Mortgage Killer: Another approach to Fight the Bank

Things to do list: All names are case sensitive-John Doe or JOHN DO

!" #o the co$nt% recorders o&&ice 'here the ho$se is located (co$nt%) and ask &or the
Mortgage Deed o& Tr$st that is recorded 'ith them &or that propert%* that is the
original 'hen the original +loan, 'as taken o$t (not s$-se.$ent assignments to
ne' Banks)" The &irst n$m-er 'ill -e the %ear (i"e" /001-1210343 'o$ld -e the
%ear /001)" Ask the 5lerk &or a 6certi&ied cop%7 it costs more -$t is proo& o&
-eing an e8act cop% o& the original and 'ill -e stamped to sho' it is a 6certi&ied
cop%7" Take it home and 'rite the 'ords 6 9evoked* 9ecinded and 5ancelled7
across it at a 1: degree angle starting in the lo'er le&t and proceeding to $pper
right* (in 9D pen or B;< (something that 'ill stand o$t against the original
'riting) and sign it: =itho$t pre>$dice a-ove signat$re* John Doe ($pper and
lo'er case-like %o$r normal signat$re)* and 'rite ?ettlor@ A$thoriAed
9epresentative -elo' %o$r signat$re" Make a cop% to practice on &irst -e&ore
doing certi&ied cop%"
/" #et %o$r cop% o& the Bromissor% Note that came 'ith all the paper'ork &rom %o$r
original loan" The Bromissor% Note 'ill -e called +NOT, and 'ill have
6-orro'ers promise to pa%7(it 'ont call %o$ settler) as the &irst n$m-er and 'ill
onl% -e C-1 pages and it is not a sec$rit% agreement or the Deed o& Tr$st" The
signed part 'ill -e -lank and $s$all% have 1-3 empt% spaces 'ith the 'ord ?A;
and Borro'er a&ter the line to sign on" Take %o$r $nsigned cop% (the one the%
gave %o$* D,ve never seen a case 'here the% gave %o$ a cop% o& the original %o$
signed at closeing)" A&ter making a cop% to practice on* take %o$r $n'ritten cop%
to the Notar% and sign it in &ront o& them* sign at a 1: degree angle 'ith 6=itho$t
pre>$dice a-ove sig"* %o$r signat$re (i"e" John Doe) and $nderneath %o$r normal
signat$re p$t 6as ?ettlor@A$thoriAed 9epresentative7 5op% and Baste the Notar%
in&ormation on the -ottom o& the Note s$ch as &or 5ali&ornia:
?tate o& 5ali&ornia )
5o$nt% o& EEEEEEEEEEEEE )
On EEEEEEEEEEEEEEEEEEE* /002* -e&ore me EEEEEEEEEEEEEEEEEEEEEEEEEEEEE*
personall% appearedEEEEEEEEEEEEEEEEEEEEEEEEEEEEE* 'ho proved to me on the -asis
o& satis&actor% evidence to -e the person(s) 'hose name(s) is@are s$-scri-ed to the 'ithin
instr$ment* and ackno'ledged to me that he@she@the% e8ec$ted the same in his@her
a$thoriAed capacit%(ies)* and that -% his@her@their signat$re(s) on the instr$ment* the
person(s) or entit% $pon -ehal& o& 'hich the person(s) acted e8ec$ted the instr$ment"
D certi&% $nder BNA;TF OF B9J<9F $nder the la's o& the ?tate o& 5ali&ornia that
the &oregoing paragraph is tr$e and correct"
=DTN?? m% hand and o&&icial seal"
EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE(seal)
A&ter getting it notariAed Make !0 copies o& the notariAed Bromissor% note and signed
Deed o& Tr$st &or later"
C" =e 'ill then sign and get NotariAed all the ?el&-8ec$ting 5ontract paper'ork in
the Doc$ments
!
section and incl$de these / doc$ments the certi&ied cop% o& the
Deed o& Tr$st %o$ 'rote 69evoked* 9escinded and 5ancelled7 across and the
Bromissor% Note %o$ signed as stated a-ove and mail ever%thing o&& to Te8as to
-e recorded online here: http:@@'''"nationalrep$-licregistr%"com@ Dt costs G3 &or
the &irst page and G/ &or each s$-se.$ent page" A&ter getting the doc$ments -ack
sho'ing recordation* sign the Bromissor% Note in 9ed ink at a 1: degree angle
across the &ront 6Accepted &or Hal$e* 8empt &rom ;ev%* John Henr% Doe*
c$rrent date* (i"e" Jan$ar% !/
th
* /0!0)* e8emption D"D"I (social sec$rit% I with no
dashes)* deposit to <nited ?tates Treas$r% and charge the same to JOHN HN9F
DO D"D" I (social sec$rit% with dashes)7
1" #et a cop% o& an D9? &orm !022A here: http:@@'''"irs"gov@p$-@irs-pd&@&!022a"pd&
and print it and practice &illing in the -o8es appropriatel%" Fo$ 'ill have to get a
printed &orm !022A directl% &rom the D9? as the do'nload 'on,t 'ork (the% $se
magnetiAed ink to scan it)" The lender is %o$r all capital name JOHN HN9F
DO and the lenders (%o$r) identi&ication I is %o$r ?ocial ?ec$rit% n$m-er* the
-orro'ers id I 'o$ld -e their TDN I (%o$ 'o$ld have to get it &rom them or leave
-lank) The -orro'ers name on the &orm is the original +lender, (the% cashed %o$r
promissor% note to &$nd the escro' acco$nt that &$nded the check to the seller)*
the acco$nt n$m-er is the +loan I, and date iss$ed* -o8 ! 'o$ld -e the original
+loan, date* -o8 / -alance- the original loan amo$nt J (all pa%ments made)* -o8 C
leave -lank* -o8 1 leave -lank* -o8 : mark %es &or the original lender i& the% have
assigned it or it has -een paid and closed* -o8 4 call it +val$a-le assets,
promissor% note-recorders n$m-er ('hatever the Te8as recorders n$m-er is 'hen
%o$ &ile and get it -ack &rom them)* the address o& the home* the apnI loanI* date
originated" This in&o sho$ldn,t -e $sed $ntil st$died &$rther as it ma% -e a &lag to
the D9?"
:" File a <55 K! 'here the de-tor (the organiAations name) is the Bank and Banks
address (&rom the original loan docs)* t%pe o& organiAation is a +;egal ntit%,*
>$risdiction is +<NDTD ?TAT?* the ?ec$red Bart% is %o$ the all capital lettered
name JOHN HN9F DO at %o$r address and -o8 1 the collateral 'ill sa% 6the
propert% (state the legal description o& the home &rom the recorders tr$st deed
in&ormation* address* and assessors parcel I7* and 6see all attached propert% on
e8hi-its +A,* +B,* +5,7 then %o$ 'ill pa% the little e8tra to $pload a BDF &ile that
contains the cop% o& the Deed o& Tr$st 'ith the 'ords 69evoked* 9ecindedL7
and the Bromissor% Note %o$ signed and notariAed as 6?ettlorL7 and a&ter &iling
the <55 ! here http:@@'''"sos"ca"gov@-$siness@$cc@&orms"htmIelectronic or here
http:@@'''"dol"'a"gov@-$siness@<55@inde8"html D have &iled in =ashington and
it 'as simple cost G!1 &or doing the <55 ! and BDF addend$m"
4" ?end the principals (the original Bank (alleged ;ender)* Tr$stee- (title compan%)*
and -ene&iciar%* and the c$rrent Bank* Tr$stee and Bene&iciar%) -% 9egistered
Mail 'ith +Broo& o& ?ervice,
/
(%o$ can do'nload the &orm and see a +&illed o$t
!
?ee n$m-er 4 a-ove &or the 9ecorders Doc$ments at &ootnote C -elo'
/
http:@@'''"scri-d"com@And%Jackson
e8ample, Foreclos$re ?el&-8ec$ting 5ontract listed at
http:@@'''"scri-d"com@And%Jackson (see &ootnote) 'ith %o$r partic$lar
in&ormation &illed in* copies o& the <55 &iling 'ith the BDF &iles and the Deed o&
Tr$st certi&ied cop%" #et a -$nch o& Big Manila &olders to send this in&o o$t to
them" 5hange the time to respond to /! calendar da%s or C0 calendar da%s on the
Docs" i& %o$ have time" #et green signat$re ret$rn cards 'hen doing the
9egistered Mail &or co$rt doc$mentation (the% received and signed &or it)" ?end a
cover letter giving them /! Da%s to ?ettle the acco$nt (G0 -alance o'ed) and a
NOTD5 OF DMAND to sho' %o$ the +original promissor% Note* and Deed o&
Tr$st and a re.$est &or validation o& the De-t (the% 'ill -e re.$ired to send it
NotariAed in the &orm o& an a&&idavit)"
M" File a cop% o& the <55 ! ('ith addend$ms) %o$ got -ack &rom -eing recorded in
Te8as into the 5o$nt% recorders o&&ice"
3" A&ter the /!* or C0 da%s have passed pl$s ! da% a&ter post o&&ice sho's receipt o&
the doc$ments* ?end a NOTD5 OF DFA<;T noting the &ail$re to re-$t the
Notices (identi&% them -% name and date and sho' cop% o& <?B? printed
statement o& deliver% noting time and date) and to validate an% de-t and send this
o&& 5erti&ied Mail (no signat$re card) and +proo& o& service,
C
(have &riend or
neigh-or -e %o$r +'itness, 'ho 'ill testi&% in co$rt i& need -e that the% sent these
docs o&&)"
2" ?end a cop% o& the Deed o& Tr$st* the Bromissor% note* and the !022a to %o$r
mortgage servicer* (tr$stee* -ene&iciar%) that %o$ have not a-andoned the &$nds
&rom %o$r promissor% note and have settled the mortgage and also to the co$nt%
Treas$rer and district attorne%" ?end the c$rrent +lender, a NOTD5 OF
DMAND &or &$ll reconve%ance as the proo& that the de-t has -een paid has -een
made and give them !0 da%s to compl% -% +proo& o& service,* 5erti&ied mail" D& the%
&ail to compl%* send them a NOTD5 OF B95H o& 5ONT9A5T and NOTD5 OF
DFA<;T and a NOTD5 OF ?<B?TDT<TDON OF T9<?T 'here %o$ 'ill
appoint a ne' tr$stee (one that 'ill give a &$ll reconve%ance)* a&ter all the% gave %o$
$nlimited Bo'er o& Attorne% &or %o$r agent (tr$stee) didn,t the% -% &ailing to re-$t
%o$r ?el&-8ec$ting 5ontractN Make a &$ll conve%ance $p and enter it into the
co$nt% recorders o&&ice" Make %o$r o'n #rant Deed and enter it into the co$nt%
recorders o&&ice"
Ne8t thing that is important to do is get a land patent on %o$r propert%" ;ook $p ho'
to do it here: http:@@'''"!/!:"org@ and t%pe in ;and Batent in the search -o8" A&ter
%o$ p$t a land patent on %o$r propert% even the government can,t take it &rom %o$*
this is ver% po'er&$l"
Fail$re to o->ect means %o$ agree"
C
http:@@'''"scri-d"com@And%Jackson
CALIFORNIA REPUBLIC FLAG your state-flag decrees the law of the contract]
To: ?$nn% ?ide MO9T#A# To: #9NHAD DNH?TMNT?* DN5 (Tr$stee)
5OMBANF* DN5 To: M9? (Bene&iciar% as ;enders nominee)
:0 Dron ?ands 5ircle* ?T /00 B"O" Bo8 /0/4* Flint* MD" 13:0!-/0/4
F9?NO* 5A* 2:4C0 (;ender) (the lender* tr$stee and -ene&iciar% are the principals)
AFFIDAVIT OF 1ohn Henry Doe
In the common law, and for the record, know all men by these presents:
That D* one John Henr% Doe* one o& the Beople o& 5ali&ornia* ?$i J$ris* herea&ter kno'n as the
+settlor@-orro'er,* d$l% depose and s'ear as a&&iant* that D* -elieve that:
!" The Bank* ?$nn% ?ide MO9T#A# 5ompan%" Dnc" and or an% assigns* herea&ter kno'n as the
+Bank,* operated in a similar manner to FD9?T NATDONA; BANK o& Montgomer%* the plainti&&
in the 5redit 9iver Decision
1
* 'hereas ?$nn% ?ide MO9T#A# 5ompan%" Dnc" as agent o&* and
in coll$sion 'ith the FD9A; 9?9H created the alleged money` that 'as advanced on
-ehal& o& the -orro'er -% +-ookkeeping entr%,"
/" The Bank led the -orro'er to -elieve the Bank had +mone%, to +loan,* the alleged +mone%, &or the
alleged +loan, 'as coming &rom the Bank,s val$a-le assets and as s$ch the &ail$re to re-pa% the
+mone%, loaned 'o$ld create a potential &or a loss o& val$a-le assets to the Bank
:
"
C" The Bank did not disclose to the -orro'er that the signat$re o& the -orro'er on the promissor%
note allo'ed the Bank to create the +mone%, iss$ed on the -orro'er@settlors -ehal& to the +seller,"
1" The s$-se.$ent +mone%, created -% monetiAing the promissor% note 'as never credited to the
-orro'ers acco$nt 'ith a +deposit slip, given to the depositor (-orro'er)* and the Bank never
disclosed the &acts to the -orro'er detailing their ac.$isition o& the +mone%, thro$gh monetiAing
the promissor% note"
:" The Bank led the -orro'er to -elieve it 'as acting in +good &aith, 'ith +clean hands, and the
alleged +loan, doc$ments 'ere la'&$l -inding contracts"
4" The -orro'er 'as $na'are and $nschooled in the la's* and operation o& the Banking ind$str% and
the Bank took advantage o& this &act to &ra$d$lentl% deceive the -orro'er"
M" D* John Henr% Doe decree
4
: the alleged +loan, +Bromissor% Note,* and +Deed o& Tr$st, contract(s)
are +$ltra vires,* void -% not meeting the la'&$l re.$irements o& a contract* to 'it: !" A +meeting
o& the minds, did not occ$r (&$ll disclos$re o& the &acts involved an the operation o& the contract)*
/" No val$a-le consideration 'as e8changed (there is no stat$te or la' $nder the 5onstit$tion o&
the <nited ?tates that allo's &or the creation o& mone% -% the Banks-see Art" !* section(s) 3* O!0)
there&ore the Bank did not present an% consideration* 'hile the -orro'er did promise to give
s$-stantive val$e (their la-or e8changed &or legal tender +mone%,)* and did give their val$a-le
1
http:@@'''"ed$cationcenter/000"com@legal@creditEriverEdecision"htm
:
There are three common terms $sed to descri-e this privatel% created mone%" The% are 6credit*7 6demand deposits7
and 6check-ook mone%"7 Dn the Fi&th edition o& Blacks ;a' Dictionar%* p" CC!* $nder the term6 5redit*7 the term
6Bank 5redit7 is descri-ed as: 6Mone% -ank o'es or 'ill lend individ$al or person"7 Dn the -ook I Bet You Thought,
published by the privately owned Federal Reserve Bank of New York* as &ollo's: 6Commercial banks create
checkbook money whenever they grant a loan, simply by adding deposit dollars to accounts on their books to
exchange for the borrower`s IOU....*
" 6A national -ank """cannot lend its credit to another by becoming surety, indorser, or guarantor for
him, such an act is ultra vires"""7 Merchants, Bank v" Baird* !40 F 41/"
6
the% are sovereigns 'itho$t s$->ects"""'ith none to govern -$t themselves""""P" 5HD?HO;M v" #O9#DA (<?) / Dall
1!2* 1:1* ! ; d 110* 1:: QDA;; (!M2C) pp1M!-1M/"
PThe ver% meaning o& 'sovereignty' is that the decree of the sovereign makes law"P AmeriP"""at the 9evol$tion* the
sovereignty devolved on the peopleR and the% are tr$l% the sovereigns o& the co$ntr%* -$t can Banana 5o" v" <nited
Fr$it 5o"* /2 ?"5t" :!!* :!C* /!C <"?" C1M* :C ;"d" 3/4* !2 Ann"5as" !01M"
+signat$re, C" There 'as no risk or lia-ilit% on the Banks part -eca$se no +mone%, 'as +loaned,
and the Bank,s agent(s) &ailed to sign a 'et ink signat$re on the contract evidencing acceptance o&
the contract and a commercial lia-ilit% on their part"
3" The Bank threatens a &oreclos$re action against the -orro'er &or &ail$re to make pa%ments 'itho$t
&irst proving it has a la'&$l right o& claim* -% esta-lishing it did +loan, mone%* it does have the
'et-ink signed +Bromissor% Note,
M
* and 'et-ink signed +Deed o& Tr$st,"
3

2" The Bank has not esta-lished a la'&$l contract(s) e8ists* that i& it did e8ist the contract(s) and or
all doc$mentation s$ch as the promissor% note* have not -een -ro$ght &orth to -e e8amined* the
-ank has committed &ra$d -% &ailing to provide the &act$al evidence o& a claim $pon 'hich relie&
can -e granted"
!0" The Bank did kno'ingl% commit &ra$d $pon the -orro'er the proo& o& 'hich is the Bank,s re&$sal
to have a &lesh and -lood agent sign the alleged +loan, doc$ments th$s -ecoming commerciall%
lia-le &or an% $nla'&$l proced$re"
!!" The Bank has never presented a +-ill, &or a de-t d$e it &rom the +-orro'er,* onl% +statements,"
F$rthermore the a&&iant sa%s not" =itness m% hand and seal:
=itho$t pre>$dice
B%:EEEEEEEEEEEEEEEEEEE
settlor@A$thoriAed 9epresentative
?A;
SELF-EXECUTING CONTRACT IN COMMON LAW
Fail$re on the part o& the alleged +lender,: ?$nn% ?ide MO9T#A#* (Bank) and or Sit,sT assigns* the
Tr$stee: #9NHAD DNH?TMNT?* DN5"* and or Sits,T assigns* the Bene&iciar%: M9?* and or Sit,sT
assigns to re-$t the &acts set &orth in n$m-ers one (!) thro$gh eleven (!!) o& the a-ove A&&adavit*
individ$all% and completel% 'ith &act$al evidence* also incl$ding -$t not limited to a complete &orensic
acco$nting o& all acco$nts* Form F9/014 (sho'ing the original -alance sheet)* an D9? &orm !022ODD
'hich 'ill identi&% 'ho the principal &$nds originated &rom* 'hich capital and interest 'as taken and 'ho
the recipient o& the &$nds is* and 'ho is holding the acco$nt in escro'* $nad>$sted* Form ?C-A
(registration) to sho' i&* 'hen and 'here the Bromissor% Note 'as sold* the 1/1 B-: prospect$s (sec$rit%
&iling)* 95-? and 95-B call sched$les* and FA? !/:* !CC* !10* :* and 2: &orms* and all doc$ments relating
M
6The Misso$ri co$rt &o$nd that* -eca$se M9? 'as not the original holder o& the promissor% note and -eca$se the
record contained no evidence that the original holder o& the note a$thoriAed M9? to trans&er the note* the lang$age o&
the assignment p$rporting to trans&er the promissor% note 'as ine&&ective" 6M9? never held the promissor% note* th$s
its assignment o& the deed o& tr$st to Oc'en separate &rom the note had no &orce"7 /31 ?"="Cd at 4/1R see also Dn re
=ilhelm* 10M B"9" C2/ (Bankr" D" Ddaho /002) (standard mortgage note lang$age does not e8pressl% or implicitl%
a$thoriAe M9? to trans&er the note)R Dn re Hargas* C24 B"9" :!!* :!M (Bankr" 5"D" 5al" /003) (7SDT& FHM has
trans&erred the note* M9? is no longer an a$thoriAed agent o& the holder $nless it has a separate agenc% contract 'ith
the ne' $ndisclosed principal" M9? presents no evidence as to 'ho o'ns the note* or o& an% a$thoriAation to act on
-ehal& o& the present o'ner"7)R ?a8on Mortgage ?ervices* Dnc" v" Hiller%* /003 =; :!M0!30 (N"D" 5al" /003)
($np$-lished opinion) (7SFTor there to -e a valid assignment* there m$st -e more than >$st assignment o& the deed
aloneR the note m$st also -e assigned" " " " M9? p$rportedl% assigned -oth the deed o& tr$st and the promissor%
note" " " " Ho'ever* there is no evidence of record that establishes that MERS either held the promissory note or
was given the authority . . . to assign the note.)"7 ;ANDMA9K NATDONA; BANK v" K??;9* (Kansas
?$preme 5o$rt A$g$st /002)
3
6To sho' standing* then* in a &oreclos$re action* the plainti&& m$st sho' that it is the holder of the note and the
mortgage at the time the complaint 'as &iled" The &oreclos$re plainti&& m$st also sho'* at the time the &oreclos$re
action is &iled* that the holder o& the note and mortgage is harmed* $s$all% -% not having received pa%ments on the
note"7 <NDTD ?TAT? DD?T9D5T 5O<9T ?O<TH9N DD?T9D5T OF OHDO =?T9N DDHD?DON AT
DAFTON DN 9 FO95;O?<9 5A?? 5A? NO" C:0M5H01C 0M5H012 0M5H03: 0M5H!C3 0M5H/CM
0M5H/10 0M5H/14 0M5H/13 0M5H/:M 0M5H/34 0M5HC01 0M5HC!/ 0M5HC!M 0M5HC1C 0M5HC:C 0M5HC40
0M5HC34 0M5HC32 0M5HC20 0M5H1CC J<D# THOMA? M" 9O? (Novem-er !:
th
* /00M)
to the alleged +loan, 'ithin t'ent% one (/!) calendar da%s o& receipt o& this notice 'ill res$lt in the Bank(s)*
Tr$stee(s)* and Bene&iciaries tacit agreement* and silent ac.$iescence
2
to the tr$th o& the statement(s) herein
and 'ill &orever -arr the Bank* the Tr$stee* and the Bene&iciar%* &rom re&$ting them in the &$t$re* 'ill give
John Henr% Doe or his agent $nlimited Bo'er o& Attorne% to represent the principals in an% capacit%* in
settling this matter* and 'ill -arr the principals &rom engaging in an% legal action &or claims* liens* legal
orders* levies* damages* losses* and relieves an% lia-ilities o& settler@-orro'er that are c$rrentl% d$e or that
ma% -ecome d$e in the &$t$re against the +settlor,@-orro'er &or alleged +loan,MDN I !00UUUU-
0000M0UUUU-M* loan I 0000UUUU* apnI 0UU-/UU-00:-000* Tr$st Deed recorders I /00UUU:/!4"
An% re-$ttal o& the tr$th o& the a-ove statements 'ill -e in the &orm o& an a&&idavit* signed and notariAed -%
high ranking o&&icer(s) or agent(s) o& the principals involved and sent 'ith +proo& o& service,* <?B?
certi&ied mail n$m-er* or 'ill -e void" An $nre-$tted a&&idavit stands as tr$th"
8ec$ted on: EEEEEEEEEEEEEEEEEEEEE/0!0 From: John Henr% Doe
444 Bleasant ?treet*
?an Diego* 5ali&ornia* S2UU0!T non-domestic
=itho$t Bre>$dice
B%:EEEEEEEEEEEEEEEEEEEE
?ettlor@A$thoriAed 9epresentative
?A;
1URAT
?tate o& 5ali&ornia
5o$nt% o& EEEEEEEEEEEEEEEE
?$-scri-ed and s'orn to (or a&&irmed) -e&ore me on this EEEEE da% o& EEEEEEE* /0EE*
-% EEEEEEEEEEEEEEEEEEEEEEE* proved to me on the -asis o& satis&actor% evidence to -e
the person(s) 'ho appeared -e&ore me"
Notar% B$-lic ?ignat$re Notar% B$-lic ?eal
2
P?ilence can onl% -e e.$ated 'ith &ra$d 'here there is a legal or moral duty to speak or 'here an in.$ir% le&t
$nans'ered 'o$ld -e intentionall% misleading"P <nited ?tates vs" T'eel* ::0 F"/d /2M (:th cir" 01@03@!2MM)"
Acceptance. Acceptance -% silence" Acceptance o& an o&&er not -% e8plicit 'ords -$t thro$gh the lack o& an o&&eree,s
response in circ$mstances in 'hich the relationship -et'een the o&&eror and the o&&eree >$sti&ies -oth the o&&eror,s
e8pectation o& a repl% and the o&&eror,s reasona-le concl$sion that the lack o& one signals acceptance" V Ordinaril%*
silence does not give rise to an acceptance o& an o&&er* -$t this e8ception arises 'hen the offeree has a duty to speak"
Black,s M
th
WHERE DOES THE FRAUD BEGIN? FBI FILES
This doc$ment is meant to take the reader do'n a road the% have likel% never traveled" This is a la%man,s
e8planation o& 'hat has -een happening in this co$ntr% that most have no idea or inkling o&" Dt is intended
to give the reader an overvie' o& a s%stemic Fra$d in this co$ntr% that has reached epic proportions and
Brovoke action to eradicate this sco$rge that has descended $pon the people o& America" Depending on
'hat %o$r sit$ation is* %o$* anger or o$tright disg$st at 'hat %o$ are a-o$t to learn" The &ollo'ing
in&ormation is s$pported 'ith &acts* e8hi-its* and la' and is not mere opinion" ;et,s start o$r >o$rne% o&
discover% 'ith the p$rchase o& a home and s$-se.$ent steps in the &inancial process thro$gh the li&e o&
the 6mortgage loan7" Dt all starts at the 6closing7 'here 'e gather 'ith other people that are 6involved7 in
the process to sign the doc$ments to p$rchase o$r ne' home" Do 'e reall% kno' 'hat goes on at the
closingN Are 'e ever told 'ho all the participants are in that entire processN Are 'e tr$l% given 6&$ll
disclos$re7 o& all the vario$s aspects o& that entire transaction regarding 'hat* &or most people* is the single
largest p$rchase the% 'ill make in their entire li&eN ;et,s start 'ith the ver% &irst part o& the transaction" =e
have a virt$al stack o& papers placed in &ront o& $s and 'e are instr$cted 'here 'e are s$pposed to start
signing or initialing on those 6closing doc$ments7" There seems to -e so man% di&&erent doc$ments 'ith
eno$gh legal lang$age that 'e co$ld read &or ho$rs >$st to get thro$gh them the &irst time* m$ch less -egin
to &$ll% $nderstand them" Are 'e given a cop% o& all these doc$ments at least M da%s prior to the closing so
'e can read and st$d% these doc$ments so 'e &$ll% $nderstand 'hat it is that 'e are signingN
And agreeing toN That has never happened &or the average cons$mer and p$rchaser o& a propert% in the last
C0 %ears or more i& it ever has at all" =HFN =e have a stack o& doc$ments placed -e&ore $s at the
6closing7 that 'e haven,t ever seen -e&ore and are instr$cted 'here to sign or initial to complete the
transaction and 6get o$r ne' home7" =e depend on the real estate agent* in most cases* to -ring the parties
together at the closing a&ter 'e have s$pplied eno$gh &inancial data and other re.$ested in&ormation so
that the 6lender7 can determine 'hether 'e can .$ali&% &or o$r 6loan7" O-vio$sl% 'e have the 6three da%
right o& rescission7 -$t do 'e reall% stop to read all the doc$ments after 'e have >$st p$rchased o$r home
and 'ant to move inN Ds the tho$ght that there might -e something 'rong 'ith 'hat 'e have >$st signed a
primar% tho$ght in o$r mind at that timeN Did 'e tr$st the people involved in the transactionN Are 'e
nat$rall% &oc$sing on getting moved into o$r ne' home and getting settled 'ith o$r &amil%N
=ho are the pla%ers involved in the transaction &rom the perspective o& the cons$mer p$rchasing a propert%
and signing a 6Mortgage Note7 and 6Deed7 or similar 6?ec$rit% Dnstr$ment7 at the closingN There is* o&
co$rse* the seller* the real estate agent(s)* title ins$rance compan%* propert% appraiser 'ho is s$pposed to
properl% determine the val$e o& the propert%* and the most o-vio$s one -eing 'ho 'e -elieve to -e 6the
lender7 in the transaction" =e are led* -% all involved* to -elieve that 'e are* in &act* -orro'ing mone%
&rom the 6lender7 'hich is then paid to the c$rrent o'ner o& the propert% as compensation &or them
relin.$ishing an% 6claim o& o'nership7 to the propert% and trans&erring that 6claim o& o'nership7 to $s as
the p$rchaser" Dt all seems so simple and clear on its &ace and then the transaction is completed" A&ter the
6closing7 ever%one is all smiles and %o$ -elieve %o$ have a ne' home and have to r epa% the 6lender7* over
a period o& %ears* the mone% 'hich %o$ -elieve %o$ have 6-orro'ed7"
D? TH9 ?OMTHDN# = DON,T KNO=N
ver%thing appears to -e relativel% simple and straight&or'ard -$t is that reall% the caseN 5o$ld it -e that
there are other pla%ers involved in this 'hole transaction that 'e kno' nothing a-o$t that
have a ver% s$-stantial &inancial interest in 'hat has >$st occ$rredN 5o$ld it -e that those pla%ers that 'e
are totall% that &alls into the categor% o& criminal cond$ctN Dt is 'ell-esta-lished la' that Fra$d vitiates
(makes void) an% contract that arises &rom it" Does this mean that this intentional 6lack o& disclos$re7 o& the
tr$e nat$re o& the contract 'e have entered into is Fra$d and 'o$ld make the mortgage contract voidN
on its &aceN 5o$ld it -e that the Fra$d co$ld act$all% -e 6st$died concealment or misrepresentation7 that
makes those involved in the act responsi-le and acco$nta-leN =hat happens to the 6Note7 once it is
deposited in the -ank and is converted to 6mone%7N Are there di&&erent kinds o& mone%N There is mone% o&
e8change and mone% o& acco$nt" The% are t'o ver% di&&erent things" ?ee attached (8hi-it 6B7 para !!)*
A&&idavit o& 8pert =itness =alker Todd" =alker Todd e8plains in his e8pert 'itness a&&idavit that the
-anks act$all% do convert signat$res into mone%" The de&inition o& 6mone%7 according to the <ni&orm
5ommercial 5ode: "Money" means a medium of exchange authorized or adopted by a domestic or foreign
government and includes a monetary unit of account established by an intergovernmental organization or
by agreement between two or more nations" Mone% can act$all% -e in di&&erent &orms other than 'hat 'e
are acc$stomed to thinking" =hen %o$ sign %o$r name on a promissor% note it -ecomes mone% 'hether
%o$ are talking a mortgage note or a credit card applicationW Did the -ankers ever 6disclose7 this to $sN
=ere 'e ever ta$ght an%thing a-o$t this in the school s%stem in this co$ntr%N 5o$ld it -e that this 'hole
idea o& -eing a-le to convert o$r signat$re to mone% is a 6st$died concealment7 or 6misrepresentation7
'here those involved -ecome responsi-le i& 'e are harmed -% their actionsN =hat %o$r home and the%
come at a later date and &oreclose and take it &rom %o$N =o$ld %o$ consider %o$rsel& to -e harmed in an%
'a%N =e 'ill -ring this $p again ver% shortl% -$t 'e need to look at the other doc$ment that is signed at
the 6closing7 that is o& great signi&icance"
THE DEED OF TRUST
=h% do 'e need a Deed o& Tr$stN =hat e8actl% D? a Deed o& Tr$st or other similar 6?ec$rit% Dnstr$ment7N
Dt spells o$t all the details o& the contract that %o$ are signing at the 6closing7* incl$ding s$ch things as
ins$rance re.$irements* preservation and maintenance and all o& the &inancial details o& ho'* 'hen* 'here
and 'h% %o$ are going to make pa%ments to the 6lender7 &or %ears and %ears" =ait a min$teWWWWW Make
pa%ments to the 6lender7NNNN =h% do %o$ have to make pa%ments to the 6lender7NNN Didn,t 'e >$st
esta-lish the &act that %o$r ho$se 'as paid &or -% FO<* 'ith %o$r 6Mortgage Note7 that is converted to
mone% -% TH BANK DBO?DTDN# DTN Ds there something 'rong 'ith this pict$reN =e have >$st paid
&or o$r 6home7 -$t no' 'e are told 'e have to sign a Deed o& Tr$st or similar 6?ec$rit% Dnstr$ment7 that
-inds $s to pa% the 6lender7 -ackN Ba% the 6lender7 -ack &or 'hatN Did the% loan $s an% mone%N
9emem-er the part a-o$t -anks not -eing a-le to loan 6their or their depositors mone%7 $nder FD9A;
;A=N =hat a-o$t: 6Dn the &ederal co$rts* it is 'ell esta-lished that a national -ank has no po'er to lend its
credit to another -% -ecoming s$ret%* indorser* or g$arantor &or him"7 Farmers and Miners Bank v.
Bluefield Nat l Bank* !! F /d 3C* /M! <"?" 442R 6A national -ank has no po'er to lend
its credit to an% person or corporation"7 Bowen v. Needles Nat. Bank* 21 F 2/:* C4 55A ::C* certiorari
denied in /0 ?"5t !0/1* !M4 <? 43/* 11 ;D 4CMN =hat is happening here 'ith this 6Deed o& Tr$st7 or
similar 6?ec$rit% Dnstr$ment7 that sa%s 'e have to pa% all this mone% -ack and i& 'e don,t* the% can
&oreclose and take o$r homeN =h% do 'e have to have this kind o& agreement 'hen 'e have alread% paid
&or o$r home thro$gh o$r 6Mortgage Note7 'hich 'as converted to mone% BF TH BANKN 5o$ld this
possi-l% -e another e8ample o& 6st$died concealment or misrepresentation7 'here those involved
co$ld -e held acco$nta-le &or their cond$ctN =hat happens to this Deed o& Tr$st or similar 6?ec$rit%
Dnstr$ment7 a&ter 'e sign itN =here does it goN Does it go into the va$lt &or sa&ekeeping like 'e
might thinkN ?ee attached 8hi-it 657 &or s$-stantiall% more in&ormation"
=HO A9 TH OTH9 B;AF9?N =e have alread% &o$nd o$t that the 6Note7 doesn,t go into the va$lt
&or sa&e keeping -$t instead is deposited into an acco$nt at the -ank and -ecomes mone%" =here does the
Note go thenN This is 'here things get H9F interesting -eca$se %o$r 6Mortgage Note7 is then $sed to
access %o$r Treas$r% Acco$nt (that %o$ kno' nothing a-o$t) and get credit in the amo$nt o& %o$r
Mortgage Note7 &rom %o$r 6Brepaid Treas$r% Acco$nt7" D& the% process the 6Note7 and get paid &or it then
the% have received the &$nds &rom FO<9 acco$nt at Treas$r% to pa% &or FO<9 home correctN The% then
t$rn aro$nd and -$ndle the 6Note7 and sell it to investors on =all ?treet and get paid againW No' let,s see
'hat happens to the 6Deed o& Tr$st7 or similar 6?ec$rit% Dnstr$ment7 a&ter %o$ have signed it" Fo$ ma% -e
.$ite s$rprised to kno' that not onl% does it not go into 6sa&ekeeping7 it is immediatel% ?O;D as an
DNH?TMNT ?5<9DTF to one o& an% n$m-er o& investors tied to =all ?treet" There is a read%* and
'aiting* market &or all o& the 6mortgage paper7 that is prod$ced -% the -anks" =hat happens is the 6Deed
o& Tr$st7 or other similar 6?ec$rit% Dnstr$ment7 is -$ndled and ?O;D to a -$%er and the BANK #T?
BADD FO9 TH HA;< OF TH MO9T#A# A#ADNWW Haven,t the -ankers >$st trans&erred an% risk
on that mortgage to someone else and the% have their mone%N That is a prett% slick 'a% o& doing thingsW
The% A;=AF? get their mone% right a'a% and ever%one else connected to the transaction
has the lia-ilitiesW Ds there something 'rong 'ith THD? pict$reN Ho' can it possi-l% -e that the -ank has
no' -een paid three times in the amo$nt o& %o$r 6p$rported7 mortgageN Ho' is it that %o$ still have to pa%
%ears and %ears on this 6p$rported7 loanN =as an% o& this disclosed to %o$ -e&ore %o$ signed the 6Deed o&
Tr$st7 or other similar 6?ec$rit% Dnstr$ment7N =o$ld %o$ have signed ANF o& those doc$ments incl$ding
the 6Mortgage Note7 i& %o$ kne' that this is 'hat 'as act$all% happeningN Do %o$ think there 'ere an%
6copies7 o& the 6Mortgage Note7 and 6Deed o& Tr$st7 or other similar 6?ec$rit% Dnstr$ment7 made d$ring
this processN Are those 6copies7 >$st &or the records to -e p$t in a &ile some'here or is there another
p$rpose &or themN
5AN 9B9OD<5DN# A NOT O9 DD OF T9<?T B D;;#A;N
=e have alread% esta-lished that the 6Mortgage Note7 and the 6Deed o& Tr$st7 or other similar 6?ec$rit%
Dnstr$ment7 are 6?ec$rities7 -% de&inition $nder the la'" ?ec$rities are reg$lated -% the ?ec$rities and
8change 5ommission 'hich is an agenc% o& the Federal #overnment" There are ver% strict reg$lations
a-o$t 'hat can and cannot -e done 'ith 6?ec$rities7" There are ver% strict reg$lations that appl% to the
reprod$ction or 6cop%ing7 o& 6?ec$rities7: The 5o$nter&eit Detection Act o& !22/* B$-lic ;a' !0/ ::0*
in ?ection 1!! o& Title C! o& the 5ode o& Federal 9eg$lations* permits color ill$strations o& <"?" c$rrenc%
provided: The ill$stration is o& a siAe less than three &o$rths or more than one and onehal&*
in linear dimension* o& each part o& the item ill$strated The ill$stration is one sided All negatives*
plates* positives* digitiAed storage medi$m* graphic &iles* magnetic medi$m* optical storage devices* and
an% other thing $sed in the making o& the ill$stration that contain an image o& the ill$stration or an% part
thereo& are destro%ed and@or deleted or erased a&ter their &inal $se Other O-ligations and ?ec$rities
Bhotographic or other likenesses o& other <nited ?tates o-ligations and sec$rities and &oreign c$rrencies
are permissi-le &or an% non &ra$d$lent p$rpose* provided the items are reprod$ced in -lack and 'hite and
are less than three .$arters or greater than one and one hal& times the siAe* in linear dimension* o&
an% part o& the original item -eing reprod$ced" Negatives and plates $sed in making the likenesses m$st -e
destro%ed a&ter their $se &or the p$rpose &or 'hich the% 'ere made"
Title 18 USC 472 Uttering counterfeit obligations or securities
=hoever* 'ith intent to de&ra$d* passes* $tters* p$-lishes* or sells* or attempts to pass* $tter* p$-lish* or sell*
or 'ith like intent -rings into the <nited ?tates or keeps in possession or conceals an% &alsel% made* &orged*
co$nter&eited* or altered o-ligation or other sec$rit% o& the <nited ?tates* shall -e &ined $nder this title or
imprisoned not more than /0 %ears* or -oth"
Title 18 USC 473 Dealing in counterfeit obligations or securities
=hoever -$%s* sells* e8changes* trans&ers* receives* or delivers an% &alse* &orged* co$nter&eited* or altered
o-ligation or other sec$rit% o& the <nited ?tates* 'ith the intent that the same -e passed* p$-lished* or $sed
as tr$e and gen$ine* shall -e &ined $nder this title or imprisoned not more than /0 %ears* or -oth"
Title 18 USC 474 Plates, stones, or analog, digital, or electronic
images for counterfeiting obligations or securities =hoever* 'ith intent to de&ra$d* makes* e8ec$tes*
ac.$ires* scans* capt$res* records* receives* transmits* reprod$ces* sells* or has in s$ch person,s control*
c$stod%* or possession* an analog* digital* or electronic image o& an% o-ligation or other sec$rit%
o& the <nited ?tates is g$ilt% o& a class B &elon%"
Are these reg$lations al'a%s adhered to -% the 6lender7 'hen the% have possession o& these 6original7
?5<9DTD? and make reprod$ctions o& them -e&ore the% are 6sold to investorsN Ho' m$ch has -een in
the media in the past / %ears a-o$t people demanding to see the 6'et ink signat$re Note7 'hen there is a
&oreclos$re action initiated against themN Fo$ hear it all the time" =h% is that s$ch a -ig iss$eN ?ho$ldn,t
the 6lender7 -e a-le to >$st -ring the 6Note7 and the 6Deed o& Tr$st7 or similar 6?ec$rit% Dnstr$ment7 to the
5o$rt and sho' that the% have the original doc$ments and are the 6holder in d$e co$rse7 and there&ore
have a legal right to &orecloseN To &oreclose the% m$st have BOTH the 6Mortgage Note7 and 6Deed o&
Tr$st7 or other similar 6?ec$rit% Dnstr$ment7 O9D#DNA; DO5<MNT? in their possession at the time
the &oreclos$re action is initiated" F$rthermore* D? there a real honest to goodness o-ligation to -e collected
onN =h% is it that there is s$ch a pro-lem 'ith 6lost Mortgage Notes7 as is claimed -% n$mero$s lenders
that are tr%ing to &oreclose toda%N Ho' co$ld it -e that there co$ld -e so man% 6lost7 doc$ments all o& a
s$ddenN 5o$ld it -e that the doc$ments 'eren,t reall% lost at all* -$t 'ere act$all% t$rned into a so$rce o&
reven$e that 'as never disclosed as -eing a part o& the transactionN To -elieve that so man% 6original7
doc$ments co$ld -e legitimatel% 6lost7 in s$ch a short period o& time stretches the credi-ilit% o& s$ch
claims -e%ond -elie&" 5o$ld this -e the reason that M9? (Mortage lectronic 9egistration ?%stems) 'as
&ormed in the !220,s as a 'a% to s$pposedl% 6trans&er o'nership o& a mortgage7 'itho$t having to have the
6original doc$ments7 that 'o$ld -e re.$ired to -e presented to the vario$s co$nt% recordersN 5o$ld it -e
the% KN= THF =O<;DN,T HAH TH O9D#DNA; DO5<MNT? FO9 95O9DDN# and had to
devise a s%stem to get aro$nd that re.$irementN =hen the &oreclos$re action is &iled in the co$rt the
attorne% &or the p$rported 6part% o& interest7* $s$all% the 6lender7 'ho is &oreclosing* &iles a 65OBF7 o& the
6Deed o& Tr$st7 or similar 6Dnvestment ?ec$rit%7 'ith the 5omplaint to -egin &oreclos$re proceedings" Ds
that 65OBF7 o& the 6?ec$rit% Dnstr$ment7 'ithin the 6reg$lations7 o& Federal ;a' $nder !3 <"?"5" X 1M1N
Ds it $s$all% the same siAe or ver% nearl% the same siAe as the original doc$mentN Fes it is and 'itho$t
.$estion it is a 5O<NT9FDT ?5<9DTFW =ho 'as it that prod$ced that 5O<NT9FDT
?5<9DTFN =ho 'as involved in taking that 5O<NT9FDT ?5<9DTF to the 5o$rt to &ile
the &oreclos$re actionN =ho is it that is no' legall% in possession o& that 5O<NT9FDT ?5<9DTFN
Has ever%one &rom the original 6lender7 do'n to the 5lerk o& the 5o$rt 'here the &oreclos$re is
no' -eing litigated -een in possession or is c$rrentl% in possession o& that 5O<NT9FDT ?5<9DTFN
=hat a-o$t the Tr$stees 'ho are involved in the process o& selling &oreclosed properties in non>$dicial
statesN =hat a-o$t the &act that there is no >$dicial proceeding in those states 'here the doc$mentation
p$rported to -e legal and proper to -ring a &oreclos$re action can -e veri&ied 'itho$t e8pensive litigation
-% the alleged 6-orro'er7N All the tr$stee has to do is send a letter to the alleged 6-orro'er7 stating
the% are in de&a$lt and can sell their propert% at p$-lic a$ction" Dt is >$st A??<MD that the% have the
6O9D#DNA;7 doc$ments in their possession as re.$ired -% la'" Dn realit%* in almost ever% sit$ation*
the% do NOTWWW The% are $sing a 5O<NT9FDT ?5<9DTF as the -asis to &oreclose on a propert% that
'as paid &or -% the person 'ho signed the 6Mortgage Note7 at the closing ta-le that 'as
converted to mone% -% the -ank" =hen it is demanded the% prod$ce the act$al 6original signed doc$ments7
the% almost al'a%s re&$se to do so and ask the 5o$rt to 6take their 'ord &or it7 that the% have BOTH o& the
original doc$ments 'hich are a-sol$tel% re.$ired to -e in their possession to -egin &oreclos$re actions"
Almost ever% time the people that are -eing &oreclosed on are a-le to convince the 5o$rt (in >$dicial
&oreclos$res) to demand that those 6original doc$ments7 -e prod$ced in 5o$rt -% the Blainti&&*
the &oreclos$re action stops and it is o-vio$s 'h% that happensW THF DON,T HAH TH 6O9D#DNA;7
DO5<MNT?" The% have* instead* s$-mitted a 5O<NT9FDT ?5<9DTF to the 5o$rt as their
6proo& o& claim7 to attempt to $n>$stl% enrich themselves thro$gh a -latantl% &ra$d$lent &oreclos$re action"
One o&ten cited e8ample o& this 'as the decision handed do'n -% <" ?" Federal District 5o$rt
J$dge 5hristopher A" Bo%ko o& Ohio* 'ho on Octo-er C!* /00M dismissed !1 &oreclos$re actions at one
time 'ith scathing &ootnote comments a-o$t the actions o& the Blainti&&s and their attorne%s" ?ee (8hi-it
67)" Not long a&ter that came the dismissal o& /4 &oreclos$re cases in Ohio -% <"?" District 5o$rt J$dge
Thomas M" 9ose 'ho re&erenced the Bo%ko r$ling in his decision" ?ee (8hi-it 6F7)" Ho' man% other
>$dges have not -een so -rave as to stand on the principles o& la' as J$dges Bo%ko and 9ose did* -$t
need to start doing so TODAFN Has an% o& this &oreclos$re activit% crossed state lines in comm$nications
or other activitiesN Have there -een at least t'o predicate acts o& Fra$d -% the parties involvedN Have the
people involved $sed an% t%pe o& electronic comm$nication in this Fra$d s$ch as telephone* &a8ing or
emailN Dt is o-vio$s that those .$estions have to -e ans'ered 'ith a reso$nding F?W D& that is the case*
then the Fra$d that has -een disc$ssed here &alls $nder the 9D5O stat$tes o& Federal ;a'" Didn,t the%
event$all% take do'n the mo- &or 9acketeering $nder 9D5O stat$tes %ears agoN Ds it time to take do'n the
6N= MOB7 'ith 9D5O once againN Ho' co$ld this kind o& sit$ation ever occ$r in this co$ntr%N
5o$ld it -e that this 'hole entire process co$ld -e 6st$died concealment or misrepresentation7 'here the
parties involved are responsi-le $nder the la' &or their cond$ctN 5o$ld it -e that it is no 6accident7 that so
man% 6'et ink signat$re7 Notes cannot -e prod$ced to -ack $p the &oreclos$re actions that are devastating
this co$ntr%N 5o$ld it -e that the over'helming $se o& 5O<NT9FDT ?5<9DTD?* as p$rported
evidence o& a de-t in &oreclos$re cases* is BF D?D#N and 6st$died concealment or misrepresentation7 so
as to strip the people o& this co$ntr% o& their propert% and assetsN 5o$ld it -e that a H9F s$-stantial
n$m-er o& Banks* Mortgage 5ompanies* ;a' Firms and Attorne%s are g$ilt% o& o$tright massive Fra$d* not
onl% against the people o& this co$ntr%* -$t o& massive Fra$d on the 5o$rt as 'ell -eca$se o& this
5O<NT9FDTDN#N Ho' co$ld one possi-l% come to an% other concl$sion a&ter learning the &acts and
$nderstanding the la'N Ho' man% other people are implicated in this MA??DH F9A<D s$ch as Tr$stees
and ?heri&&s that have sold literall% millions o& homes a&ter &oreclos$re proceedings -ased on these
5O<NT9FDT ?5<9DTD? s$-mitted as evidence o& a p$rported o-ligationN Ho' man% >$dges kno'
a-o$t this Fra$d happening right in their o'n co$rtrooms and never did an%thingN Ho' man% o& them have
act$all% -een BADD &or making >$dgments on &oreclos$resN =o$ldn,t that -e a &elon% or at the ver% least*
misprision o& &elon%* to kno' 'hat is going on and not act to stop it or make it kno'n to a$thorities in a
position to investigate and stop itN Ho' is it that so man% -anks co$ld recover &inanciall%* so rapidl%* &rom
the &inancial de-acle o& /00302* 'ith &oreclos$res still r$nning at record levels* and %et pa% -ack ta8pa%er
mone% that 'as sho'ered on them and do it so .$ickl%N 5o$ld it -e that 'hen the% take -ack a propert% in
&oreclos$re 'here the% never risked an% mone% and act$all% 'ere $n>$stl% enriched in the previo$s
transaction* that it is eas% to make h$ge s$ms -% reselling that propert% and then -eginning the 'hole
6<nconsciona-le7 process all over again 'ith a ne' 6-orro'er7N Ho' is it that >$st three %ears ago a loan
'as availa-le to virt$all% almost an%one 'ho co$ld 6&og a mirror7 'ith no doc$mentation o& income or
a-ilit% to repa% a loanN 5ommon sense makes %o$ ask ho' 6lenders7 co$ld possi-l% take those kinds o&
risks" 5o$ld it -e that the a-ilit% to 6repa% a loan7 'as not an iss$e at all &or the lenders -eca$se the%
'ere going to get their pro&its immediatel% and risk a-sol$tel% nothing at allN 5o$ld it -e that* i& an%thing*
the% stood to make even more mone% i& a person de&a$lted on the 6alleged loan7 in a short period o& timeN
The% co$ld literall% o-tain the propert% &or nothing other than some legal &ees and co$rt &iling costs thro$gh
&oreclos$re" The% co$ld then resell the propert% and reap additional $n>$st pro&its once againW One does not
need to have -een a &inance ma>or in college to &ig$re o$t 'hat has -een happening once %o$ are
enlightened to the FA5T?"
=HAT A5TDON? HAH BOB; TAKN TO AHODD ;O?DN#
THD9 HOM? DN FO95;O?<9N
There have -een a n$m-er o& di&&erent actions taken -% people to keep &rom losing their homes in
&oreclos$re" The &irst and most 'idel% $sed tactic is to demand that the part% -ringing the &oreclos$re
action does* in &act* have the standing to -ring the action" The most important iss$e o& standing is 'hether
that part% has act$al possession o& the 6original 'et ink signat$re7 doc$ments &rom the closing sho'ing
the% are the 6holder in d$e co$rse7" As previo$sl% mentioned* in almost A;; cases the Blainti&& -ringing
the action re&$ses to make these doc$ments availa-le &or inspection -% the De&endant in the &oreclos$re
action so the% can* in &act* determine the a$thenticit% o& those doc$ments that are claimed to -e 6original7
and p$rportedl% giving the legal right to &oreclose" The &act that the 5o$rts allo' this to happen repeatedl%
'itho$t demanding the Blainti&& -ring the 7'et ink signat$re doc$ments7 into the co$rt &or inspection -%
the De&endant* -egs the .$estion o& 'hether some o& the >$diciar% are involved in this Fra$d" =here is d$e
process $nder the la' &or the De&endant 'hen the Blainti&& is NOT 9Y<D9D -% the 5o$rt to meet that
-$rden o& proo& o& standing* 'hen demanded* to -ring their action o& &oreclos$reN One other option that has
-een $sed more and more &re.$entl% in recent months to deal 'ith &oreclos$re actions is the iss$ing o& a
6Bonded Bromissor% Note7 or 6Bill o& 8change7 as pa%ment to the alleged 6lender7 as satis&action o& an%
amo$nts allegedl% o'ed -% the De&endant" As 'as earlier descri-ed* a 6Note7 is mone% and as the -anks
demonstrated a&ter the closing* it can -e deposited in the -ank and converted to mone%" ?OM o& the
6Bonded Bromissor% Notes7 and 6Bills o& 8change7 are* in &act* negotiated and credit is given to the
acco$nts speci&ied and all t$rns o$t 'ell" ?ee (8hi-it 6B7 para !/) The pro-lem that has occ$rred is that
MANF o& the 6lenders7 sa% that the 6Bonded Bromissor% Notes7 and 6Bills o& 8change7 are -og$s
doc$ments and are 'orthless and &ra$d$lent and the% re&$se to give credit &or the amo$nt o& the 6Note7
the% receive as pa%ment o& an alleged de-t even tho$gh the% are given speci&ic instr$ctions on ho' to
negotiate the 6Note7" Dsn,t it interesting that THF can take a 6Note7 that THF print and p$t -e&ore %o$
to sign at the closing ta-le and deposit it in the -ank and it is converted to mone% immediatel%* -$t the
6Note7 that FO< iss$e is 'orthless and &ra$d$lentN The onl% di&&erence is =HO B9DNT? TH NOTWWWW
The% are -oth signed -% the same 6-orro'er7 and it is that person,s credit that -acks that 6Note7"
The 6lenders7 don,t 'ant the people to kno' the% can $se %o$r 6Brepaid Treas$r% Acco$nt7* >$st as the
-anks do 'itho$t %o$r kno'ledge and consent" ?ee (8hi-it 6D7) &or more in&ormation on6Bills o&
8change7" The &act that ?OM o& the 6Bonded Bromissor% Notes7 are negotiated and acco$nts are settled*
proves -e%ond a shado' o& a do$-t that the% are legal ?5<9DTD? >$st like the one that the -ank got
&rom the 6-orro'er7 at the closing" =h% then aren,t A;; o& the 6Notes7 processed and credit given to the
acco$nts and the &oreclos$re dismissedN Beca$se -% doing so %o$ 'o$ld -e lo'ering the National De-t and
the -ankers 'o$ld make less mone%WWWW One ver% interesting thing that happens 'ith these 6Bonded
Bromissor% Notes7 or 6Bills o& 8change7 that are s$-mitted as pa%ment* is that the% are H9F 9A9;F
9T<9ND TO TH D??<9 %et credit is not given to the intended acco$nt" The% are not ret$rned* and
the iss$er is told the% are 6-og$s* &ra$d$lent and 'orthless7 -$t the% are NOT 9T<9NDW =h% 'o$ld
someone keep something that is allegedl% 6-og$s* &ra$d$lent and 'orthless7N 5o$ld it -e that the% are
instances" There co$ld -e no other e8planation &or the &ail$re to ret$rn the allegedl% 6'orthless7 doc$ments
=HD5H A9 A5T<A;;F ?5<9DTD?WWW Does the &act that the% keep the 6Note7 that 'as s$-mitted
and re&$se to credit the acco$nt that it 'as 'ritten to satis&%* rise to the level o& THFT OF ?5<9DTD?N
This is >$st one more e8ample o& the Fra$d that is so o-vio$s" This is -$t one more e8ample o& the r$thless
nat$re o& those 'ho 'o$ld de&ra$d the people o& this co$ntr%" 5ON5;<?DON? One o& the incredi-le
aspects o& this 'hole de-acle is the &act that the ver% people 'ho are participants in this Fra$d are victims
as 'ell" Ho' man% -ank emplo%ees* >$dges* co$rt clerks* la'%ers* process servers* ?heri&&s and others have
mortgagesN Ho' man% o& the people 'ho 'ork in la' o&&ices* 5o$rtho$ses* ?heri&&s Departments and
other entities that are directl% involved in this Fra$d have -een &ra$d$lentl% &oreclosed on themselvesN Ho'
NOT 9A;;F 6BO#<?* F9A<D<;NT AND =O9TH;??7 and the 6lender7 has* in &act* act$all%
negotiated them &or FT HN MO9 <NJ<?T N9D5HMNTN That is e8actl% 'hat happens in man%
man% people in o$r militar%* la' en&orcement* &ire&ighting and medical &ields have lost their homes to this
Fra$dN Ho' man% o& %o$r &riends or neigh-ors have lost their homes to these &ra$d$lent &oreclos$resN
ver%one 'ho has a mortgage is a HD5TDM o& this &ra$d -$t some o& the most honest* tr$sting* hardest
'orking and most dedicated people in this co$ntr% have -een the -iggest victims" =ho are those 'ho have
-een the ma>or -ene&iciaries o& this massive Fra$dN Those 'ith the 6s$perior kno'ledge7 that ena-les them
to take advantage o& anotherZs ignorance o& the la' to deceive them -% 6st$died concealment or
misrepresentation7" This gro$p o& -ene&iciaries incl$des man% on =all ?treet* large investors* and most
notorio$sl%* the -ankers at the top and the la'%ers 'ho 'ork so hard to enhance their pro&its
and protect the Fra$d -% them &rom -eing e8posed" The time has no' come to make those having s$perior
kno'ledge 'ho HAH taken advantage o& anotherZs ignorance o& the la' to deceive them
-% st$died concealment or misrepresentation to -e held responsi-le &or that cond$ct" This isn,t >$st an idea"
Dt is TH ;A= and it is time to en&orce it starting 'ith the criminal aspect o& the &ra$dW <nder the doctrine
o& 69espondeat ?$perior7 the people at the top o& these organiAations are responsi-le &or the actions o&
those in their emplo%" That is 'here the investigations and arrests need to start" =hat is it going to take to
p$t a stop to the destr$ction o& this co$ntr% and the lives o& the people 'ho live hereN Dt is going to
take an $prising o& the people o& this co$ntr%* as a 'hole* to &inall% sa% that the% have had eno$gh" The
in&ormation presented here is -$t one part o& the -eginning o& that $prising and the -eginning o& the end o&
the Fra$d $pon the people o& America" Dt is o-vio$s* as has -een pointed o$t here* 'ith s$pporting
evidence* that Fra$d is rampant" Fo$ no' kno' the stor% and can no longer sa% %o$ are totall% $nin&ormed
a-o$t this s$->ect" This is onl% an o$tline o& 'hat needs to* and 'ill* -ecome common kno'ledge to the
people and la' en&orcement agencies in this co$ntr%" D& %o$ are in la' en&orcement it is FO<9 D<TF to
take 'hat %o$ have -een given here and move &or'ard 'ith %o$r o'n intense investigation and
root o$t the Fra$d and stop the the&t o& people,s homes" Fo$r &ail$re to do so 'o$ld make %o$ an accessor%
to the &ra$d thro$gh %o$r inaction no' that %o$ have -een noticed o& 'hat is occ$rring" D& %o$ are an
attorne% and receive this in&ormation it 'o$ld do %o$ 'ell to take it to heart* and $nderstand there is no
place &or %o$r participation in this Fra$d and i& %o$ participate %o$ 'ill likel% -ecome lia-le &or s$-stantial
damages* i& not more severe conse.$ences s$ch as prison" D& %o$ are in the >$diciar% %o$ 'o$ld
do 'ell to start &ollo'ing the letter o& the la' i& %o$ haven,t -een* and start making A;; o& those in %o$r
5o$rt do like'ise* lest %o$ &ind %o$rsel& looking &or emplo%ment as so man% others are* i& %o$
are not incarcerated as a res$lt o& %o$r participation in the &ra$d" D& %o$ are part o& the la' en&orcement
comm$nit% that en&orces legal matters regarding &oreclos$re %o$ 'o$ld do 'ell to make s$re that A;;
things have -een done legall% and properl% rather than >$st taking the position 6D am >$st doing m% >o-7 and
t$rn a -lind e%e to 'hat %o$ no' kno'" D& %o$ are a -anker* %o$ m$st kno' that %o$ are no' going to start
-eing held acco$nta-le &or the destr$ction %o$ have 'reaked on this co$ntr%" Fo$ have ever% right to -e*
and sho$ld -e* a&raidLL"ver% a&raid" D& %o$ are one o& the r$thless &oreclos$re la'%ers that has pra%ed on
the n$mero$s people 'ho have lost their homes* %o$ need to -e a&raid also" Her%* H9F a&raid" =hen
people learn the tr$th a-o$t 'hat %o$ have done to them %o$ can e8pect to see retaliation &or 'hat %o$ have
done" Beople are going to 'ant to see those 'ho de&ra$ded them -ro$ght to >$stice" !hese are not threats
by any stretch of the imagination" These are ver% simple o-servations and the st$d% o& h$man -ehavior
sho's $s that 'hen people &ind o$t the% have -een de&ra$ded in s$ch a grand manner as this* the% tend to
-ecome rather angr% and search &or those 'ho perpetrated the &ra$d $pon them" The &oreclos$re la'%ers
and the -ankers 'ill -e standing clearl% in their sights" The .$estion o& =H9 DO? TH F9A<D
B#DN has -een ans'ered" Dt -egan right at the closing ta-le and 'as perpet$ated all the 'a% to the loss o&
propert% thro$gh &oreclos$re or the incredi-le pa%ment o& /0 or C0 %ears o& pa%ments and interest -%
the alleged 6-orro'er7 to those 'ho 'o$ld conspire to commit Fra$d* coll$sion and co$nter&eiting and
practice 6st$died concealment or misrepresentation7 &or their o'n $n>$st enrichment" The simplest o&
analogies: =hat 'o$ld happen i& %o$ 'ere to make a copy o& a G!00 Federal 9eserve Note and go to
=almart and attempt to $se it to &ra$d$lentl% ac.$ire items that %o$ 'antedN Fo$ more than likel% 'o$ld
-e arrested and charged 'ith co$nter&eiting $nder Title !3 <?5 X 1M1 and go to prison" =hat is
the di&&erence* other than the magnit$de o& the &ra$d* -et'een that scenario and someone 'ho makes a
copy o& a mortgage sec$rit%* and $sing it thro$gh &oreclos$re* attempts to &ra$d$lentl% ac.$ire a propert%N
?ho$ldn,t the% -e treated e8actl% the same $nder the la'N The ans'er is o-vio$s and no' it is starting to
happen" !itle "# $%& ' ()( =hoever* 'ith intent to de&ra$d* makes* e8ec$tes* ac.$ires* scans* capt$res*
records* receives* transmits* reprod$ces* sells* or has in s$ch person,s control* c$stod%*
or possession* an analog* digital* or electronic image o& an% o-ligation or other sec$rit% o& the <nited ?tates
is g$ilt% o& a class B &elon%" PFra$d vitiates the most solemn 5ontracts* doc$ments and even >$dgmentsP
S<"?" vs" Throckmorton* 23 <? 4!* at pg" 4:T" 6Dt is not necessar% &or rescission o& a contract that the part%
making the misrepresentation sho$ld have kno'n that it 'as &alse* -$t recover% is allo'ed even tho$gh
misrepresentation is innocentl% made* -eca$se it 'o$ld -e $n>$st to allo' one 'ho made &alse
representations* even innocentl%* to retain the &r$its o& a -argain ind$ced -% s$ch representations"7 S=hipp
v" Dverson* 1C =is /d !44T" PAn% &alse representation o& material &acts made 'ith kno'ledge o& &alsit% and
'ith intent that it shall -e acted on -% another in entering into contract* and 'hich is so acted $pon*
constit$tes Z&ra$d*Z and entitles part% deceived to avoid contract or recover damages"P Barnsdall 9e&ining
5orn" v" Birnam =ood Oil 5o" 2/ F /4 3!M" A thoro$gh reading o& the attached e8hi-its 'ill enlighten one
even more* incl$ding 8hi-it 6#7";isting o& Attached 8hi-its A" Deed o& Tr$st Template From
Freddiemac"com (5ali&ornia) B" A&&idavit o& =alker Todd 8pert =itness 5" Memorand$m o& ;a' Bank
Fra$d D" Memorand$m o& ;a' Boints o& A$thorit% Bills o& 8change " <" ?" District 5o$rt J$dge
5hristopher A" Bo%ko Decision F" <" ?" District 5o$rt J$dge Thomas M" 9ose Decision #" ?ec$ritiAation
is D;;#A;
Exhibit B
Affidavit of Walker Todd Expert Witness
NoteR mphasis added to this a&&idavit 'ith Fello' HighlightingW
?TAT OF MD5HD#AN
DN TH 5D95<DT 5O<9T FO9 TH 5O<NTF OF OAK;AND
)
BANK ON* N"A"* ) 5ase No" 0C-01M113-5[
)
Blainti&&* ) Hon" "" ?osnick
)
v" ) AFFDDAHDT OF =A;K9 F" TODD*
) UB9T =DTN?? FO9 DFNDANT?
HA9?HAHA9DHAN DAH and )
B9ATDMA DAH* >ointl% and severall%* )
)
De&endants" )
EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE
Harshavardhan Dave and Bratima H" Dave Michael 5" Hammer (B1!M0:)
5@o :!/3 cho 9oad 9%an O" ;a'lor (B4142C)
Bloom&ield Hills* MD 13C0/ Dickinson =right B;;5
De&endants* in propria persona Attorne%s &or Bank One* N"A"
:00 =ood'ard Aven$e* ?$ite 1000
Detroit* Michigan 13//4
(C!C) //C-C:00
No' comes the A&&iant* =alker F" Todd* a citiAen o& the <nited ?tates and the ?tate o&
Ohio over the age o& /! %ears* and declares as &ollo's* $nder penalt% o& per>$r%:
!" That D am &amiliar 'ith the Bromissor% Note and Dis-$rsement 9e.$est and A$thoriAation*
dated Novem-er /C* !222* together sometimes re&erred to in other doc$ments &iled -%
De&endants in this case as the 6alleged agreement7 -et'een De&endants and Blainti&& -$t
called the 6Note7 in this A&&idavit" D& called as a 'itness* D 'o$ld testi&% as stated herein" D
make this A&&idavit -ased on m% o'n personal kno'ledge o& the legal* economic* and
historical principles stated herein* e8cept that D have relied entirel% on doc$ments provided to
me* incl$ding the Note* regarding certain &acts at iss$e in this case o& 'hich D previo$sl% had
no direct and personal kno'ledge" D am making this a&&idavit -ased on m% e8perience and
e8pertise as an attorne%* economist* research 'riter* and teacher" D am competent to make
the &ollo'ing statements"
B9OF??DONA; BA5K#9O<ND Y<A;DFD5ATDON?
/" M% .$ali&ications as an e8pert 'itness in monetar% and -anking instr$ments are as &ollo's"
For 20 years, I worked as an attorney and legal officer for the legal departments of the
Federal Reserve Banks of New York and Cleveland. Among other things* D 'as assigned
responsi-ilit% &or .$estions involving -oth novel and ro$tine notes* -onds* -ankers,
acceptances* sec$rities* and other &inancial instr$ments in connection 'ith m% 'ork &or the
9eserve Banks, disco$nt 'indo's and parts o& the open market trading desk &$nction in Ne'
Fork" Dn addition* &or nine %ears* D 'orked as an economic research o&&icer at the Federal 9eserve Bank o&
5leveland" D -ecame one o& the Federal 9eserve ?%stem,s recogniAed e8perts on the legal histor% o& central
-anking and the pledging o& notes* -onds* and other &inancial instr$ments at the disco$nt 'indo' to ena-le
the Federal 9eserve to make advances o& credit that -ecame or co$ld -ecome mone%" D also have read
e8tensivel% treatises on the legal and &inancial histor% o& mone% and -anking and have p$-lished several
articles covering all o& the s$->ects >$st mentioned" D have served as an e8pert 'itness in several trials
involving -anking practices and monetar% instr$ments" A s$mmar% -iographical sketch and res$me
incl$ding &$rther details o& m% 'ork e8perience* readings* p$-lications* and ed$cation 'ill -e tendered to
De&endants and ma% -e made availa-le to the 5o$rt and to Blainti&&,s co$nsel $pon re.$est"
#N9A;;F A55BTD A55O<NTDN# B9DN5DB;? C" Banks are re.$ired to adhere to #enerall%
Accepted Acco$nting Brinciples (#AAB)" #AAB &ollo's an acco$nting convention that lies at the heart o&
the do$-le-entr% -ookkeeping s%stem called the Matching Brinciple" This principle 'orks as &ollo's:
When a bank accepts bullion, coin, currency, checks, drafts, promissory notes, or any other similar
instruments (hereinafter ~instruments) from customers and deposits or records the instruments as
assets, it must record offsetting liabilities that match the assets that it accepted from customers. The
liabilities represent the amounts that the bank owes the customers, funds accepted from customers.
Dn a &ractional reserve -anking s%stem like the <nited ?tates -anking s%stem* most o& the &$nds advanced to
-orro'ers (assets o& the -anks) are created by the banks themselves and are not merel% trans&erred &rom
one set o& depositors to another set o& -orro'ers" 9;HAN5 OF ?<BT; DD?TDN5TDON? ABO<T
TFB? OF MONF
1" From m% st$d% o& historical and economic 'ritings on the s$->ect* D concl$de that a common
misconception a-o$t the nat$re o& mone% $n&ort$natel% has -een perpet$ated in the <"?" monetar% and
-anking s%stems* especiall% since the !2C0s" Dn classical economic theor%* once economic e8change has
moved -e%ond the -arter stage* there are t'o t%pes o& mone%: in -oth $rope and the <nited ?tates*
con&$sion a-o$t the distinctiveness o& these t'o concepts has led to persistent attempts to treat mone% o&
acco$nt as the e.$ivalent o& mone% o& e8change" Dn realit%* especiall% in a &ractional reserve -anking
s%stem* a comparativel% small amo$nt o& mone% o& e8change (e"g"* gold* silver* and o&&icial c$rrenc% notes)
ma% s$pport a vastl% larger .$antit% o& -$siness transactions denominated in mone% o& acco$nt" The s$m o&
these transactions is the s$m o& credit e8tensions in the econom%" =ith the e8ception o& c$stomar% stores o&
val$e like gold and silver* the monetar% -ase o& the econom% largel% consists o& credit instr$ments" Against
this background, I conclude that the Note, despite some language about ~lawful money explained
below, clearly contemplates both disbursement of funds and eventual repayment or settlement in
money of account (that is, money of exchange would be welcome but is not required to repay or settle
the Note). The &act$al -asis o& this concl$sion is the re&erence in the Dis-$rsement 9e.$est and
A$thoriAation to repa%ment o& G2:*20:"!4 to Michigan National Bank &rom the proceeds o& the Note" That
'as an e8change o& the credit o& Bank One (Blainti&&) &or credit apparentl% and previo$sl% e8tended to
De&endants -% Michigan National Bank" Also* there is no reason to -elieve that Blainti&& 'o$ld re&$se a
s$-stit$tion o& the credit o& another -ank or -anker as complete pa%ment o& the De&endants, repa%ment
o-ligation $nder the Note" This is a case a-o$t e8changes o& mone% o& acco$nt (credit)* not a-o$t
e8changes o& mone% o& e8change (la'&$l mone% or even legal tender)" :" Dronicall%* the Note e8plicitl%
re&ers to repa%ment in 6la'&$l mone% o& the <nited ?tates o& America7 (see 6Bromise to Ba%7 cla$se)"
Traditionall% and legall%* 5ongress de&ines the phrase 6la'&$l mone%7 &or the <nited ?tates" ;a'&$l mone%
'as the &orm o& mone% o& e8change that the &ederal government (or an% state) co$ld -e re.$ired -% stat$te
to receive in / pa%ment o& ta8es or other de-ts" Traditionall%* as de&ined -% 5ongress* la'&$l mone% onl%
incl$ded gold* silver* and c$rrenc% notes redeema-le &or gold or silver on demand" Dn a -anking la'
conte8t* la'&$l mone% 'as onl% those &orms o& mone% o& e8change (the &orms reserves o& a national -ank
prior to !2!C (date o& creation o& the Federal 9eserve Banks)" %ee* ;a'&$l Mone%* +ebster,s New
-nternational .ictionary (/d ed" !2:0)" In light of these facts, I conclude that Plaintiff and Defendants
exchanged reciprocal credits involving money of account and not money of exchange; no lawful
money was or probably ever would be disbursed by either side in the covered transactions. This
concl$sion also is consistent 'ith the -ookkeeping entries that $nderlie the loan acco$nt in disp$te in the
present case" Moreover* it is p$AAling 'h% Blainti&& 'o$ld retain the archaic lang$age* 6la'&$l mone% o&
the <nited ?tates o& America*7 in its other'ise modern-seeming Note" Dt is possi-le that this lang$age is
merel% a legac% &rom the pre-!2CC era" Modern credit agreements might incl$de repa%ment lang$age s$ch
as* 6The repa%ment o-ligation $nder this agreement shall contin$e $ntil pa%ment is received in fully and
finally collected funds*7 'hich avoids the entire .$estion o& 6Dn 'hat &orm o& mone% or credit is the
repa%ment o-ligation d$eN7 /. 0egal tender* a related concept -$t one that is economicall% in&erior to
lawful money -eca$se it allo's pa%ment in instr$ments that cannot -e redeemed &or gold or silver on
demand* has -een the &orm o& mone% o& e8change commonl% $sed in the <nited ?tates since !2CC* 'hen
domestic private gold transactions 'ere s$spended ($ntil !2M1)"" Basicall%* legal tender is 'hatever the
government sa%s that it is" The most common &orm o& legal tender toda% is Federal 9eserve notes* 'hich -%
la' cannot -e redeemed &or gold since !2C1 or* since !241* &or silver" %ee* C! <"?"5" ?ections :!0C* :!!3
(-)* and :!!2 (a)" Note: D .$estion the statement that &ed reserve notes cannot -e redeemed &or silver since
!241" Dt 'as Johnson 'ho declared on !: Marc% !24M that a&ter !: J$ne !24M that Fed 9es Notes 'o$ld not
-e e8changed &or silver and the practice did stop on !: J$ne !24M K not !241" D -elieve this to -e error in
the te8t o& the a$thor,s a&&idavit" ). 0egal tender under the $niform &ommercial &ode 1$.&.&.2* ?ection !-
/0! (/1) (O&&icial 5omment)* is a concept that sometimes s$r&aces in cases o& this nat$re"" The re&erenced
O&&icial 5omment notes that the de&inition o& money is not limited to legal tender $nder the <"5"5" Money
is de&ined in ?ection !-/0! (/1) as 6a medi$m o& e8change a$thoriAed or adopted -% a domestic or &oreign
government and incl$des a monetar% $nit o& acco$nt esta-lished -% an intergovernmental organiAation or
-% agreement -et'een t'o or more nations"7 The relevant O&&icial 5omment states that 6The test adopted
is that o& sanction o& government* 'hether -% a$thoriAation -e&ore iss$e or adoption a&ter'ard* 'hich
recogniAes the circ$lating medi$m as a part o& the o&&icial c$rrenc% o& that government" The narro' vie'
that mone% is limited to legal tender is re>ected"7 Th$s* D concl$de that the <"5"5" tends to validate the
classical theoretical vie' o& mone%" HO= BANK? B#AN TO ;ND THD9 O=N 59DDT DN?TAD
OF 9A; MONF 3" Dn m% opinion* the -est so$rces o& in&ormation on the origins and $se o& credit as
mone% are in Al&red Marshall* MONF* 59DDT O 5OMM95 /12-/:! (!2/2) and 5harles B"
Kindle-erger* A FDNAN5DA; HD?TO9F OF =?T9N <9OB :0-:C (!231)" A s%nthesis o& these
so$rces* as applied to the &acts o& the present case* is as &ollo's: As commercial -anks and disco$nt ho$ses
(private -ankers) -ecame esta-lished in parts o& $rope (especiall% #reat Britain) and North America* -%
the mid-nineteenth cent$r% the% commonl% made loans to -orro'ers -% e8tending their o'n credit to the
-orro'ers or* at the -orro'ers, direction* to third parties" The t%pical &orm o& s$ch e8tensions o& credit 'as
dra&ts or -ills o& e8change dra'n $pon themselves (claims on the credit o& the dra'ees) instead o&
C dis-$rsements o& -$llion* coin* or other &orms o& mone%" Dn transactions 'ith third parties* these dra&ts
and -ills came to serve most o& the ordinar% &$nctions o& mone%" The third parties had to determine &or
themselves 'hether s$ch 6credit mone%7 had val$e and* i& so* ho' m$ch" The Federal 9eserve Act o& !2!C
'as dra&ted 'ith this model o& the commercial econom% in mind and provided at least t'o mechanisms (the
disco$nt 'indo' and the open market trading desk) -% 'hich certain t%pes o& -ankers, credits co$ld -e
e8changed &or Federal 9eserve credits* 'hich in t$rn co$ld -e 'ithdra'n in la'&$l mone%" 5redit at the
Federal 9eserve event$all% -ecame the principal &orm o& monetar% reserves o& the commercial -anking
s%stem* especiall% a&ter the s$spension o& domestic transactions in gold in !2CC" Th$s* credit mone% is not
alien to the c$rrent o&&icial monetar% s%stemR it is >$st rarel% $sed as a device &or the creation o& Federal
9eserve credit that* in t$rn* in the &orm o& either Federal 9eserve notes or -anks, deposits at Federal
9eserve Banks* &$nctions as mone% in the c$rrent monetar% s%stem" Dn &act* a means -% 'hich the Federal
9eserve e8pands the mone% s$ppl%* loosel% de&ined* is to set -anks, reserve re.$irements (c$rrentl%*
$s$all% ten percent o& demand lia-ilities) at levels that 'o$ld enco$rage -anks to e8tend ne' credit to
-orro'ers on their o'n -ooks that third parties 'o$ld have to present to the same -anks &or redemption*
th$s leading to an e8pansion o& -ank-created credit mone%" Dn the modern econom%* man% non--ank
providers o& credit also e8tend -ook credit to their c$stomers 'itho$t previo$sl% setting aside an e.$ivalent
amo$nt o& monetar% reserves (credit card line o& credit access checks iss$ed -% non--anks are a good
e8ample o& this t%pe o& credit)* 'hich also ca$ses an e8pansion o& the aggregate .$antit% o& credit mone%"
The disc$ssion o& mone% taken &rom Federal 9eserve and other modern so$rces in paragraphs !! et se." is
consistent 'ith the acco$nt o& the origins o& the $se o& -ank credit as mone% in this paragraph"
ADVANCES OF BANK CREDIT AS THE EQUIVALENT OF MONEY 2" Blainti&& apparentl% asserts
that the De&endants signed a promise to pa%* s$ch as a note(s) or credit application (collectivel%* the
6Note7)* in e8change &or the Blainti&&,s advance o& &$nds* credit* or some t%pe o& mone% to or on -ehal& o&
De&endant" Ho'ever* the -ookkeeping entries re.$ired -% application o& #AAB and the Federal 9eserve,s
o'n 'ritings sho$ld trigger close scr$tin% o& Blainti&&,s apparent assertions that it lent its &$nds* credit* or
mone% to or on -ehal& o& De&endants* there-% ca$sing them to o'e the Blainti&& G100*000" According to
the -ookkeeping entries sho'n or other'ise descri-ed to me and application o& #AAB* the De&endants
allegedl% 'ere to tender some &orm o& money (6la'&$l mone% o& the <nited ?tates o& America7 is the t%pe
o& mone% e8plicitl% called &or in the Note)* sec$rities or other capital e.$ivalent to mone%* &$nds* credit* or
something else o& val$e in e8change (mone% o& e8change* loosel% de&ined)* collectivel% re&erred to herein
as 6mone%*7 to repa% 'hat the Blainti&& claims 'as the money lent to the De&endants" It is not an
unreasonable argument to state that Plaintiff apparently changed the economic substance of the
transaction from that contemplated in the credit application form, agreement, note(s), or other
similar instrument(s) that the Defendants executed, thereby changing the costs and risks to the
Defendants. At most* the Blainti&& e8tended its o'n credit (mone% o& acco$nt)* -$t the De&endants 'ere
re.$ired to repa% in money (mone% o& e8change* and lawful money at that)* which creates at least the
inference of inequality of obligations on the t'o sides o& the transaction (money* incl$ding lawful money*
is to -e e8changed &or bank credit)" MOD9N A<THO9DTD? ON MONF !!"To $nderstand 'hat
occ$rred -et'een Blainti&& and De&endants concerning the alleged loan o& money or* more acc$ratel%*
credit* it is help&$l to revie' a modern Federal 9eserve description o& a -ank,s lending process" %ee* David
H" Friedman* MONF AND BANKDN# (1th ed" !231)(apparentl% alread% introd$ced into this case): 6The
commercial -ank lending process is similar to that o& a thri&t in that the receipt o& cash &rom depositors
increases -oth its assets and its deposit lia-ilities* 'hich ena-les it to make additional loans and
investments. 1" " " =hen a commercial -ank makes a -$siness loan* 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 &orm o& a demand deposit in
the amo$nt o& the loan.7 (5ons$mer loans are &$nded similarl%") There&ore* the -ank,s original
-ookkeeping entr% sho$ld sho' an increase in the amo$nt o& the asset credited on the asset side o& its -ooks
and a corresponding increase e.$al to the val$e o& the asset on the lia-ilit% side o& its -ooks" This would
show that the bank received the customer`s signed promise to repay as an asset, thus monetizing the
customer`s signature and creating on its books a liability in the form of a demand deposit or other
demand liability of the bank. The -ank then $s$all% 'o$ld hold this demand deposit in a transaction
acco$nt on -ehal& o& the c$stomer" Dnstead o& the -ank lending its money or other assets to the c$stomer* as
the c$stomer reasona-l% might -elieve &rom the &ace o& the Note* the -ank created &$nds &or the c$stomer,s
transaction acco$nt 'itho$t the c$stomer,s permission* a$thoriAation* or kno'ledge and delivered the
credit on its o'n -ooks representing those &$nds to the c$stomer* mean'hile alleging that the -ank lent the
c$stomer money" D& Blainti&&,s response to this line o& arg$ment is to the e&&ect that it ackno'ledges that
it lent credit or iss$ed credit instead o& mone%* one might re&er to Thomas B" Fitch* BA99ON,?
B<?DN?? #<DD DD5TDONA9F OF BANKDN# T9M?* 65redit -anking*7 C" 6Bookkeeping entr%
representing a deposit o& &$nds into an acco$nt"7 B$t Blainti&&,s loan agreement apparentl% avoids claiming
that the -ank act$all% lent the De&endants money" The% apparentl% state in the agreement that the
De&endants are o-ligated to repa% Blainti&& principal and interest &or the 6Hal$a-le consideration (mone%)
the -ank gave the c$stomer (-orro'er)"7 The loan agreement and Note apparentl% still delete an% re&erence
to the -ank,s receipt o& act$al cash val$e &rom the De&endants and e8change o& that receipt &or act$al cash
val$e that the Blainti&& -anker ret$rned" 12.According to the Federal Reserve Bank of New York, money
is anything that has value that banks and people accept as money; money does not have to be issued
by the government. For e8ample* David H" Friedman* D BT FO< THO<#HT" " " " 2* Federal 9eserve
Bank o& Ne' Fork (1th ed" !231)(apparentl% alread% introd$ced into this case)* e8plains that -anks create
ne' mone% -% depositing DO<s* promissor% notes* o&&set -% -ank lia-ilities called checking acco$nt
-alances" Bage : sa%s* 6Mone% doesn,t have to -e intrinsicall% val$a-le* -e iss$ed -% government* or -e in
an% special &orm" " " "7 !C"The p$-lication* Anne Marie ;" #oncA%* MOD9N MONF M5HAND5? M-
CC* Federal 9eserve Bank o& 5hicago (rev" ed" J$ne !22/)(apparentl% alread% introd$ced into this case)*
contains standard -ookkeeping entries demonstrating that money ordinaril% is recorded as a -ank asset*
'hile a -ank liability is evidence o& money that a -ank o'es" The -ookkeeping entries tend to prove that
-anks accept cash* checks* dra&ts* and promissor% notes@credit agreements (assets) as money deposited to
create credit or check-ook mone% that are -ank liabilities* 'hich sho's that* a-sent an% right o& seto&&*
-anks o'e money to persons 'ho deposit money"" Cash (money of exchange) is money, and credit or
promissory notes (money of account) become money when banks deposit promissory notes with the
intent of treating them like deposits of cash. %ee* !/ <"?"5" ?ection !3!C (l2(!) (de&inition o& 6deposit7
$nder Federal Deposit Dns$rance Act)" The Blainti&& acts in the capacit% o& a lending or -anking instit$tion*
and the ne'l% iss$ed credit or mone% is similar or e.$ivalent to a promissor% note* 'hich ma% -e treated as
a deposit o& mone% 'hen received -% the lending -ank"" Federal 9eserve Bank o& Dallas p$-lication
MONF AND BANKDN#* page !!* e8plains that 'hen -anks grant loans* the% create ne' mone%" The
ne' mone% is created -eca$se a ne' 6loan -ecomes a deposit* >$st like a pa%check does"7 MOD9N
MONF M5HAND5?* page 4* sa%s* 6=hat the% S-anksT do 'hen the% make loans is to accept
promissor% notes in e8change &or credits to the -orro'ers, transaction acco$nts"7 The ne8t sentence on the
same page e8plains that the -anks, assets and lia-ilities increase -% the amo$nt o& the loans" :
5OMMNTA9F AND ?<MMA9F OF A9#<MNT !1" Blainti&& apparentl% accepted the De&endants,
Note and credit application (mone% o& acco$nt) in e8change &or its o'n credit (also mone% o& acco$nt) and
deposited that credit into an acco$nt 'ith the De&endants, names on the acco$nt* as 'ell as apparentl%
iss$ing its o'n credit &or G2:*20:"!4 to Michigan National Bank &or the acco$nt o& the De&endants" One
reasona-l% might arg$e that the Blainti&& recorded the Note or credit application as a loan (mone% o&
acco$nt) &rom the De&endants to the Blainti&& and that the Blainti&& then -ecame the -orro'er o& an
e.$ivalent amo$nt o& mone% o& acco$nt &rom the De&endants" 15. The Plaintiff in fact never lent any of
its own pre-existing money, credit, or assets as consideration to purchase the Note or credit
agreement from the Defendants. (9o-ertson Notes: D add that 'hen the -ank does the &orgoing* then in
that event* there is an $tter failure of consideration &or the 6loan contract7") =hen the Blainti&& deposited
the De&endants, G100*000 o& ne'l% iss$ed credit into an acco$nt* the Blainti&& created &rom GC40*000 to
G100*000 o& ne' mone% (the nominal principal amo$nt less $p to ten percent or G10*000 o& reserves that
the Federal 9eserve 'o$ld re.$ire against a demand deposit o& this siAe)" The Blainti&& received G100*000
o& credit or mone% o& acco$nt &rom the De&endants as an asset" #AAB ordinaril% 'o$ld re.$ire that the
Blainti&& record a lia-ilit% acco$nt* crediting the De&endants, deposit acco$nt* sho'ing that the Blainti&&
o'es G100*000 o& mone% to the De&endants* >$st as i& the De&endants 'ere to deposit cash or a
pa%roll check into their acco$nt" !4" The &ollo'ing appears to -e a disp$ted &act in this case a-o$t 'hich D
have ins$&&icient in&ormation on 'hich to &orm a concl$sion: D in&er that it is alleged that Blainti&& re&$sed
to lend the De&endants Blainti&&,s o'n mone% or assets and recorded a G100*000 loan &rom the De&endants
to the Blainti&&* 'hich arg$a-l% 'as a G100*000 deposit o& mone% o& acco$nt -% the De&endants* and then
'hen the Blainti&& repaid the De&endants -% pa%ing its o'n credit (mone% o& acco$nt) in the amo$nt o&
G100*000 to third-part% sellers o& goods and services &or the acco$nt o& De&endants* the De&endants 'ere
repaid their loan to Blainti&&* and the transaction 'as complete" !M" D do not have s$&&icient kno'ledge o&
the &acts in this case to &orm a concl$sion on the &ollo'ing disp$ted points: None o& the &ollo'ing material
&acts are disclosed in the credit application or Note or 'ere advertised -% Blainti&& to prove that the
De&endants are the tr$e lenders and the Blainti&& is the tr$e -orro'er" The Plaintiff is trying to use the
credit application form or the Note to persuade and deceive the Defendants into believing that the
opposite occurred and that the Defendants were the borrower and not the lender. The &ollo'ing point
is $ndisp$ted: The De&endants, loan o& their credit to Blainti&&* 'hen iss$ed and paid &rom their
deposit or credit acco$nt at Blainti&&* -ecame mone% in the Federal 9eserve ?%stem (s$->ect
to a red$ction o& $p to ten percent &or reserve re.$irements) as the ne'l% iss$ed credit 'as
paid p$rs$ant to 'ritten orders* incl$ding checks and 'ire trans&ers* to sellers o& goods and
services &or the acco$nt o& De&endants"
5ON5;<?DON
!3" Based on the &oregoing* Blainti&& is $sing the De&endant,s Note &or its o'n p$rposes* and it
remains to -e proven 'hether Blainti&& has inc$rred an% &inancial loss or act$al damages (D do
not have s$&&icient in&ormation to &orm a concl$sion on this point)" Dn an% case* the incl$sion
o& the 6la'&$l mone%7 lang$age in the repa%ment cla$se o& the Note is con&$sing at -est and
in &act ma% -e misleading in the conte8t descri-ed a-ove"
4
AFFD9MATDON
!2" D here-% a&&irm that D prepared and have read this A&&idavit and that D -elieve the &oregoing
statements in this A&&idavit to -e tr$e" D here-% &$rther a&&irm that the -asis o& these -elie&s is
either m% o'n direct kno'ledge o& the legal principles and historical &acts involved and 'ith
respect to 'hich D hold m%sel& o$t as an e8pert or statements made or doc$ments provided to
me -% third parties 'hose veracit% D reasona-l% ass$med"
F$rther the A&&iant sa%eth na$ght"
At 5hagrin Falls* Ohio
Decem-er :* /00C EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE
=A;K9 F" TODD (Ohio -ar no" 0041:C2)
8pert 'itness &or the De&endants
=alker F" Todd* Attorne% at ;a'
!!41 ?heer-rook Drive
5hagrin Falls* Ohio 110//
(110) CC3-!!42* &a8 (110) CC3-!:CM
e-mail: 'estoddQadelphia"net
\mailto:'estoddQadelphia"net]
NOTARY`S VERIFICATION
At 5hagrin Falls* Ohio
Decem-er :* /00C
On this da% personall% came -e&ore me the a-ove-named A&&iant* 'ho proved his identit% to me to
m% satis&action* and he ackno'ledged his signat$re on this A&&idavit in m% presence and stated that he
did so 'ith &$ll $nderstanding that he 'as s$->ect to the penalties o& per>$r%"
EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE
Notar% B$-lic o& the ?tate o& Ohio
M
Exhibit C
Memorandum of Law Bank Fraud
MEMORANDUM OF LAW - BANK FRAUD
D have* thro$gh research* learned the &ollo'ing to -e tr$e and most likel% applies to me* 'hich is the reason
D have re.$ested and demanded 6the -ank7 to validate their claims and prod$ce p$rs$ant to applica-le la'"
This MMO9AND<M serves to s$pport m% s$spicions and identi&% criminal &acts" The 6-ank7 allegedl%
6loaned me their mone%7 'hen in realit% the% deposited (credited) m% promissor% note and $sed that
deposit to 6pa% m% seller7" ?o$rce and reasoning a&ter revie'ing the original &ile clearl% sho's this
&act* 'hich is the reason &or the 6-ank7 re&$sing and &ailing to validate and to prod$ce as stip$lated -% la'"
Ho'ever* the tr$th is o$t and there is plent% o& la' -acking $p the &act that the -ank is criminal"
FORECLOSURE ACTIONS AND CASES LAWFULLY DISMISSED (NOT LETTING BANK
FORECLOSE WITHOUT LAWFUL VALIDATION AND PRODUCTION) BY THE COURTS
DUE TO BANK'S FAILURE TO VALIDATE & PRODUCE AS STIPULATED BY LAW AND
COMMITTED ~BANK FRAUD AGAINST THE BORROWER FROM THE BAR
ASSOCIATION'S OFFICIAL WEB SITE :... 3this &ourt has the responsibility to assure itself that the
foreclosure plaintiffs have standing and that sub4ect matter 4urisdiction re5uirements are met at the time
the complaint is filed. 6ven without the concerns raised by the documents the plaintiffs have filed* there is
reason to 5uestion the existence of standing and the 4urisdictional amount3. 7ver 89 cases are covered by
the B:; at< http:@@'''"a-anet"org@rpte@p$-lications@ereport@/003@C@Ohio&oreclos$res"pd&
!" 6A national -ank has no po'er to lend its credit to an% person or corporation " " "7 Bo'en v" Needles Nat"
Bank* 21 F 2/: C4 55A ::C* certiorari denied in /0 ?"5t !0/1* !M4 <? 43/* 11 ;D 4CM"
/" 5o$ntr%'ide Home ;oans* Dnc" v Ta%lor - Ma%er* J"* ?$preme 5o$rt* ?$&&olk 5o$nt% @ 2@0M
C" American Brokers 5ond$it v" [AMA;;OA - J$dge ?5HA5K /3Jan/003 A$rora ;oan ?ervices v"
MA5BH9?ON - J$dge FA9NTD ! !Mar/003
1" 6A -ank ma% not lend its credit to another even tho$gh s$ch a transaction t$rns o$t to have -een o&
-ene&it to the -ank* and in s$pport o& this a list o& cases might -e cited* 'hich-'o$ld look like a catalog of
ships"7 Smphasis addedT Norton #rocer% 5o" v" Beoples Nat" Bank* !11 ? :0:" !:! Ha !2:"
:" 6Dn the &ederal co$rts* it is 'ell esta-lished that a national -ank has not po'er to lend its credit to another
-% -ecoming s$ret%* indorser* or g$arantor &or him"7Z Farmers and Miners Bank v" Bl$e&ield Nat Zl Bank* !!
F /d 3C* /M! <"?" 442"
4" Bank o& Ne' Fork v" ?DN#H - J$dge K<9T[ !1Dec/00M
M" Bank o& Ne' Fork v" TO99? - J$dge 5O?T;;O !!Mar/003
3" Bank o& Ne' Fork v" O9O?5O - J$dge ?5HA5K !2Nov/00M 5iti Mortgage Dnc" v" B9O=N - J$dge
FA9NTD !CMar/003
2" 6The doctrine o& $ltra vires is a most po'er&$l 'eapon to keep private corporations 'ithin their
legitimate spheres and to p$nish them &or violations o& their corporate charters* and it pro-a-l% is not
invoked too o&tenL" [inc 5ar-onate 5o" v" First National Bank* !0C =is !/:* M2 N= //2" American
8press 5o" v" 5itiAens ?tate Bank* !21 N= 1C0"
PDt has -een settled -e%ond controvers% that a national -ank* $nder &ederal ;a' -eing limited in its po'ers
and capacit%* cannot lend its credit -% g$aranteeing the de-ts o& another" All s$ch contracts entered into -%
its o&&icers are $ltra vires " " "P Ho'ard O Foster 5o" v" 5itiAens NatZl Bank o& <nion* !CC ?5 /0/* !C0 ?
M:2(!2/4)"
!0" 6" " " checks* dra&ts* mone% orders* and -ank notes are not la'&$l mone% o& the <nited ?tates """7 ?tate v"
Neilon* MC Bac C/1* 1C Ore !43"
!!" American Brokers 5ond$it v" [AMA;;OA - J$dge ?5HA5K !! ?ep/00M 5o$ntr%'ide Mortgage v"
B9;D<K - J$dge 5O?T;;O ! CMar/003
!/" De$tsche Bank v" Barnes-J$dgment ntr%
!C" De$tsche Bank v" Barnes-=ithdra'al o& O->ections and Motion to Dismiss De$tsche Bank v"
A;MANF J$dge 5O?T;;O 0MJan/003 De$tsche Bank v" Ben>amin 59<[ K J$dge K<9T[
/!Ma%/003 De$tsche Bank v" Fo-anna 59<[ - J$dge K<9T[ /!Ma%/003 De$tsche Bank v"
5ABA9OF - J$dge 5O?T;;O 0/Apr/003 De$tsche Bank v" 5A?T;;ANO? @
/00MNF?lipOp:02M3<@- J$dge ?5HA5K !!Ma%/00M
!1" De$tsche Bank v" 5A?T;;ANO?@ /003NF?lipOp:00CC<@ - J$dge ?5HA5K !1Jan /003
!:" H?B5 v" Halentin - J$dge ?5HA5K calls them liars and dismisses =DTH pre>$dice VV
!4" De$tsche Bank v" 5;O<DN @ /00MNF?lipOp: ! M4M<@ J$dge ?5HA5K ! 3?ep/00M
!M" De$tsche Bank v" [A#<D - J$dge ?5HA5K /!Dec/00M De$tsche Bank v" #9ANT - J$dge
?5HA5K /:Apr/003 De$tsche Bank v" HA99D? - J$dge ?5HA5K 0:Fe-/003
!3" De$tsche Bank v" ;a5rosse* 5ede* DT5 5omplaint
!2" De$tsche Bank v" ND5HO;;? - J$dge K<9T[ /!Ma%/003 De$tsche Bank v" 9FAN - J$dge K<9T[
/2Jan/003 De$tsche Bank v" ?AMB?ON - J$dge K<9T[ !4Jan/003
/0" De$tsche v" Marche - Order to ?ho' 5a$se to HA5AT J$dgment o& Foreclos$re K !! J$ne/002
/!" #MA5 Mortgage ;;5 v" MATTH=? - J$dge K<9T[ !0Jan/003 #MA5 Mortgage ;;5 v"
?9AFDN - J$dge 5O?T;;O 03Jan/003 H?B5 Bank <?A NA v" 5DB9DAND J$dge 5O?T;;O
03Jan/003 H?B5 Bank <?A NA v" JA5K - J$dge 5O?T;;O 0/Apr/003 Dnd%Mac Bank F?B v"
9ODNF-9O?? - J$dge K<9T[ !:Jan/003 ;a?alleBank NA v" 5HA9;<? - J$dge K<9T[
0CJan/003 ;a?alleBank NA v" ?MA;;? - J$dge K<9T[ 0CJan/003 BHH Mortgage 5orp v" BA9B9 -
J$dge K<9T[ !:Jan/003 Bropert% Asset Management v" H<AFTA 0:Dec/00M //" 9ivera* Dn 9e
?ervices ;;5 v" ?ATTA9 @ /00MNF?lipOp: ! 32:<@ - J$dge ?5HA5K 02Oct/00M
/C" <?Bank NA v" A<#<?T - J$dge K<9T[ /MNov/00M <?Bank NA v" #9ANT - J$dge K<9T[
!1Dec/00M <?Bank NA v" 9O<NDT9 - J$dge B<9K !!Oct/00M <?Bank NA v" HD;;A9<; -
J$dge K<9T[ 0!Fe-/003
/1" =ells Fargo Bank NA v" HAMBTON - J$dge K<9T[ 0C Jan/003 /:" =ells Fargo* ;itton ;oan v"
Farmer =DTH B9J<DD5 J$dge ?chack J$ne/003
/4" =ells Fargo v" 9e%es =DTH B9J<DD5* Fra$d on 5o$rt O ?anctions J$dge ?chack J$ne/003
/M" De$tsche Bank v" Bea-od% J$dge Nolan (9eg$lation [) Dnd%mac Bank*F?B v" Bo%d - ?chack J"
Jan$ar% /002
/3" Dnd%mac Bank* F?B v" Bethle% - ?chack* J" Fe-r$ar% /002 ( The tale o& man% hats)
/2" ;a?alle Bank Natl" Assn" v Ahearn - Appellate Division* Third Department (Bro ?e)
C0" N= J9?F 5O<9T DD?MD??? FO95;O?<9 FD;D BF D<T?5H BANK FO9
FAD;<9 TO B9OD<5 TH NOT
C!" =hittiker v" De$tsche (MMO9AND<M DN OBBO?DTDON TO DFNDANT?, MOTDON? TO
DD?MD??2 =hittiker (B;ADNTDFF?, OBJ5TDON? TO 9BO9T AND 95OMMNDATDON)
=hittiker (DFNDANT =;TMAN* =DNB9# O 9D? 5O"* ;BA,? 9?BON? TO B;ADNTDFF?,
OBJ5TDON? TO 9BO9T AND 95OMMNDATDON) =hittiker (9?BON? TO B;ADNTDFF?,
OBJ5TDON? TO MA#D?T9AT J<D# BA9?ON,? 9BO9T AND 95OMMNDATDON TO
#9ANT DT? MOTDON TO DD?MD??)
C/" Novastar v" ?n%der V 1lack of standing2 ?n%der 1motion to amend w=pre4udice2 ?n%der 1response to
amend2
CC" =ashington M$t$al v" 5it% o& 5leveland 1+:M$>s motion to dismiss2
C1" /003-Ohio-!!MMR D;J Mtge" 5apital* Dnc" v" Barsons (%? ;eversed for lack of standing)
C:" verhome v" 9o'land
C4" De$tsche - 5lass Action (9D5O) Bank o& Ne' Fork v" TO99? K J$dge 5O?T;;O ! !Mar/003
CM" De$tsche Bank Ans'er =hittiker
C3" Manle% Ans'er =hittiker
C2" J$stice Arth$r M" ?chack
10" J$dge Holsch$h- ?ho' ca$se
1!" J$dge Holsch$h- Dismissals
1/" J$dge Bo%koZs De$tsche Bank Foreclos$res
1C" 9ose 5omplaint &or Foreclos$re ^ 9ose Dismissals
11" OZMalle% Dismissals
1:" 5it% O& 5leveland v" Banks
14" Do'd Dismissal
1M" M5 canZt &ind the note
13" Oc'en canZt &ind the note
12" <? Bank canZt &ind the Note
:0" <? Bank - No Note
:!" Ke% Bank - No Note
:/" =ells Fargo - De&ective pleading
:C" 5omplaint in Jack v" M9?* 5iti* De$tsche
:1" #MA5 v" Marsh
::" Massach$setts : 9o-in Ha%es v" De$tsche Bank
:4" Florida: De$tsche BankZs ?$mmar% J$dgment Denied
:M" Te8as: M9? v" Fo$ng @ /nd 5irc$it 5o$rt o& Appeals - BAN;: ;DHDN#?TON* DA<BHDNOT* and
M55OF* JJ"
:3" Nevada: M9? cr$shed: Dn re Mitchell
:2" PNeither* as incl$ded in its po'ers not incidental to them* is it a part o& a -ankZs -$siness to lend its
credit" D& a -ank co$ld lend its credit as 'ell as its mone%* it might* i& it received compensation and 'as
care&$l to p$t its name onl% to solid paper* make a great deal more than an% la'&$l interest on its mone%
'o$ld amo$nt to" D& not care&$l* the po'er 'o$ld -e the mother o& panics* " " " Dndeed* lending credit
is the e8act opposite o& lending mone%* 'hich is the real -$siness o& a -ank* &or 'hile the latter creates a
lia-ilit% in &avor o& the -ank* the &ormer gives rise to a lia-ilit% o& the -ank to another" - Morse. Banks and
Banking :th d" ?ec 4:R Magee* Banks and Banking* Crd d" ?ec /13"P American 8press 5o" v" 5itiAens
?tate Bank* !21 N= 1/2"
40" PDt is not 'ithin those stat$tor% po'ers &or a national -ank* even tho$gh solvent* to lend its credit to
another in an% o& the vario$s 'a%s in 'hich that might -e done"P Federal Dntermediate 5redit Bank v" ;
ZHerrison* CC F /d 31!* 31/ (!2/2)"
4!" 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 o& 5ommerce v" Atkinson* :: 1M!"
4/" PA -ank can lend its mone%* -$t not its credit"P First NatZl Bank o& Tallapoosa v" Monroe " !C: #a 4!1*
42 ? !!/1* C/ ;9A (N?) ::0"
4C" P"" " the -ank is allo'ed to hold mone% $pon personal sec$rit%R -$t it m$st -e mone% that it loans* not its
credit"P ?eligman v" 5harlottesville Nat" Bank* C H$ghes 41M* Fed 5ase No"!/* 41/* !0C2"
41" PA loan ma% -e de&ined as the deliver% -% one part% to* and the receipt -% another
part% o&* a s$m o& mone% $pon an agreement* e8press or implied* to repa% the s$m 'ith or 'itho$t
interest"P Barsons v" Fo8 !M2 #a 40:* !M4 ? 411" Also see Kirklandv" Baile%* !:: ? /d M0! and <nited
?tates v" Nei&ert =hite 5o"* /1M Fed ?$pp 3M3* 3M2"
4:" PThe 'ord Zmone%Z in its $s$al and ordinar% acceptation means gold* silver* or paper mone% $sed as a
circ$lating medi$m o& e8change " " "P ;ane v" 9aile% /30 K% C!2* !CC ?= /d M:"
44" PA promise to pa% cannot* -% arg$ment* ho'ever ingenio$s* -e made the e.$ivalent o& act$al
pa%ment """P 5hristensen v" Bee-e* 2! B !CC* C/ <tah 104"
4M" 6A -ank is not the holder in d$e co$rse $pon merel% crediting the depositors acco$nt"7 Bankers Tr$st v"
Nagler* //2 NF? /d !1/* !1C"
43" PA check is merel% an order on a -ank to pa% mone%"P Fo$ng v" Hem-ree* MC B/d C2C
42" PAn% &alse representation o& material &acts made 'ith kno'ledge o& &alsit% and 'ith intent that it shall
-e acted on -% another in entering into contract* and 'hich is so acted $pon* constit$tes Z&ra$d*Z and entitles
part% deceived to avoid contract or recover damages"P Barnsdall 9e&ining 5orn" v" Birnam =ood Oil 5o"
2/ F /4 3!M"
M0" PAn% cond$ct capa-le o& -eing t$rned into a statement o& &act is representation" There is no distinction
-et'een misrepresentations e&&ected -% 'ords and misrepresentations e&&ected -% other acts"P ;eonard v"
?pringer !2M Dll :C/" 41 N
C0!"
M!" 6D& an% part o& the consideration &or a promise -e illegal* or i& there are several considerations &or an
$nsevera-le promise one o& 'hich is illegal* the promise* 'hether 'ritten or oral* is 'holl% void* as it is
impossi-le to sa% 'hat part or 'hich one o& the considerations ind$ced the promise"7 Menominee 9iver
5o" v" A$g$st$s ?pies ; O 5 5o"*!1M =is ::2-:M/R !C/ N= !!//"
M/" 6The contract is void i& it is onl% in part connected 'ith the illegal transaction and the promise single or
entire"7 #$ardian Agenc% v" #$ardian M$t" ?avings Bank* //M =is ::0* /M2 N= 3C" MC" 6Dt is not
necessar% &or recision o& a contract that the part% making the misrepresentation sho$ld have kno'n that it
'as &alse* -$t recover% is allo'ed even tho$gh misrepresentation is innocentl% made* -eca$se it 'o$ld -e
$n>$st to allo' one 'ho made &alse representations* even innocentl%* to retain the &r$its o& a -argain
ind$ced -% s$ch representations"7 =hipp v" Dverson* 1C =is /d !44" M1" Pach Federal 9eserve -ank is a
separate corporation o'ned -% commercial -anks in its region """P ;e'is v" <nited ?tates* 430 F /0 !/C2
(!23/)"
HOW AND WHY THE BANKS SECRETLY AND QUICKLY ~SWITCH CURRENCY
NOT FULFILL THE LOAN AGREEENT !THE "ONTRA"T# O$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 $ORRO&ER#
The oldest scheme thro$gho$t Histor% is the changing o& c$rrenc%" 9emem-er the mone%changers in the
temple (BDB;)N ,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 c$rrenc% as a -$siness"
Fo$ 'o$ld have to convert to Temple c$rrenc% in order to -$% an animal &or sacri&ice" The Temple
Merchants made mone% -% the e8change" The Bi-le calls it $n>$st 'eights and meas$res* and >$dges it to
-e an a-omination" Jes$s cleared the Temple o& these a-ominations" O$r 5hristian Fo$nding Fathers did the
same" Ben Franklin said in his a$to-iograph%* P""" the ina-ilit% o& the colonists to get the po'er to iss$e
their o'n mone% permanentl% o$t o& the hands o& King #eorge DDD and the international -ankers 'as the
prime reason &or the revol$tionar% 'ar"7 The %ear !2!C 'as the third attempt -% the $ropean -ankers to
get their s%stem -ack in place 'ithin the <nited ?tates o& America" Bresident Andre' Jackson ended the
second attempt in !3C4" =hat the% co$ld not 'in militaril% in the 9evol$tionar% =ar the% attempted to
accomplish -% a -anking mone% scheme 'hich allo'ed the $ropean Banks to o'n the mortgages on
nearl% ever% home* car* &arm* ranch* and -$siness at no cost to the -ank" 9e.$iring 6=e the Beople7 to pa%
interest on the e.$it% 'e lost and the -ank got &ree" Toda% people -elieve that cash and coins -ack $p the
all checks" D& %o$ deposit G!00 o& cash* the -ank records the cash as a -ank asset (de-it) and credits a
Demand Deposit Acco$nt (DDA)* sa%ing that the -ank o'es %o$ G!00" For the G!00 lia-ilit% the -ank
o'es %o$* %o$ ma% receive cash or 'rite a check" D& %o$ 'rite a G!00 check* the G!00 lia-ilit% %o$r -ank
o'es %o$ is trans&erred to another -ank and that -ank o'es G!00 to the person %o$ 'rote the check to" That
person can 'rite a G!00 check or receive cash" ?o &ar there is no pro-lem" 9emem-er one thing ho'ever*
&or the check to -e valid there m$st &irst -e a deposit o& mone% to the -anks ASSETS* to make the check
(lia-ilit%) good" The lia-ilit% is like a HOLDING ACCOUNT claiming that mone% 'as deposited to make
the check good" Here then, is how the switch in currency takes place The -ank advertises it loans,
mone%" The -ank sa%s* Psign hereP" Ho'ever the -ank never signs -eca$se the% kno' the% are not going to
lend %o$ theirs* or other depositorZs mone%" <nder the la' o& -ankr$ptc% o& a nation* the mortgage note acts
like mone%" The -ank makes it look like a loan -$t it is not" It is an exchange. The bank receives the
equity in the home you are buying, for free, in exchange for an unpaid bank liability that the bank
cannot pay, without returning the mortgage note. If the bank had fulfilled its end of the contract, the
bank could not have received the equity in your home for free. The bank receives your mortgage note
without investing or risking onecent. The bank sells the mortgage note, receives cash or an asset that
can then be converted to cash and still refuses to loan you their or other depositors' money or
pay the liability it owes you. On a G!00*000 loan the -ank does not give $p G!00*000" The -ank receives
G!00*000 in cash or an asset and iss$es a G!00*000 lia-ilit% (check) the -ank has no intention o& pa%ing"
The G!00*000 the -ank received in the alleged loan is the e.$it% (lien on propert%) the -ank received
'itho$t investment* and it is the G!00*000 the individ$al lost in e.$it% to the -ank" The G!00*000 e.$it% the
individ$al lost to the -ank* 'hich demands he@she repa% pl$s interest" The loan agreement the -ank told
%o$ to sign said ;OAN" The -ank -roke that agreement" The -ank no' o'ns the mortgage note 'itho$t
loaning an%thing" The -ank then deposited the mortgage note in an acco$nt the% opened $nder %o$r name
'itho$t %o$r a$thoriAation or kno'ledge" The -ank 'ithdre' the mone% 'itho$t %o$r a$thoriAation or
kno'ledge $sing a &orged signat$re" The -ank then claimed the mone% 'as the -anks, propert%* 'hich is a
&ra$d$lent conversion" The mortgage note 'as deposited or de-ited (asset) and credited to a Direct Deposit
Acco$nt* (DDA) (lia-ilit%)" The credit to Direct Deposit Acco$nt (lia-ilit%) 'as $sed &rom 'hich to iss$e
the check" The -ank >$st s'itched the c$rrenc%" The -ank demands that %o$ cannot $se the same c$rrenc%*
'hich the -ank deposited (promissor% notes or mortgage notes) to discharge %o$r mortgage note" The -ank
re&$ses to loan %o$ other depositorsZ mone%* or pa% the lia-ilit% it o'es %o$ &or having deposited %o$r
mortgage note" To pa% this lia-ilit% the -ank m$st ret$rn the mortgage note to %o$" Ho'ever instead o& the
-ank pa%ing the lia-ilit% it o'es %o$* the -ank demands %o$ $se these $npaid -anklia-ilities* created in the
alleged loan process* as the ne' c$rrenc%" No' %o$ m$st la-or to earn the -ank c$rrenc% ($npaid lia-ilities
created in the alleged loan process) to pa% -ack the -ank" =hat the -ank received &or &ree* the individ$al
lost in e.$it%" D& %o$ tried to repa% the -ank in like kind c$rrenc%* ('hich the -ank deposited 'itho$t
%o$r a$thoriAation to create the check the% iss$ed %o$)* 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 $ses to -$% %o$r propert% in the &oreclos$re" The% get %o$r real propert% at no cost" D& the% accept
%o$r promissor% note to discharge the mortgage note* the -ank can $se the promissor% note to -$% %o$r
home i& %o$ sell it" Their pro-lem is* the promissor% note stops the interest and there is no lien on the
propert%" D& %o$ sell the home -e&ore the -ank can &ind o$t and $se the promissor% note to -$% the home*
the -ank lost" The -ank claims the% have not -o$ght the home at no cost" Y$estion is* 'hat right does the
-ank have to receive the mortgage note at no cost in direct violation o& the contract the% 'rote and re&$sed
to sign or &$l&ill" B% demanding that the -ank &$l&ill the contract and not change the c$rrenc%* the -ank
m$st deposit %o$r second promissor% note to create check -ook mone% to end the &ra$d* p$tting ever%one
-ack in the same position the% 'here* prior to the &ra$d* in the &irst place" Then all the homes* &arms*
ranches* cars and -$sinesses in this co$ntr% 'o$ld -e redeemed and the e.$it% ret$rned to the right&$l
o'ners (the people)" D& not* ever% time the homes are re&inanced the -anks get the e.$it% &or &ree" Fo$ and D
m$st la-or /0 to C0 %ears &$ll time as the -ankers sit -ehind their desks* la$ghing at $s -eca$se 'e are too
st$pid to &ig$re it o$t or to &orce them to &$l&ill their contract" The G!00*000 created in&lation and this
increases the e.$it% val$e o& the homes" On an average homes are re&inanced ever% M !@/ %ears" =hen the
home is re&inanced the -ank again receives the e.$it% &or &ree" =hat the -ank receives &or &ree the alleged
-orro'er loses to the -ank" According to the Federal 9eserve Banks, o'n -ook o& 9ichmond* Ha" titled
6FO<9 MONF7 page seven* ~...demand deposit accounts are not legal tender... D& a promissor% note
is legal tender* the -ank m$st accept it to discharge the mortgage note" The -ank changed the c$rrenc% &rom
the mone% deposited* (mortgage note) to check -ook mone% (lia-ilit% the -ank o'es &or the mortgage note
deposited) &orcing $s to la-or to pa% interest on the e.$it%* in real propert% (real estate) the -ank received
&or &ree" This cost 'as not disclosed in NOTICE TO CUSTOMER REQUIRED BY FEDERAL
LAW, Federal Reserve Regulation Z. =hen a -ank sa%s the% gave %o$ credit* the% mean the% credited
%o$r transaction acco$nt* leaving %o$ 'ith the pres$mption that the% deposited other depositors mone% in
the acco$nt" The &act is the% deposited %o$r mone% (mortgage note)" The -ank cannot mone%* the% are to
credit a Demand Deposit Acco$nt $nder %o$r name* so %o$ can 'rite checks and spend %o$r mone%" Dn this
case the% claim %o$r mone% is their mone%" Ask a criminal attorne% 'hat happens in a &ra$d$lent
conversion o& %o$r &$nds to the -ankZs $se and -ene&it* 'itho$t %o$r signat$re or a$thoriAation"
=hat the -anks co$ld not 'in vol$ntaril%* thro$gh deception the% received &or &ree" ?everal presidents*
John Adams* Thomas Je&&erson* and A-raham ;incoln -elieved that -anker capitalism 'as more dangero$s
to o$r li-erties than standing armies" <"?" Bresident James A" #ar&ield said* 6=hoever controls the mone%
in an% co$ntr% is a-sol$te master o& ind$str% and commerce"P The 5hicago Federal 9eserve BankZs
-ook*7Modern Mone% Mechanics7* e8plains e8actl% ho' the -anks e8pand and contract the check-ook
mone% s$ppl% &orcing people into &oreclos$re" This co$ld never happen i& contracts 'ere not violated and i&
'e receivede.$al protection $nder the la' o& 5ontract"
HOW THE BANK SWITCHES THE CURRENCY
This is a repeat 'orded di&&erentl% to -e s$re %o$ $nderstand it" %ou must understand t0e currenc- s7itc0.
The -ank does not loan mone%" The -ank merel% s'itches the c$rrenc%" The alleged -orro'er created
mone% or c$rrenc% -% simpl% signing the mortgage note" The -ank does not sign the mortgage note -eca$se
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 %o$r mortgage note (lien on propert%) as mone% &rom 'hich to
iss$e a check" No mone% 'as loaned to legall% &$l&ill the contract &or the -ank to o'n the mortgage note"
B% doing this* the -ank received the lien on the propert% 'itho$t risking or $sing one cent" The people lost
the e.$it% in their homes and &arms to the -ank and no' the% m$st la-or to pa% interest on the propert%*
'hich the -ank got &or &ree and the% lost" The check is not mone%* the check merel% trans&ers mone% and
-% trans&erring mone% the check acts ;DK mone%" The mone% deposited is the mortgage note" -f the bank
never fulfills the contract to loan money* then the bank does not own the mortgage note. The deposited
mortgage note is still %o$r mone% and the checking acco$nt the% set $p in %o$r name* 'hich the% credited*
&rom 'hich to iss$e the check* is still %o$r mone%" The% onl% ret$rned %o$r mone% in the &orm o& a check"
=h% do %o$ have to &$l&ill %o$r end o& the agreement i& the -ank re&$ses to &$l&ill their end o& the
agreementN D& the -ank does not loan %o$ their mone% the% have not &$l&illed the agreement* the contract is
void" You created currency by simply signing the mortgage note. The mortgage note has val$e -eca$se
o& the lien on the propert% and -eca$se o& the &act that %o$ are to repa% the loan" The -ank deposits the
mortgage note (c$rrenc%) to create a check (c$rrenc%* -ank mone%)" Both c$rrencies cost nothing to create"
B% la' the -ank cannot create c$rrenc% (-ank mone%* a check) 'itho$t &irst depositing c$rrenc%* (mortgage
note) or legal tender" For the check to -e valid there m$st -e mortgage note or -ank mone% as legal tender*
-$t the -ank accepted c$rrenc% (mortgage note) as a deposit 'itho$t telling %o$ and 'itho$t %o$r
a$thoriAation" The -ank 'ithdre' %o$r mone%* 'hich the% deposited 'itho$t telling %o$ and 'ithdre'
it 'itho$t %o$r signat$re* in a &ra$d$lent conversion scheme* 'hich can land the -ankers in >ail -$t is
pla%ed o$t in ever% 5it% and To'n in this nation on a dail% -asis" Without loaning you money, the bank
deposits your money (mortgage note), withdraws it and claims it is the bank's money and that it is
their money they loaned you. Dt is not a loan* it is merel% an e8change o& one c$rrenc% &or another* the%Zll
o'e %o$ the mone%* 'hich the% claimed the% 'ere to loan %o$" D& the% do not loan the mone% and
merel% e8change one c$rrenc% &or another* the -ank receives the lien on %o$r propert% &or &ree" =hat the%
get &or &ree %o$ lost and m$st la-or to pa% -ack at interest" D& the -anks loaned %o$ legal tender* the% co$ld
not receive the liens on nearl% ever% home* car* &arm* and -$siness &or &ree" The people 'o$ld still o'n the
val$e o& their homes" The -ank m$st sell %o$r c$rrenc% (mortgage note) &or legal tender so i& %o$ $se
the -ankZs c$rrenc% (-ank mone%)* and 'ant to convert c$rrenc% (-ank mone%) to legal tender the% 'ill -e
a-le to make it appear that the c$rrenc% (-ank mone%) is -acked -% legal tender" The -ankZs c$rrenc% (-ank
mone%) has no val$e 'itho$t %o$r c$rrenc% (mortgage note)" The -ank cannot sell %o$r c$rrenc% (mortgage
note) 'itho$t &$l&illing the contract -% loaning %o$ their mone%" The% never loaned mone%* the% merel%
e8changed one c$rrenc% &or another" The -ank received %o$r c$rrenc% &or &ree* 'itho$t making an% loan or
&$l&illing the contract* changing the cost and the risk o& the contract 'herein the% re&$sed to sign* kno'ing
that it is a change o& c$rrenc% and not a loan" D& %o$ $se c$rrenc% (mortgage note)* the same c$rrenc% the
-ank deposited to create c$rrenc% (-ank mone%)* to pa% the loan* the -ank re>ects it and sa%s %o$ m$st $se
c$rrenc% (-ank mone%) or legal tender" The -ank received %o$r c$rrenc% (mortgage note) and the -ankZs
c$rrenc% (-ank mone%) &or &ree 'itho$t $sing legal tender and 'itho$t loaning mone% there-% re&$sing to
&$l&ill the contract" No' the -ank s'itches the c$rrenc% 'itho$t loaning mone% and demands to receive
%o$r la-or to pa% 'hat 'as not loaned or the -ank 'ill $se %o$r c$rrenc% (mortgage note) to -$% %o$r
home in &oreclos$re* The 9evol$tionar% 'ar 'as &o$ght to stop these -ank schemes" The -ank has a 'ritten
polic% to e8pand and contract the c$rrenc% (-ank mone%)* creating recessions* &orcing people o$t o& 'ork*
allo'ing the -anks to o-tain %o$r propert% &or &ree" D& the -anks loaned legal tender* this 'o$ld never
happen and the home 'o$ld cost m$ch less" D& %o$ allo' someone to o-tain liens &or &ree and create a ne'
c$rrenc%* 'hich is not legal tender and %o$ m$st $se legal tender to repa%" This changes the cost and the
risk" <nder this -ank scheme* even i& ever%one in the nation o'ned their homes and &arms de-t &ree* the
-anks 'o$ld soon receive the liens on the propert% in the loan process" The liens the -anks receive &or &ree*
are 'hat the people lost in propert%* and no' m$st la-or to pa% interest on" The interest 'o$ld not -e paid
i& the -anks &$l&illed the contract the% 'rote" D& there is e.$al protection $nder the la' and contract* %o$
co$ld get the mortgage note -ack 'itho$t &$rther la-or" =h% sho$ld the -ank get %o$r mortgage note and
%o$r la-or &or &ree 'hen the% re&$se to &$l&ill the contract the% 'rote and told %o$ to signN ?orr% &or the
red$ndanc%* -$t it is important &or %o$ to kno' -% heart their 6shell game7* D 'ill contin$e in that
red$ndanc% as it is imperative that %o$ $nderstand the principle" The &ollo'ing material is case la' on the
s$->ect and other related legal iss$es as 'ell as a s$mmar%" LOGIC AS EVIDENCE The check 'as
'ritten 'itho$t ded$cting &$nds &rom ?avings Acco$nt or 5erti&icate o& Deposit allo'ing the mortgage
note to -ecome the ne' pool o& mone% o'ed to Demand Deposit Acco$nt* ?avings Acco$nt* 5erti&icate o&
Deposit 'ith Demand Deposit* ?avings Acco$nt* and@or 5erti&icate o& Deposit increasing -% the amo$nt o&
the mortgage note" Dn this case the -ankers sell the mortgage note &or Federal 9eserve Bank Notes or other
assets 'hile still o'ing the lia-ilit% &or the mortgage note sold and 'itho$t the -ank giving $p an%- Federal
9eserve Bank Notes" D& the -ank had to part 'ith Federal 9eserve Bank Notes* and 'itho$t the -ene&it o&
checks to hide the &ra$d$lent conversion o& the mortgage note &rom 'hich it iss$es the check* the -ank
&ra$d 'o$ld -e e8posed" Federal 9eserve Bank Notes are the onl% mone% called legal tender" D& onl%
Federal 9eserve Bank Notes are deposited &or the credit to Demand Deposit Acco$nt- ?avings Acco$nt*
5erti&icate o& Deposit* and i& the -ank 'rote a check &or the mortgage note* the check then trans&ers Federal
9eserve Bank Notes and the -ank gives the -orro'er a -ank asset" There is no increase in the check -ook
mone% s$ppl% that e8ists in the loan process" The -ank polic% is to increase -ank lia-ilitiesR Demand
Deposit Acco$nt* ?avings Acco$nt* 5erti&icate o& Deposit* -% the mortgage note" D& the mortgage note is
mone%* then the -ank never gave $p a -ank asset" The -ank simpl% $sed &ra$d$lent conversion o&
o'nership o& the mortgage note" The -ank cannot o'n the mortgage note $ntil the -ank &$l&ills the contract"
The check is not the mone%R the mone% is the deposit that makes the check good" Dn this case* the mortgage
note is the mone% &rom 'hich the check is iss$ed" =ho o'ns the mortgage note 'hen the mortgage note is
depositedN The -orro'er o'ns the mortgage note -eca$se the -ank never paid mone% &or the mortgage
note and never loaned mone% (-ank asset)" The -ank simpl% claimed the -ank o'ned the mortgage note
'itho$t pa%ing &or it and deposited the mortgage note &rom 'hich the check 'as iss$ed" This is &ra$d$lent
conversion" The -ank risked nothingW Not even one penn% 'as invested" The% never took mone% o$t o& an%
acco$nt* in order to o'n the mortgage note* as proven -% the -ookkeeping entries* &inancial ratios* the
-alance sheet* and o& co$rse the -ankZs literat$re" The -ank simpl% never complied 'ith the contract"
D& the mortgage note is not mone%* then the check is check kiting and the -ank is insolvent and the -ank
still never paid" D& the mortgage note is mone%* the -ank took o$r mone% 'itho$t sho'ing the deposit* and
'itho$t pa%ing &or it* 'hich is &ra$d$lent conversion" The -ank claimed it o'ned the mortgage note
'itho$t pa%ing &or it* then sold the mortgage note* took the cash and never $sed the cash to pa% the lia-ilit%
it o'ed &or the check the -ank iss$ed" The lia-ilit% means that the -ank still o'es the mone%" The -ank
m$st ret$rn the mortgage note or the cash it received in the sale* in order to pa% the lia-ilit%" ven i& the
-ank did this* the -ank still never loaned $s the -ankZs mone%* 'hich is 'hat ZloanZ means" The check is not
mone% -$t merel% an order to pa% mone%" D& the mortgage note is mone% then the -ank m$st pa% the check
-% ret$rning the mortgage note" The onl% 'a% the -ank can pa% Federal 9eserve Bank Notes &or the check
iss$ed is to sell the mortgage note &or Federal 9eserve Bank Notes" Federal 9eserve Bank Notes are
non-redeema-le in violation o& the <55" The -ank &orces $s to trade in non-redeema-le private -ank notes
o& 'hich the -ank re&$ses to pa% the lia-ilit% o'ed" =hen 'e present the Federal 9eserve Bank Notes &or
pa%ment the -ank >$st gives $s -ack another Federal 9eserve Bank Note 'hich the -ank paid / !@/ cents
&or per -ill regardless o& denomination" What a profit for the bank! The check iss$ed can onl% -e
redeemed in Federal 9eserve Bank Notes* 'hich the -ank o-tained -% selling the mortgage note that the%
paid nothing &or" The -ank &orces $s to trade in -ank lia-ilities* 'hich the% never redeem in an asset" =e
the people are &orced to give $p o$r assets to the -ank &or &ree* and 'itho$t cost to the -ank" This is
&ra$d$lent conversion making the contract* 'hich the -ank created 'ith their polic% o& -ookkeeping
entries* illegal and the alleged contract n$ll and void" The -ank has no right to the mortgage note or to a
lien on the propert%* $ntil the -ank per&orms $nder the contract" The -ank had less than ten percent o&
Federal 9eserve Bank Notes to -ack $p the -ank lia-ilities in Demand Deposit Acco$nt* ?avings Acco$nt*
or 5erti&icate o& DepositZs" A -ank lia-ilit% to pa% mone% is not mone%" =hen 'e tr% and
repa% the -ank in like &$nds (s$ch as is the -anks polic% to deposit &rom 'hich to iss$e checks) the% claim
it is not mone%" The -ankZs con&$sing and deceptive trade practices and their alleged contracts are
$nconsciona-le"
SUMMARY OF DAMAGES
The -ank made the alleged -orro'er a depositor -% depositing a G!00*000 negotia-le instr$ment* 'hich the
-ank sold or had availa-le to sell &or appro8imatel% G!00*000 in legal tender" The -ank did not credit the
-orro'erZs transaction acco$nt sho'ing that the -ank o'ed the -orro'er the G!00*000" 9ather the -ank
claimed that the alleged -orro'er o'ed the -ank the G!00*000* then placed a lien on the -orro'erZs real
propert% &or G!00*000 and demanded loan pa%ments or the -ank 'o$ld &oreclose" The -ank deposited a
non-legal tender negotia-le instr$ment and e8changed it &or another non legal tender check* 'hich traded
like mone%* $sing the deposited negotia-le instr$ment as the mone% deposited" The -ank changed the
c$rrenc% 'itho$t the -orro'erZs a$thoriAation" First -% depositing non legal tender &rom 'hich to iss$e a
check ('hich is non-legal tender) and $sing the negotia-le instr$ment (%o$r mortgage note)* to e8change
&or legal tender* the -ank needed to make the check appear to -e -acked -% legal tender" No loan ever took
place" Which shell hides the little pea? The transaction that took place 'as merel% a change o& c$rrenc%
('itho$t a$thoriAation)* a negotia-le instr$ment &or a check" The negotia-le instr$ment is the mone%* 'hich
can -e e8changed &or legal tender to make the check good" An e8change is not a loan" The -ank e8changed
G!00*000 &or G!00*000" There 'as no need to go to the -ank &or an% mone%" The c$stomer (alleged
-orro'er) did not receive a loan* the alleged -orro'er lost G!00*000 in val$e to the -ank* 'hich the -ank
kept and recorded as a -ank asset and never loaned an% o& the -ankZs mone%" Dn this e8ample* the damages
are G!00*000 pl$s interest pa%ments* 'hich the -ank demanded -% mail" The -ank illegall% placed a lien on
the propert% and then threatened to &oreclose* &$rther damaging the alleged -orro'er* i& the pa%ments 'ere
not made" A depositor is o'ed mone% &or the deposit and the alleged -orro'er is o'ed mone% &or the
loan the -ank never made and %et placed a lien on the real propert% demanding pa%ment" Damages exist in
that the bank refuses to loan their money. The -ank denies the alleged -orro'er e.$al protection $nder
the la' and contract* -% merel% e8changing one c$rrenc% &or another and re&$sing repa%ment in the same
t%pe o& c$rrenc% deposited" The -ank re&$sed to &$l&ill the contract -% not loaning the mone%* and -% the
-ank re&$sing to -e repaid in the same c$rrenc%* 'hich the% deposited as an e8change &or another c$rrenc%"
A de-t tender o&&ered and re&$sed is a de-t paid to the e8tent o& the o&&er" The -ank has no a$thoriAation to
alter the alleged contract and to re&$se to per&orm -% not loaning mone%* -% changing the c$rrenc% and then
re&$sing repa%ment in 'hat the -ank has a 'ritten polic% to deposit" The seller o& the home received a
check" The mone% deposited &or the check iss$ed came &rom the -orro'er not the -ank" The -ank has no
right to the mortgage note $ntil the -ank per&orms -% loaning the mone%" Dn the transaction the -ank 'as to
loan legal tender to the -orro'er* in order &or the -ank to sec$re a lien" The -ank never made the loan* -$t
kept the mortgage note the alleged -orro'er signed" This allo'ed the -ank to o-tain the e.$it% in the
propert% (-% a lien) and trans&er the 'ealth o& the propert% to the -ank 'itho$t the -ankZs investment* loan*
or risk o& mone%" Then the -ank receives the alleged -orro'erZs la-or to pa% principal and <s$r% interest"
=hat the people o'ned or sho$ld have o'ned de-t &ree* the -ank o-tained o'nership in* and &or &ree* in
e8change &or the people receiving a de-t* pa%ing interest to the -ank* all -eca$se the -ank re&$sed to loan
mone% and merel% e8changed one c$rrenc% &or another" This places %o$ in perpet$al slaver% to the -ank
-eca$se the -ank re&$ses to per&orm $nder the contract" The lien &orces pa%ment -% threat o& &oreclos$re"
The mail is $sed to e8tort pa%ment on a contract the -ank never &$l&illed" D& the -ank re&$ses to per&orm*
then the% m$st ret$rn the mortgage note" D& the -ank 'ishes to per&orm* then the% m$st make the loan" The
past pa%ments m$st -e ret$rned -eca$se the -ank had no right to lien the propert% and e8tort interest
pa%ments" The -ank note &or t'o reasons" The mortgage note 'as deposited and the mone% 'ithdra'n
'itho$t a$thoriAation -% $sing a &orged signat$re andR t'o* the contract 'as never &$l&illed" The -ank acted
'itho$t a$thoriAation and is involved in a &ra$d there-% damaging the alleged -orro'er"
Excerpts From ~Modem Money Mechanics Pages 3 & 6
+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 $.%.
government securities. -n today>s world of &omputer financial transactions* the Federal ;eserve Bank pays
for the securities with an "electronic" check drawn on itself. @ia its "Fedwire" transfer network* the
Federal ;eserve notifies the dealer>s designated bank 1Bank :2 that payment for the securities should be
credited to 1deposited in2 the dealer>s account at Bank :. :t the same time* Bank :>s reserve account at the
Federal ;eserve is credited for the amount of the securities purchased. !he Federal ;eserve %ystem has
added D"9*999 of securities to its assets* which it has paid for* in effect* by creating a liability on itself in
the form of bank reserve balances. !hese reserves on Bank :>s books are matched by D"9*999 of the
dealer>s deposits that did not exist before. -f business is active* the banks with excess reserves probably will
have opportunities to loan the DE*999. 7f course* they do not really pay out loans from money they receive
as
deposits. -f they did this* no additional money would be created. +hat they do when they make loans is to
accept promissory notes in exchange for credits to tile borrower>s transaction accounts. 0oans 1assets2 and
deposits 1liabilities2 both rise by DE*999. ;eserves are unchanged by the loan transactions. But the deposit
credits constitute new additions to the total deposits of the banking system. B9OOF BANK? DBO?DT
NOT? AND D??< BANK 5H5K?" TH 5H5K? A9 ON;F A? #OOD A? TH B9OMD??O9F
NOT" NA9;F A;; BANK 5H5K? A9 59ATD F9OM B9DHAT NOT?" FD9A;
9?9H BANK NOT? A9 A B9DHAT 5O9BO9AT NOT (5hapter 13* 13 ?tat !!/) = <?
NOT? TO DD?5HA9# NOT?"
6xcerpt from booklet Cour Money* page )< 7ther M" Money +hile demand deposits* traveler,s checks* and
interestFbearing accounts with unlimited checking authority are not legal tender* they are usually
acceptable in payment for purchases of goods and services. The -ooklet* 6Fo$r Mone%7* is distri-$ted &ree
o& charge" Additional copies ma% -e o-tained -% 'riting to: Federal Reserve Bank of Richmond Public
Services
Department P.O. Box 27622 Richmond, Virginia 23261
CREDIT LOANS AND VOID CONTRACTS: CASE LAW
M:" 6Dn the &ederal co$rts* it is 'ell esta-lished that a national -ank has not po'er to lend its credit to
another -% -ecoming s$ret%* indorser* or g$arantor &or him"7Z Farmers and Miners Bank v" Bl$e&ield Nat Zl
Bank* !! F /d 3C* /M! <"?" 442"
M4" PA national -ank has no po'er to lend its credit to an% person or corporation " " " Bo'en v" Needles Nat"
Bank* 21 F 2/: C4 55A ::C* certiorari denied in /0 ?"5t !0/1* !M4 <? 43/* 11 ;D 4CM"
MM" 6The doctrine o& $ltra vires is a most po'er&$l 'eapon to keep private corporations 'ithin their
legitimate spheres and to p$nish them &or violations o& their corporate charters* and it pro-a-l% is not
invoked too o&ten "" "7 [inc 5ar-onate 5o" v" First National Bank* !0C =is !/:* M2 N= //2" American
8press 5o" v" 5itiAens ?tate Bank* !21 N= 1C0"
M3" 6A -ank ma% not lend its credit to another even tho$gh s$ch a transaction t$rns o$t to have -een o&
-ene&it to the -ank* and in s$pport o& this a list o& cases might -e cited* 'hich-'o$ld look like a catalog of
ships"7 Smphasis addedT Norton #rocer% 5o" v" Beoples Nat" Bank* !11 ? :0:" !:! Ha !2:"
M2" PDt has -een settled -e%ond controvers% that a national -ank* $nder &ederal ;a' -eing limited in its
po'ers and capacit%* cannot lend its credit -% g$aranteeing the de-ts o& another" All s$ch contracts entered
into -% its o&&icers are $ltra vires " " "P Ho'ard O Foster 5o" v" 5itiAens NatZl Bank o& <nion* !CC ?5 /0/*
!C0 ?
M:2(!2/4)"
30" 6" " " checks* dra&ts* mone% orders* and -ank notes are not la'&$l mone% o& the <nited ?tates """7 ?tate v"
Neilon* MC Bac C/1* 1C Ore !43"
3!" PNeither* as incl$ded in its po'ers not incidental to them* is it a part o& a -ankZs -$siness to lend its
credit" D& a -ank co$ld lend its credit as 'ell as its mone%* it might* i& it received compensation and 'as
care&$l to p$t its name onl% to solid paper* make a great deal more than an% la'&$l interest on its mone%
'o$ld amo$nt to" D& not care&$l* the po'er 'o$ld -e the mother o& panics " " " Dndeed* lending credit is the
e8act opposite o& lending mone%* 'hich is the real -$siness o& a -ank* &or 'hile the latter creates a lia-ilit%
in &avor o& the -ank* the &ormer gives rise to a lia-ilit% o& the -ank to another" - Morse. Banks and Banking
:th d" ?ec 4:R Magee* Banks and Banking* Crd d" ?ec /13"P American 8press 5o" v" 5itiAens ?tate
Bank* !21 N= 1/2"
3/" PDt is not 'ithin those stat$tor% po'ers &or a national -ank* even tho$gh solvent* to lend its credit to
another in an% o& the vario$s 'a%s in 'hich that might -e done"P Federal Dntermediate 5redit Bank v" ;
ZHerrison* CC F /d 31!* 31/ (!2/2)"
3C" 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 o& 5ommerce v" Atkinson* :: 1M!"
31" PA -ank can lend its mone%* -$t not its credit"P First NatZl Bank o& Tallapoosa v" Monroe " !C: #a 4!1*
42 ? !!/1* C/ ;9A (N?) ::0"
3:" P"" " the -ank is allo'ed to hold mone% $pon personal sec$rit%R -$t it m$st -e mone% that it loans* not its
credit"P ?eligman v" 5harlottesville Nat" Bank* C H$ghes 41M* Fed 5ase No"!/* 41/* !0C2"
34" PA loan ma% -e de&ined as the deliver% -% one part% to* and the receipt -% another part% o&* a s$m o&
mone% $pon an agreement* e8press or implied* to repa% the s$m 'ith or 'itho$t interest"P Barsons v" Fo8
!M2 #a 40:* !M4 ? 411" Also see Kirkland v" Baile%* !:: ? /d M0! and <nited ?tates v" Nei&ert =hite
5o"* /1M Fed ?$pp 3M3* 3M2"
3M" PThe 'ord Zmone%Z in its $s$al and ordinar% acceptation means gold* silver* or paper mone% $sed as a
circ$lating medi$m o& e8change " " "P ;ane v" 9aile% /30 K% C!2* !CC ?= /d M:"
33" PA promise to pa% cannot* -% arg$ment* ho'ever ingenio$s* -e made the e.$ivalent o& act$al
pa%ment """P 5hristensen v" Bee-e* 2! B !CC* C/ <tah 104"
32" 6A -ank is not the holder in d$e co$rse $pon merel% crediting the depositors acco$nt"7 Bankers Tr$st v"
Nagler* //2 NF? /d !1/* !1C"
20" PA check is merel% an order on a -ank to pa% mone%"P Fo$ng v" Hem-ree* MC B/d C2C"
2!" PAn% &alse representation o& material &acts made 'ith kno'ledge o& &alsit% and 'ith intent that it shall
-e acted on -% another in entering into contract* and 'hich is so acted $pon* constit$tes Z&ra$d*Z and entitles
part% deceived to avoid contract or recover damages"P Barnsdall 9e&ining 5orn" v" Birnam =ood Oil 5o""
2/ F /4 3!M"
2/" PAn% cond$ct capa-le o& -eing t$rned into a statement o& &act is representation" There is no distinction
-et'een misrepresentations e&&ected -% 'ords and misrepresentations e&&ected -% other acts"P ;eonard v"
?pringer !2M Dll :C/" 41 N
C0!"
2C" 6D& an% part o& the consideration &or a promise -e illegal* or i& there are several considerations &or an
$nsevera-le promise one o& 'hich is illegal* the promise* 'hether 'ritten or oral* is 'holl% void* as it is
impossi-le to sa% 'hat part or 'hich one o& the considerations ind$ced the promise"7 Menominee 9iver
5o" v" A$g$st$s ?pies ; O 5 5o"* !1M =is ::2" :M/R !C/ N= !!//" 21" 6The contract is void i& it is onl% in
part connected 'ith the illegal transaction and the promise single or entire"7 #$ardian Agenc% v" #$ardian
M$t" ?avings Bank* //M =is ::0* /M2 N= 3C"
2:" 6Dt is not necessar% &or rescission o& a contract that the part% making the misrepresentation sho$ld have
kno'n that it 'as &alse* -$t recover% is allo'ed even tho$gh misrepresentation is innocentl% made* -eca$se
it 'o$ld -e $n>$st to allo' one 'ho made &alse representations* even innocentl%* to retain the &r$its o& a
-argain ind$ced -% s$ch representations"7 =hipp v" Dverson* 1C =is /d !44"
24" Pach Federal 9eserve -ank is a separate corporation o'ned -% commercial -anks in its region """P
;e'is v" <nited ?tates* 430 F /0 !/C2 (!23/)"
2M" Dn a De-torZs 9D5O action against its creditor* alleging that the creditor had collected an $nla'&$l de-t*
an interest rate ('here all loan charges 'ere added together) that e8ceeded* in the lang$age o& the 9D5O
?tat$te* Pt'ice the en&orcea-le rate"P The 5o$rt &o$nd no reason to impose a re.$irement that the Blainti&&
sho' that the De&endant had -een convicted o& collecting an $nla'&$l de-t* r$nning a Ploan sharkingP
operation" The de-t incl$ded the &act that e8action o& a $s$rio$s interest rate rendered the de-t $nla'&$l and
that is all that is necessar% to s$pport the 5ivil 9D5O action" D$rante Bros" O ?ons* Dnc" v" Fl$shing Nat Zl
Bank" M:: F/d /C2* 5ert" denied* 1MC <? 204 (!23:)"
23" The ?$preme 5o$rt &o$nd that the Blainti&& in a civil 9D5O action need esta-lish onl% a criminal
PviolationP and not a criminal conviction" F$rther* the 5o$rt held that the De&endant need onl% have ca$sed
harm to the Blainti&& -% the commission o& a predicate o&&ense in s$ch a 'a% as to constit$te a Ppattern o&
9acketeering activit%"P That is* the Blainti&& need not demonstrate that the De&endant is an organiAed crime
&ig$re* a mo-ster in the pop$lar sense* or that the Blainti&& has s$&&ered some t%pe o& special 9acketeering
in>$r%R all that the Blainti&& m$st sho' is 'hat the ?tat$te speci&icall% re.$ires" The 9D5O ?tat$te and the
civil remedies &or its violation are to -e li-erall% constr$ed to e&&ect the congressional p$rpose as -roadl%
&orm$lated in the ?tat$te" ?edima* ?B9; v" Dmre8 5o"* 1MC <? 1M2 (!23:)"
DEFINITIONS TO KNOW WHEN EXAMINING A BANK CONTRACT
BANK ACCOUNT: A s$m o& mone% placed 'ith a -ank or -anker* on deposit* -% a c$stomer* and s$->ect
to -e dra'n o$t on the latterZs check"
BANK: 'hose -$siness it is to receive mone% on deposit* cash checks or dra&ts* disco$nt commercial
paper* make loans and iss$e promissor% notes pa%a-le to -earer* kno'n as -ank notes"
BANK CREDIT: A credit 'ith a -ank -% 'hich* on proper credit rating or proper sec$rit% given to the
-ank* a person receives li-ert% to dra' to a certain e8tent agreed $pon"
BANK DEPOSIT: 5ash* checks or dra&ts placed 'ith the -ank &or credit to depositorZs acco$nt" Blacement
o& mone% in -ank* there-%* creating contract -et'een -ank and depositors"
DEMAND DEPOSIT: The right to 'ithdra' deposit at an% time"
BANK DEPOSITOR: One 'ho delivers to* or leaves 'ith a -ank a s$m o& mone% s$->ect to his order"
BANK DRAFT: A check* dra&t or other &orm o& pa%ment"
ANK OF ISSUE: Bank 'ith the a$thorit% to iss$e notes 'hich are intended to circ$late as c$rrenc%"
LOAN: Deliver% -% one part% to* and receipt -% another part%* a s$m o& mone% $pon agreement* e8press or
implied* to repa% it 'ith or 'itho$t interest"
CONSIDERATION: The ind$cement to a contract" The ca$se* motive* price or impelling in&l$ences*
'hich ind$ces a contracting* part% to enter into a contract" The reason* or material ca$se o& a contract"
CHECK: A dra&t dra'n $pon a -ank and pa%a-le on demand* signed -% the maker or dra'er* containing
an $nconditional promise to pa% a certain s$m in mone% to the order o& the pa%ee" The Federal 9eserve
Board de&ines a check as* "...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."
QUESTIONS ONE MIGHT ASK THE BANK IN AN INTERROGATORY
Did the -ank loan gold or silver to the alleged -orro'erN
Did the -ank loan credit to the alleged -orro'erN
Did the -orro'er sign an% agreement 'ith the -ank* 'hich prevents the -orro'er &rom repa%ing the -ank
in creditN
Ds it tr$e that %o$r -ank creates check -ook mone% 'hen the -ank grants loans* simpl% -% adding deposit
dollars to acco$nts on the -ankZs -ooks* in e8change* &or the -orro'erZs mortgage noteN
Has %o$r -ank* at an% time* $sed the -orro'erZs mortgage note* Ppromise to pa%P* as a deposit on the -ankZs
-ooks &rom 'hich to iss$e -ank checks to the -orro'erN
At the time o& the loan to the alleged -orro'er* 'as there one dollar o& Federal 9eserve Bank Notes in the
-ankZs possession &or ever% dollar o'ed in ?avings Acco$nts* 5erti&icates o& Deposits and check Acco$nts
(Demand Deposit Acco$nts) &or ever% dollar o& the loanN
According to the -ankZs polic%* is a promise to pa% mone% the e.$ivalent o& mone%N
Does the -ank have a polic% to prevent the -orro'er &rom discharging the mortgage note in Plike kind
&$ndsP 'hich the -ank deposited &rom 'hich to iss$e the checkN
Does the -ank have a polic% o& violating the Deceptive Trade Bractices ActN
=hen the -ank loan o&&icer talks to the -orro'er* does the -ank in&orm the -orro'er that the -ank $ses the
-orro'ers mortgage note to create the ver% mone% the -ank loans o$t to the -orro'erN
Does the -ank have a polic% to sho' the same mone% in t'o separate places at the same timeN
Does the -ank claim to loan o$t mone% or credit &rom savings and certi&icates o& deposits 'hile never
red$cing the amo$nt o& mone% or credit &rom savings acco$nts or certi&icates o& deposits* 'hich c$stomers
can 'ithdra' &romN
<sing the -anking practice in place at the time the loan 'as made* is it theoreticall% possi-le &or the -ank to
have loaned o$t a percentage o& the ?avings Acco$nts and 5erti&icates o& DepositsN
D& the ans'er is PnoP to .$estion I!C* e8plain 'h% the ans'er is no" Dn regards to .$estion I!C* at the time
the loan 'as made* 'ere there eno$gh Federal 9eserve Bank Notes on hand at the -ank to match the
&ig$res represented -% ever% ?avings Acco$nt and 5erti&icate o& Deposit and checking Acco$nt (Demand
Deposit Acco$nt)N
Does the -ank have to o-e%* the la's concerning* 5ommercial BaperR 5ommercial Transactions*
5ommercial Dnstr$ments* and Negotia-le Dnstr$mentsN
Did the -ank lend the -orro'er the -ankZs assets* or the -ankZs lia-ilitiesN
=hat is the complete name o& the -anking entit%* 'hich emplo%s %o$* and in 'hat >$risdiction is the -ank
charteredN
=hat is the -ankZs de&inition o& P;oan 5reditPN
Did the -ank $se the -orro'ers ass$med mortgage note to create ne' -ank mone%* 'hich did not e8ist
-e&ore the ass$med mortgage note 'as signedN
Did the -ank take mone% &rom an% Demand Deposit Acco$nt (DDA)* ?avings Acco$nt (?A)* or a
5erti&icate o& Deposit (5D)* or an% com-ination o& an% Demand Deposit Acco$nt* ?avings Acco$nt or
5erti&icate o& Deposit* and loan this mone% to the -orro'erN
Did the -ank replace the mone% or credit* 'hich it loaned to the -orro'er 'ith the -orro'erZs ass$med
mortgage noteN
Did the -ank take a -ank asset called mone%* or the credit $sed as collateral &or c$stomersZ -ank deposits* to
loan this mone% to the -orro'er* and@or did the -ank $se the -orro'erZs note to replace the asset it loaned to
the -orro'erN
Did the mone% or credit* 'hich the -ank claims to have loaned to the -orro'er* come &rom deposits o&
mone% or credit made -% the -ankZs c$stomers* e8cl$ding the -orro'erZs ass$med mortgage noteN
5onsidering the -alance sheet entries o& the -ankZs loan o& mone% or credit to the -orro'er* did the -ank
directl% decrease the c$stomer deposit acco$nts (i"e" Demand Deposit Acco$nt* ?avings Acco$nt* and
5erti&icate o& Deposit) &or the amo$nt o& the loanN
Descri-e the -ookkeeping entries re&erred to in .$estion I!C" Did the -ankZs -ookkeeping entries to record
the loan and the -orro'erZs ass$med mortgage note ever* at an% time* directl% decrease the amo$nt o&
mone% or credit &rom an% speci&ic -ank c$stomerZs deposit acco$ntN
Does the -ank have a polic% or practice to 'ork in cooperation 'ith other -anks or &inancial instit$tions $se
-orro'erZs mortgage note as collateral to create an o&&setting amo$nt o& ne' -ank mone% or credit or check
-ook mone% or Demand Deposit Acco$nt generall% to e.$al the amo$nt o& the alleged loanN
9egarding the -orro'ers ass$med mortgage loan* give the name o& the acco$nt 'hich 'as de-ited to record
the mortgage" 9egarding the -ookkeeping entr% re&erred to in Dnterrogator% I!M* state the name and p$rpose
o& the acco$nt* 'hich 'as credited" =hen the -orro'erZs ass$med mortgage note 'as de-ited as a
-ookkeeping entr%* 'as the o&&setting entr% a credit acco$ntN
9egarding the initial -ookkeeping entr% to record the -orro'erZs ass$med mortgage note and the ass$med
loan to the -orro'er* 'as the -ookkeeping entr% credited &or the mone% loaned to the -orro'er* and 'as
this credit o&&set -% a de-it to record the -orro'erZs ass$med mortgage noteN
Does the -ank c$rrentl% or has it ever at an%time $sed the -orro'erZs ass$med mortgage note as mone% to
cover the -ankZs lia-ilities re&erred to a-ove* i"e" Demand Deposit Acco$nt* ?avings Acco$nt and
5erti&icate o& DepositN
=hen the ass$med loan 'as made to the -orro'er* did the -ank have ever% Demand Deposit Acco$nt*
?avings Acco$nt* and 5erti&icate o& Deposit -acked $p -% Federal 9eserve Bank Notes on hand at the
-ankN
Does the -ank have an esta-lished polic% and practice to emit -ills o& credit 'hich it creates $pon its -ooks
at the time o& making a loan agreement and iss$ing mone% or socalled mone% o& credit* to its -orro'ersN
SUMMARY
The -ank advertised it 'o$ld loan mone%* 'hich is -acked -% legal tender" Ds not that 'hat the s%m-ol G
meansN Ds that not 'hat the contract saidN Do %o$ not kno' there is no agreement or contract in the
a-sence o& m$t$al consentN The -ank ma% sa% that the% gave %o$ a check* %o$ o'e the -ank mone%" This
in&ormation sho's %o$ that the check came &rom the mone% the alleged -orro'er provided and the -ank
never loaned an% mone% &rom other depositors"
I`ve shown you the law and the bank`s own literature to prove my case. All the -ank did 'as trick %o$"
The% get %o$r mortgage note 'itho$t investing one cent* -% making%o$ a depositor and not a -orro'er"
The key to the puzzle is, the bank did not sign the contract" If they did they must loan you the money.
If they did not sign it, chances are, they deposited the mortgage note in a checking account and used
it to issue a check without ever loaning you money or the bank investing one cent.
O$r Nation* along 'ith ever% ?tate o& the <nion* entered into Bankr$ptc%* in !2CC" This changes the la'
&rom Pgold and silver7 legal mone% and 6common la'7 to the la' o& -ankr$ptc%" <nder Bankr$ptc% 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 tender* 'hen the% never loaned %o$ an% o& their mone%"
The trick is the% made %o$ a depositor instead o& a -orro'er" The% deposited %o$r mortgage note and
iss$ed a -ank check" Neither the mortgage note nor the check is legal tender" The mortgage note and the
check are no' mone% created that never e8isted* prior" The -ank got %o$r mortgage note &or &ree 'itho$t
loaning %o$ mone%* and sold the mortgage note to make the -ank check appear legal" The -orro'er
provided the legal tender* 'hich the -ank gave -ack in the &orm o& a check. D& the -ank loaned legal tender*
as the contract says, &or the -ank to legall% o'n the mortgage note* then the people 'o$ld still o'n the
homes* &arms* -$sinesses and cars* nearl% de-t &ree and pa% little* i& an% interest" By the banks not
fulfilling the contract by loaning legal tender, they make the alleged borrower, a depositor. This is a
fraudulent conversion of the mortgage note. A Fraud is a felony.
The -ank had no intent to loan* making it promissor% &ra$d* mail &ra$d* 'ire &ra$d* and a list o& other
crimes a mile long" Ho' can the% make a &elon%* legalN The% cannotW Fra$d is &ra$dW The -anks deposit
%o$r mortgage note in a checking acco$nt" The deposit -ecomes the -ank,s propert%" The% 'ithdra'
mone% 'itho$t %o$r signat$re* and call the mone%* the -anks mone% that the% loaned to %o$" The -ank
&orgot one thing" D& the -ank deposits %o$r mortgage note* then the -ank m$st credit %o$r checking acco$nt
claiming the -ank o'es %o$ G!00*000 &or the G!00*000 mortgage note deposited" The credit o& G!00*000
the -ank o'es %o$ &or the deposit allo's %o$ to 'rite a check or receive cash" The% did not tell %o$ the%
deposited the mone%* and the% &orget to tell %o$ that the G!00*000 is mone% the -anks o'e %o$* not 'hat
%o$ o'e the -ank" Fo$ lost G!00*000 and the -ank gained G!00*000" For the G!00*000 the -ank gained* the
-ank received government -onds or cash o& G!00*000 -% selling the mortgage note" For the loan* the -ank
received G!00*000 cash* the -ank did not give $p G!00*000" An%time the -ank receives a deposit* the -ank
o'es %o$ the mone%" Fo$ do not o'e the -ank the mone%" D& %o$ or D deposit an%oneZs negotia-le
instr$ment 'itho$t a contract a$thoriAing it* and 'ithdra' the mone% claiming it is o$r mone%* 'e 'o$ld
go to >ail" D& it 'as o$r polic% to violate a contract* 'e co$ld go to >ail &or a ver% long time" Fo$ agreed to
receive a loan* not to -e a depositor and have the -ank receive the deposit &or &ree" =hat the -ank got &or
&ree (lien on real propert%) %o$ lost and no' m$st pa% 'ith interest"D& the -ank loaned $s legal tender (other
depositors, mone%) to o-tain the mortgage note the -ank co$ld never o-tain the lien on the propert% &or
&ree" B% not loaning their mone%* -$t instead depositing the mortgage note the -ank creates in&lation* 'hich
costs the cons$mer mone%" Bl$s the economic loss o& the asset* 'hich the -ank received &or &ree* in
direct violation o& an% signed agreement" =e 'ant e.$al protection $nder the la' and contract* and to have
the -ank &$l&ill the contract or ret$rn the mortgage note" We want the judges, sheriffs, and lawmakers to
uphold their oath of office and to honor and uphold the founding fathers U.S. Constitution. Is this too
much to ask?
=hat is the mortgage noteN The mortgage note represents %o$r &$t$re loan pa%ments" A promise to pa% the
mone% the -ank loaned %o$" =hat is a lienN The lien is a sec$rit% on the propert% &or the mone% loaned"
Ho' can the -ank promise to pa% mone% and then not pa%N Ho' can the% take a promise to pa% and call it
mone% and then $se it as mone% to p$rchase the &$t$re pa%ments o& mone% at interest" Dnterest is the
compensation allo'ed -% la' or &i8ed -% the parties &or invested any money to receive your mortgage
note" =hat is it the% are charging interest onN The -ank received an asset" The% never gave $p an asset" Did
the% pa% interest on the mone% the% received as a depositN A check iss$ed on a deposit received &rom the
-orro'er cost the -ank nothingN =here did the mone% come &rom that the -ank invested to charge interest
onN The -ank ma% sa% 'e received a -ene&it" =hat -ene&itN =itho$t their -ene&it 'e 'o$ld
receive e.$al protection $nder the la'* 'hich 'o$ld mean 'e did not need to give $p an asset or pa%
interest on o$r o'n mone%W =itho$t their -ene&it 'e 'o$ld -e &ree and not enslaved" =e 'o$ld have little
de-t and interest instead o& -eing enslaved in de-t and interest" The -anks -roke the contract* 'hich the%
never intended to &$l&ill in the &irst place" =e got a check and a ho$se* 'hile the% received a lien and
interest &or &ree* thro$gh a -roken contract* 'hile 'e got a de-t and lost o$r assets and o$r co$ntr%" The
-ene&it is the -anks* 'ho have placed liens on nearl% ever% asset in the nation* 'itho$t costing the -ank one
cent" Dn&lation and 'orking to pa% the -ank interest on o$r o'n mone% is the -ene&it" ?ome -ene&itW
What a Shell Game. The Following case was an actual trial concerning the issues we have covered.
The 1udge was extraordinary in-that he had a grasp of the Constitution that I haven`t seen often
enough in our courts. This is the real thing, absolutely true. This case was reviewed by the Minnesota
Supreme Court on their own motion. The last thing in the world that the Bankers and the 1udges
wanted was case law against the Bankers. However, this case law is real.
EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE
STATE OF MINNESOTA IN 1USTICE COURT COUNTY OF SCOTT TOWNSHIP OF CREDIT
RIVER )MARTIN V. MAHONEY, 1USTICE FIRST BANK OF MONTGOMERY, Plaintiff, )
CASE NO: 19144 Vs. ) 1UDGMENT AND DECREE
1erome Daly, Defendant. )
The a-ove entitled action came on -e&ore the co$rt and a >$r% o& !/ on Decem-er M* !243 at !0:00 a"m"
Blainti&& appeared -% its Bresident ;a'rence H" Morgan and 'as represented -% its 5o$nsel Theodore 9"
Mell-%* De&endant appeared on his o'n -ehal&" A >$r% o& Talesmen 'ere called* impaneled and s'orn to
tr% the iss$es in this case" ;a'rence H" Morgan 'as the onl% 'itness called &or plainti&& and de&endant
testi&ied as the onl% 'itness in his o'n -ehal&" Blainti&& -ro$ght this as a 5ommon ;a' action &or the
recover% o& the possession o& lot !2* Fairvie' Beach* ?cott 5o$nt%* Minn" Blainti&& claimed titled to the
9eal Bropert% in .$estion -% &oreclos$re o& a Note and Mortgage Deed dated Ma% 3* !241 'hich plainti&&
claimed 'as in de&a$lt at the time &oreclos$re proceedings 'ere started" De&endant appeared and ans'ered
that the plainti&& created the mone% and credit $pon its o'n -ooks -% -ookkeeping entr% as the legal &ail$re
o& consideration &or the Mortgage Deed and alleged that the ?heri&&,s sale passed no title to plainti&&" The
iss$es tried to the >$r% 'ere 'hether there 'as a la'&$l consideration and 'hether De&endant had 'aived
his rights to complain a-o$t the consideration having paid on the note &or almost C %ears" Mr" Morgan
admitted that all o& the mone% or credit 'hich 'as $sed as a consideration 'as created $pon their -ooks
that this 'as standard -anking practice e8ercised -% their -ank in com-ination 'ith the Federal 9eserve
Bank o& Minneapolis* another private -ank* &$rther that he kne' o& no <nited ?tates ?tat$te o& ;a' that
gave the Blainti&& the a$thorit% to do this" Blainti&& &$rther claimed that De&endant -% $sing the ledger -ook
created credit and -% pa%ing on the Note and Mortgage 'aived an% right to complain a-o$t the
consideration and that De&endant 'as estopped &rom doing so" At !/:!: on Decem-er M* !243 the J$r%
ret$rned a $nanimo$s verdict &or the De&endant" No' there&ore -% virt$e o& the a$thorit% vested in me
p$rs$ant to the Declaration o& Dndependence* the North'est Ordinance o& !M3M* the 5onstit$tion o& the
<nited ?tates and the 5onstit$tion and la's o& the ?tate Minnesota not inconsistent there'ith"
IT IS HEREBY ORDERED, AD1UDGED AND DECREED
That Blainti&& is not entitled to recover the possession o& lot !2* Fairvie' Beach* ?cott 5o$nt%* Minnesota
according to the plat thereo& on &ile in the 9egister o& Deeds o&&ice" That -eca$se o& &ail$re o& a la'&$l
consideration the note and Mortgage dated Ma% 3* !241 are n$ll and void" That the ?heri&&s sale o& the
a-ove descri-ed premises held on J$ne /4* !24M is n$ll and void* o& no e&&ect" That Blainti&& has no right*
title or interest in said premises or lien thereon* as is a-ove descri-ed"That an% provision in the Minnesota
5onstit$tion and an% Minnesota ?tat$te limiting the J$risdiction o& this 5o$rt is rep$gnant to the
5onstit$tion o& the <nited ?tates and to the Bill o& 9ights o& the Minnesota 5onstit$tion and is n$ll and
void and that this 5o$rt has J$risdiction to render complete J$stice in this ca$se" That De&endant is a'arded
costs in the s$m o& GM:"00 and e8ec$tion is here-% iss$ed there&ore" A !0 da% sta% is granted" The
&ollo'ing memorand$m and an% s$pplemental memorand$m made and &iled -% this 5o$rt in s$pport o& this
>$dgment is here-% made a part hereo& -% re&erence" BF TH 5O<9T Dated Decem-er 2* !242
MA9TDN H" MAHONF
J$stice o& the Beace 5redit 9iver To'nship ?cott 5o$nt%* Minnesota
MEMORANDUM
The iss$es in this case 'ere simple" There 'as no material disp$te on the &acts &or the >$r% to resolve"
Blainti&& admitted that it* in com-ination 'ith the Federal 9eserve Bank o& Minneapolis* 'hich are &or all
practical p$rposes -eca$se o& their interlocking activit% and practices* and -oth -eing Banking Dnstit$tions
Dncorporated $nder the la's o& the <nited ?tates* are in the ;a' to -e treated as one and the same Bank* did
create the entire G!1*000"00 in mone% or credit $pon its o'n -ooks -% -ookkeeping entr%" That this 'as
the 5onsideration $sed to s$pport the Note dated Ma% 3* !241 and the Mortgage o& the same date" The
Mone% and credit &irst came into e8istence 'hen the% credited it" Mr" Morgan admitted that no <nited
?tates ;a' o& ?tat$te e8isted 'hich gave him the right to do this" A la'&$l consideration m$st e8ist and -e
tendered to s$pport the note" (?ee Anhe$ser B$sch Bre'ing 5o" v" mma Mason* 11 Minn" C!3" 14 N=
::3") The J$r% &o$nd there 'as no la'&$l consideration and D agree Onl% #od can create something
o& val$e o$t o& nothing" ven i& de&endant co$ld -e charged 'ith 'aiver or estoppel as a matter o& la' this
is no de&ense to the plainti&&" The la' leaves 'rongdoers 'here it &inds them" (?ee sections :0* : !* and :/
o& Am J$r /d PActionsP on page :31"P) No action 'ill lie to recover on a claim -ased $pon* or in an%
manner depending $pon* a &ra$d$lent* illegal* or immoral transaction or contract to 'hich plainti&& 'as a
part%" Blainti&&s act o& creating is not a$thoriAed -% the 5onstit$tion and ;a's o& the <nited ?tates* is
$nconstit$tional and void* and is not la'&$l consideration in the e%es o& the la' to s$pport an% thing or
$pon 'hich an% la'&$l rights can -e -$ilt" Nothing in the 5onstit$tion o& the <nited ?tates limits the
>$risdiction o& this 5o$rt* 'hich is one o& original >$risdiction 'ith right o& trial -% >$r% g$aranteed"
This is a 5ommon ;a' Action" Minnesota cannot limit or impair the po'er o& this 5o$rt to render
complete >$stice -et'een the parties" An% provisions in the 5onstit$tion and la's o& Minnesota 'hich
attempt to do so is rep$gnant to the 5onstit$tion o& the <nited ?tates and void" No .$estion as to the
J$risdiction o& this 5o$rt 'as raised -% either part% at the trial" Both parties 'ere given complete li-ert% to
s$-mit an% and all &acts and la' to the >$r%* at least in so &ar as the% sa' it" No complaint 'as made -%
Blainti&& that Blainti&& did not receive a &air trial" From the admissions made -% Mr" Morgan the path o&
d$t% 'as made direct and clear &or the >$r%" Their verdict co$ld not reasona-l% have -een
other'ise" J$stice 'as rendered completel% and 'itho$t p$rchase* con&orma-le to the la'
in this 5o$rt on Decem-er M* !243"
BY THE COURT MARTIN V. MAHONEY
1ustice of the Peace Credit River Township Scott County, Minnesota
Note: Dt has never -een do$-ted that a note given on a consideration* 'hich is prohi-ited -% la' is void" Dt
has -een determined independent o& Acts o& 5ongress* that sailing $nder the license o& an enem% is illegal"
The emission o& Bills o& 5redit $pon the -ooks o& these private 5orporations &or the p$rposes o& private
gain is not 'arranted -% the 5onstit$tion o& the <nited ?tates and is $nla'&$l" ?ee 5raig v" Q 1 peters
reports 2!/* This 5o$rt can tread onl% that path 'hich is marked o$t -% d$t%" M"H"M"
:U+GE ARTIN AHONE% +E"I(ION A( FOLLO&(
PFor the J$sticeZs &ees* the First National Bank deposited Q the 5lerk o& the District 5o$rt the t'o Federal
9eserve Bank Notes" The 5lerk tendered the Notes to me (the J$dge)" As J$dge m% s'orn d$t% compelled
me to re&$se the tender" This is contrar% to the 5onstit$tion o& the <nited ?tates" The ?tates have no po'er
to make -ank notes a legal tender" Onl% gold and silver coin is a la'&$l tender"P (?ee American J$rist on
Mone% C4 sec"!C") 6Bank Notes are a good tender as mone% $nless speci&icall% o->ected to" Their consent
and $sage is -ased $pon the converti-ilit% o& s$ch notes to coin at the pleas$re o& the holder $pon
presentation to the -ank &or redemption" =hen the ina-ilit% o& a -ank to redeem its notes is openl% avo'ed
the% instantl% lose their character as mone% and their circ$lation as c$rrenc% ceases"P (?ee American J$rist
C4-section 2)" PThere is no la'&$l consideration &or these Federal 9eserve Bank Notes to circ$late as
mone%" The -anks act$all% o-tained these notes &or cost o& printing - A la'&$l consideration m$st e8ist &or
a Note" As a matter o& &act* the PNotesP are not Notes at all* as the% contain no promise to pa%"P (?ee !M
American J$rist section 3:* /!:) PThe activit% o& the Federal 9eserve Banks o& Minnesota* ?an Francisco
and the First National Bank o& Montgomer% is contrar% to p$-lic polic% and contrar% to the 5onstit$tion o&
the <nited ?tates* and constit$tes an $nla'&$l creation o& mone%* credit and the o-taining o& mone% and
credit &or no val$a-le consideration" Activit% o& said -anks in creating mone% and credit is not 'arranted -%
the 5onstit$tion o& the <nited ?tates"P PThe Federal 9eserve Banks and National Banks e8ercise an
e8cl$sive monopol% and privilege o& creating credit and iss$ing Notes at the e8pense o& the p$-lic 'hich
does not receive a &air e.$ivalent" This scheme is o-li.$el% designed &or the -ene&it o& an idle monopol% to
ro-* -lackmail* and oppress the prod$cers o& 'ealth" PThe Federal 9eserve Act and the National Bank Act
are* in their operation and e&&ect* contrar% to the 'hole letter and spirit o& the 5onstit$tion o& the <nited
?tates* &or the% con&er an $nla'&$l and $nnecessar% po'er on private partiesR the% hold all o& o$r &ello'
citiAens in dependenceR the% are s$-versive to the rights and li-eration o& the people"7 PThese Acts have
de&iled the la'&$ll% constit$ted #overnment o& the <nited ?tates" The Federal 9eserve Act and the
National Banking Act are not necessar% and proper &or carr%ing into e8ec$tion the legislative po'ers
granted to 5ongress or an% other po'ers vested in the #overnment o& the <nited ?tates* -$t on the
contrar%* are s$-versive to the rights o& the Beople in their rights to li&e* li-ert%* and propert%"P (?ee ?ection
14/ o& Title C! <" ?" 5ode)"
PThe meaning o& the 5onstit$tional provision* ZNO ?TAT ?HA;; make an%thing -$t #old and ?ilver
5oin a legal tender Z pa%ment o& de-tsZ is direct* clear* $nam-ig$o$s and 'itho$t an% .$ali&ication" This
5o$rt is 'itho$t a$thorit% to interpolate an% e8ception" M% d$t% is simpl% to e8ec$te it* as and to
prono$nce the legal res$lt" From an e8amination o& the case o& d'ards v" Kearse%* Federal 9eserve Bank
Notes (&iat mone%) 'hich are attempted to -e made a legal tender* are e8actl% 'hat the a$thors o& the
5onstit$tion o& the <nited ?tates intend to prohi-it" No ?tate can make these Notes a legal tender" 5ongress
is incompetent to a$thoriAe a ?tate to make the Notes a legal tender" For the e&&ect o& -inding 5onstit$tion
provisions see 5ooke v" Dverson" This &ra$d$lent Federal 9eserve ?%stem and National Banking ?%stem has
impaired the o-ligation o& 5ontract promoted disrespect &or the 5onstit$tion and ;a' and has shaken
societ% to its &o$ndation"P (?ee 24 <"?" 5ode :2: and !03 M C33 and 4C M !1M) PTitle C!* <"?" 5ode*
?ection 1C/* is in direct con&lict 'ith the 5onstit$tion inso&ar* at least* that it attempts to make Federal
9eserve Bank Notes a legal tender" The 5onstit$tion is the ?$preme ;a' o& the ;and" ?ection 14/ o& Title
C! is not a la'* 'hich is made in p$rs$ance o& the 5onstit$tion" Dt is $nconstit$tional and void* and D so
hold" There&ore* the t'o Federal 9eserve Bank Notes are N$ll and Hoid &or an% la'&$l p$rpose
in so &ar as this case is concerned and are not a valid deposit o& G/"00 'ith the 5lerk o& the District 5o$rt
&or the p$rpose o& e&&ecting an Appeal &rom this 5o$rt to the District 5o$rt"P PHo'ever* o& these Federal
9eserve Bank Notes* previo$sl% disc$ssed * and that is that the Notes are invalid* -eca$se o& a theor% that
the% are -ased $pon a valid* ade.$ate or la'&$l consideration" At the hearing sched$led &or Jan$ar% //*
!242* at M:00 B"M"* Mr" Morgan appeared at the trialR he appeared as a 'itness to -e candid* open* direct*
e8perienced and tr$th&$l" He testi&ied to %ears o& e8perience 'ith the Bank o& America in ;os Angeles* the
Mar.$ette National Bank o& Minnesota and the First National Bank o& Minnesota" He seemed to -e &amiliar
'ith the operation o& the Federal 9eserve ?%stem" He &reel% admitted that his Bank created all o& the mone%
and credit $pon its -ooks 'ith 'hich it ac.$ired the Note and Mortgage o& Ma% 3* !241" The credit &irst
came into e8istence 'hen the Bank created it $pon its -ooks" F$rther* he &reel% admitted that no
<nited ?tates ;a' gave the Bank the a$thorit% to do this" This 'as o-vio$sl% no la'&$l consideration &or
the Note" The Bank parted 'ith a-sol$tel% nothing e8cept a little ink" Dn this case* the evidence 'as
on Jan$ar% //* !242 that the Federal 9eserve Bank o-tained the Notes &or this seems to -e con&erred -%
Title !/ <?5 ?ection 1/0" The cost is a-o$t 2@!0th o& a cent per Note regardless o& the amo$nt o& the Note"
The Federal 9eserve Banks create all o& the mone% and credit $pon their -ooks -% -ookkeeping entries -%
'hich the% ac.$ire <nited ?tates ?ec$rities" The collateral re.$ired to o-tain the Note is* -% section 1!/
<?5* Title !/* a deposit o& a like amo$nt o& -onds" Bonds 'hich the Banks ac.$ire -% creating mone% and
credit -% -ookkeeping entr%"P PNo rights can -e ac.$ired -% &ra$d" The Federal 9eserve Bank Notes are
ac.$ired thro$gh the $se o& $nconstit$tional stat$tes and &ra$d"P PThe 5ommon ;a' re.$ires a la'&$l
consideration &or an% contract or Note" These Notes are void &or &ail$re at a la'&$l consideration at
5ommon ;a'* entirel% apart &rom an% 5onstit$tional consideration" <pon this gro$nd* the Notes are
ine&&ect$al &or an% p$rpose" This seems to -e the principal o->ection to paper &iat mone% and the ca$se o&
its depreciation and &ail$re do'n thro$gh the ages" D& allo'ed to contin$e* Federal 9eserve Bank Notes 'ill
meet the same &ate" From the evidence introd$ced on Jan$ar% //* !242* this 5o$rt &inds that as o& March
!3* !242* all #old and ?ilver -acking is removed &rom Federal 9eserve Bank Notes"P PThe la' leaves
'rongdoers 'here it &inds them" (?ee D Mer" J$r /nd on Actions ?ection ::0)"P?laver% and all its incidents*
incl$ding Beonage* thralldom* and de-t created -% &ra$d is $niversall% prohi-ited in the <nited ?tates" This
case represents -$t another re&ined &orm o& ?laver% -% the Bankers" Their position is not s$pported -% the
5onstit$tion o& the <nited ?tates" The Beople have spoken their 'ill in terms* 'hich cannot -e
mis$nderstood" Dt is indispensa-le to the preservation o& the <nion and independence and li-erties o& the
people that this 5o$rt* adhere onl% to the mandate o& the 5onstit$tion and administer it as it is 'ritten" D*
there&ore* hold these Notes in .$estion void and not e&&ect$al &or an% p$rpose"P (1) Jan$ar% C0* !242
J$dge Martin H" Mahone%
J$stice o& the Beace 5redit 9iver To'nship
_______________________________________________________________________
CREDIT LOANS AND VOID CONTRACTS PERFECT OBLIGATION AS TO A
HUMAN BEING AS TO A BANK
F$rthermore* this Memorand$m o& la' is o&&ered in order to advance $nderstanding o& the comple8 legal
iss$es* present and em-odied in the 5ommon ;a'* 'ith a$thorities* la' and cases in s$pport o&* 'hich 'ill
constit$te the &ollo'ing &acts: Brivatel% o'ned -anks are making loans o& PcreditP 'ith the intended
p$rpose o& circ$lating PcreditP as Pmone%P" Other &inancial instit$tions and individ$als ma% Pla$nderP -ank
credit that the% receive directl% or indirectl% &rom privatel% o'ned -anks" This collective activit% is
$nconstit$tional* $nla'&$l* in violation o& 5ommon ;a'* <"?" 5ode and the principles o& e.$it%" ?$ch
activit% and $nderl%ing contracts have long -een held void* -% ?tate 5o$rts* Federal 5o$rts and the <"?"
?$preme 5o$rt" This Memorand$m 'ill demonstrate thro$gh a$thorities and esta-lished common la'* that
credit Pmone% creationP -% privatel% o'ned -ank corporations is not reall% Pmone% creationP at all" Dt is the
trade specialt% and art&$l ill$sion o& la' merchants* 'hich $se old-time trade secrets o& the #oldsmiths* to
entrap the -orro'er and $n>$stl% enrich the lender thro$gh $s$r% and other $nla'&$l techni.$es" Dss$es
-ased on la' and the principles o& e.$it%* 'hich are 'ithin the >$risdiction o& this 5o$rt* 'ill -e addressed"
THE GOLDSMITHS
Dn his -ook* Money and Banking (3th dition* !231)* Bro&essor David 9" Kamerschen 'rites on pages :4
-4C: PThe &irst -ankers in the modern sense 'ere the goldsmiths* 'ho &re.$entl% accepted -$llion and coins
&or storage """ One res$lt 'as that the goldsmiths temporaril% co$ld lend part o& the gold le&t 'ith them " " "
These loans o& their c$stomersZ gold 'ere soon replaced -% a revol$tionar% techni.$e" =hen people
-ro$ght in gold* the goldsmiths gave them notes promising to pa% that amo$nt o& gold on demand" The
notes* &irst made pa%a-le to the order o& the individ$al* 'ere later changed to -earer o-ligations"
Dn the previo$s &orm* a note pa%a-le to the order o& Je-idiah Johnson 'o$ld -e paid to no one else $nless
Johnson had &irst endorsed the note """ B$t notes 'ere soon -eing $sed in an $n&oreseen 'a%" The note
holders &o$nd that* 'hen the% 'anted to -$% something* the% co$ld $se the note itsel& in pa%ment more
convenientl% and let the other person go a&ter the gold* 'hich the person rarel% did " " "The specie* then
tended to remain in the goldsmithsZ va$lts" " " " The goldsmiths -egan to realiAe that the% might pro&it
handsomel% -% iss$ing some'hat more notes than the amo$nt o& specie the% held" " " These additional
notes 'o$ld cost the goldsmiths nothing e8cept the negligi-le cost o& printing them* %et the notes provided
the goldsmiths 'ith &$nds to lend at interest " " " "And the% 'ere to &ind that the pro&ita-ilit% o& their lending
operations 'o$ld e8ceed the pro&it &rom their original trade" The goldsmiths -ecame -ankers as their
interest in man$&act$re o& gold items to sell 'as replaced -% their concern 'ith credit policies and lending
activities " " "The% discovered earl% that* altho$gh an $nlimited note iss$e 'o$ld -e $n'ise* the% co$ld
iss$e notes $p to several times the amo$nt o& specie the% held" The ke% to the 'hole operation la% in the
p$-licZs 'illingness to leave gold and silver in the -ankZs va$lts and $se the -ankZs notes" This discover% is
the -asis o& modern -anking: On page M1* Bro&essor Kamerschen &$rther e8plains the evol$tion o& the credit
s%stem: P;ater the goldsmiths learned a more e&&icient 'a% to p$t their credit mone% into circ$lation" The%
lent -% iss$ing additional notes* rather than -% pa%ing o$t in gold" Dn e8change &or the interest--earing note
received &rom their c$stomer (in e&&ect* the loan contract)* the% gave their o'n non-interest -earing note"
ach 'as act$all% -orro'ing &rom the other """ The advantage o& the later proced$re o&Z lending notes rather
than gold 'as that " " " more notes co$ld -e iss$ed i& the gold remained in the va$lts """ Th$s* thro$gh the
principle o& -ank note iss$ance* banks learned to create money in the form of their own liability"P
Smphasis AddedT
MODERN MONEY MECHANICS
Another p$-lication 'hich e8plains modern -anking as learned &rom the #old smiths is Modern Money
Mechanics (:th edition !22/)* p$-lished -% the Federal 9eserve Bank o& 5hicago 'hich states -eginning
on page C: PDt started 'ith the goldsmiths """P At one time* -ankers 'ere merel% middlemen" The% made a
pro&it -% accepting gold and coins -ro$ght to them &or sa&ekeeping and lending the gold and coins to
-orro'ers" B$t the goldsmiths soon &o$nd that the receipts the% iss$ed to depositors 'ere -eing $sed as a
means o& pa%ment" ZThen* -ankers discovered that the% co$ld make loans merel% -% giving -orro'ers their
promises to pa%* or -ank notes""" Dn this 'a%* -anks -egan to create mone% """ Demand deposits are the
modern co$nterpart o& -ank notes " " " Dt 'as a small step &rom printing notes to making -ook entries to the
credit o& -orro'ers 'hich the -orro'ers* in t$rn* co$ld ZspendZ -% 'riting checks* there-% printing their
own mone%"P Smphasis addedT
HOW BANKS CREATE MONEY
Dn the modern sense* -anks create mone% -% creating Pdemand deposits"P Demand deposits are merel%
P-ook entriesP that re&lect ho' m$ch la'&$l mone% the -ank o'es its c$stomers" Th$s* all deposits are
called demand deposits and are the -ankZs lia-ilities" The -ankZs assets are the va$lt cash pl$s all the PDO<sP
or promissor% notes that the -orro'er signs 'hen the% -orro' either mone% or credit" =hen a -ank lends
its cash (legal mone%)* it loans its assets* -$t 'hen a -ank lends its 6credit7 it lends its lia-ilities"
The lending o& credit is* there&ore* the e8act opposite o& the lending o& cash (legal mone%)" At this point* 'e
need to de&ine the meaning o& certain 'ords like Pla'&$l mone%7* 6legal tender7* 6other mone%7 and
6dollars7" The terms PMone%P and PTenderP had their origins in Article !* ?ec" 3 and Article !* ?ec" !0 o&
the &onstitution of the $nited %tates" !/ <"?"5" X!:/ re&ers to Pgold and silver coin as la'&$l mone% o& the
<nited ?tatesP and 'as $nconstit$tionall% repealed in !221 in-that 5ongress can not delegate an% portion
o& their constit$tional responsi-ilit% 'itho$t Amendment" The term Plegal tenderP 'as originall% cited in C!
<"?"5"A" XC2/ and is no' re-codi&ied in C! <"?"5"A" X:!0C 'hich states: P<nited ?tates coins and
c$rrenc% " " " are legal tender &or all de-ts* p$-lic charges* ta8es* and d$es"P The common denominator in
-oth Pla'&$l mone%P and Plegal tender mone%P is that the <nited ?tates #overnment iss$es -oth"
=ith Bankers* ho'ever* 'e &ind that there are t'o &orms o& mone% - one is governmentiss$ed* and
privatel% o'ned -anks s$ch as =A?HDN#TON M<T<A;* and JB MO9#AN 5HA?* iss$e the other" As
'e have alread% disc$ssed government iss$ed &orms o& mone%* 'e m$st no' scr$tiniAe privatel% iss$ed
&orms o& mone%" All privatel% iss$ed &orms o& mone% toda% are -ased $pon the lia-ilities o& the iss$er"
There are three common terms $sed to descri-e this privatel% created mone%" The% are 6credit7* 6demand
deposits7 and 6check-ook mone%7" Dn the ?i8th edition o& Blacks ;a' Dictionar%* p"C4M $nder the term
65redit7 the term 6Bank credit7 is descri-ed as: 6Mone% -ank o'es or 'ill lend a individ$al or person7" Dt
is clear &rom this de&inition that 6Bank credit7 'hich is the 6mone% -ank o'es7 is the -ankZs lia-ilit%" The
term 6check-ook mone%7 is descri-ed in the -ook 6- Bet Cou !hought3* p$-lished -% the privatel% o'ned
Federal 9eserve Bank o& Ne' Fork* as &ollo's: P5ommercial -anks create check-ook mone% 'henever
the% grant a loan* simpl% -% adding deposit dollars to acco$nts on their -ooks to e8change &or the
-orro'ers DO< " " " "P The 'ord PdepositP and Pdemand depositP -oth mean the same thing in -ank
terminolog% and re&er to the -ankZs lia-ilities" For e8ample* the 5hicago Federal 9eserves p$-lication*
6Modern Money Mechanics3 states: PDeposits are merel% -ook entries """ Banks can -$ild $p deposits -%
increasing loans """ Demand deposits are the modern co$nterpart o& -ank notes" Dt 'as a small step
&rom printing notes to making -ook entries to the credit o& -orro'ers 'hich the -orro'ers* in t$rn* co$ld
ZspendZ -% 'riting checks" Th$s* it is demonstrated in 6Modern Mone% Mechanics7 ho'* $nder the practice
o& &ractional reserve -anking* a deposit o& G:*000 in cash co$ld res$lt in a loan o& credit@check-ook
mone%@demand deposits o&" G!00*000 i& reserve ratios set -% the Federal 9eserve are :_ (instead o& !0_)"
Dn a practical application* here is ho' it 'orks" D& a -ank has ten people 'ho each deposit G:*000 (totaling
G:0*000) in cash (legal mone%) and the -ankZs reserve ratio is :_* then the -ank 'ill lend t'ent% times this
amo$nt* or G!*000*000 in PcreditP mone%" =hat the -ank has act$all% done* ho'ever* is to 'rite a check or
loan its credit 'ith the intended p$rpose o& circ$lating credit as Pmone%"P Banks kno' that i& all the people
'ho receive a check or credit loan come to the -ank and demand cash* the -ank 'ill have to close its
doors -eca$se it doesnZt have the cash to -ack $p its check or loan" The -ankZs check or loan 'ill* ho'ever*
pass as mone% as long as people have con&idence in the ill$sion and donZt demand cash" Banics are created
'hen people line $p at the -ank and demand cash (legal mone%)* ca$sing -anks to &old as histor% records in
several time periods* the most recent in this co$ntr% 'as the panic o& !2CC"
THE PROCESS OF PASSING CHECKS OR CREDIT AS MONEY IS DONE QUITE SIMPLY
A deposit o& G:*000 in cash -% one person res$lts in a loan o& G!00*000 to another person at :_ reserves"
The person receiving the check or loan o& credit &or G!00*000 $s$all% deposits it in the same -ank or
another -ank in the Federal 9eserve ?%stem" The check or loan is sent to the -ookkeeping department o&
the lending -ank 'here a -ook entr% o& G!00*000 is credited to the -orro'erZs acco$nt" The lending -ankZs
check that created the -orro'erZs loan is then stamped PBaidP 'hen the acco$nt o& the -orro'er is credited
a PdollarP amo$nt" The -orro'er ma% then PspendP these -ook entries (demand deposits) -% 'riting checks
to others* 'ho in t$rn deposit their checks and have -ook entries trans&erred to their acco$nt &rom the
-orro'erZs checking acco$nt" Ho'ever* t'o highl% .$estiona-le and $nla'&$l acts have no' occ$rred" The
&irst 'as 'hen t he -ank 'rote the check or made the loan 'ith ins$&&icient &$nds to -ack them $p" The
second is 'hen the -ank stamps its o'n 6Not ?$&&icient F$nds7 check PpaidP or posts a loan -% merel%
crediting the -orro'erZs acco$nt 'ith -ook entries the -ank calls Pdollars"P Dronicall%* the check or loan
seems good and passes as mone% -- $nless an emergenc% occ$rs via demands &or cash - or a 5o$rt
challenge -- and the art&$l* ill$sion -$--le* -$rsts"
DIFFERENT KINDS OF MONEY
The -ook* 6- Bet Cou !hought3* p$-lished -% the Federal 9eserve Bank o& Ne' Fork* states: PMone% is
an% generall% accepted medi$m o& e8change* not simpl% coin and c$rrenc%" Mone% doesn>t have to -e
intrinsicall% val$a-le* be issued by a government or -e in an% special &orm"P Smphasis addedT Th$s 'e see
that privatel% iss$ed &orms o& mone% onl% re.$ire p$-lic con&idence in order to pass as mone%" 5o$nter&eit
mone% also passes as mone% as long as no-od% discovers itZs co$nter&eit" ;ike 'ise* P-adP checks and
PcreditP loans pass as mone% so long as no one &inds o$t the% are $nla'&$l" Fet* once the &ra$d is
discovered* the val$es o& s$ch 6-ank mone%7 like -ad check,s ceases to e8ist" There are* there&ore* t'o
kinds o& mone% -- government iss$ed legal mone% and privatel% iss$ed $nla'&$l mone%"
DIFFERENT KINDS OF DOLLARS
The dollar once represented something intrinsicall% val$a-le made &rom gold or silver" For e8ample* in
!M2/* 5ongress de&ined the silver dollar as a silver coin containing CM!"/: grains o& p$re silver" The legal
dollar is no' kno'n as P<nited ?tates coins and c$rrenc%"P Ho'ever* the BankerZs dollar has -ecome a
$nit o& meas$re o& a di&&erent kind o& mone%" There&ore* 'ith Bankers there is a PdollarP o& coins and a
dollar o& cash (legal mone%)* a PdollarP o& de-t* a PdollarP o& credit* a PdollarP o& check-ook mone% or a
PdollarP o& checks" =hen one re&ers to a dollar spent or a dollar loaned* he sho$ld no' indicate 'hat kind
o& PdollarP he is talking a-o$t* since Bankers have created so man% di&&erent kinds"
A dollar o& -ank Pcredit mone%P is the e8act opposite o& a dollar o& Plegal mone%P" The &ormer is a lia-ilit%
'hile the latter is an asset" Th$s* it can -e seen &rom the earlier statement .$oted &rom - Bet Cou !hought*
that mone% can -e privatel% iss$ed as: PMone% doesnZt have to """ -e iss$ed -% a government or -e in an%
special &orm"P Dt sho$ld -e care&$ll% noted that -anks that iss$e and lend privatel% created mone% demand
to -e paid 'ith government iss$ed mone%" Ho'ever* pa%ment in like kind $nder nat$ral e.$it% 'o$ld seem
to indicate that a de-t created -% a loan o& privatel% created mone% can -e paid 'ith other privatel% created
mone%* 'itho$t regard &or 6an% special &orm7 as there are no stat$tor% la's to dictate ho' either private
citiAens or -anks ma% create mone%" BY WHAT AUTHORITY?
B% 'hat a$thorit% do state and national -anks* as privatel% o'ned corporations* create mone% -% lending
their credit --or more simpl% p$t - -% 'riting and passing P-adP checks and PcreditP loans as Pmone%PN
No'here can a la' -e &o$nd that gives -anks the a$thorit% to create mone% -% lending their lia-ilities"
There&ore* the ne8t .$estion is* i& -anks are creating mone% -% passing -ad checks and lending their credit*
'here is their a$thorit% to do soN From their literat$re* -anks claim these techni.$es 'ere learned &rom the
trade secrets o& the #oldsmiths" Dt is evident* ho'ever* that mone% creation -% private -anks is not the
res$lt o& po'ers con&erred $pon them -% government* -$t rather the art&$l $se o& long held Ptrade secrets"P
Th$s* $nla'&$l mone% creation is not -eing done -% -anks as corporations* -$t $nla'&$ll% -% -ankers"
Article I, Section 10, para. 1 of the "onstitution of t0e United (tates of America specifically states that
no state shall "... coin money, emit bills of credit, make any thing but gold and silver coin a Tender in
Payment of Debts* pass an% Bill o& Attainder* e8 post &acto ;a'* or ;a' impairing the O-ligations o&
5ontracts " " PSmphasis addedT
The states, which grant the Charters of state banks also, prohibit the emitting of Bills of credit by not
granting such authority in bank charters. Dt is o-vio$s that P=e the peopleP never delegated to
5ongress* state government* or agencies o& the state* the po'er to create and iss$e mone% in the &orm o&
checks* credit* or other P-ills o& credit"P The Federal #overnment toda% does not a$thoriAe -anks to emit*
'rite* create* iss$e and pass checks and credit as mone%" B$t -anks do* and get a'a% 'ith itW Banks call
their privatel% created mone% nice so$nding names* like 6credit7* 6demand deposits7* or 6check-ook
mone%7" Ho'ever* the tr$e nat$re o& Pcredit mone%P and PchecksP does not change regardless o& the poetic
terminolog% $sed to descri-e them" ?$ch mone% in common $se -% privatel% o'ned -anks is illegal $nder
Art" !* ?ec"!0* para" ! o& the 5onstit$tion o& the <nited ?tates o& America* as 'ell as $nla'&$l $nder the
la's o& the <nited ?tates and o& this ?tate"
VOID "ULTRA VIRES" CONTRACTS
The co$rts have long held that 'hen a corporation e8ec$tes a contract -e%ond the scope o& its charter or
granted corporate po'ers* the contract is void or P$ltra viresP" Dn &entral !ransp. &o. v. Gullman* !C2 <"?"
40* !! ?" 5t" 1M3* C: ;" d" ::* the co$rt said: PA contract ultra vires -eing $nla'&$l and void* not -eca$se
it is in itsel& immoral* -$t -eca$se the corporation* -% the la' o& its creation* is incapa-le o& making it* the
co$rts* 'hile re&$sing to maintain an% action $pon the $nla'&$l contract* have al'a%s striven to do >$stice
-et'een the parties* so &ar as co$ld -e done consistentl% 'ith adherence to la'* -% permitting propert% or
mone%* parted 'ith on the &aith o& the $nla'&$l contract* to -e recovered -ack* or compensation to -e made
&or it" Dn s$ch case* ho'ever* the action is not maintained $pon the $nla'&$l contract* nor according to its
termsR -$t on an implied contract o& the de&endant to ret$rn* or* &ailing to do that* to make compensation
&or* propert% or mone% 'hich it has no right to retain" To maintain s$ch an action is not to a&&irm* -$t to
disa&&irm* the $nla'&$l contract"P P=hen a contract is once declared $ltra vires* the &act that it is e8ec$ted `
does not validate it* nor can it -e rati&ied* so as to make it the -asis o& s$itor action* nor does the
doctrine o& estoppel appl%"P FH G; v. ;ichmond* !CC ? 323R !:! Ha !2:" PA national -ank """ cannot lend
its credit to another -% -ecoming s$ret%* indorser* or g$arantor &or him* s$ch an act R is $ltra vires " " "P
Merchants> Bank v. Baird !40 F 41/"
THE QUESTION OF LAWFUL CONSIDERATION
The iss$e o& 'hether the lender 'ho 'rites and passes a P-adP check or makes a PcreditP loan has a claim
&or relie& against the -orro'er is eas% to ans'er* providing the lender can prove that he gave a la'&$l
consideration* -ased $pon la'&$l acts" B$t did the lender give a la'&$l considerationN To give a lawful
consideration, the lender must prove that he gave the borrower lawful money such as coins or
currency. Failing that, he can have no claim for relief in a court at law against the borrower as the
lender's actions were ultra vires or void from the beginning of the transaction.
Dt can -e arg$ed that 6-ad7 checks or 6credit7 loans that pass as mone% are val$a-leR -$t so are co$nter&eit
coins and c$rrenc% that pass as mone%" Dt seems $nconsciona-le that a -ank 'o$ld ask homeo'ners to p$t
$p a homestead as collateral &or a Pcredit loanP that the -ank created o$t o& thin air" =o$ld this co$rt o& la'
or e.$it% allo' a co$nter&eiter to &oreclose against a personZs home -eca$se the -orro'er 'as late in
pa%ments on an $nla'&$l loan o& co$nter&eit mone%N =ere the co$rt to do so* it 'o$ld -e contrar% to all
principles o& la'" The .$estion o& val$a-le consideration in the case at -ar* does not depend on an% val$e
imparted -% the lender* -$t the &alse con&idence instilled in the P-adP check or PcreditP loan -% the lender"
Dn a co$rt at la' or e.$it%* the lender has no claim &or relie&" The arg$ment that -eca$se the -orro'er
received propert% &or the lenderZs P-adP check or PcreditP loan gives the lender a claim &or relie& is not valid*
$nless the lender can prove that he gave la'&$l val$e" The seller in some cases 'ho ma% -e holding the
6-ad7 check or 65redit7 loan has a claim &or relie& against the lender or the -orro'er or -oth* -$t the
lender has no s$ch claim" BORROWER RELIEF
?ince 'e have esta-lished that the lender o& $nla'&$l or co$nter&eit mone% has no claim &or relie& $nder a
void contract* the last .$estion sho$ld -e* does the -orro'er have a claim &or relie& against the lenderN
First* i& it is esta-lished that the -orro'er has made no pa%ments to the lender* then the -orro'er has no
claim &or relie& +against the lender &or mone% damages" B$t the -orro'er has a claim &or relie& to void the
de-t he o'es the lender &or notes or o-ligations $nla'&$ll% created -% an $ltra vires contract &or lending
PcreditP mone%"
The borrower, the Courts have long held, has a claim for relief against the lender to have the note,
security agreement, or mortgage note the borrower signed declared null and void.
The -orro'er ma% also have claims &or relie& &or -reach o& contract -% the lender &or not lending Pla'&$l
mone%P and &or 6$s$r%7 &or charging an interest rate several times greater than the amo$nt agreed to in the
contract &or an% la'&$l mone% act$all% risked -% the lender" For e8ample* i& on a G!00*000 loan it can -e
esta-lished that the lender act$all% risked onl% G:*000 (:_ Federal 9eserve ratio) 'ith a contract interest
rate o& !0_* the lender has then loaned G2:*000 o& PcreditP and G:*000 o& Pla'&$l mone%P" Ho'ever*
'hile charging !0_ interest (G!0*000) on the entire G!00*000" The tr$e interest rate on the G:*000 o&
Pla'&$l mone%P act$all% risked -% the lender is /00_ 'hich violates Usury laws of this state.
If no "lawful money" was loaned, then the interest rate is an infinite percentage. Such techniques the
bankers say were learned from the trade secrets of the Goldsmiths. The Courts have repeatedly ruled
that such contracts with borrowers are wholly void from the beginning of the transaction, because
banks are not granted powers to enter into such contracts by either state or national charters.
ADDITIONAL BORROWER RELIEF
Dn Federal District 5o$rt the -orro'er ma% have additional claims &or relie& $nder P5ivil 9D5OP Federal
9acketeering la's (!3 <"?"5" X !241)" The lender ma% have esta-lished a Ppattern o& racketeering activit%P
-% $sing the <"?" Mail more than t'ice to collect an $nla'&$l de-t and the lender ma% -e in violation o& !3
<"?"5" X!C1!* !C1C* !24! and !24/" The -orro'er has other claims &or relie& i& he can prove there 'as or is
a conspirac% to deprive him o& propert% 'itho$t d$e process o& la' $nder" (1/ <"?"5" X!23C (5onstit$tional
Dn>$r%)* !23: (5onspirac%) and !234 (PKno'ledgeP and PNeglect to BreventP a <"?" 5onstit$tional =rong)*
<nder !3 <"?"5"A"X /1! (5onspirac%) violators* Pshall -e &ined not more than G!0*000 or imprisoned not
more than ten (!0) %ears or -oth"P
Dn a De-torZs 9D5O action against its creditor* alleging that the creditor had collected an $nla'&$l de-t* an
interest rate ('here all loan charges 'ere added together) that e8ceeded* in the lang$age o& the 9D5O
?tat$te* Pt'ice the en&orcea-le rateP" The 5o$rt &o$nd no reason to impose a re.$irement that the Blainti&&
sho' that the D e&endant had -een convicted o& collecting an $nla'&$l de-t* r$nning a Ploan sharkingP
operation" The de-t incl$ded the &act that e8action o& a $s$rio$s interest rate rendered the de-t $nla'&$l
and that is all that is necessar% to s$pport the 5ivil 9D5O action" D$rante Bros" O ?ons* Dnc" v" Fl$shing
Nat Zl Bank" M:: F/d /C2* 5ert" denied* 1MC <? 204 (!23:)" The ?$preme 5o$rt &o$nd that the Blainti&& in a
civil 9D5O action* need esta-lish onl% a criminal PviolationP and not a criminal conviction" F$rther* the
5o$rt held that the De&endant need onl% have ca$sed harm to the Blainti&& -% the commission o& a predicate
o&&ense in s$ch a 'a% as to constit$te a Ppattern o& 9acketeering activit%"P That is* the Blainti&& need not
demonstrate that the De&endant is an organiAed crime &ig$re* a mo-ster in the pop$lar sense* or that the
Blainti&& has s$&&ered some t%pe o& special 9acketeering in>$r%R all that the Blainti&& m$st sho' is 'hat the
?tat$te speci&icall% re.$ires" The 9D5O ?tat$te and the civil remedies &or its violation are to -e li-erall%
constr$ed to e&&ect the congressional p$rpose as -roadl% &orm$lated in the ?tat$te" ?edima* ?B9; v" Dmre8
5o"* 1MC <? 1M2 (!23:)" Aside &rom an% legal o-ligation* there e8ists a societal and moral o-ligation en$re
to -oth the Blainti&& and the De&endant in that i& %o$ 'ere to de&$se a Bom-* and %o$ completed the task
22_ correct* %o$ are still dead" #rantor -elieves that his position on the la' is so$nd* -$t &ears grievo$s
reperc$ssions thro$gho$t the &inancial comm$nit% i& he sho$ld prevail" The credit &or mone% scheme is
endemic thro$gho$t o$r societ% and co$ld have devastating e&&ects on the national econom%" #rantor
-elieves that another approach ma% -e e8plored as &ollo's: PERFECT OBLIGATION AS TO A
HUMAN BEING That 'hich is -orro'ed is 'ealth" ;a-or created that 'ealth* so it is mone%
not'ithstanding its &orm" 5onsideration is promised in advance -% the Bromissor o& the Note* in the nat$re
o& principal and interest pa%ments &or the consideration provided -% the lender* 'hich is his personal
'ealth created -% his la-or" A Mortgage Note or Bromissor% Note sec$res the position o& the lender and i&
there is de&a$lt on the promise to pa% then the -orro'er has agreed to accept the strict &oreclos$re
remed% provided -% state stat$tes" Then the -orro'er o-ligated themselves to pa% -ack the principal and
pa% &or the $se o& it* in the &orm o& interest &or the %ears over 'hich the principal is to -e paid -ack" When
payments stop there is a prima facie injury to the lender" =hen pa%ments stop the lender has strict
&oreclos$re proced$re in state co$rt to remed% the pa% -ack o& the -alance o& the principal" J$dgment to
&oreclose on the propert% is granted $pon the mere proo& that pa%ments have ceased as promised" The
propert% is sold to cover the $npaid -alanceR de&icienc% >$dgment ma% -e needed" All is right 'ith the
'orld" Here the lender 'o$ld -e pre>$diced i& complete and s'i&t remed% 'ere not availa-le" A-sent s$ch
remed% the government 'o$ld -e part% to placing the lender into a condition o& invol$ntar% servit$de
to the -orro'er" PERFECT OBLIGATION AS TO A BANK
Dn %ears past -anks and savings and loans instit$tions en>o%ed the remed% o$tlined a-ove" The reason 'as
the% 'ere lending o$t mone% -elonging to their depositors and there 'as prima &acie in>$r% to the
depositors $pon the mere proo& that pa%ments had ceased" There-% the -ank as 'ell as the government
'o$ld -e part% to creating a condition o& invol$ntar% servit$de $pon the depositors i& strict &oreclos$re
remed% 'ere not availa-le" Toda% depositors are not in >eopard% o& -eing in>$red 'hen a person -orro's
mone% &rom a -ank" The -ank does not lend their mone%* onl% their credit in the amo$nt o& the loan (paper
acco$nting)" Hence no prima &acie in>$r% e8ists to either the depositors or the -ank $pon the mere proo&
that pa%ments cease" Dn>$r% is -ased $pon the pa%ments made as to the credit line"
PERFECT OR IMPERFECT OBLIGATION
A per&ect o-ligation is one recogniAed and sanctioned -% positive la'R one o& 'hich the &$l&illment can -e
en&orced -% the aid o& the la'" B$t i& the d$t% created -% the o-ligation operates onl% on the moral sense*
'itho$t -eing en&orced -% an% positive la'* it is called an Pimper&ect o-ligation*P and creates no right o&
action* nor has it an% legal operation" The d$t% o& e8ercising gratit$de* charit%* and the other merel% moral
d$ties are e8amples o& this kind o& o-ligation" d'ards v" Keane%* 24 <"?" :2:* 400* /1 ;"d" M2C"
#overnment approved the Federal 9eserve Bank* Dnc"* as the 5entral Banking s%stem &or the <nited ?tates*
and it,s polic% is revie'ed -% 5ongress al-eit* in a haphaAard manner" The Federal 9eserve a$thoriAes its
6private mone%7 6Federal 9eserve Bank Notes7 to -e $sed -% lending instit$tions s$ch as mem-er -anks*
to operate $pon a s%stem o& &ractionaliAing" The nat$re o& 'hich is that the% do not lend either their mone%
or the mone% o& the depositors* the mone% is created o$t o& thin air* -% the mere stroke o& a pen" =hen there
is no consideration in >eopard% o& -eing ret$rned* then the o-ligation is to make the -ank in>$r% proo&* to
the e8tent o& the o-ligation* 'hich 'o$ld -e to make them 'hole"
The onl% legal o-ligation is -ased $pon the moral iss$e* 'hich $nder the la' is an Dmper&ect O-ligation* to
ret$rn to them their propert%* 'hich isn,t 'ealth* -$t credit" A Bromissor% Note is signed $nder Peconomic
comp$lsionP 'hen* the PloanP 'ill not -e cons$mmated $nless and $ntil the -orro'er signs it" Th$s*
per&orming the act o& signing a Bromissor% Note cannot -e considered vol$ntar%" The discharging o& the
credit is -ased $pon social* economic* and moral standards to make the -ank 'hole* i& in>$r% is claimed* in
an% co$rt action 'here de&a$lt on the Bromissor% Note is on record and 'here the -ank &ails to veri&% an
in>$r%* the -ank cannot en&orce a promise to pa% consideration 'here the% provided no consideration" For
the -ank to -e a-le to &orce $pon the de&endant an amo$nt over and a-ove the credit* is to &orce $pon the
de&endants a de-t that goes to the control o& their la-or against their 'ill" This condition 'o$ld -e Beonage*
'hich has -een a-olished in this co$ntr%" (1/ <"?"5" X !221* and !3 <"?"5" X!:3!") The .$estion then
arises as to 'hen is the o-ligation discharged* to p$t the -ank in a position* 'here there is no record o&
in>$r% to itN
THE CASE IS CLEAR
Conspiracy against rights: D& t'o or more persons conspire to in>$re* oppress* threaten* or intimidate an%
person in an% ?tate* Territor%* 5ommon'ealth* Bossession* or District in the &ree e8ercise or en>o%ment o&
an% right or privilege sec$red to him -% the 5onstit$tion or la's o& the <nited ?tates* or -eca$se o& his
having so e8ercised the same R or D& t'o or more persons go in disg$ise on the high'a%* or on the premises
o& another* 'ith intent to prevent or hinder his &ree e8ercise or en>o%ment o& an% right or privilege so
sec$red - The% shall -e &ined $nder this title or imprisoned not more than ten %ears* or -othR and i& death
res$lts &rom the acts committed in violation o& this section or i& s$ch acts incl$de kidnapping or an attempt
to kidnap* aggravated se8$al a-$se or an attempt to commit aggravated se8$al a-$se* or an attempt to kill*
the% shall -e &ined $nder this title or imprisoned &or an% term o& %ears or &or li&e* or -oth* or ma% -e
sentenced to death" S!3* <?5 /1!T
Deprivation of rights under color of law: =hoever* $nder color o& an% la'* stat$te* ordinance* reg$lation*
or c$stom* 'ill&$ll% s$->ects an% person in an% ?tate* Territor%* 5ommon'ealth* Bossession* or District to
the deprivation o& an% rights* privileges* or imm$nities sec$red or protected -% the 5onstit$tion or la's o&
the <nited ?tates* or to di&&erent p$nishments* pains* or penalties* on acco$nt o& s$ch person -eing an alien*
or -% reason o& his color* or race* than are prescri-ed &or the p$nishment o& citiAens* shall -e &ined $nder
this title or imprisoned not more than one %ear* or -othR and i& -odil% in>$r% res$lts &rom the acts committed
in violation o& this section or i& s$ch acts incl$de the $se* attempted $se* or threatened $se o& a dangero$s
'eapon* e8plosives* or &ire* shall -e &ined $nder this title or imprisoned not more than ten %ears* or -othR
and i& death res$lts &rom the acts committed in violation o& this section or i& s$ch acts incl$de kidnapping or
an attempt to kidnap* aggravated se8$al a-$se* or an attempt to commit aggravated se8$al a-$se* or an
attempt to kill* shall -e &ined $nder this title* or imprisoned &or an% term o& %ears or &or li&e* or -oth* or ma%
-e sentenced to death" S!3* <?5 /1/T Property rights of citizens: All citiAens o& the <nited ?tates shall
have the same right* in ever% ?tate and Territor%* as is en>o%ed -% 'hite citiAens thereo& to inherit*
p$rchase* lease* sell* hold* and conve% real and personal propert%" S1/ <?5 !23/T Civil action for
deprivation of rights: ver% person 'ho* $nder color o& an% stat$te* ordinance* reg$lation* c$stom* or
$sage* o& an% ?tate or Territor% or the District o& 5ol$m-ia* s$->ects* or ca$ses to -e s$->ected* an% citiAen
o& the <nited ?tates or other person 'ithin the >$risdiction thereo& to the deprivation o& an% rights*
privileges* or imm$nities sec$red -% the 5onstit$tion and la's* shall -e lia-le to the part% in>$red in an
action at la'* s$it in e.$it%* or other proper proceeding &or redress* e8cept that in an% action -ro$ght
against a >$dicial o&&icer &or an act or omission taken in s$ch o&&icerZs >$dicial capacit%* in>$nctive relie&
shall not -e granted $nless a declarator% decree 'as violated or declarator% relie& 'as $navaila-le" For the
p$rposes o& this section* an% Act o& 5ongress applica-le e8cl$sivel% to the District o& 5ol$m-ia shall -e
considered to -e a stat$te o& the District o& 5ol$m-ia" S1/ <?5 !23CT
Conspiracy to interfere with civil rights: Depriving persons o& rights or privileges: D& t'o or more
persons in an% ?tate or Territor% conspire or go in disg$ise on the high'a% or on the premises o& another*
&or the p$rpose o& depriving* either directl% or indirectl%* an% person or class o& persons o& the e.$al
protection o& the la's* or o& e.$al privileges and imm$nities $nder the la'sR or &or the p$rpose o&
preventing or hindering the constit$ted a$thorities o& an% ?tate or Territor% &rom giving or sec$ring to all
persons 'ithin s$ch ?tate or Territor% the e.$al protection o& the la'sR or i& t'o or more persons
conspire to prevent -% &orce* intimidation* or threat* an% citiAen 'ho is la'&$ll% entitled to vote* &rom
giving his s$pport or advocac% in a legal manner* to'ard or in &avor o& the election o& an% la'&$ll%
.$ali&ied person as an elector &or Bresident or Hice Bresident* or as a Mem-er o& 5ongress o& the <nited
?tatesR or to in>$re an% citiAen in person or propert% on acco$nt o& s$ch s$pport or advocac%R in an% case o&
conspirac% set &orth in this section* i& one or more persons engaged therein do* or ca$se to -e done* an% act
in &$rtherance o& the o->ect o& s$ch conspirac%* 'here-% another is in>$red in his person or propert%* or
deprived o& having and e8ercising an% right or privilege o& a citiAen o& the <nited ?tates* the part% so
in>$red or deprived ma% have an action &or the recover% o& damages occasioned -% s$ch in>$r% or
deprivation* against an% one or more o& the conspirators" S1/ <?5 !23:(C)T
Action for neglect to prevent: ver% person 'ho* having kno'ledge that an% o& the 'rongs conspired to
-e done* and mentioned in section !23: o& this title* are a-o$t to -e committed* and having po'er to
prevent or aid in preventing the commission o& the same* neglects or re&$ses so to do* i& s$ch 'rong&$l act
-e committed* shall -e lia-le to the part% in>$red* or his legal representatives* &or all damages ca$sed -%
s$ch 'rong&$l act* 'hich s$ch person -% reasona-le diligence co$ld have preventedR and s$ch damages
ma% -e recovered in an action on the caseR and an% n$m-er o& persons g$ilt% o& s$ch 'rong&$l neglect or
re&$sal ma% -e >oined as de&endants in the actionR and i& the death o& an% part% -e ca$sed -% an% s$ch
'rong&$l act and neglect* the legal representatives o& the deceased shall have s$ch action there&ore* and
ma% recover not e8ceeding G:*000 damages therein* &or the -ene&it o& the 'ido' o& the deceased* i& there
-e one* and i& there -e no 'ido'* then &or the -ene&it o& the ne8t o& kin o& the deceased" B$t no action
$nder the provisions o& this section shall -e s$stained 'hich is not commenced 'ithin one %ear a&ter the
ca$se o& action has accr$ed" S1/ <?5 !234T
COURT: The person and s$it o& the sovereignR the place 'here the sovereign so>o$rns 'ith his regal
retin$e* 'herever that ma% -e" SBlackZs ;a' Dictionar%* :th dition* page C!3"T
COURT: An agenc% o& the sovereign created -% it directl% or indirectl% $nder its a$thorit%* consisting o&
one or more o&&icers* esta-lished and maintained &or the p$rpose o& hearing and determining iss$es o& la'
and &act regarding legal rights and alleged violations thereo&* and o& appl%ing the sanctions o& the la'*
a$thoriAed to e8ercise its po'ers in the co$rse o& la' at times and places previo$sl% determined -% la'&$l
a$thorit%" SDs-ill v" ?tovall* Te8"5iv"App"* 2/ ?"="/d !04M* !0M0R BlackZs ;a'
Dictionar%* 1th dition* page 1/:T
COURT OF RECORD: To -e a co$rt o& record a co$rt m$st have &o$r characteristics* and ma% have a
&i&th" The% are: a" A >$dicial tri-$nal having attri-$tes and e8ercising &$nctions independentl% o& the person
o& the magistrate designated generall% to hold it SJones v" Jones* !33 Mo"App" //0* !M: ?"=" //M* //2R 8
parte #ladhill* 3 Metc" Mass"* !M!* per ?ha'* 5"J" ?ee* also* ;ed'ith v" 9osalsk%* /11 N"F" 104* !:: N""
433* 432T SBlackZs ;a' Dictionar%* 1th d"* 1/:* 1/4T
-" Broceeding according to the co$rse o& common la' SJones v" Jones* !33 Mo"App" //0* !M: ?"=" //M*
//2R 8 parte #ladhill* 3 Metc" Mass"* !M!* per ?ha'* 5"J" ?ee* also* ;ed'ith v" 9osalsk%* /11 N"F" 104*
!:: N"" 433* 432T SBlackZs ;a' Dictionar%* 1th d"* 1/:* 1/4T
c" Dts acts and >$dicial proceedings are enrolled* or recorded* &or a perpet$al memor% and testimon%" SC Bl"
5omm" /1R C ?teph" 5omm" C3CR The Thomas Fletcher* 5"5"#a"* /1 F" 13!R 8 parte Thistleton* :/ 5al
//:R r'in v" <"?"* D"5"#a"* CM F" 133* / ;"9"A" //2R Heininger v" Davis* 24 Ohio ?t" /0:* !!M
N"" //2* /C!T
d" Has po'er to &ine or imprison &or contempt" SC Bl" 5omm" /1R C ?teph" 5omm" C3CR The Thomas
Fletcher* 5"5"#a"* /1 F" 13!R 8 parte Thistleton* :/ 5al //:R r'in v" <"?"* D"5"#a"* CM F" 133* / ;"9"A"
//2R Heininger v" Davis* 24 Ohio ?t" /0:* !!M N"" //2* /C!"T SBlackZs ;a' Dictionar%* 1
th
d"* 1/:* 1/4T
e" #enerall% possesses a seal" SC Bl" 5omm" /1R C ?teph" 5omm" C3CR The Thomas Fletcher* 5"5"#a"* /1 F"
13!R 8 parte Thistleton* :/ 5al //:R r'in v" <"?"* D"5"#a"* CM 133* / ;"9"A" //2R Heininger v" Davis* 24
Ohio ?t" /0:* !!M N"" //2* /C!"T SBlackZs ;a' Dictionar%* 1th d"* 1/:* 1/4T
Taking into consideration all of the documentation contained herein it is abundantly clear that no
foreclosure action is warranted, justified or lawful. There is no injury to the purported lender. A
court of record should decide what actions should and must be taken as a result of the unlawful
actions of the Plaintiff. Exhibit D Memorandum of Law Points of Authority Bills of Exchange
NOTICE NOTICE OF MEMORANDUM OF LAW-Points and Authorities in Support of
International Bill of Exchange
PThose 'ho constit$te an association nation'ide o& private* $nincorporated persons engaged in the $siness
o& -anking to iss$e notes against these o-ligations o& the <nited ?tates d$e themR 'hose private propert%
is at risk to collateraliAe the government,s de-t and c$rrenc%* -% legal de&initions* a Pnational banking
associationPR s$ch notes* iss$ed against these obligations of the United States to that part of the public
debt due its Principals and Sureties are re;uired <- la7 to <e acce.ted as ,legal tender, of .a-ment for
all de<ts .u<lic and .ri=ate* and are de&ined in la' as Pobligations of the United StatesP* on the same par
and categor% 'ith Federal reserve notes and other c$rrenc% and legal tender o-ligations"P RE: Item
tendered for Discharge of Debt" The instrument tendered to the bank and negotiated to the United
States Treasury for settlement is an ~Obligation of THE UNITED STATES*7 $nder Title 18USC
Sect.8, representing as the de&inition provides a 6certi&icate o& inde-tedness L"drawn upon an authorized
officer of the United States*7 (in this case the ?ecretar% o& the Treas$r%)7issued under an Act of
Congress7 (in this case public law 73-10, H1R-192 of 1933 and Title 31 USC 3123, and 31 USC 5103)
and by treaty (in this case the UNITED NATIONS CONVENTION ON INTERNATIONAL BILLS
OF EXCHANGE AND INTERNATIONAL PROMISSORY NOTES (UNCITRAL) and the
Universal Postal Union headquartered in Bern, Switzerland)"
TITLE 18 > PART I > CHAPTER 1 > Sec. 1. > Sec. 8"
Sec. 8. - Obligation or other security of the United States defined The term ''obligation or other
security of the United States'' includes all bonds, certificates of indebtedness, national bank currency*
Federal 9eserve notes* Federal 9eserve -ank notes* co$pons* <nited ?tates notes* Treas$r% notes* gold
certi&icates* silver certi&icates* &ractional notes* certi&icates o& deposit* -ills* checks* or dra&ts &or mone%*
drawn by or upon authorized officers of the United States* stamps and other representatives o& val$e* o&
'hatever denomination* issued under any Act of Congress* and canceled <nited ?tates stamps"
The Dnternational Bill o& 8change is legal tender as a national -ank note* or note o& a National Banking
Association* -% legal and@or stat$tor% de&inition (UCC 4-105, 12CFRSec. 229.2, 210.2, 12 USC 1813)*
iss$ed $nder A$thorit% o& the <nited ?tates 5ode 31 USC 392, 5103* 'hich o&&iciall% de&ines this as a
stat$tor% legal tender o-ligation o& TH <NTDD ?TAT?* and is iss$ed in accordance 'ith 31 USC 3123
and H1R-192 (1933) 'hich esta-lish and provide &or its iss$ance as 6B$-lic Bolic%7 in remed% &or
discharge o& e.$it% interest recover% on that portion o& the p$-lic de-t to its Brincipals* and ?$reties -earing
the O-ligation o& TH <NDTD ?TAT?" This is a stat$tor% remed% &or e.$it% interest recover% d$e the
principles and s$reties o& the <nited ?tates &or discharge of lawful debts in commerce in conjunction
with US obligations to that portion of the public debt it is intended to reduce"D$ring the &inancial crisis
o& the depression* in !2CC s$-stance o& gold* silver and real mone% 'as removed as a &o$ndation &or o$r
&inancial s%stem" Dn it s place the substance o& the American citiAenr%: their real propert%* 'ealth* assets
and prod$ctivit% that belongs to them 'as* in e&&ect* +pledged, -% the government and placed at risk as
the collateral &or US debt, credit and currency &or commerce to &$nction" This is 'ell doc$mented in the
actions o& 5ongress and the Bresident at that time and in the 5ongressional de-ates that preceded the
adoption o& the reorganiAational meas$res: Senate Document No. 43, 73rd Congress, 1st Session* stated*
P<nder the ne' la' the mone% is iss$ed to the -anks in return &or Government obligations, bills of
exchange, drafts, notes, trade acceptances, and banker`s acceptances. The money will be worth 100
cents on the dollar, because it is backed by the credit of the nation. It will represent a mortgage on all
the homes and other property of all the people in the Nation"P (=hich lawfully belongs to these private
citiAens") The National De-t is de&ined as 6mortgages on the wealth and income of the people of
a country"7 (nc%clopedia Britannica* !2:2") Their 'ealth* L" their income" The reorganiAation is
evidenced -%: The mergenc% Banking Act* March 2* !2CC* Ho$se Joint 9esol$tion !2/* J$ne :* !2CC
(p$-lic la' MC-!0) And the ?eries o& 8ec$tive Orders that s$rro$nded them: 40MC- 9eopening o& Banks"
m-argo on #old Ba%ments and 8ports* and ;imitations on Foreign 8change Transactions" March !0*
!2CC 4!!!-Transactions in &oreign e8change are permitted $nder #overnmental ?$pervision" April /0*
!2CC 4!0/ - For-idding the hoarding o& gold coin* gold -$llion and gold certi&icates" April :* On
Decem-er /C* !2!C* 5ongress had passed PAn Act to provide &or the esta-lishment o& Federal reserve
-anks* to &$rnish an elastic c$rrenc%* to a&&ord a means o& redisco$nting commercial paper* to esta-lish a
more e&&ective s$pervision o& -anking in the <nited ?tates* and for other purposesP" The Act is commonl%
kno'n as the PFederal Reserve ActP" One &o the p$rposes &or enacting the Federal 9eserve Act 'as:
(C) to authorize "hypothecation" of obligations including "United States bonds or other securities
which Federal reserve Banks are authorized to holdP $nder ?ection !1(a)R 12 USC; ch. 6, 38 Stat. 251
Sect 14(a) The term PhypothecationP as stated in ?ection !1(a) o& the Act is de&ined: P!" Banking" Offer of
stocks* -onds* or other assets o'ned -% a part% other than the borrower as collateral for a loan, without
transferring title" D& the -orro'er t$rns the propert% over to the lender 'ho holds it &or sa&ekeeping* the
action is re&erred to as a pledge" D& the -orro'er retains possession* -$t gives the lender the right to sell
the property in event of default* it is a tr$e h%pothecation" /" ?ec$rities" The pledging o& negotia-le
sec$rities to collateraliAe a -rokerZs margin loan" The -roker pledges the same sec$rities to a -ank as
collateral &or a -rokerZs loan* the process is re&erred to as rehypothecation"P
Dictionary Of Banking Terms, Fitch, pg. 228 (1997)T
As seen &rom the de&initions* in h%pothecation there is equitable risk to the actual o'ner" ?ection !4 o& the
c$rrent Federal 9eserve Act* 'hich is codi&ied at !/ <?5 1!!* declares that "Federal Reserve Notes" are
"obligations of the United States". ?o 'e see the Pfull faith and creditP o& the United States: 'hich is
the substance o& the American citiAenr%: their real propert%* 'ealth* assets and prod$ctivit% that belongs
to them* is there-% hypothecated and rehypothecated -% the <nited ?tates to its o-ligations as 'ell as to
the Federal 9eserve for the issuance and backing of Federal Reserve Notes as legal tender P&or all
ta8es* c$stoms* and other p$-lic d$esP" TITLE 12 > CHAPTER 3 > SUBCHA PTER XII > Sec. 411.
Sec. 411. - Issuance to reserve banks; nature of obligation; redemption Federal 9eserve notes* to -e
iss$ed at the discretion o& the Board o& #overnors o& the Federal 9eserve ?%stem &or the p$rpose o& making
advances to Federal reserve -anks thro$gh the Federal reserve agents as hereina&ter set &orth and &or no
other p$rpose* are a$thoriAed" The said notes shall be obligations of the United States and shall be
receivable by all national and member banks and Federal reserve banks and for all taxes, customs,
and other public dues" The commerce and credit o& the nation contin$es on toda% $nder &inancial
reorganiAation (Bankr$ptc%) as it has since !2CC* still -acked -% the assets and 'ealth o& the American
citiAenr%: at risk &or the government`s o-ligations and c$rrenc%" <nder the !1th amendment and n$mero$s
?$preme 5o$rt precedents* as 'ell as in e.$it%* Private property can not be taken or pledged for public
use without just compensation, or due process of law " The <nited ?tates can not pledge or risk the
property and wealth of its private citizens, for any government purpose without legally providing
them remedy to recover what is due them on their risk" This principle is so 'ell esta-lished in nglish
common la' and in the histor% o& American >$rispr$dence" The !1th amendment provides: 6no person
shall be deprived of.property without due process of law7"
And 5o$rts have long r$led to have one,s propert% legall% held as collateral or s$ret% &or a de-t even 'hen
he still o'ns it and still has it is to deprive him o& it since it is at risk and co$ld -e lost &or the de-t at an%
time" The <nited ?tates ?$preme 5o$rt said* in <nited ?tates v" 9$ssell S!C =all* 4/C* 4/MT
PPrivate property, the Constitution provides, shall not be taken for public use without just
compensation"7 PThe right of subrogation is not &o$nded on contract" Dt is a creature of equityR is
en&orced solel% &or the p$rpose o& accomplishing the ends o& s$-stantial >$sticeR and is independent of any
contractual relations between the parties." Memphis & L. R. R. Co. v. Dow, 120 U.S. 287, 301-302
(1887)" The rights of a surety to recovery on his risk or loss when standing for the debts of
another 'as rea&&irmed again as late as !24/ in Bearlman v" 9eliance Dns"5o"* CM! <"?"!C/ 'hen the 5o$rt
said:.sureties compelled to pay debts for their principal have been deemed entitled to
reimbursement, even without a contractual promise .And probably there are few doctrines better
established.... Black`s Law Dictionary , 5th edition, defines ~surety: 6One 'ho $ndertakes to pa%
or to do any other act in event that his principal fails therein" ver%one 'ho inc$rs a liability in
person or estate for the benefit of another* 'itho$t sharing in the consideration* stands in the position
of a ~surety"7 5onstit$tionall% and in the la's o& e.$it%* the <nited ?tates could not borrow or pledge
the property and wealth of its private citizens, put at risk as collateral for its currency and credit
without legally providing them equitable remedy for recovery of what is due them. The <nited ?tates
government* o& co$rse* did not violate the la' or the 5onstit$tion in this 'a%* in order to collateraliAe its
&inancial reorganiAation* -$t did* in fact* provide s$ch a legal remed% so that it has -een a-le to contin$e on
since !2CC to h%pothecate the private 'ealth and assets o& those classes o& persons -% 'hom it is o'ned*
at risk backing the government`s o-ligations and c$rrenc%* by their implied consent* thro$gh the
government having provided s$ch remedy* as de&ined and codi&ied a-ove* &or recover% o& 'hat is d$e them
on their assets and 'ealth at risk" The provisions &or this are &o$nd in the same act o& 6B$-lic Bolic%7 H1R-
192, public law 73-10 that s$spended the gold standard &or o$r c$rrenc%* a-rogated the right to demand
pa%ment in gold* and made Federal 9eserve notes &or the &irst time legal tender* 6backed by the substance
or ~credit of the nation7" All <? c$rrenc% since that time is onl% credit against the real propert%* 'ealth
and assets -elonging to the private soverign American people* taken and@or +pledged, -% TH
<NDTD ?TAT? to its secondary creditors as security &or its o-ligations" 5onse.$entl%* those backing
the nation,s credit and c$rrenc% co$ld not recover 'hat 'as d$e them by anything drawn on Federal
Reserve notes without expanding their risk and obligation to themselves" An% recover% pa%ments
-acked -% this c$rrenc% 'o$ld onl% increase the public debt its citizens were collateral for, which an
equitable remedy was intended to reduce* and in e.$it% 'o$ld not satis&% an%thing" And there 'as no
longer actual money of substance to pay anybody" There are other serio$s limitations on o$r present
s%stem" Since the institution of these events, for practical purposes of commercial exchange, there has
been no actual money in circulation by which debt owed from one party to another can actually be
repaid" Federal 9eserve Notes* altho$gh made legal tender &or all de-ts p$-lic and private in the
reorganiAation* can onl% discharge a de-t" De-t m$st -e 6paid7 'ith value or s$-stance (i"e" gold* silver*
-arter* la-or* or a commodit%)" For this reason HJ9-!2/ (!2CC)* 'hich esta-lished the 6p$-lic polic%7 o&
o$r c$rrent monetar% s%stem* repeatedl% $ses the technical term o& 6discharge7 in con>$nction 'ith
6pa%ment7 in la%ing o$t p$-lic polic% &or the ne' s%stem" A de-t c$rrenc% s%stem cannot pa% de-t"
?o &rom that time to the present* commerce in the corporate <NDTD ?TAT? and among s$--corporate
s$->ect entities has had onl% de-t note instr$ments -% 'hich de-t can -e discharged and trans&erred in
di&&erent &orms" The $npaid de-t* created and@or e8panded -% the plan no' carries a public liability &or
collection in that 'hen de-t is discharged 'ith de-t instr$ments* (i"e" Federal 9eserve Notes incl$ded)* -%
o$r commerce* de-t is inadvertentl% -eing expanded instead o& -eing cancelled* th$s increasing the
public debt" A situation potentially fatal to any economy" 5ongress and government o&&icials 'ho
orchestrated the p$-lic la's and reg$lations that made the financial reorganization anticipated the long
term e&&ect o& a de-t -ased &inancial s%stem 'hich man% in government &eared* and 'hich 'e &ace toda% in
servicing the interest on trillions $pon trillions o& dollars in <? 5orporate p$-lic de-t and in this same act
made provision not onl% &or the recovery remedy to satisfy equity to its ?$reties* -$t to simultaneously
resolve this problem as well" ?ince it is* in &act* the real propert%* 'ealth and assets o& that class o&
persons that is the s$-stance -acking all the other o-ligations* c$rrenc% and credit o& TH <NDTD
?TAT? and s$ch c$rrencies co$ld not -e $sed to red$ce its o-ligations &or e.$it% interest recover% to its
Brincipals and ?$reties* HJ9-!2/ &$rther made the 6notes o& national -anks 6and 6national -anking
associations7 on a par 'ith its other c$rrenc% and legal tender o-ligations"
Now TDT; C! * ?<BTDT; DH * 5HABT9 :! * ?<B5HABT9 D * ?ec" :!0C" says* 0egal tender
-<nited ?tates coins and c$rrenc% (incl$ding Federal reserve notes and circ$lating notes o& Federal reserve
-anks and national banks) are legal tender &or all de-ts* p$-lic charges* ta8es* and d$es" (emphasis added)
B$t this o&&icial de&inition &or +legal tender, 'as &irst esta-lished in HJ9-!2/ (!2CC) in the same act that
made &ederal reserve notes and notes o& national -anking associations legal tender"
B$-lic Bolic% HJ9-!2/ JODNT 9?O;<TDON TO ?<?BND TH #O;D ?TANDA9D AND
AB9O#AT TH #O;D 5;A<?* J<N :* !2CC
H"J" 9es" !2/* MCrd 5ong"* !st ?ession Joint resol$tion to ass$re $ni&orm val$e to the coins and c$rrencies
o& the <nited ?tates" As $sed in this resol$tion* the term ~obligation means an obligation (including
every obligation of and to the United States, excepting currency) pa%a-le in mone% o& the <nited ?tatesR
and the term ~coin or currency means coin or currency of the United States, including Federal
9eserve notes and circ$lating notes o& Federal 9eserve -anks and national banking associations"
6All coins and currencies of the United States (including Federal 9eserve notes and circ$lating notes of
Federal 9eserve -anks and national banking associations) hereto&ore or herea&ter coined or iss$ed* shall
be legal tender &or all de-ts* &or p$-lic and private* p$-lic charges* ta8es* d$ties* and d$es*7
USC Title 12.221 Definitions K 6The terms 6national bank7 and 6national banking association7L"shall
-e held to -e synonymous and interchangeable"7T ~notes of national banks or ~national banking
associations have continuously been maintained in the official definition of legal tender since 1une 5,
1933 to the present day, when the term had never been used to define ~currency or ~legal
tender before that" Brior to !2CC the &orms o& c$rrenc% in $se that 'ere legal tender 'ere man% and
varied: -<nited ?tates #old 5erti&icates K <nited ?tates Notes K Treas$r% Notes K Dnterest -earing notes K
#old 5oins o& <nited ?tates K ?tandard silver dollars K ?$-sidiar% silver coins K minor coins -
5ommemorative coins Kbut the list did not include federal reserve notes or notes of national banks or
national banking associations despite the &act national -ank notes 'ere a common medi$m o& e8change
or 6c$rrenc%7 and had -een* almost since the &o$nding o& o$r -anking s%stem and 'ere -acked -% <nited
?tates -onds or other sec$rities on deposit &or the -ank 'ith the <? Treas$r%" F$rther* from the time of
their inclusion in the definition they have been phased out $ntil presentl% all provision in the <nited
?tates 5ode pertaining to incorporated federally chartered National Banking institutions issuing,
redeeming, replacing and circulating notes have all -een repealed"
USC TITLE 12 > CHAPTER 2 - NATDONA; BANK? ?<B5HABT9 H - OBTADNDN# AND
D??<DN# 5D95<;ATDN# NOT? ?ec"!0! to !!0" ;epealed" B$-" ;" !0C-C/:* title HD* ?ec" 40/e:-!!* &/-
1A* g2* ?ept" /C* !221* !03 ?tat" //2/* //21
?<B5HABT9 HD - 9DMBTDON AND 9B;A5MNT OF 5D95<;ATDN# NOT?
?ec"!/!" ;epealed" B$-" ;" !0C-C/:* title HD* ?ec" 40/&1B* ?ept" /C* !221* !03 ?tat" //2/
?ec"!/!a" 9edemption o& notes $nidenti&ia-le as to -ank o& iss$e
?ec"!//" ;epealed" B$-" ;" 2M-/:3* ?ec" :-* ?ept" !C* !23/* 24 ?tat" !043
?ec"!//a" 9edeemed notes o& $nidenti&ia-le iss$eR &$nds charged against
?ec !/C to !/4" ;epealed" B$-" ;" !0C-C/:* title HD* ?ec" 40/e!/* !C* &15* 4* ?ept"
/C* !221* !03 ?tat" //2/* //2C
?ec!/M" ;epealed" B$-" ;" 32-::1* ?ec" 3a* ?ept" 4* !244* 30 ?tat" 4CC
As stated in Money and Banking, 4th edition, by David H. Friedman, publ. by the American
Bankers Association* page M3* 6Today commercial banks no longer issue currency, ..~
Dt is clear* &ederall% incorporated -anking instit$tions s$->ect to the restrictions and repealed provisions o&
Title !/* are not those primarily referred to maintained in the current definition of ~legal tender7"
The legal stat$tor% and pro&essional de&initions o& 6bank7* 6banking7* and ~banker7 $sed in the <nited
?tates 5ode and 5ode o& Federal 9eg$lations are not those commonl% $nderstood &or these terms and have
made the stat$tor% de&inition o& 6Bank7 accordingl%: UCC 4-105 BA9T ! PBankP means a person
engaged in the business of banking, 12CFR Sec. 229.2 De&initions (e) Bank meansa6the term -ank
also incl$des any person engaged in the business of banking*7 12CFR Sec. 210.2 De&initions" (d)7 Bank
means any person engaged in the business of banking"7 USC Title 12 Sec. 1813" KDefinitions of Bank
and Related Terms" K (!) Bank" K The term ZZbankZZ K (A) 6means an% national -ank* ?tate -ank* and
District -ank* and an% Federal -ranch and ins$red -ranchR7 Black`s Law Dictionary, 5th Edition* page
!CC* de&ines a 6Banker7 as* ~In general sense, person that engages in business of banking. In
narrower meaning, a private person...; who is engaged in the business of banking without being
incorporated. Under some statutes, an individual banker, as distinguished from a ~private banker,
is a person who, having complied with the statutory requirements, has received authority from the
state to engage in the business of banking, while a private banker is a person engaged in banking
without having any special privileges or authority from the state. 6
~Banking Ds partl% and optionall% de&ined as 6The business of issuing notes for circulation..,
negotiating bills"7 Black`s Law Dictionary, 5th Edition* page !CC* de&ines 6Banking7: ~The business of
banking, as defined by law and custom, consists in the issue of notes ..intended to circulate as
money.... And de&ines a 6Banker`s Note7 as: 6A commercial instrument resem-ling a -ank note in
ever% partic$lar e8cept that it is given by a private banker or unincorporated banking institution"7
Federal ?tat$te does not speci&icall% de&ine 6national bank and ~national banking association7 in
those sections where these uses are legislated on to exclude a private banker or unincorporated
banking institution" Dt does de&ine these terms to the exclusion o& s$ch persons in the chapters and
sections 'here the iss$e and circ$lation o& notes -% national -anks has -een repealed or
forbidden" "In the absence of a statutory definition, courts give terms their ordinary meaning"
PBass* Terri ;" v" ?tolper* KoritAinsk%* !!! F"Cd !C/:*Mth5ir" Apps" (!224)" As the <"?" ?$preme 5o$rt
noted* PWe have stated time and again that courts must presume that a legislature says in a statute
what it means and means in a statute what it says there"7 ?ee* e"g"* <nited ?tates v" 9on Bair
nterprises* Dnc"* 132 <"?" /C:* /1! -/1/ (!232)R <nited ?tates v" #olden-erg*!43 <"?" 2:* !0/ -!0C
(!32M)R PThe legislative purpose is expressed by the ordinary meaning of the words used"
69ichards v" <nited ?tates* C42 <"?"! (!24/)" There&ore* as noted a-ove* the legal de&initions relating to
+legal tender` have -een 'ritten -% 5ongress and maintained as s$ch to -e -oth exclusive* 'here
necessar%* and inclusive* 'here appropriate* to provide in its stat$tor% de&initions o& legal tender &or the
inclusion o& all those* 'ho -% de&inition o& private* $nincorporated persons engaged in the -$siness o&
-anking to iss$e notes against the o-ligation o& the <nited ?tates &or recover% on their risk* 'hose private
assets and propert% are -eing $sed to collateraliAe the o-ligations o& the <nited ?tates since !2CC* as
collectivel% and nationall% constit$ting a legal class o& persons -eing a 6national bank or ~national
banking association with the right to issue such notes against The Obligation of THE UNITED
STATES for equity interest recovery due and accrued to these Principals and Sureties of the United
States backing the obligations of US currency and credit; as a means for the legal tender discharge of
lawful debts in commerce as remedy due them in conjunction with US obligations to the discharge of
that portion of the public debt, which is provided for in the present financial reorganization still in
effect and ongoing since 1933" S!/ <?5 1!!* !3 <?5 3* !/ <?5R ch" 4* C3 ?tat" /:! ?ect !1(a)* C! <?5
:!!3* C!/C" 'ith rights protected $nder the !1th Amendment o& the <nited ?tates 5onstit$tion* -% the <"?"
?$preme 5o$rt in <nited ?tates v" 9$ssell (!C =all* 4/C* 4/M)* Bearlman v" 9eliance Dns" 5o"* CM! <"?"
!C/*!C4*!CM (!24/)* The <nited ?tates v" Hooe* C 5ranch (<"?")MC(!30:)* and in con&ormit% 'ith the <"?"
?$preme 5o$rt M2 <"?" /3M (!3M0)* !M/ <"?"13 ( !323)* and as con&irmed at C0M <"?" /1M(!2C2)"T
HJ9-!2/ &$rther declared LL"every provision..which purports to give the oblige a right to require
payment in gold or a particular kind of coin or currency..is declared to be against Public Policy;
and no such provision shall be..made with respect to any obligation hereafter incurred"7 Making
'a% &or discharge and recover% on <? 5orporate p$-lic de-t d$e the Brincipals and ?$reties o& TH
<NDTD ?TAT? providing as 6public policy7 &or the discharge o& 6every obligation, ~including every
obligation OF and TO THE UNITED STATES, ~dollar for dollar7* allo'ing those -acking the <?
&inancial reorganiAation to recover on it -% discharging an o-ligation the% o'ed TO THE UNITED
STATES or its s$--corporate entities* against that same amount of obligation OF THE UNITED
STATES owed to them; thus providing the remedy for the discharge and orderly recovery o& e.$it%
interest on <? 5orporate p$-lic de-t d$e the ?$reties* Brincipals* and Holders o& TH <NDTD ?TAT?*
discharging that portion o& the p$-lic de-t without expansion of credit, debt or obligation on THE
UNITED STATES or these its prime-creditors it 'as intended to satis&% e.$ita-le remed% to* -$t
gaining &or each -earer o& s$ch note* discharge o& o-ligation e.$ivalent in val$e +dollar &or dollar, to an%
and all 6lawful money of the United States7"Those 'ho constit$te an association nation'ide o& private*
$nincorporated persons engaged in the -$siness o& -anking to iss$e notes against these o-ligations o& the
<nited ?tates d$e themR 'hose private propert% is at risk to collateraliAe the government,s de-t
and c$rrenc%* -% legal de&initions* a Pnational banking associationPR s$ch notes* iss$ed against these
obligations of the United States to that part of the public debt due its Principals and Sureties are
re.$ired -% la' to -e accepted as Plegal tenderP o& pa%ment &or all de-ts p$-lic and private* and* as 'e have
seen* are de&ined in la' as Po-ligations o& the <nited ?tatesP* on the same par and categor% 'ith Federal
reserve notes and other c$rrenc% and legal tender o-ligations" This is 'hat is asserted in the tender
presented to the -ank &or deposit and the government has said nothing to the contrar%" =o$ld 'e .$estion
that this is e8actl% 'hat 5ongress has provided &or in these stat$tes and codes on the p$-lic de-t and
o-ligations o& the <nited ?tates and that this is the remed% codi&ied in stat$tor% la' and de&inition 'e have
cited hereN ven tho$gh it is never disc$ssed" <nder this remed% &or discharge o& the p$-lic de-t and
recover% to its Brincipals and ?$reties* TWO debts that 'o$ld have -een discharged in Federal 9eserve
de-t note or checks dra'n on the same* e.$all% expanding the p$-lic de-t -% those transactions* are
discharged against a SINGLE public debt of the Corporate UNITED STATES and its sub-corporate
entities to its prime-creditor without the expansion and use of Federal Reserve debt note instruments
as currency and credit* and so* without the e8pansion o& de-t and de-t instr$ments in the monetar%
s%stem and the expansion of the public de-t as -$rden $pon the entire &inancial s%stem and its Brincipals*
and ?$reties the recover% remed% 'as intended to relieve" Apparentl% their $se is &or the discharge and
non-cash accrual reduction o& <? 5orporate p$-lic de-t to the Brincipals* Brime 5reditors and Holders o&
it as provided in la' and the instr$ments 'ill $ltimatel% -e settled -% ad>$stment and set-o&& in discharge
o& a -earer,s o-ligation TO TH <NDTD ?TAT? against the o-ligation OF TH <NDTD ?TAT? &or
the amo$nt o& the instr$ment to the original creditor it 'as tendered to or 'homever or 'hatever instit$tion
ma% -e the &inal -earer and holder in d$e co$rse o& it* again* th$s discharging that portion o& the p$-lic
de-t without expansion of credit, debt or note on the prime-creditors of THE UNITED STATES
it 'as intended to satis&% e.$ita-le remed% to* -$t gaining &or each endorsed -earer o& it discharge o&
o-ligation e.$ivalent in val$e +dollar &or dollar, o& c$rrenc%* meas$ra-le in 6lawful money of the United
States7" Altho$gh this has -een p$-lic polic% as a remed% &or the discharge o& de-t in con>$nction
'ith removal o& gold* silver and real mone% as legal tender c$rrenc% -% the same act o& p$-lic polic% in
!2CC* it has -een a difficult concept to comm$nicate &or others to accept and to kno' 'hat to do 'ith it* so
its never gained common $se and &or o-vio$s reasons the government has discouraged p$-lic
$nderstanding o& the remed% and recover% $nder it and there&ore it is little known and not generall%
accessed -% the p$-lic" B$t it is still an o-ligation the <nited ?tates has bound itsel& to and has provided
&or in stat$tor% la' and the <nited ?tates still accepts these non-cash accr$al e8changes toda% as a matter
o& la' and e.$it%" ?o is the e8perience o& man% 'ho have attempted to access the remed%" That the 6p$-lic
policies7 o& Ho$se Joint 9esol$tion !2/ o& !2CC are still in e&&ect is evidenced -% the other provisions o&
6p$-lic polic%7 it esta-lished that 'e can see along 'ith these disc$ssed" No one 'o$ld attempt to demand
pa%ment in gold or a partic$lar kind o& coin or c$rrenc% in $se or think to 'rite s$ch an o-ligation into a
contract* because the gold standard for currency is still suspended and the right to a gold
clause` to require payment in gold is still abrogated. Both are also part of ~public
policy established in H1R-192" The practical evidence and &act o& the <nited ?tates, &inancial
reorganiAation (-ankr$ptc%) is still ongoing toda%* visi-le all aro$nd $s to see and $nderstand" =hen
Treas$r% notes come d$e* the%,re not paid" The% are refinanced by new T-Bills and notes to -ack the
c$rrenc% and cover the de-ts" ""something that cannot -e done 'ith de-t ..unless,.. the debtor is
protected from creditors in a bankruptcy reorganization that is reg$larl% -eing restr$ct$red to keep it
going" ver% time the Federal de-t ceiling is raised -% 5ongress they are restructuring the bankruptcy
reorganization of the government`s debt so commerce can continue on" For o-vio$s reasons the <nited
?tates government does not like having to recogniAe all this" Dt is a ver% sensitive and delicate matter" And
&e' can speak or 'ill speak a$thoritativel% a-o$t it* as the -ank has &o$nd o$t" The recover% remed% is
maintained in la' -eca$se it has to -e to satis&% e.$it% to its prime creditors" At this late time* the <nited
?tates is neither e8pecting nor intending it to -e generall% accessed -% the p$-lic" 9egarding s$ch
instr$ments tendered to the ?ecretar%* 'hen p$-lic o&&icials are p$t in a position to legall% ackno'ledge or
den% the a$thorit% or validit% o& the instr$ments* those in responsi-ilit% will not deny or dishonor
it, or an instrument of discharge properly submitted for that purpose" The iss$e is 'hat has the
government said a-o$t it no'N=hat is its polic% in practiceN And ho' does it &inall% respond to s$ch
claims o& 'hich it receives tho$sands ever% da%N It is a fact: Title C! <?5 C!/C makes a stat$tor% pledge
o& the <nited ?tates government to pa%ment o& o-ligations and interest on the p$-lic de-t" TDT; C! *
?<BTDT; DDD * 5HABT9 C! * ?<B5HABT9 DD * ?ec" C!/C" K Payment of obligations and interest on
the public debt(a) The &aith o& the <nited ?tates #overnment is pledged to pa%* in legal tender* principal
and interest on the o-ligations o& the #overnment iss$ed $nder this chapter" (b) 6The Secretary of the
Treasury shall pa% interest d$e or accr$ed on the p$-lic de-t"7
It is a fact: Title C! ?ection C!C0 &$rther delineates in its de&initions a portion o& the total p$-lic de-t
'hich is held by the public as the 6Net p$-lic de-t7 TITLE 31 ] SUBTITLE III ] CHAPTER 31 ]
SUBCHAPTER II ] Sec. 3130" Sec. 3130. - Annual public debt report
(e) De&initions" -
(2) Total public debt" - The term ZZtotal p$-lic de-tZZ means the total amo$nt o& the o-ligations s$->ect to
the p$-lic de-t limit esta-lished in section C!0! o& this title" (C) Net public debt" - The term ''net public
debt'' means the portion of the total public debt which is held by the public" It is a fact: ?ection C!0!
re&erences guaranteed obligations held by the Secretary of
the Treasury 'hich are excepted and exempted &rom 6the &ace amo$nt o& o-ligations 'hose principal and
interest are g$aranteed -% the <nited ?tates #overnment7
Sec. 3101. - Public debt limit
(b) The &ace amo$nt o& o-ligations iss$ed $nder this chapter and the &ace amo$nt o& o-ligations 'hose
principal and interest are g$aranteed -% the <nited ?tates #overnment (except guaranteed obligations
held by the Secretary of the Treasury) ma% not -e more than G:*2:0*000*000*000* o$tstanding at one
time* s$->ect to changes periodicall% made in that amo$nt as provided -% la' It is a fact: ver% da% the
<nited ?tates Treas$r% department receives doAens or h$ndreds o& s$ch instr$ments making claims o& this
t%pe" O-vio$sl% some are valid and some are not" It is a fact: There are onl% C o&&icial government
directives or alerts that address sp$rio$s* &ra$d$lent* &ictitio$s* or other'ise invalid* instr$ments sent to the
<? Treas$r% &or pa%ment* and only one that o&&iciall% states 'hat is to -e official US government policy
and treatment o& them i& the% are received* this is A;9T 22-!0: 'hich is also p$-lished on the
government 'e-site &or the <nited ?tates Treas$r%: '''"p$-licde-t"treas"gov $nder Fra$ds and Bhonies*
The O&&ice o& the 5omptroller o& the 5$rrenc%* n&orcement O 5ompliance Division in A;9T 22-!0
states: T%pe: ?$spicio$s Transactions TO: 5hie& 8ec$tive O&&icers o& all National BanksR all ?tateBanking
A$thoritiesR 5hairman* Board o& #overnors o& the Federal 9eserve ?%stemR 5hairman* Federal
Deposit Dns$rance 5orporationR 5on&erence o& ?tate Bank ?$pervisorsR Dep$t% 5omptrollers (Districts)R
Assistant Dep$t% 5omptrollersR District 5o$nsel and 8amining Bersonnel" 9: Fictitio$s ?ight Dra&ts
pa%a-le thro$gh the <"?" Treas$r% Dt has -een -ro$ght to o$r attention that certain individ$als have -een
making and e8ec$ting 'orthless paper doc$ments 'hich are titled P?ight Dra&tP These items state
that the% are pa%a-le thro$gh the <" ?" Treas$r%* !:00 Benns%lvania Aven$e* N=* =ashington* D5 /0//0"
These instr$ments are -eing presented &or pa%ment at -anks and other -$sinesses thro$gho$t the <nited
?tates" Any of these instruments that are presented to the U. S. Treasury for payment will be
returned to the sender and
copies 'ill -e provided to the appropriate la' en&orcement agencies"7 Dishonored"
This is in con&ormit% 'ith the <ni&orm 5ommercial 5ode that parties ma% rel% on their presentment o&
o-ligations as settled $nless given a Notice o& Dishonor* 'hether directl% applica-le to Treas$r% Dept"
o&&icers or not"
UCC3-503. NOTICE OF DISHONOR .(b) Notice of dishonor may be given -% an% person: may be
given -% an% commerciall% reasona-le means* incl$ding an oral* 'ritten* or electronic comm$nicationR
and is sufficient if it reasonably identi&ied the instrument and indicates that the instr$ment has -een
dishonored or has not -een paid or accepted" 9et$rn o& an instr$ment given to a bank for collection is
s$&&icient notice o& dishonor" Lc) ?$->ect to ?ection C-:01(c)* with respect to an instrument taken for
collection notice o& dishonor m$st -e givenL" within 30 days following the day on which the
person receives notice of dishonor. With respect to any other instrument, notice of dishonor must be
given within 30 days following the day on which dishonor occurs. These instruments are never
returned from the Treasury dishonored. It is a fact: There is no -asis or reason or pla$si-le e8planation
&or s$ch unexplained silence 'ith regard to these partic$lar instr$ments" ver% other -ranch o& the Federal
government incl$ding the Dept" o& the Treas$r% has developed ela-orate li-raries o& comp$ter generated
&orm letters o& statements and replies dealing 'ith almost ever% possi-le .$estion or claim that co$ld -e
made o& an% agenc% or department o& the Federal government" The <nited ?tates Treas$r% has an O&&ice o&
B$-lic 5orrespondence 'hose sole >o- it is to respond to comm$nications &rom the general p$-lic" THERE
IS NO COMMUNICATION SENT TO THE UNITED STATES TREASURY THAT CAN
NOT BE RESPONDED TO AS IT MAY REQUIRE. Man% s$ch categories o& re.$ests calling &or
response are &ar greater in n$m-er than claims in e.$it% &or recover% to a Brime-creditor over the <nited
?tates and some categories are &ar &e'er in n$m-er* and %et -e the re.$ests greater or smaller in n$m-er
or in comple8it% o& response re.$ired* all these of a commercial nature are regularly and timely
responded to. There is virtually no written response by the Federal government to this issue of
recovery to the prime-creditors and holders in equity over the United States. The
factually observable position of the Secretary of the Treasury and his department in response to
THIS type of claim has been ABSOLUTE SILENCE be they from bank, business or private person:
Not denial* disavo'al* dishonor* or rep$diation o& s$ch claims O9 their -asis in la' and &act i& the% are not
tr$e* 'hich in ever% other case o& correspondence to the Federal government or the Department o& Treas$r%
dealing 'ith an% .$estion* re.$est or claim: ANF ?<5H FA;? 5;ADM* MD?5ON5BTDON O9
MD?TAKN <ND9?TANDDN# ON TH BA9T OF TH #N9A; B<B;D5 D? TDM;F DA;T
=DTH DN H9F 5A? BF ?<5H FO9M ;TT9?" Dt is the d$t% o& the <nited ?tates Treas$r% to the
commerce o& the nation and in the interests o& the general p$-lic 'hom it serves to quickly and
conclusively quash and repudiate any such false understandings or claims of remedy in equity on
recovery of the public debt in the commercial realm and it is easily within their power to do so"
This despite the fact the onl% o&&icial <? government directive &rom the Department o& the Treas$r%
dealing 'ith polic% o& the government to'ard &ictitio$s or other'ise invalid instr$ments sent to the Treasr%
&or collection states clearl% 6they will be returned to the sender"7 There is* there&ore* no -asis or reason
or pla$si-le e8planation &or s$ch unexplained silence 'ith regard to this partic$lar class o& instr$ment
except that a remedy in equity for recovery to the prime-creditors over the United States IS true and
factual and CANNOT BE DENIED or DISHONORED in equity, and that such Bills of Acceptance in
discharge of mutually offsetting obligations between the United States and its holders in equity as
secured parties ARE, in fact, being kept, held, and without return or dishonor, accepted as
obligations of the United States in the discharge and recovery of the public debt as they make claim
on their face to the Secretary of the Treasury to be" How the% are to -e recovered on is $p to the parties
involved holding s$ch o-ligations and is provided &or in la' and reg$lation and administrative proced$re a
holder or its -anking instit$tion ma% $se" In Conclusion: When a Commercial Bank sends the
instrument to the Secretary for discharge of its own obligations and a problem arises concerning the
instrument, a commercial response of some kind is required. There is a legal liability of the
government to a negotiable legal tender obligation upon the United States government sent to them
for acceptance by a member Federal Reserve Bank after they received it and became responsible for
it. The Treas$r% has an o-ligation as a department o& government serving the p$-lic interest to the -ank
'hich as a mem-er o& the Federal 9eserve ?%stem that has a commercial o-ligation to an acco$nt holder
and a Crd part% 'ho tendered the item in pa%ment to tell them that its not an% good or its not going to -e
honored* even i& the% 'anted to keep it &or prosec$tion or investigation" This is in e&&ect 'hat the directive
sa%s the government 'ill do i& its no good" What does statutory law, regulation, or case law tells us
about what that obligation isN The% do not dishonor it in an% 'a% -% ret$rn o& the item or the sending o&
an% notice to that e&&ect* or make re.$est &or additional in&ormation or time &or e8amination o& the
instr$ment* or given a statement o& e8planation indicating the time &rame &or its revie' and settlement i& it
'o$ld -e an inordinatel% length% time as longer than 40 da%s to &inish 'ith it" The instr$ments are -eing
kept* held* and 'itho$t ret$rn or dishonor* are accepted as an o-ligation o& the <nited ?tates in the
discharge and recover% o& the p$-lic de-t as it makes claim on its &ace to -e"B$t another 'a%: D& the -ank
had had to pa% the item to honor its c$stomer agreement as i& it had -een a check* what would or could the
bank be trying to do with it to finally settle the account? The bank needs to treat the Instrument
tendered as an obligation of the United States to the bank. The tender of these Instruments
discharge the obligation of the debt for which they are delivered and the payee
becomes the new holder in due course and collection agent on the Instruments" Exhibit E
U. S. District Court 1udge Christopher A. Boyko Decision
UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF OHIO EASTERN DIVISION
IN RE FORECLOSURE CASES ) CASE NO. NO.1:07CV2282
)
07CV2532 ) 07CV2560) 07CV2602) 07CV2631)
07CV2638) 07CV2681) 07CV2695) 07CV2920) 07CV2930
) 07CV2949) 07CV2950) 07CV3000) 07CV3029))
1UDGE CHRISTOPHER A. BOYKO))))OPINION AND ORDER))
CHRISTOPHER A. BOYKO, 1":
On Octo-er !0* /00M* this 5o$rt iss$ed an Order re.$iring Blainti&&-;enders in a n$m-er o& pending
&oreclos$re cases to &ile a cop% o& the e8ec$ted Assignment demonstrating Blainti&& 'as the holder and
o'ner o& the Note and Mortgage as of t0e date t0e "om.laint 7as filed* or the 5o$rt 'o$ld enter a
dismissal" A&ter considering the s$-missions* along 'ith all the doc$ments &iled o& record* the 5o$rt
dismisses the captioned cases 'itho$t pre>$dice" The 5o$rt has reached toda%,s determination a&ter a
thoro$gh revie' o& all the relevant la' and the -rie&s and arg$ments recentl% presented -% the parties*
incl$ding oral 5ase !:0M-cv-0//3/-5AB Doc$ment !! Filed !0@C!@/00M Bage ! o& 4-/-
arg$ments heard on Blainti&& De$tsche Bank,s Motion &or 9econsideration" The decision* there&ore* is
applica-le &rom this date &or'ard* and shall not have retroactive e&&ect" LAW AND ANALYSIS
A part% seeking to -ring a case into &ederal co$rt on gro$nds o& diversit% carries the -$rden o& esta-lishing
diversit% >$risdiction" &oyne v. :merican !obacco &ompany* !3C F" Cd 133 (4th 5ir" !222)" F$rther* the
plainti&& 6-ears the -$rden o& demonstrating standing and m$st plead its components 'ith speci&icit%"7
&oyne* !3C F" Cd at 121R @alley Forge &hristian &ollege v. :mericans $nited for %eparation of &hurch H
%tate* -nc.* 1:1 <"?" 141 (!23/)" The minim$m constit$tional re.$irements &or standing are: proo& o& in>$r%
in &act* ca$sation* and redressa-ilit%" @alley Forge* 1:1 <"?" at 1M/" Dn addition* 6the plainti&& m$st -e a
proper proponent* and the action a proper vehicle* to vindicate the rights asserted"7 &oyne* !3C F" Cd
at 121 (.$oting Gestrak v. 7hio 6lections &omm,n* 2/4 F" /d :MC* :M4 (4th 5ir" !22!))" To satis&% the
re.$irements o& Article DDD o& the <nited ?tates 5onstit$tion* the plainti&& m$st sho' he has .ersonall-
suffered some actual in8ur- as a res$lt o& the illegal cond$ct o& the de&endant" (mphasis added)" &oyne*
!3C F" Cd at 121R @alley Forge* 1:1 <"?" at 1M/" Dn each o& the a-ove-captioned 5omplaints* the named
Blainti&& alleges it is the holder and o'ner o& the Note and Mortgage" Ho'ever* the attached Note and
Mortgage identi&% the mortgagee and promisee as the original lending instit$tion a one other than the
named Blainti&&" F$rther* the Breliminar% J$dicial 9eport attached as an e8hi-it to the 5omplaint
makes no re&erence to the named Blainti&& in the recorded chain o& title@interest" The 5o$rt,s Amended
#eneral Order No" /004-!4 re.$ires Blainti&& to s$-mit an a&&idavit along 'ith the 5omplaint* 'hich
identi&ies Blainti&& either as the original mortgage holder* or as an assignee* 5ase !:0M-cv-0//3/-5AB
Doc$ment !! Filed !0@C!@/00M Bage / o& 4 -C-
tr$stee or s$ccessor-in-interest" Once again* the a&&idavits s$-mitted in all these cases recite the averment
that Blainti&& is the o'ner o& the Note and Mortgage* 'itho$t an% mention o& an assignment or tr$st or
s$ccessor interest" 5onse.$entl%* the ver% &ilings and s$-missions o& the Blainti&& create a con&lict" Dn ever%
instance* then* Blainti&& has not satis&ied its -$rden o& demonstrating standing at the time o& the &iling o& the
5omplaint" <nderstanda-l%* the 5o$rt re.$ested clari&ication -% re.$iring each Blainti&& to s$-mit
a cop% o& the Assignment o& the Note and Mortgage* e8ec$ted as o& the date o& the Foreclos$re 5omplaint"
Dn the a-ove-captioned cases* none o& the Assignments sho' the named Blainti&& to -e the o'ner o& the
rights* title and interest $nder the Mortgage at iss$e as o& the date o& the Foreclos$re 5omplaint" The
Assignments* in ever% instance* e8press a present intent to conve% all rights* title and interest in the
Mortgage and the accompan%ing Note to the Blainti&& named in the caption o& the Foreclos$re 5omplaint
$pon receipt o& s$&&icient consideration on the date the Assignment 'as signed and notariAed" F$rther* the
Assignment doc$ments are all prepared -% co$nsel &or the named Blainti&&s" These pro&&ered doc$ments
-elie Blainti&&s, assertion the% o'n the Note and Mortgage -% means o& a p$rchase 'hich pre-dated the
5omplaint -% da%s* months or %ears" Blainti&&-;enders shall take note* &$rthermore* that prior to the
iss$ance o& its Octo-er !0* /00M Order* the 5o$rt considered the principles o& 6real part% in interest*7 and
e8amined Fed" 9" 5iv" B" !M a 6Barties Blainti&& and De&endantR 5apacit%7 and its associated 5ommentar%"
The 9$le is not apropos to the sit$ation raised -% these Foreclos$re 5omplaints" The 9$le,s 5ommentar%
o&&ers this e8planation: 6The provision sho$ld not -e mis$nderstood or distorted" Dt is intended to prevent
&or&eit$re 'hen determination o& the 5ase !:0M-cv-0//3/-5AB Doc$ment !! Filed !0@C!@/00M Bage C o& 4
! Asto$ndingl%* co$nsel at oral arg$ment stated that his client* the p$rchaser &rom the original mortgagee*
ac.$ired complete legal and e.$ita-le interest in land 'hen mone% changed hands* even -e&ore the
p$rchase agreement* let alone a proper assignment* made its 'a% into his client,s possession"-1-
proper part% to s$e is di&&ic$lt or 'hen an $nderstanda-le mistake has -een made" """ Dt is* in cases o& this
sort* intended to ins$re against &or&eit$re and in>$stice """7 Blainti&&-;enders do not allege mistake or that a
part% cannot -e identi&ied" Nor 'ill Blainti&&-;enders s$&&er &or&eit$re or in>$stice -% the dismissal o& these
de&ective complaints other'ise than on the merits" Moreover* this 5o$rt is o-ligated to care&$ll% scr$tiniAe
all &ilings and pleadings in &oreclos$re actions* since the $ni.$e nat$re o& real propert% re.$ires contracts
and transactions concerning real propert% to -e in 'riting" 9"5" X !CC:"01" Ohio la' holds that 'hen a
mortgage is assigned* moreover* the assignment is s$->ect to the recording re.$irements o& 9"5" X :C0!"/:"
&reager v. :nderson (!2C1)* !4 Ohio ;a' A-s" 100 (interpreting the &ormer stat$te* #"5" X 3:1C)" 6Th$s*
'ith regards to real propert%* -e&ore an entit% assigned an interest in that propert% 'o$ld -e entitled to
receive a distri-$tion &rom the sale o& the propert%* their interest therein m$st have -een recorded in
accordance 'ith Ohio la'"7 -n re 7chmanek* /44 B"9" !!1* !/0 (Bkrtc%"N"D" Ohio /000) (citing Ginney v.
Merchants, National Bank of .efiance* M! Ohio ?t" !MC* !MM (!201)"! This 5o$rt ackno'ledges the right
o& -anks* holding valid mortgages* to receive timel% pa%ments" And* i& the% do not receive timel%
pa%ments* -anks have the right to properl% &ile actions on the de&a$lted notes a seeking &oreclos$re on the
propert% sec$ring the notes" Fet* this 5o$rt possesses the independent o-ligations to preserve the >$dicial
integrit% o& the &ederal co$rt and to >ealo$sl% g$ard &ederal >$risdiction" Neither the &l$idit% o& 5ase !:0M-
cv-0//3/-5AB Doc$ment !! Filed !0@C!@/00M Bage 1 o& 4 /
Blainti&&,s reliance on Ohio,s 6real part% in interest r$le7 (O95B !M) and on an% Ohio case citations is
misplaced" Altho$gh Ohio la' g$ides &ederal co$rts on s$-stantive iss$es* state proced$ral la' cannot -e
$sed to e8plain* modi&% or contradict a &ederal r$le o& proced$re* 'hich p$rpose is clearl% spelled o$t in
the 5ommentar%" 6Dn &ederal diversit% actions* state la' governs s$-stantive iss$es and &ederal la'
governs proced$ral iss$es"7 6rie ;.;. &o. v. !ompkins* C01 <"?" 4C (!2C3)R 0egg v. &hopra* /34 F" Cd
/34* /32 (4th 5ir" /00/)R Iafford v. Ieneral 6lectric &ompany* 22M F" /d !:0* !4:-4 (4th 5ir" !22C)"
C
Blainti&&,s* 6J$dge* %o$ >$st don,t $nderstand ho' things 'ork*7 arg$ment reveals a condescending
mindset and .$asi-monopolistic s%stem 'here &inancial instit$tions have traditionall% controlled* and still
control* the &oreclos$re process" T%picall%* the homeo'ner 'ho &inds himsel&@hersel& in &inancial straits*
&ails to make the re.$ired mortgage pa%ments and &aces a &oreclos$re s$it* is not interested in testing state
or &ederal >$risdictional re.$irements* either pro se or thro$gh co$nsel" Their &oc$s is either* 6ho' do D
save m% home*7 or 6i& D have to give it $p* D,ll simpl% leave and &ind some'here else to live"7
Dn the meantime* the &inancial instit$tions or s$ccessors@assignees r$sh to &oreclose* o-tain a
de&a$lt >$dgment and then sit on the deed* avoiding responsi-ilit% &or maintaining the propert% 'hile
reaping the &inancial -ene&its o& interest r$nning on a >$dgment" The &inancial instit$tions kno' the la'
charges the one 'ith title (still the homeo'ner) 'ith maintaining the propert%"
There is no do$-t ever% decision made -% a &inancial instit$tion in the &oreclos$re process is
driven -% mone%" And the legal 'ork 'hich &lo's &rom 'inning the &inancial instit$tion,s &avor is highl%
l$crative" There is nothing improper or 'rong 'ith &inancial instit$tions or la' &irms making a pro&it a
to the contrar% * the% sho$ld -e re'arded &or so$nd -$siness and legal practices" Ho'ever* $nchallenged
-% $nder&inanced opponents* the instit$tions 'orr% less a-o$t >$risdictional re.$irements and more a-o$t
ma8imiAing ret$rns" <nlike the &oc$s o& &inancial instit$tions* the &ederal co$rts m$st act as gatekeepers*
ass$ring that onl% those 'ho meet diversit% and standing re.$irements are allo'ed to pass thro$gh"
5o$nsel &or the instit$tions are not 'itho$t legal arg$ment to s$pport their position* -$t their
arg$ments &all 'oe&$ll% short o& >$sti&%ing their premat$re &ilings* and $tterl% &ail to satis&% their standing
-:-
the secondar% mortgage market* nor monetar% or economic considerations o& the parties* nor the
convenience o& the litigants s$persede those o-ligations" Despite Blainti&&s, co$nsel,s -elie& that 6there
appears to -e some level o& disagreement and@or mis$nderstanding amongst pro&essionals* -orro'ers*
attorne%s and mem-ers o& the >$diciar%*7 the 5o$rt does not re.$ire instr$ction and is not operating $nder
an% misapprehension" The 6real part% in interest7 r$le* to 'hich the Blainti&&-;enders contin$all% re&er in
their responses or motions* is clearl% comprehended -% the 5o$rt and is not intended to assist -anks in
avoiding traditional &ederal diversit% re.$irements"/ <nlike Ohio ?tate la' and proced$re* as Blainti&&s
perceive it* the &ederal >$dicial s%stem need not* and 'ill not* -e 6&orgiving in this regard"7C
5ase !:0M-cv-0//3/-5AB Doc$ment !! Filed !0@C!@/00M Bage : o& 4
and >$risdictional -$rdens" The instit$tions seem to adopt the attit$de that since the% have -een doing this
&or so long* $nchallenged* this practice e.$ates 'ith legal compliance" Finall% p$t to the test* their 'eak
legal arg$ments compel the 5o$rt to stop them at the gate" The 5o$rt 'ill ill$strate in simple terms its
decision: 6Fl$idit% o& the market7 a 6U7 dollars* 6contract$al arrangements -et'een instit$tions and
co$nsel7 a 6U7 dollars* 6p$rchasing mortgages in -$lk and sec$ritiAing7 a 6U7 dollars* 6r$sh to &ile* slo'
to record a&ter >$dgment7 a 6U7 dollars* 6the >$risdictional integrit% o& <nited ?tates District 5o$rt7 a
6Briceless"7 -4-
CONCLUSION
For all the &oregoing reasons* the a-ove-captioned Foreclos$re 5omplaints are dismissed 'itho$t pre>$dice"
IT IS SO ORDERED. DATE: October 31, 2007 S/Christopher A. Boyko
CHRISTOPHER A. BOYKO
United States District 1udge
5ase !:0M-cv-0//3/-5AB Doc$ment !! Filed !0@C!@/00M Bage 4 o& 4
Exhibit F
U. S. District Court 1udge Thomas M. Rose
Decision
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION AT DAYTON
IN RE FORECLOSURE CASES CASE NO. 3:07CV043
07CV049 07CV085 07CV138 07CV237 07CV240 07CV246 07CV248 07CV257 07CV286 07CV304
07CV312 07CV317 07CV343 07CV353 07CV360 07CV386 07CV389 07CV390 07CV433
1UDGE THOMAS M. ROSE
______________________________________________________________________________
OPINION AND ORDER
______________________________________________________________________________
The &irst private &oreclos$re action -ased $pon &ederal diversit% >$risdiction 'as &iled in
this 5o$rt on Fe-r$ar% 2* /00M" ?ince then* t'ent%-si8 (/4) additional complaints &or &oreclos$re
-ased $pon &ederal diversit% >$risdiction have -een &iled"
STANDING AND SUB1ECT MATTER 1URISDICTION
=hile each o& the complaints &or &oreclos$re pleads standing and >$risdiction* evidence s$-mitted either
'ith the complaint or later in the case indicates that standing and@or s$->ect matter >$risdiction ma% not
have e8isted at the time certain o& the &oreclos$re complaints 'ere 5ase C:0M-cv-00/34-TM9-M9M
Doc$ment /1 Filed !!@!:@/00M Bage ! o& M -/-
&iled" F$rther* onl% one o& these &oreclos$re complaints th$s &ar 'as &iled in compliance 'ith this
5o$rt,s #eneral Order 0M-0C captioned 6Broced$res &or Foreclos$re Actions Based On Diversit%
J$risdiction" ?tanding Federal co$rts have onl% the po'er a$thoriAed -% Article DDD o& the <nited ?tates
5onstit$tion and the stat$tes enacted -% 5ongress p$rs$ant thereto" Bender v. +illiamsport :rea %chool
.istrict* 1M: <"?" :C1* :1! (!234)" As a res$lt* a plainti&& m$st have constit$tional standing in order &or a
&ederal co$rt to have >$risdiction" -d.Blainti&&s have the -$rden o& esta-lishing standing" 0oren v. Blue
&ross H Blue %hield of Michigan* No" 04-/020* /00M =; /M/4M01 at VM (4th 5ir" ?ept" /0* /00M). D& the%
cannot do so* their claims m$st -e dismissed &or lack o& s$->ect matter >$risdiction" -d. (citing &entral
%tates
%outheast H %ou hwest :reas Bealth and +elfare Fund v. MerckFMedco Managed &are* 1CC F"Cd !3!* !22
(/d 5ir" /00:))" Beca$se standing involves the &ederal co$rt,s s$->ect matter >$risdiction* it can -e raised
s$a sponte" -d. (citing &entral %tates* 1CC F"Cd at !23)" F$rther* standing is determined as o& the time the
complaint is &iled" &leveland Branch* N::&G v. &ity of Garma* 7hio* /4C F"Cd :!C* :/1 (4th 5ir" /00!)*
cert. denied* :C: <"?" 2M! (/00/)" Finall%* 'hile a determination o& standing is generall% -ased $pon
allegations in the complaint* 'hen standing is .$estioned* co$rts ma% consider evidence thereo&" %ee
N::&G* /4C F"Cd at :/C-C0R %enter v. Ieneral Motors* :C/ F"/d :!! (4th 5ir" !2M4)* cert. denied* 1/2
<"?" 3M0 (!2M4) To satis&% Article DDD,s standing re.$irements* a plainti&& m$st sho': (!) it has s$&&ered an
in>$r% in &act that is concrete and partic$lariAed and act$al or imminent* not con>ect$ral or 5ase C:0M-cv-
00/34-TM9-M9M Doc$ment /1 Filed !!@!:@/00M Bage / o& M -C-
h%potheticalR (/) the in>$r% is &airl% tracea-le to the challenged action o& the de&endantR and (C) it is likel%*
as opposed to merel% spec$lative* that the in>$r% 'ill -e redressed -% a &avora-le decision" 0oren* /00M =;
/M/4M01 at VM"To sho' standing* then* in a &oreclos$re action* the plainti&& m$st sho' that it is the holder
o& the note and the mortgage at the time the complaint 'as &iled" The &oreclos$re plainti&& m$st also sho'*
at the time the &oreclos$re action is &iled* that the holder o& the note and mortgage is harmed* $s$all% -% not
having received pa%ments on the note" Diversit% J$risdiction Dn addition to standing* a co$rt ma% address
the iss$e o& s$->ect matter >$risdiction at an% time* 'ith or 'itho$t the iss$e -eing raised -% a part% to the
action" &ommunity Bealth Glan of 7hio v. Mosser* C1M F"Cd 4!2* 4// (4th 5ir" /00C)" F$rther* as 'ith
standing* the plainti&& m$st sho' that the &ederal co$rt has s$->ect matter >$risdiction over the &oreclos$re
action at the time the &oreclos$re action 'as &iled" &oyne v. :merican !obacco &ompany* !3C F"Cd 133*
12/-2C (4th 5ir" !222)" Also as 'ith standing* a &ederal co$rt is re.$ired to ass$re itsel& that it has s$->ect
matter >$risdiction and the -$rden is on the plainti&& to sho' that s$->ect matter >$risdiction e8isted at the
time the complaint 'as &iled" -d. Finall%* i& s$->ect matter >$risdiction is .$estioned -% the co$rt* the
plainti&& cannot rel% solel% $pon the allegations in the complaint and m$st -ring &or'ard relevant* ade.$ate
proo& that esta-lishes s$->ect matter >$risdiction" Nelson &onstruction &o. v. $.%.* No" 0:-!/0:5* /00M =;
C/22!4! at VC (Fed" 5l"* Oct" /2* /00M) (citing McNutt v. Ieneral Motors :cceptance &orp. of -ndiana*
/23 <"?" !M3 (!2C4))R see also Nichols v. Muskingum &ollege* C!3 F"Cd 4M1* (4th 5ir" /00C) (6in revie'ing
a !/(-)(!) motion* the co$rt ma% consider evidence o$tside the pleadings to resolve &act$al disp$tes
5ase C:0M-cv-00/34-TM9-M9M Doc$ment /1 Filed !!@!:@/00M Bage C o& M -1-
concerning >$risdictionL7)" The &oreclos$re actions are -ro$ght to &ederal co$rt -ased $pon the &ederal
co$rt having >$risdiction p$rs$ant to /3 <"?"5" X !CC/* termed diversit% >$risdiction" To invoke diversit%
>$risdiction* the plainti&& m$st sho' that there is complete diversit% o& citiAenship o& the parties and that the
amo$nt in controvers% e8ceeds GM:*000" /3 <"?"5" X !CC/" 5oncl$sion =hile the plainti&&s in each o& the
a-ove-captioned cases have pled that the% have standing and that this 5o$rt has s$->ect matter >$risdiction*
the% have s$-mitted evidence that indicates that the% ma% not have had standing at the time the &oreclos$re
complaint 'as &iled and that s$->ect matter >$risdiction ma% not have e8isted 'hen the &oreclos$re
complaint 'as &iled"F$rther* this 5o$rt has the responsi-ilit% to ass$re itsel& that the &oreclos$re plainti&&s
have standing and that s$->ect-matter->$risdiction re.$irements are met at the time the complaint is &iled"
ven 'itho$t the concerns raised -% the doc$ments the plainti&&s have &iled* there is reason to .$estion the
e8istence o& standing and the >$risdictional amo$nt" %ee Katherine M" Borter* Misbehavior and Mistake in
Bankruptcy Mortgage &laims C-1 (Novem-er 4* /00M)* <niversit% o& Do'a 5ollege o& ;a' ;egal ?t$dies
9esearch Baper ?eries Availa-le at ??9N: http:@@ssrn"com@a-stract-!0/M24! (6SHTome mortgage lenders
o&ten diso-e% the la' and overreach in calc$lating the mortgage o-ligations o& cons$mers" L Man% o& the
overcharges and $nrelia-le calc$lationsL raise the specter o& poor recordkeeping* &ail$re to compl% 'ith
cons$mer protection la's* and massive* consistent overcharging"7) There&ore* plainti&&s are given $ntil not
later than thirt% da%s &ollo'ing entr% o& this order to s$-mit evidence sho'ing that the% had standing in the
a-ove-captioned cases when the 5ase C:0M-cv-00/34-TM9-M9M Doc$ment /1 Filed !!@!:@/00M Bage 1
o& M !The 5o$rt vie's the statement 6the complaint m$st -e accompanied -% the &ollo'ing7 to
mean that the items listed m$st -e &iled 'ith the complaint and not at some time later that is more
convenient &or the plainti&&" -:- complaint was filed and that this 5o$rt had diversit% >$risdiction when the
complaint was filed" Fail$re to do so 'ill res$lt in dismissal 'itho$t pre>$dice to re&iling i& and 'hen the
plainti&& ac.$ires standing and the diversit% >$risdiction re.$irements are met" %ee -n re Foreclosure &ases*
No" !:0M5H//3/* et al"* slip op" (N"D" Ohio Oct" C!* /00M) (Bo%ko* J")COMPLIANCE WITH
GENERAL ORDER 07-03 Federal 9$le o& 5ivil Broced$re 3C(a)(/) provides that a 6local r$le imposing a
re.$irement o& &orm shall not -e en&orced in a manner that ca$ses a part% to lose rights -eca$se o& a
non'ill&$l &ail$re to compl% 'ith the re.$irement"7 Fed" 9" 5iv" B" 3C(a)(/)" The 5o$rt recogniAes that a
local r$le concerning 'hat doc$ments are to -e &iled 'ith a certain t%pe o& complaint is a r$le o& &orm"
Bicks v. Miller Brewing &ompany* /00/ =; 44CM0C (:th 5ir" /00/)" Ho'ever* a part% ma% -e denied
rights as a sanction i& &ail$re to compl% 'ith s$ch a local r$le is 'ill&$l" -d. #eneral Order 0M-0C provides
proced$res &or &oreclos$re actions that are -ased $pon diversit% >$risdiction" Dncl$ded in this #eneral Order
is a list o& items that m$st accompan% the 5omplaint"! Among the items listed are: a Breliminar% J$dicial
9eportR a 'ritten pa%ment histor% veri&ied -% the plainti&&,s a&&idavit that the amo$nt in controvers%
e8ceeds GM:*000R a legi-le cop% o& the promissor% note and an% loan modi&ications* a recorded cop% o& the
mortgageR an% applica-le assignments o& the mortgage* an a&&idavit doc$menting that the named plainti&& is
the o'ner and holder o& the note and mortgageR and a corporate disclos$re statement" Dn general* it is &rom
these items and the &oreclos$re complaint that the 5o$rt can con&irm standing and the 5ase C:0M-cv-00/34-
TM9-M9M Doc$ment /1 Filed !!@!:@/00M Bage : o& M /The ?i8th 5irc$it ma% look to an attorne%,s
actions in other cases to determine the e8tent o& his or her good &aith in a partic$lar action" %ee &apital
-ndemnity &orp. v. ?ellinick* M: F" App,8 222* !00/ (4th 5ir" /00C)" F$rther* the la' holds a plainti&&
6acco$nta-le &or the acts and omissions o& SitsT chosen co$nsel"7 Gioneer -nv. %ervices &o. v. Brunswick
:ssociates 0td.Gartnership* :0M <"?" C30* C2M (!22C)" -4- e8istence o& diversit% >$risdiction at
the time the &oreclos$re complaint is &iled" 5oncl$sion To date* t'ent%-si8 (/4) o& the t'ent%-seven (/M)
&oreclos$re actions -ased $pon diversit% >$risdiction pending -e&ore this 5o$rt 'ere &iled -% the same
attorne%" One o& the t'ent%-si8 (/4) &oreclos$re actions 'as &iled in compliance 'ith #eneral Order 0M-0C"
The remainder 'ere not"/ Also* man% o& these &oreclos$re complaints are notated on the docket to indicate
that the% are not in compliance" Finall%* the attorne% 'ho has &iled the t'ent%-si8 (/4) &oreclos$re
complaints has in&ormed the 5o$rt on the record that he kno's and can compl% 'ith the &iling re.$irements
&o$nd in #eneral Order 0M-0C" There&ore* since the attorne% 'ho has &iled t'ent%-si8 (/4) o& the t'ent%-
seven (/M) &oreclos$re actions -ased $pon diversit% >$risdiction that are c$rrentl% -e&ore this 5o$rt is 'ell
a'are o& the re.$irements o& #eneral Order 0M-0C and can compl% 'ith the #eneral Order,s &iling
re.$irements* &ail$re in the &$t$re -% this attorne% to compl% 'ith the &iling re.$irements o& #eneral Order
0M-0C ma% onl% -e considered to -e 'ill&$l" Also* d$e to the e8tensive disc$ssions and arg$ment that has
taken place* &ail$re to compl% 'ith the re.$irements o& the #eneral Order -e%ond the &iling re.$irements
-% this attorne% ma% also -e considered to -e 'ill&$l" A 'ill&$l &ail$re to compl% 'ith #eneral Order 0M-0C
in the &$t$re -% the attorne% 'ho &iled the t'ent%-si8 &oreclos$re actions no' pending ma% res$lt in
immediate dismissal o& the 5ase C:0M-cv-00/34-TM9-M9M Doc$ment /1 Filed !!@!:@/00M Bage 4 o& M
-M- &oreclos$re action" F$rther* the attorne% 'ho &iled the t'ent%-seventh &oreclos$re action is here-% p$t
on notice that &ail$re to compl% 'ith #eneral Order 0M-0C in the &$t$re ma% res$lt in This 5o$rt is 'ell
a'are that entities 'ho hold valid notes are entitled to receive timel% pa%ments in accordance 'ith the
notes" And* i& the% do not receive timel% pa%ments* the entities have the right to seek &oreclos$re on the
accompan%ing mortgages" Ho'ever* 'ith regard the en&orcement o& standing and other >$risdictional
re.$irements pertaining to &oreclos$re actions* J$dge 5hristopher A Bo%ko o& the <nited ?tates District
5o$rt &or the Northern District o& Ohio 'ho recentl% stressed that the >$dicial integrit% o& the <nited ?tates
District 5o$rt is 6Priceless"7 DONE and ORDERED in Da%ton* Ohio* this Fi&teenth da% o& Novem-er*
/00M"
s/Thomas M. Rose
EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE
THOMA? M" 9O?
<NDTD ?TAT? DD?T9D5T J<D#
5opies provided: 5o$nsel o& 9ecord
5ase C:0M-cv-00/34-TM9-M9M Doc$ment /1 Filed !!@!:@/00M Bage M o& M
Exhibit G
Securitization is ILLEGAL
Title: SECURITIZATION IS ILLEGAL.
AUTHOR: MD5HA; N=O#<#<* 5erti&ied B$-lic Acco$ntant (Mar%land* <?A)R B"Arch"
(5it% 5ollege O& Ne' Fork)" MBA (5ol$m-ia <niversit%)" Attended ?$&&olk ;a' ?chool
(Boston* <?A)" Address: B" O" Bo8 !M000/* Brookl%n* NF !!/!M* <?A" Bhone@Fa8: !-M!3-4C3-
4/M0" mail: dataghpeoplepc.comR mcn!!!Q>$no"com"
theres more %o$ can search &or FBD &iles on: http:@@gro$ps"%ahoo"com@gro$p@9edemptionB%Method@