ,:,7 frther delineates in its definitions a portion of the total p&lic de&t !hich is
hel' 9y the 8u9lic as the @Net p&lic de&tA !I!LC H# \ &U"!I!LC III \ CFA(!CD H# \ &U"CFA(!CD II
\ &ec) H#H-% &ec) H#H-) - Annual 8u9lic 'e9t re8ort
=e> Definitions% -
=$> !otal 8u9lic 'e9t% - The term YYtotal p&lic de&tYY means the total amont of the o&ligations s&(ect to the
p&lic de&t limit esta&lished in section ,:7: of this title% =,? Net 8u9lic 'e9t% - !he term SSnet 8u9lic 'e9tSS
means the 8ortion o2 the total 8u9lic 'e9t :hich is hel' 9y the 8u9lic% It is a 2act: -ection ,:7: references
guarantee' o9ligations hel' 9y the &ecretary o2
the !reasury !hich are eAce8te' and eAem8te' from @the face amont of o&ligations !hose principal and
interest are garanteed &" the *nited -tates /overnmentA
&ec) H#-#) - (u9lic 'e9t limit
=9> The face amont of o&ligations issed nder this chapter and the face amont of o&ligations !hose principal
and interest are garanteed &" the *nited -tates /overnment =eAce8t guarantee' o9ligations hel' 9y the
&ecretary o2 the !reasury? ma" not &e more than 8F5JF75777577757775 otstanding at one time5 s&(ect to
changes periodicall" made in that amont as provided &" la! It is a 2act: Ever" da" the *nited -tates Treasr"
department receives do<ens or hndreds of sch instrments making claims of this t"pe% O&viosl" some are valid
and some are not% It is a 2act: There are onl" , official government directives or alerts that address sprios5
fradlent5 fictitios5 or other!ise invalid5 instrments sent to the *- Treasr" for pa"ment5 and only one that
officiall" states !hat is to &e o22icial U& go7ernment 8olicy and treatment of them if the" are received5 this is
A+E4T JJ-:7: !hich is also p&lished on the government !e&site for the *nited -tates Treasr":
!!!%p&licde&t%treas%gov nder Frads and 0honies5
The Office of the )omptroller of the )rrenc"5 Enforcement V )ompliance Division in A+E4T JJ-:7 states:
T"pe: -spicios Transactions TO: )hief EBective Officers of all National BanksQ all -tateBanking AthoritiesQ
)hairman5 Board of /overnors of the Federal 4eserve -"stemQ )hairman5 Federal
Deposit 'nsrance )orporationQ )onference of -tate Bank -pervisorsQ Dept" )omptrollers =Districts?Q Assistant
Dept" )omptrollersQ District )onsel and EBamining 0ersonnel% 4E: Fictitios -ight Drafts pa"a&le throgh the
*%-% Treasr" 't has &een &roght to or attention that certain individals have &een making and eBecting
!orthless paper docments !hich are titled P-ight DraftP These items state
that the" are pa"a&le throgh the *% -% Treasr"5 :F77 0enns"lvania Avene5 N35 3ashington5 D) ;7;;7% These
instrments are &eing presented for pa"ment at &anks and other &sinesses throghot the *nited -tates% Any o2
these instruments that are 8resente' to the U) &) !reasury 2or 8ayment :ill 9e returne' to the sen'er and
copies !ill &e provided to the appropriate la! enforcement agencies%A Dishonore'%
This is in conformit" !ith the *niform )ommercial )ode that parties ma" rel" on their presentment of o&ligations
as settled nless given a Notice of Dishonor5 !hether directl" applica&le to Treasr" Dept% officers or not%
UCCH-.-H) N*!ICC *F DI&F*N*D <=9> Notice o2 'ishonor may 9e gi7en &" an" person: may 9e given &"
an" commerciall" reasona&le means5 inclding an oral5 !ritten5 or electronic commnicationQ
an' is su22icient i2 it reasona9ly identified the instrument an' indicates that the instrment has &een dishonored
or has not &een 8ai' or accepted% 4etrn of an instrment gi7en to a 9an@ 2or collection is sfficient notice of
dishonor% Wc? -&(ect to -ection ,-F7E=c?5 :ith res8ect to an instrument ta@en 2or collection notice of
dishonor mst &e givenW% :ithin H- 'ays 2ollo:ing the 'ay on :hich the
8erson recei7es notice o2 'ishonor) 1ith res8ect to any other instrument notice o2 'ishonor must 9e gi7en
:ithin H- 'ays 2ollo:ing the 'ay on :hich 'ishonor occurs) !hese instruments are ne7er returne' 2rom the
!reasury 'ishonore') It is a 2act: There is no &asis or reason or plasi&le eBplanation for sch uneA8laine'
silence !ith regard to these particlar instrments% Ever" other &ranch of the Federal
government inclding the Dept% of the Treasr" has developed ela&orate li&raries of compter generated form
letters of statements and replies dealing !ith almost ever" possi&le 6estion or claim that cold &e made of an"
agenc" or department of the Federal government% The *nited -tates Treasr" has an Office of 0&lic
)orrespondence !hose sole (o& it is to respond to commnications from the general p&lic% !FCDC I& N*
C*MMUNICA!I*N &CN! !* !FC UNI!CD &!A!C& !DCA&UDE !FA! CAN
N*! "C DC&(*NDCD !* A& I! MAE DCQUIDC) Can" sch categories of re6ests calling for response are
far greater in nm&er than claims in e6it" for recover" to a 0rime-creditor over the *nited -tates and some
categories are far fe!er in nm&er5 and "et &e the re6ests greater or smaller in nm&er
or in compleBit" of response re6ired5 all these o2 a commercial nature are regularly an' timely res8on'e'
to) !here is 7irtually no :ritten res8onse 9y the Fe'eral go7ernment to this issue o2 reco7ery to the 8rime-
cre'itors an' hol'ers in eLuity o7er the Unite' &tates) !he
2actually o9ser7a9le 8osition o2 the &ecretary o2 the !reasury an' his 'e8artment in res8onse to !FI& ty8e
o2 claim has 9een A"&*LU!C &ILCNCC 9e they 2rom 9an@ 9usiness or 8ri7ate 8erson:
Not denial5 disavo!al5 dishonor5 or repdiation of sch claims O4 their &asis in la! and fact if the" are not tre5
!hich in ever" other case of correspondence to the Federal government or the Department of Treasr" dealing
!ith an" 6estion5 re6est or claim: AN1 -*)H FA+-E )+A'C5 C'-)ON)E0T'ON O4
C'-TAHEN *NDE4-TAND'N/ ON THE 0A4T OF THE /ENE4A+ 0*B+') '- T'CE+1 DEA+T 3'TH 'N
E2E41 )A-E B1 -*)H FO4C +ETTE4-% 't is the dt" of the *nited -tates Treasr" to the commerce of the
nation and in the interests of the general p&lic !hom it serves to Luic@ly and conclusi7ely Luash an' re8u'iate
any such 2alse un'erstan'ings or claims o2 reme'y in eLuity on reco7ery o2 the 8u9lic 'e9t in the
commercial realm an' it is easily :ithin their 8o:er to 'o so%
!his 'es8ite the 2act the onl" official *- government directive from the Department of the Treasr" dealing !ith
polic" of the government to!ard fictitios or other!ise invalid instrments sent to the Treasr" for collection states
clearl" @they :ill 9e returne' to the sen'er%A There is5 therefore5 no &asis or reason or plasi&le eBplanation for
sch uneA8laine' silence !ith regard to this particlar class of instrment eAce8t that a reme'y in eLuity 2or
reco7ery to the 8rime-cre'itors o7er the Unite' &tates I& true an' 2actual an' CANN*! "C DCNICD or
DI&F*N*DCD in eLuity an' that such "ills o2 Acce8tance in 'ischarge o2 mutually o22setting o9ligations
9et:een the Unite' &tates an' its hol'ers in eLuity as secure' 8arties ADC in 2act 9eing @e8t hel' an'
:ithout return or 'ishonor acce8te' as o9ligations o2 the Unite' &tates in the 'ischarge an' reco7ery o2 the
8u9lic 'e9t as they ma@e claim on their 2ace to the &ecretary o2 the !reasury to 9e% Fo: the" are to &e
recovered on is p to the parties involved holding sch o&ligations and is provided for in la! and reglation and
administrative procedre a holder or its &anking instittion ma" se% In Conclusion: 1hen a Commercial "an@
sen's the instrument to the &ecretary 2or 'ischarge o2 its o:n o9ligations an' a 8ro9lem arises concerning
the instrument a commercial res8onse o2 some @in' is reLuire') !here is a legal lia9ility o2 the go7ernment
to a negotia9le legal ten'er o9ligation u8on the Unite' &tates go7ernment sent to them
2or acce8tance 9y a mem9er Fe'eral Deser7e "an@ a2ter they recei7e' it an' 9ecame res8onsi9le 2or it) The
Treasr" has an o&ligation as a department of government serving the p&lic interest to the &ank !hich as a
mem&er of the Federal 4eserve -"stem that has a commercial o&ligation to an accont holder and a ,rd part" !ho
tendered the item in pa"ment to tell them that its not an" good or its not going to &e honored5 even if the" !anted
to keep it for prosection or investigation% This is in effect !hat the directive sa"s the government !ill do if its no
good% 1hat 'oes statutory la: regulation or case la: tells us a9out :hat that o9ligation isK The" do not
dishonor it in an" !a" &" retrn of the item or the sending of an" notice to that effect5 or make re6est for
additional information or time for eBamination of the
instrment5 or given a statement of eBplanation indicating the time frame for its revie! and settlement if it !old
&e an inordinatel" length" time as longer than 97 da"s to finish !ith it% The instrments are &eing kept5 held5 and
!ithot retrn or dishonor5 are accepted as an o&ligation of the *nited -tates in the discharge and recover" of the
p&lic de&t as it makes claim on its face to &e%0t another !a": 'f the &ank had had to pa" the item to honor its
cstomer agreement as if it had &een a check5 :hat :oul' or coul' the 9an@ 9e trying to 'o :ith it to 2inally
settle the accountN !he 9an@ nee's to treat the Instrument ten'ere' as an o9ligation o2 the Unite' &tates to
the 9an@) !he ten'er o2 these Instruments
'ischarge the o9ligation o2 the 'e9t 2or :hich they are 'eli7ere' an' the 8ayee
9ecomes the ne: hol'er in 'ue course an' collection agent on the Instruments% CAhi9it C
U) &) District Court Bu'ge Christo8her A) "oy@o Decision
UNI!CD &!A!C& DI&!DIC! C*UD! N*D!FCDN DI&!DIC! *F *FI* CA&!CDN DI;I&I*N
IN DC F*DCCL*&UDC CA&C& > CA&C N*) N*)#:-/C;$$0$
> -/C;$.H$ >
-/C;$.,-> -/C;$,-$> -/C;$,H#> -/C;$,H0> -/C;$,0#> -/C;$,4.> -/C;$4$-> -/C;$4H-
> -/C;$4%4> -/C;$4.-> -/C;H---> -/C;H-$4>>
BUDGC CFDI&!*(FCD A) "*EK*>>>>*(INI*N AND *DDCD>>
CFDI&!*(FCD A) "*EK* B%:
On Octo&er :75 ;77G5 this )ort issed an Order re6iring 0laintiff-+enders in a nm&er of pending foreclosre
cases to file a cop" of the eBected Assignment demonstrating 0laintiff !as the holder and o!ner of the Note and
Cortgage as of t0e date t0e "om.laint 7as filed5 or the )ort !old enter a dismissal% After considering the
s&missions5 along !ith all the docments filed of record5 the )ort dismisses the captioned cases !ithot
pre(dice% The )ort has reached toda"$s determination after a thorogh revie! of all the relevant la! and the
&riefs and argments recentl" presented &" the parties5 inclding oral )ase ::7G-cv-7;;I;-)AB Docment ::
Filed :7>,:>;77G 0age : of 9-;-
argments heard on 0laintiff Detsche Bank$s Cotion for 4econsideration% The decision5 therefore5 is applica&le
from this date for!ard5 and shall not have retroactive effect% LA1 AND ANALE&I&
A part" seeking to &ring a case into federal cort on gronds of diversit" carries the &rden of esta&lishing
diversit" (risdiction% &oyne v. :merican !obacco &ompany5 :I, F% ,d EII =9th )ir% :JJJ?% Frther5 the plaintiff
@&ears the &rden of demonstrating standing and mst plead its components !ith specificit"%A &oyne5 :I, F% ,d at
EJEQ @alley Forge &hristian &ollege v. :mericans $nited for %eparation of &hurch H %tate* -nc.5 EFE *%-% E9E
=:JI;?% The minimm constittional re6irements for standing are: proof of in(r" in fact5 casation5 and
redressa&ilit"% @alley Forge5 EFE *%-% at EG;% 'n addition5 @the plaintiff mst &e a proper proponent5 and the action
a proper vehicle5 to vindicate the rights asserted%A &oyne5 :I, F% ,d
at EJE =6oting Gestrak v. 7hio 6lections &omm,n5 J;9 F% ;d FG,5 FG9 =9th )ir% :JJ:??% To satisf" the
re6irements of Article ''' of the *nited -tates )onstittion5 the plaintiff mst sho! he has .ersonall- suffered
some actual in8ur- as a reslt of the illegal condct of the defendant% =Emphasis added?% &oyne5 :I, F% ,d at EJEQ
@alley Forge5 EFE *%-% at EG;% 'n each of the a&ove-captioned )omplaints5 the named 0laintiff alleges it is the
holder and o!ner of the Note and Cortgage% Ho!ever5 the attached Note and Cortgage identif" the mortgagee
and promisee as the original lending instittion a one other than the named 0laintiff% Frther5 the 0reliminar"
Jdicial 4eport attached as an eBhi&it to the )omplaint
makes no reference to the named 0laintiff in the recorded chain of title>interest% The )ort$s Amended /eneral
Order No% ;779-:9 re6ires 0laintiff to s&mit an affidavit along !ith the )omplaint5 !hich identifies 0laintiff
either as the original mortgage holder5 or as an assignee5 )ase ::7G-cv-7;;I;-)AB Docment :: Filed
:7>,:>;77G 0age ; of 9 -,-
trstee or sccessor-in-interest% Once again5 the affidavits s&mitted in all these cases recite the averment that
0laintiff is the o!ner of the Note and Cortgage5 !ithot an" mention of an assignment or trst or sccessor
interest% )onse6entl"5 the ver" filings and s&missions of the 0laintiff create a conflict% 'n ever" instance5 then5
0laintiff has not satisfied its &rden of demonstrating standing at the time of the filing of the )omplaint%
*nderstanda&l"5 the )ort re6ested clarification &" re6iring each 0laintiff to s&mit
a cop" of the Assignment of the Note and Cortgage5 eBected as of the date of the Foreclosre )omplaint% 'n the
a&ove-captioned cases5 none of the Assignments sho! the named 0laintiff to &e the o!ner of the rights5 title and
interest nder the Cortgage at isse as of the date of the Foreclosre )omplaint% The Assignments5 in ever"
instance5 eBpress a present intent to conve" all rights5 title and interest in the Cortgage and the accompan"ing
Note to the 0laintiff named in the caption of the Foreclosre )omplaint pon receipt of sfficient consideration
on the date the Assignment !as signed and notari<ed% Frther5 the
Assignment docments are all prepared &" consel for the named 0laintiffs% These proffered docments &elie
0laintiffs$ assertion the" o!n the Note and Cortgage &" means of a prchase !hich pre-dated the )omplaint &"
da"s5 months or "ears% 0laintiff-+enders shall take note5 frthermore5 that prior to the issance of its Octo&er :75
;77G Order5 the )ort considered the principles of @real part" in interest5A and eBamined Fed% 4% )iv% 0% :G a
@0arties 0laintiff and DefendantQ )apacit"A and its associated )ommentar"% The 4le is not apropos to the
sitation raised &" these Foreclosre )omplaints% The 4le$s )ommentar" offers this eBplanation: @The provision
shold not &e misnderstood or distorted% 't is intended to prevent forfeitre !hen determination of the )ase ::7G-
cv-7;;I;-)AB Docment :: Filed :7>,:>;77G 0age , of 9
: Astondingl"5 consel at oral argment stated that his client5 the prchaser from the original mortgagee5
ac6ired complete legal and e6ita&le interest in land !hen mone" changed hands5 even &efore the
prchase agreement5 let alone a proper assignment5 made its !a" into his client$s possession%-E-
proper part" to se is difficlt or !hen an nderstanda&le mistake has &een made% %%% 't is5 in cases of this sort5
intended to insre against forfeitre and in(stice %%%A 0laintiff-+enders do not allege mistake or that a part" cannot
&e identified% Nor !ill 0laintiff-+enders sffer forfeitre or in(stice &" the dismissal of these defective complaints
other!ise than on the merits% Coreover5 this )ort is o&ligated to carefll" scrtini<e all filings and pleadings in
foreclosre actions5 since the ni6e natre of real propert" re6ires contracts and transactions concerning real
propert" to &e in !riting% 4%)% S :,,F%7E% Ohio la! holds that !hen a mortgage is assigned5 moreover5 the
assignment is s&(ect to the recording re6irements of 4%)% S F,7:%;F% &reager v. :nderson =:J,E?5 :9 Ohio +a!
A&s% E77 =interpreting the former statte5 /%)% S IFE,?% @Ths5 !ith regards to real propert"5 &efore an entit"
assigned an interest in that propert" !old &e entitled to receive a distri&tion from the sale of the propert"5 their
interest therein mst have &een recorded in accordance !ith Ohio la!%A -n re 7chmanek5 ;99 B%4% ::E5 :;7
=Bkrtc"%N%D% Ohio ;777? =citing Ginney v.
Merchants, National Bank of .efiance5 G: Ohio -t% :G,5 :GG =:J7E?%: This )ort ackno!ledges the right of
&anks5 holding valid mortgages5 to receive timel" pa"ments% And5 if the" do not receive timel" pa"ments5 &anks
have the right to properl" file actions on the defalted notes a seeking foreclosre on the propert" secring the
notes% 1et5 this )ort possesses the independent o&ligations to preserve the (dicial
integrit" of the federal cort and to (ealosl" gard federal (risdiction% Neither the flidit" of )ase ::7G-cv-
7;;I;-)AB Docment :: Filed :7>,:>;77G 0age E of 9 ;
0laintiff$s reliance on Ohio$s @real part" in interest rleA =O4)0 :G? and on an" Ohio case citations is
misplaced% Althogh Ohio la! gides federal corts on s&stantive isses5 state procedral la! cannot &e
sed to eBplain5 modif" or contradict a federal rle of procedre5 !hich prpose is clearl" spelled ot in
the )ommentar"% @'n federal diversit" actions5 state la! governs s&stantive isses and federal la!
governs procedral isses%A 6rie ;.;. &o. v. !ompkins5 ,7E *%-% 9, =:J,I?Q 0egg v. &hopra5 ;I9 F% ,d
;I95 ;IJ =9th )ir% ;77;?Q Iafford v. Ieneral 6lectric &ompany5 JJG F% ;d :F75 :9F-9 =9th )ir% :JJ,?%
,
0laintiff$s5 @Jdge5 "o (st don$t nderstand ho! things !ork5A argment reveals a condescending
mindset and 6asi-monopolistic s"stem !here financial instittions have traditionall" controlled5 and still
control5 the foreclosre process% T"picall"5 the homeo!ner !ho finds himself>herself in financial straits5
fails to make the re6ired mortgage pa"ments and faces a foreclosre sit5 is not interested in testing state
or federal (risdictional re6irements5 either pro se or throgh consel% Their focs is either5 @ho! do '
save m" home5A or @if ' have to give it p5 '$ll simpl" leave and find some!here else to live%A
'n the meantime5 the financial instittions or sccessors>assignees rsh to foreclose5 o&tain a
defalt (dgment and then sit on the deed5 avoiding responsi&ilit" for maintaining the propert" !hile
reaping the financial &enefits of interest rnning on a (dgment% The financial instittions kno! the la!
charges the one !ith title =still the homeo!ner? !ith maintaining the propert"%
There is no do&t ever" decision made &" a financial instittion in the foreclosre process is
driven &" mone"% And the legal !ork !hich flo!s from !inning the financial instittion$s favor is highl"
lcrative% There is nothing improper or !rong !ith financial instittions or la! firms making a profit a
to the contrar" 5 the" shold &e re!arded for sond &siness and legal practices% Ho!ever5 nchallenged
&" nderfinanced opponents5 the instittions !orr" less a&ot (risdictional re6irements and more a&ot
maBimi<ing retrns% *nlike the focs of financial instittions5 the federal corts mst act as gatekeepers5
assring that onl" those !ho meet diversit" and standing re6irements are allo!ed to pass throgh%
)onsel for the instittions are not !ithot legal argment to spport their position5 &t their
argments fall !oefll" short of (stif"ing their prematre filings5 and tterl" fail to satisf" their standing
-F-
the secondar" mortgage market5 nor monetar" or economic considerations of the parties5 nor the convenience of
the litigants spersede those o&ligations% Despite 0laintiffs$ consel$s &elief that @there appears to &e some level of
disagreement and>or misnderstanding amongst professionals5 &orro!ers5 attorne"s and mem&ers of the
(diciar"5A the )ort does not re6ire instrction and is not operating nder
an" misapprehension% The @real part" in interestA rle5 to !hich the 0laintiff-+enders continall" refer in their
responses or motions5 is clearl" comprehended &" the )ort and is not intended to assist &anks in avoiding
traditional federal diversit" re6irements%; *nlike Ohio -tate la! and procedre5 as 0laintiffs perceive it5 the
federal (dicial s"stem need not5 and !ill not5 &e @forgiving in this regard%A,
)ase ::7G-cv-7;;I;-)AB Docment :: Filed :7>,:>;77G 0age F of 9
and (risdictional &rdens% The instittions seem to adopt the attitde that since the" have &een doing this
for so long5 nchallenged5 this practice e6ates !ith legal compliance% Finall" pt to the test5 their !eak
legal argments compel the )ort to stop them at the gate% The )ort !ill illstrate in simple terms its decision:
@Flidit" of the marketA a @.A dollars5 @contractal arrangements &et!een instittions and conselA a @.A
dollars5 @prchasing mortgages in &lk and secriti<ingA a @.A dollars5 @rsh to file5 slo! to record after
(dgmentA a @.A dollars5 @the (risdictional integrit" of *nited -tates District )ortA a @0riceless%A -9-
C*NCLU&I*N
For all the foregoing reasons5 the a&ove-captioned Foreclosre )omplaints are dismissed !ithot pre(dice%
I! I& &* *DDCDCD) DA!C: *cto9er H# $--/ &6Christo8her A) "oy@o
CFDI&!*(FCD A) "*EK*
Unite' &tates District Bu'ge
)ase ::7G-cv-7;;I;-)AB Docment :: Filed :7>,:>;77G 0age 9 of 9
CAhi9it F
U) &) District Court Bu'ge !homas M) Dose
Decision
UNI!CD &!A!C& DI&!DIC! C*UD!
&*U!FCDN DI&!DIC! *F *FI*
1C&!CDN DI;I&I*N A! DAE!*N
IN DC F*DCCL*&UDC CA&C& CA&C N*) H:-/C;-%H
-/C;-%4 -/C;-0. -/C;#H0 -/C;$H/ -/C;$%- -/C;$%, -/C;$%0 -/C;$./ -/C;$0, -/C;H-%
-/C;H#$ -/C;H#/ -/C;H%H -/C;H.H -/C;H,- -/C;H0, -/C;H04 -/C;H4- -/C;%HH
BUDGC !F*MA& M) D*&C
KKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKK
*(INI*N AND *DDCD
KKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKK
The first private foreclosre action &ased pon federal diversit" (risdiction !as filed in
this )ort on Fe&rar" J5 ;77G% -ince then5 t!ent"-siB =;9? additional complaints for foreclosre
&ased pon federal diversit" (risdiction have &een filed%
&!ANDING AND &U"BCC! MA!!CD BUDI&DIC!I*N
3hile each of the complaints for foreclosre pleads standing and (risdiction5 evidence s&mitted either !ith the
complaint or later in the case indicates that standing and>or s&(ect matter (risdiction ma" not have eBisted at the
time certain of the foreclosre complaints !ere )ase ,:7G-cv-77;I9-TC4-C4C Docment ;E Filed ::>:F>;77G
0age : of G -;-
filed% Frther5 onl" one of these foreclosre complaints ths far !as filed in compliance !ith this
)ort$s /eneral Order 7G-7, captioned @0rocedres for Foreclosre Actions Based On Diversit" Jrisdiction%
-tanding Federal corts have onl" the po!er athori<ed &" Article ''' of the *nited -tates
)onstittion and the stattes enacted &" )ongress prsant thereto% Bender v. +illiamsport :rea %chool .istrict5
EGF *%-% F,E5 FE: =:JI9?% As a reslt5 a plaintiff mst have constittional standing in order for a federal cort to
have (risdiction% -d.0laintiffs have the &rden of esta&lishing standing% 0oren v. Blue &ross H Blue %hield of
Michigan5 No% 79-;7J75 ;77G 3+ ;G;9G7E at ]G =9th )ir% -ept% ;75 ;77G?. 'f the" cannot do so5 their claims mst
&e dismissed for lack of s&(ect matter (risdiction% -d. =citing &entral %tates
%outheast H %ou hwest :reas Bealth and +elfare Fund v. MerckFMedco Managed &are5 E,, F%,d :I:5 :JJ
=;d )ir% ;77F??% Becase standing involves the federal cort$s s&(ect matter (risdiction5 it can &e raised
sa sponte% -d. =citing &entral %tates5 E,, F%,d at :JI?% Frther5 standing is determined as of the time the
complaint is filed% &leveland Branch* N::&G v. &ity of Garma* 7hio5 ;9, F%,d F:,5 F;E =9th )ir% ;77:?5 cert.
denied5 F,F *%-% JG: =;77;?% Finall"5 !hile a determination of standing is generall" &ased pon allegations in the
complaint5 !hen standing is 6estioned5 corts ma" consider evidence thereof% %ee N::&G* ;9, F%,d at F;,-,7Q
%enter v. Ieneral Motors5 F,; F%;d F:: =9th )ir% :JG9?5 cert. denied5 E;J *%-% IG7 =:JG9? To satisf" Article '''$s
standing re6irements5 a plaintiff mst sho!: =:? it has sffered an
in(r" in fact that is concrete and particlari<ed and actal or imminent5 not con(ectral or )ase ,:7G-cv-77;I9-
TC4-C4C Docment ;E Filed ::>:F>;77G 0age ; of G -,-
h"potheticalQ =;? the in(r" is fairl" tracea&le to the challenged action of the defendantQ and =,? it is likel"5 as
opposed to merel" speclative5 that the in(r" !ill &e redressed &" a favora&le decision% 0oren5 ;77G 3+ ;G;9G7E
at ]G%To sho! standing5 then5 in a foreclosre action5 the plaintiff mst sho! that it is the holder of the note and
the mortgage at the time the complaint !as filed% The foreclosre plaintiff mst also sho!5 at the time the
foreclosre action is filed5 that the holder of the note and mortgage is harmed5 sall" &" not having received
pa"ments on the note% Diversit" Jrisdiction 'n addition to standing5 a cort ma" address the isse of s&(ect
matter (risdiction at an" time5 !ith or !ithot the isse &eing raised &" a part" to the action% &ommunity Bealth
Glan of 7hio v. Mosser5 ,EG F%,d 9:J5 9;; =9th )ir% ;77,?% Frther5 as !ith standing5 the plaintiff mst sho! that
the federal cort has s&(ect matter (risdiction over the foreclosre action at the time the foreclosre action !as
filed% &oyne v. :merican !obacco &ompany5 :I, F%,d EII5 EJ;-J, =9th )ir% :JJJ?% Also as !ith standing5 a federal
cort is re6ired to assre itself that it has s&(ect matter (risdiction and the &rden is on the plaintiff to sho! that
s&(ect matter (risdiction eBisted at the time the complaint !as filed% -d. Finall"5 if s&(ect matter (risdiction is
6estioned &" the cort5 the plaintiff cannot rel" solel" pon the allegations in the complaint and mst &ring
for!ard relevant5 ade6ate proof that esta&lishes s&(ect matter (risdiction% Nelson &onstruction &o. v. $.%.5 No%
7F-:;7F)5 ;77G 3+ ,;JJ:9: at ], =Fed% )l%5 Oct% ;J5 ;77G? =citing McNutt v. Ieneral Motors :cceptance &orp.
of -ndiana5 ;JI *%-% :GI =:J,9??Q see also Nichols v. Muskingum &ollege5 ,:I F%,d 9GE5 =9th )ir% ;77,? =@in
revie!ing a :;=&?=:? motion5 the cort ma" consider evidence otside the pleadings to resolve factal disptes
)ase ,:7G-cv-77;I9-TC4-C4C Docment ;E Filed ::>:F>;77G 0age , of G -E-
concerning (risdictionWA?% The foreclosre actions are &roght to federal cort &ased pon the federal cort
having (risdiction prsant to ;I *%-%)% S :,,;5 termed diversit" (risdiction% To invoke diversit"
(risdiction5 the plaintiff mst sho! that there is complete diversit" of citi<enship of the parties and that the
amont in controvers" eBceeds 8GF5777% ;I *%-%)% S :,,;% )onclsion 3hile the plaintiffs in each of the a&ove-
captioned cases have pled that the" have standing and that this )ort has s&(ect matter (risdiction5 the" have
s&mitted evidence that indicates that the" ma" not have had standing at the time the foreclosre complaint !as
filed and that s&(ect matter (risdiction ma" not have eBisted !hen the foreclosre complaint !as filed%Frther5
this )ort has the responsi&ilit" to assre itself that the foreclosre plaintiffs have standing and that s&(ect-
matter-(risdiction re6irements are met at the time the complaint is filed% Even !ithot the concerns raised &" the
docments the plaintiffs have filed5 there is reason to 6estion the eBistence of standing and the (risdictional
amont% %ee Hatherine C% 0orter5 Misbehavior and Mistake in Bankruptcy Mortgage &laims ,-E =Novem&er 95
;77G?5 *niversit" of 'o!a )ollege of +a! +egal -tdies 4esearch 0aper -eries Availa&le at --4N:
http:>>ssrn%com>a&stract-:7;GJ9: =@NHOome mortgage lenders often diso&e" the la! and overreach in calclating
the mortgage o&ligations of consmers% W Can" of the overcharges and nrelia&le calclationsW raise the
specter of poor recordkeeping5 failre to compl" !ith
consmer protection la!s5 and massive5 consistent overcharging%A? Therefore5 plaintiffs are given ntil not later
than thirt" da"s follo!ing entr" of this order to s&mit evidence sho!ing that the" had standing in the a&ove-
captioned cases :hen the )ase ,:7G-cv-77;I9-TC4-C4C Docment ;E Filed ::>:F>;77G 0age E of G
:The )ort vie!s the statement @the complaint mst &e accompanied &" the follo!ingA to
mean that the items listed mst &e filed !ith the complaint and not at some time later that is more convenient for
the plaintiff% -F- com8laint :as 2ile' and that this )ort had diversit" (risdiction :hen the com8laint :as 2ile'%
Failre to do so !ill reslt in dismissal !ithot pre(dice to refiling if and !hen the plaintiff ac6ires standing and
the diversit" (risdiction re6irements are met% %ee -n re Foreclosure &ases5 No% ::7G)2;;I;5 et al%5 slip op%
=N%D% Ohio Oct% ,:5 ;77G? =Bo"ko5 J%?C*M(LIANCC 1I!F GCNCDAL *DDCD -/--H Federal 4le of )ivil
0rocedre I,=a?=;? provides that a @local rle imposing a re6irement of form shall not &e enforced in a manner
that cases a part" to lose rights &ecase of a non!illfl failre to compl" !ith the re6irement%A Fed% 4% )iv% 0%
I,=a?=;?% The )ort recogni<es that a local rle concerning !hat docments are to &e filed !ith a certain t"pe of
complaint is a rle of form% Bicks v. Miller Brewing &ompany5 ;77; 3+ 99,G7, =Fth )ir% ;77;?% Ho!ever5 a part"
ma" &e denied rights as a sanction if failre to compl" !ith sch a local rle is !illfl% -d. /eneral Order 7G-7,
provides procedres for foreclosre actions that are &ased pon diversit" (risdiction% 'nclded in this /eneral
Order is a list of items that mst accompan" the )omplaint%: Among the items listed are: a 0reliminar" Jdicial
4eportQ a !ritten pa"ment histor" verified &" the plaintiff$s affidavit that the amont in controvers" eBceeds
8GF5777Q a legi&le cop" of the promissor" note and an" loan modifications5 a recorded cop" of the mortgageQ an"
applica&le assignments of the mortgage5 an affidavit docmenting that the named plaintiff is the o!ner and holder
of the note and mortgageQ and a corporate disclosre statement% 'n general5 it is from these items and the
foreclosre complaint that the )ort can confirm standing and the )ase ,:7G-cv-77;I9-TC4-C4C Docment ;E
Filed ::>:F>;77G 0age F of G ;The -iBth )ircit ma" look to an attorne"$s actions in other cases to determine the
eBtent of his or her good faith in a particlar action% %ee &apital -ndemnity &orp. v. ?ellinick5 GF F% App$B JJJ5
:77; =9th )ir% ;77,?% Frther5 the la! holds a plaintiff @acconta&le for the acts and omissions of NitsO chosen
consel%A Gioneer -nv. %ervices &o. v. Brunswick :ssociates 0td.Gartnership5 F7G *%-% ,I75 ,JG =:JJ,?% -9-
eBistence of diversit" (risdiction at the time the foreclosre complaint is filed% )onclsion To date5 t!ent"-siB
=;9? of the t!ent"-seven =;G? foreclosre actions &ased pon diversit" (risdiction pending &efore this )ort !ere
filed &" the same attorne"% One of the t!ent"-siB =;9? foreclosre actions !as filed in compliance !ith /eneral
Order 7G-7,% The remainder !ere not%; Also5 man" of these foreclosre complaints are notated on the docket to
indicate that the" are not in compliance% Finall"5 the attorne" !ho has filed the t!ent"-siB =;9? foreclosre
complaints has informed the )ort on the record that he kno!s and can compl" !ith the filing re6irements fond
in /eneral Order 7G-7,% Therefore5 since the attorne" !ho has filed t!ent"-siB =;9? of the t!ent"-seven =;G?
foreclosre actions &ased pon diversit" (risdiction that are crrentl" &efore this )ort is !ell a!are of the
re6irements of /eneral Order 7G-7, and can compl" !ith the /eneral Order$s filing re6irements5 failre in the
ftre &" this attorne" to compl" !ith the filing re6irements of /eneral Order 7G-7, ma" onl" &e considered to
&e !illfl% Also5 de to the eBtensive discssions and argment that has taken place5 failre to compl" !ith the
re6irements of the /eneral Order &e"ond the filing re6irements &" this attorne" ma" also &e considered to &e
!illfl% A !illfl failre to compl" !ith /eneral Order 7G-7, in the ftre &" the attorne" !ho filed the t!ent"-siB
foreclosre actions no! pending ma" reslt in immediate dismissal of the )ase ,:7G-cv-77;I9-TC4-C4C
Docment ;E Filed ::>:F>;77G 0age 9 of G -G- foreclosre action% Frther5 the attorne" !ho filed the t!ent"-
seventh foreclosre action is here&" pt on notice that failre to compl" !ith /eneral Order 7G-7, in the ftre
ma" reslt in This )ort is !ell a!are that entities !ho hold valid notes are entitled to receive timel" pa"ments in
accordance !ith the notes% And5 if the" do not receive timel" pa"ments5 the entities have the right to seek
foreclosre on the accompan"ing mortgages% Ho!ever5 !ith regard the enforcement of standing and other
(risdictional re6irements pertaining to foreclosre actions5 Jdge )hristopher A Bo"ko of the *nited -tates
District )ort for the Northern District of Ohio !ho recentl" stressed that the (dicial integrit" of the *nited
-tates District )ort is @(riceless%A D*NC and *DDCDCD in Da"ton5 Ohio5 this Fifteenth da" of Novem&er5
;77G%
s6!homas M) Dose
UUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUU
THOCA- C% 4O-E
*N'TED -TATE- D'-T4')T J*D/E
)opies provided: )onsel of 4ecord
)ase ,:7G-cv-77;I9-TC4-C4C Docment ;E Filed ::>:F>;77G 0age G of G
CAhi9it G
&ecuritiMation is ILLCGAL
!itle: &CCUDI!IUA!I*N I& ILLCGAL)
AU!F*D: C')HAE+ N3O/*/*5 )ertified 0&lic Accontant =Car"land5 *-A?Q B%Arch%
=)it" )ollege Of Ne! 1ork?% CBA =)olm&ia *niversit"?% Attended -ffolk +a! -chool
=Boston5 *-A?% Address: 0% O% BoB :G777;5 Brookl"n5 N1 ::;:G5 *-A% 0hone>FaB: :-G:I-9,I-
9;G7% Email: 'ataghY8eo8le8c)comQ mcn:::R(no%com%
theres more "o can search for FB' files on: http:>>grops%"ahoo%com>grop>4edemptionB"Cethod>

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Mortgage Killer: Another approach to Fight the Bank

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