Truth about your Money, your Bank and your Debt."
UNITED STATES Bankruptcy Court
For Eastern District of Texas
DENALORE LEE CANNON &
ROSE ANN HOOPER cannon, plaintiffs
TEXAS INDEPENDENT BANK, Defendants
Case No. 96-41-347-DRS
Adversary Proceeding No. A-96-4 147-DRS
Plaintiff’s Memorandum of the Law
ON CREDIT LOANS AND VOID CONTRACTS
To the Honorable Judge of Said Court:
This Memorandum with authorities, law and cases in support, will establish the following facts: 1) Defendant and privately owned banks are making loans of credit with the intended purpose of “creating” credit as “money;” 2) other financial institutions and individuals may “launder” bank credit that they receive directly or indirectly from privately owned banks; 3) such activity and underlying contracts have long been held void by State Courts, Federal Courts and the U. S. Supreme Court.
This Memorandum will show through authorities that credit “money creation” by privately owned bank corporations is not really “money creation” at all, but the trade specialty and artful illusion of law merchants who use old-time trade secrets of the Goldsmiths to entice the borrower and unjustly enrich the lender through usury and other artful techniques. Issues based on law and the principles of equity, which are within the jurisdiction of this Court, will be addressed.
HISTORY OF MONEY AND BANKING
In his book, Money and Banking (8th Edition, 1984), Professor David R. Kamerschen writes on pages 56-63: “The first bankers in the modern sense were the goldsmiths, who frequently accepted bullion and coins for storage . . . One result was that the goldsmiths temporarily could lend part of the gold left with them . . . These loans of their customers’ gold were soon replaced by a revolutionary technique . . . When people brought in gold, the goldsmith gave them notes promising to pay that amount of gold on demand. The notes, first made payable to the order of the individual, were later changed to bearer obligations. In the previous form, a note payable to the order of Perry Reeves would be paid to no one else unless Reeves had first endorsed the note . . . But notes were soon being used in an unforeseen way. The note holders found that, when they wanted to buy something, they could use the note itself in payment more conveniently and let the other person go after the gold, which the person rarely did . . . The specie, then tendered to remain in the goldsmiths’ vaults . . . The goldsmiths began to realize that they might profit handsomely by issuing somewhat more notes than the amount of specie they held.
“These additional notes would cost the goldsmiths nothing except the negligible cost of printing them, yet the notes provided the goldsmiths with funds to lend at interest . . . And they were to find that the profitability of their lending operations would exceed the profit from their original trade. The goldsmiths became bankers as their interest in manufacture of gold items to sell was replaced by their concern with credit policies and lending activities.
“They discovered early that, although an unlimited note issue would be unwise, they could issue notes up to several times the amount of specie they held. The key to the whole operation lay in the public’s willingness to leave gold and silver in the bank’s vaults and use the bank’s notes. This discovery is the basis of modern banking.”
On page 74, Professor Kamerschen further explains the evolution of the credit system: “Later the goldsmiths learned a more efficient way to put their credit money into circulation. They lent by issuing additional notes rather than by paying out in gold, in exchange for the interest bearing note received from their customer (in effect, the loan contract), they gave their own non-interest bearing note. Each was actually borrowing from the other . . . The advantage of the later procedure of lending notes rather than gold was that . . . more notes could be issued if the gold remained in the vaults . . . Thus, through the principle of bank note issuance banks learned to create money in the form of their own liability.”
Another publication that explains modern banking as learned from the Goldsmiths is Modern Money Mechanics (5th edition 1992), published by the Federal Reserve Bank of Chicago, that states beginning on page 3: “It started with the goldsmiths . . .” At one time, bankers were merely middlemen. They made a profit by accepting gold and coins brought to them for safekeeping and lending the gold and coins to borrowers. But the goldsmiths soon found that the receipts they issued to depositors were being used as a means of payment. “Then bankers discovered that they could make loans merely by giving borrowers their promises to pay, or bank notes . . . In this way, banks began to create money . . . Demand deposits are the modern counterpart of bank notes. . . It was a small step from printing notes to making book entries to the credit of borrowers that the borrowers, in turn, could ‘spend’ by writing checks, thereby printing their own money.”
MODERN MONEY AND BANKING
HOW BANKS CREATE MONEY
In the modern sense, banks create money by creating “demand deposits”. Demand deposits are merely “book entries” that reflect how much lawful money the bank owes its customers. Thus, all deposits are called demand deposits and are the bank’s liabilities. The bank’s assets are the vault cash plus all the “IOUs” or promissory notes that borrowers sign when they borrow either money or credit. When a bank lends its cash (legal money), it loans its assets, but when a bank lends credit, it lends its liabilities. The lending of credit is, therefore, the exact opposite of the lending of cash (legal money).
At this point, we need to define the meaning of certain words like “lawful money”, “legal tender”, “other money”, and “dollars”.
The terms “Money” and “Tender” had their origins in Article I, Sec. 8 and Article I, Sec. 10 of the Constitution of the United States. Title 12 U.S.C. 152 refers to “gold and silver coin as lawful money of the united States” and was repealed in 1994. The term “legal tender” was originally cited in 31 U.S.C.A. 392 and is now re-codified in 31 U.S.C.A. 5103 that states: “united States coins and currency . . . are legal tender for all debts, public charges, taxes, and dues.” The common denominator in both “lawful money” and “legal tender money” is that both are issued by the United States Government.
With Bankers, however, we find that there are two forms of money – one is government-issued and the other is issued by privately owned banks such as Defendant, Texas Independent Bank. As we have already discussed government-issued forms of money, we need to look at privately-issued forms of money.
All privately issued forms of money today are based upon the liabilities of the issuer. There are three common terms used to describe this privately created money. They are “credit”, “demand deposits”, and “checkbook money”. In the Fifth edition of Black’s Law Dictionary, p.331, under the term “Credit”, the term “Bank credit” is described as: “Money bank owes or will lend individual or person”. It is clear from this definition that “Bank credit” which is the “money bank owes” is the bank’s liability. The term “checkbook money” is described in the book I Bet You Thought, published by the privately owned Federal Reserve Bank of New York, as follows: “Commercial 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 . . .”
The word “deposit” and “demand deposit” both mean the same thing in bank terminology and refer to the bank’s liabilities. For example, the Chicago Federal Reserve’s book, Modern Money Mechanics says: “Deposits are merely book entries . . . Banks can build up deposits by increasing loans . . . Demand deposits are the modern counterpart of bank notes. It was a small step from printing notes to making book entries to the credit of borrowers which the borrowers, in turn, could ‘spend’ by writing checks.” Thus, it is demonstrated in Modern Money Mechanics how, under the practice of fractional reserve banking, a deposit of $5,000 in cash could result in a loan of credit/checkbook money/demand deposits of $100,000 if reserve ratios set by the Federal Reserve are 5% (instead of 10%).
In a practical application, here is how it works. If a bank has ten people who each deposit $5,000 (totaling $50,000) in cash (legal money) and the bank’s reserve ratio is 5%, then the bank will lend twenty times this amount, or $1,000,000 in “credit” money. What the bank has actually done, however, is to write a check or loan its credit with the intended purpose of circulating credit as “money”. Banks know that if all the people, who receive a check or credit loan, were to come to the bank and demand cash, the bank would have to close its doors because it doesn’t have the cash to back up its check or loan. The bank’s check or loan will, however, pass as money as long as people have confidence in the illusion and don’t demand cash. Panics are created when people line up at the bank and demand cash (legal money), causing banks to fold as history records in several time periods.
The process of passing checks or credit as money is done quite simply. A deposit of $5,000 in cash by one person results in loans totaling $100,000 to other persons at 5% reserves. The persons receiving the checks or loans of credit totaling $100,000 usually deposit these checks or loans of credit it in the same bank or another bank in the Federal Reserve System. These checks or loans are sent to the bookkeeping department of the lending bank where book entries totaling $100,000 are credited to the borrowers’ accounts. The lending bank’s checks that created the borrowers’ loans are then stamped “Paid” when the accounts of the borrowers are credited “dollar” amounts. The borrowers may then “spend” these book entries (demand deposits) by writing checks to others, who in turn deposit their checks and have book entries transferred to their accounts from the borrowers’ checking accounts.
However, two highly questionable and unlawful acts have now occurred. The first was when the bank wrote the check or made the loan with insufficient funds to back the check. The second is when the bank stamps its own NSF check “paid” or posts a loan by merely crediting the borrower’s account with book entries the bank calls “dollars.” Ironically, the check or loan seems good and passes as money – unless an emergency occurs via demands for cash – or a Court challenge – and the artful illusion bubble bursts.
DIFFERENT KINDS OF MONEY
The book I Bet You Thought, published by the Federal Reserve Bank of New York says:
“Money is any generally accepted medium of exchange, not simply coin and currency. Money doesn’t have to be intrinsically valuable, be issued by a government or be in any special form.” [Emphasis added.] Thus, we see that privately issued forms of money only require public confidence to pass as money. Counterfeit money also passes as money as long as nobody discovers it is counterfeit. Likewise, “bad” checks and “credit” loans pass as money as long as no one objects. Yet, once the truth is discovered, the value of such “bank money”, like bad checks, ceases to exist. There are, therefore, two kinds of money – government-issued legal money and privately-issued money, by agreement of the parties.
DIFFERENT KINDS OF DOLLARS
The dollar once represented something intrinsically valuable made from gold or silver. For example, in 1792 Congress defined the silver dollar as a silver coin containing 371.25 grains of pure silver. The legal dollar is now known as “United States coins and currency”. However, the Banker’s dollar has become a unit of measure of a different kind of money. Therefore, with Bankers there is a “dollar” of coins and a “dollar” of cash (legal money), a “dollar” of debt, a “dollar” of credit, a “dollar” of checkbook money or a “dollar” of checks. When one refers to a dollar spent or a dollar loaned, he should now indicate what kind of “dollar” he is referencing, since Bankers have created so many different kinds.
A dollar of bank “credit money” is the exact opposite of a dollar of “legal money”. The former is a liability while the latter is an asset. Thus, it can be seen from the earlier statement quoted from I Bet You Thought, that money can be privately issued as: “Money doesn’t have to . . . be issued by a government or be in any special form.” It should be carefully noted that banks that issue and lend privately created money, demand to be paid with government issued money. However, payment in like kind under natural equity would seem to indicate that a debt created by a loan of privately created money can be paid with other privately created money, without regard for “any special form” as there are no statutory laws to dictate how either private citizens or banks may create money.
BY WHAT AUTHORITY??
By what authority do state and national banks, as privately owned corporations, create money by lending their credit – or more simply put, by writing and passing “bad” checks and “credit” loans as “money”? Nowhere can a law be found that gives banks the authority to create money by lending their liabilities.
Therefore, the next question is: If banks are creating money by passing bad checks and lending their credit, where is their authority to do so? From their literature, banks claim these techniques were learned from the trade secrets of the Goldsmiths. It is evident, however, that money creation by private banks is not the result of powers conferred upon them by government, but rather the artful use of long held “trade secrets”. Thus, such money creation is not being done by banks as corporations, but by bankers.
Article I, Section 10, para. 1 of the Constitution of the United States 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 any Bill of Attainder, ex post facto Law, or Law impairing the Obligations of Contracts . . .” [Emphasis added.] The states that grant the Charters of state banks also prohibit the emitting of bills of credit by not granting such authority in bank charters.
It is obvious that the people never delegated to Congress, state government, or agencies of the state, the power to create and issue money in the form of checks, credit, or other “bills of credits” to people in the states. The Federal Government today does not authorize banks in the states to emit, write, create, issue, and pass checks and credit as money, but banks do, and get away with it, because the people do not take advantage of the rights they have in that creation process. Banks assign their privately created money through misleading terms, like “credit”, “demand deposits”, and “checkbook money”; however, the true nature of “credit money” and “checks” does not change regardless of the artful terminology used to describe them. Such money in common use by privately owned banks is illegal under Article I, Sec. 10, para. 1 of the Constitution of the United States as well as unlawful under the laws of the United States, but is permitted through agreement of the parties, whether the parties realize they are agreeing or not.
VOID “ULTRA VIRES” CONTRACTS
Black’s Law Dictionary defines the Latin term “extra vires” to mean beyond powers. Black’s Law Dictionary explains the term “ultra vires” embraces “[a]n act performed without any authority to act on subject. Haslund v. City of Seattle, 86 Wash.2d 607, 547 P.2d 1221, 1230. Acts beyond the scope of the powers of a corporation, as defined by its charter or laws of state of incorporation. State ex rel. v. Holston Trust Col, 168 Tenn. 546, 79 S.W.2d 1012, 1016. The term has a broad application and includes not only acts prohibited by the charter, but acts which are in excess of powers granted and not prohibited, and generally applied either when a corporation has no power whatever to do an act, or when the corporation has the power, but exercises it irregularly. People ex rel. Barrett v. Bank of Peoria, 295 Ill.App. 543, 15 N.E.2d 333, 335. Act is ultra vires when corporation is without authority to perform it under any circumstances or for any purpose. By doctrine of ultra vires a contract made by a corporation beyond the scope of its corporate powers is unlawful. Community Federal Sav. & Loan Ass’n of Independence, Mo. v. Fields, C.C.A., Mo., 128 F.2d 705, 708.” Black’s 6th Edition, p. 1522.
The courts have long held that when a corporation executes a contract beyond the scope of its charter or granted corporate powers, the contract is void or “ultra vires”. See infra, Pullman v. Central Transp. Co., 139 U.S. 62, 11 S.Ct. 478, 35 L.Ed. 55.
THE QUESTION OF LAWFUL CONSIDERATION
The issue of whether the lender, who writes and passes a “bad” check or makes a “credit” loan, has a claim for relief against the borrower is easy to answer, providing the lender can prove that he gave a lawful consideration based upon lawful acts, but did the lender give a lawful consideration? 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, UNLESS the borrower understands how the consideration was created and enforces its rights against the lender.
It can be claimed that “bad” checks or “credit” loans, that pass as money, are valuable, but so are counterfeit coins and currency that pass as money. It seems unconscionable that a bank would ask homeowners to put up a homestead as collateral for a “credit loan” that the bank created out of thin air. Would a court of law or equity allow a counterfeiter to foreclose against a person’s home because the borrower was late in payments on an unlawful loan? If the court were to do so, it would be contrary to all principles of law.
The question of valuable consideration does not depend on any value imparted by the lender, but by the confidence instilled in the “bad” check or “credit” loan by the lender. In a court at law or equity, the lender has no claim for relief. The argument that the lender has a claim for relief because the borrower received property for the lender’s “bad” check or “credit” loan, is not valid unless the lender can prove that he gave lawful value. The claim for relief lies with the seller, who may be holding the “bad” check or “credit” loan, against the lender or the borrower, or both, but the seller had confidence that the check he received had value, and the merchants who accepted his checks had the same confidence. Without that confidence, the bank’s checks would be worthless.
BORROWER RELIEF ***
Since we have established that the lender of unlawful or counterfeit money has no claim for relief under a void contract, the last question is, does the borrower have a claim for relief against the lender?
First, if it is established that the borrower has made no payments to the lender, then the borrower has no claim for relief against the lender for money damages, but the borrower has a claim for relief to void the debt he owes the lender for notes or obligations unlawfully created by an Ultra vires contract for lending “credit” money.
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 borrower may also have claims for relief for breach of contract by the lender for not lending “lawful money” and for usury for charging an interest rate several times greater than the amount agreed to in the contract for any lawful money actually risked by the lender. For example, if on a $100,000 loan it can be established that the lender actually risked only $5,000 (5% Federal Reserve ratio) with a current interest rate of 10%, the lender has then loaned $95,000 of “credit” and $5,000 of “lawful money” while charging 10% interest ($10,000) on the entire $100,000. The true interest rate on the $5,000 of “lawful money” actually risked by the lender is 200%, which violates Usury laws. 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 say 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
In District Court, the borrower may have additional claims for relief under “Civil RICO” Federal Racketeering laws (Title 18 U.S.C. 1964) as the lender may have established a “pattern of racketeering activity” by using the U.S. Mail more than twice to collect an unlawful debt and the lender may be in violation of Title 18 U.S.C. 1341, 1343, 1961 and 1962. The borrower may have other claims for relief if he can prove there was or is a conspiracy to deprive him of property without due process of law under Title 42 U.S.C. 1983 (Constitutional injury), 1985 (Conspiracy) and 1986 (“Knowledge” and “Neglect to Prevent” a U.S. Constitutional Wrong). Under Title 18 U.S.C.A. 241 (Conspiracy), violators “shall be fined not more than $10,000 or imprisoned not more than ten (10) years or both.”
CASE CITES IN SUPPORT
ULTRA VIRES CONTRACTS
1. “A contract is ultra vires being unlawful and void, not because it is in itself immoral, but because the corporation, by the law of its creation, is incapable of making it. The courts, while refusing to maintain any action upon the unlawful contract, have always striven to do justice between the parties, so far as could be done consistently with adherence to law, by permitting property or money, parted with on the faith of the unlawful contract, to be recovered back, or compensation to be made for it. In such case, however, the action is not maintained upon the unlawful contract, nor according to its terms; but on an implied contract of the defendant to return, or failing to do that, to make compensation for, property or money which it has no right to retain. To maintain such an action is not to affirm, but to disaffirm the unlawful contract.” Pullman v. Central Transp. Co., 139 U.S. 62, 11 S.Ct. 478, 35 L.Ed. 55
2. “When a contract is once declared ultra vires, the fact that it is executed does not validate it, nor can it be ratified, so as to make it the basis of suit or action, nor does the doctrine of estoppel apply.” F&PR v. Richmond, 133 SE 898; 151 Va. 195.
3. “A national bank . . . cannot lend its credit to another by becoming surety, indorser or guarantor for him, such an act is ultra vires . . .” Merchants Bank v. Baird, 160 F 642.
LOAN OF CREDIT
4. “In the federal courts, it is well established that a national bank has not power to lend its credit to another by becoming surety, endorser, or guarantor for him.” Farmers and Miners Bank v. Bluefield Nat’l Bank, 11 F.2d 83, 271 U.S. 669.
5. “A national bank has no power to lend its credit to any person or corporation.” Bowen v. Needles Nat. Bank, 94 F. 925; 36 CCA 553, certiorari denied In 20 S.Ct. 1024, 176 US 682, 44 L.Ed 637.
6. “Mr. Justice Marshall said: ‘The doctrine of ultra vires is a most powerful weapon to keep private corporations within their legitimate spheres and to punish them for violations of their corporate charters, and it probably is not invoked too often . . .’” Zinc Carbonate Co. v. First National Bank, 103 Wis. 125, 79 NW 229, American Express Co. v. Citizens State Bank, 194 NW 430.
7. “A bank may not lend its credit to another, even though such a transaction turns out to have been of benefit to the bank, and in support of this a list of cases might be cited, which would look like a catalog of ships.” Norton Grocery Co. v. Peoples Nat. Bank, 144 SE 505, 151 Va 195.
8. “It has been settled beyond controversy that a national bank, under federal law being limited in its powers and capacity, cannot lend its credit by guaranteeing the debts of another. All such contracts entered into by its officers are ultra vires. . .” Howard & Foster Co. v. Citizens Nat’l Bank of Union, 133 SC 202, 130 SE 759 (1926).
9. “. . . checks, drafts, money orders and bank notes are not lawful money of the United States . . .” State v. Neilon, 73 Pac. 324, 43 Ore. 168.
10. “Neither, as included in its powers, nor incidental to them, is it a part of a bank’s business to lend its credit. If a bank could lend its credit as well as its money, it might, if it received compensation and was careful to put its name only to solid paper, make a great deal more than any lawful interest on its money would amount to. If not careful, the power would be the mother of panics . . . Indeed, lending credit is the exact opposite of lending money which is the real business of a bank, for while the latter creates a liability in favor of the bank, the former gives rise to a liability of the bank to another.” 1 Morse, Banks and Banking, 5th Ed. Sec. 65; Magee, Banks and Banking, 3rd Ed. Sec. 248.” American Express Co. v. Citizens State Bank, 194 NW 429.
11. “It is not within those statutory powers for a national bank, even though solvent, to lend its credit to another in any of the various ways in which that might be done.” Federal Intermediate Credit Bank v. L. Herrison, 33 F.2d 841, 842 (1929).
12. “There is no doubt but what the law is that a national bank cannot lend its credit or become an accommodation endorser.” National Bank of Commerce v. Atkinson, 56 F. 471.
13. “A bank can lend its money, but not its credit.” First Nat’l Bank of Tallapoosa v. Monroe, 135 Ga 614, 69 F. 1124, 32 LRA (NS) 550.
14. “. . . the bank is allowed to lend money upon personal security, but it must be money that it loans, not its credit.” Sellgman v. Charlottesville Nat. Bank, 3 Hughes 647, Fed. Case No. 12, 642, 1039.
LOANS OF MONEY
15. “A loan may be defined as the delivery by one party to, and the receipt by another party of, a sum of money upon an agreement express or implied, to repay the sum with or without interest.” Parsons v. Fox,179 Ga 605, 176 SE 644. Also see Kirkland v. Bailey, 155 SE 2d 701, and United States v. Neifert White Co., 247 Fed.Supp. 878, 879.
“The word ‘money’ in its usual and ordinary acceptation means gold, silver, or paper money used as a circulating medium of exchange. . .” e.v. Railey 280 Ky 319, 133 SW2d 75.
PROMISE TO PAY NOT EQUIVALENT TO PAYMENT
16. “A promise to pay cannot, by argument, however ingenious, be made the equivalent of actual payment . . .” Christensen v. Beebe, 91 P 133, 32 Utah 406.
17. “A check is merely an order on a bank to pay money.” Young v. Hembree, 73 P2d 393.
HOLDER IN DUE COURSE
18. “A bank is not the holder in due course upon merely crediting the depositor’s account.” Bankers Trust v. Nagler, 229 NYS2d 142, 143.
FRAUD AND MISREPRESENTATION
19. “Any false representation of material facts made with knowledge of falsity and with intent that it shall be acted on by another in entering into contract, and which is so acted upon, constitutes ‘fraud,’ and entitles party deceived to avoid contract or recover damages.” Barnsdall Refining Corp. v. Bimarn Wood Oil Co., 92 F.2d S17.
20. “Any conduct capable of being turned into a statement of fact is representation. There is no distinction between misrepresentations effected by words and misrepresentations effected by other acts.” Leonard v. Springer, 197 Ill 532, 64 NE 301.
21. “It is not necessary for rescission of a contract that the party making the misrepresentation should have known that it was false, but recovery is allowed even though misrepresentation is innocently made, because it would be unjust to allow one who made false representations even innocently to retain the fruits of a bargain induced by such representations.” Whipp v. Iverson, 43 Wis.2d 166.
22. “If any part of the consideration for a promise be illegal, or if there are several considerations for an unseverable promise, one of which is illegal, the promise, whether written or oral, is wholly void, as it is impossible to say what part or which one of the considerations induced the promise.” Menominee River Co. v. Augustus Spies L&C Co., 147 Wis 559, 572; 132 NW 1122.
“The contract is void if it is only in part connected with the illegal transaction and the promise single or entire.” Guardian Agency v. Guardian Mut. Savings Bank, 227 Wis. 550, 279 NW 83.
23. In a Debtor’s RICO action against its creditor, alleging that the creditor had collected an unlawful debt, an interest rate (where all loan charges were added together) that exceeded, in the language of the RICO Statute, “twice the enforceable rate,” the Court found no reason to impose a requirement that the Plaintiff show that the Defendant had been convicted of collecting an unlawful debt, running a “loan sharking” operation. The debt included the fact that exaction of a usurious interest rate rendered the debt unlawful and that is all that is necessary to support the Civil RICO action. Durante Bros. & Sons, Inc. v. Flushing Nat. Bank, 755 F.2d 239, cert. denied, 473 US 906 (1985).
24. The Supreme Court found that the Plaintiff in a civil RICO action need establish only a criminal “violation” and not a criminal conviction. Further, the Court held that the Defendant need only have caused harm to the Plaintiff by the commission of a predicate offense in such a way as to constitute a “pattern of Racketeering activity.” That is, the Plaintiff need not demonstrate that the Defendant is an organized crime figure, a mobster in the popular sense, or that the Plaintiff has suffered some type of special Racketeering injury; all that the Plaintiff must show is what the Statute specifically requires. The RICO Statute and the civil remedies for its violation are to be liberally construed to effect the Congressional purpose as broadly formulated in the statute. Sedima, SPRL v. Imrex Co., 473 US 479 (1985)
FEDERAL RESERVE BANK
25. “Each Federal Reserve bank is a separate corporation owned by commercial banks in its region . . .” Lewis v. United States, 680 F.2d 1239 (1982).
26. Adequate Assurance of Due Performance at UCC § 2-609(4) and correlating state statutes states:
“After receipt of a justified demand, failure to provide within a reasonable time not exceeding 30 days such assurance of due performance, as is adequate under the circumstances of the particular case, is a repudiation of the contract.”
3. Within 10 days after service of the motion the opposing party shall serve and file his written opposition thereto, together with a memorandum of points and authorities and supporting affidavits, if any, stating facts showing why the motion should be denied. Failure
of the opposing party to serve and file his written opposition may be construed as an admission that the motion is meritorious and a consent to granting the same.
Nevada Rules of Civil Procedure
Rule 56 (e)
Form of Affidavits; Further Testimony; Defense Required. Supporting and opposing affidavits shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated therein. Sworn or certified copies of all papers or parts thereof referred to in an affidavit shall be attached thereto and served therewith. The court may permit affidavits to be supplemented or opposed by depositions, answers to interrogatories, or further affidavits. When a motion for summary judgement is made and supported as provided in this rule, an adverse party may not rest upon mere allegations or denials of his pleading, but his response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial. If he does not so repsond, summary judgement, if appropriate, shall be entered against him.
Well here it is from the law as we write it in the letter of explanantion. Dr. Weatherly
. Please note the following:
“Currency is defined as– coined money and such other banknotes or other paper money as are authorized by law and do in fact circulate from hand to hand as the medium of exchange.” Blacks, 5th.
Title 31 United States Code, Section 392) provides in part:
" All coins and currencies of the United States, regardless of when coined or issued, shall be legal tender for all debts, public and private, public charges, taxes, duties and dues."
Legal tender - United States coins and currency (including Federal reserve notes and circulating notes of Federal reserve banks and national banks) are legal tender for all debts, public charges, taxes, and dues. (emphasis added)
[USC Title 12.221 Definitions – “The terms “national bank” and “national banking association”….shall be held to be synonymous and interchangeable.”]
This official definition for ‘legal tender’ was first established in HJR-192 (1933). This, the same act that suspended the gold standard for our currency, and abrogated the right to demand payment in gold, made federal reserve notes and notes of national banks legal tender, both backed by “the credit of the nation”.
Public Policy HJR-192
JOINT RESOLUTION TO SUSPEND THE GOLD
STANDARD AND ABROGATE THE GOLD CLAUSE,
JUNE 5, 1933
H.J. Res. 192, 73rd Cong., 1st Session
Joint resolution to assure uniform value to the coins and currencies of the United States.
(b) As used in this resolution, the term “obligation” means an obligation (including every obligation of and to the United States, excepting currency) payable in money of the United States; and the term “coin or currency” means coin or currency of the United States, including Federal Reserve notes and circulating notes of Federal Reserve banks and national banking associations.
“All coins and currencies of the United States (including Federal Reserve notes and circulating notes of Federal Reserve banks and national banking associations) heretofore or hereafter coined or issued, shall be legal tender for all debts, for public and private, public charges, taxes, duties, and dues,”
“notes of national banks” or “national banking associations” have continuously been maintained in the official definition of legal tender since June 5, 1933 to the present day, when the term had never been used to define “currency ”or “legal tender” before that.
Prior to 1933 the forms of currency in use that were legal tender were many and varied:
-United States Gold Certificates – United States Notes – Treasury Notes – Interest bearing notes –Gold Coins of United States – Standard silver dollars – Subsidiary silver coins – minor coins
-Commemorative coins –
but the list did not include notes of national banks or national banking associations despite the fact such notes were a common medium of exchange or “currency” and had been, almost since the founding of our banking system and were backed by United States bonds or other securities on deposit for the bank with the US Treasury.
Further, from the time of their inclusion in the definition they have been phased out until presently all provisions in the United States Code pertaining to incorporated National Banking institutions issuing, redeeming, replacing and circulating notes have all been repealed:
USC TITLE 12 > CHAPTER 2 - NATIONAL BANKS
SUBCHAPTER V - OBTAINING AND ISSUING CIRCULATING NOTES
· Sec. 101 to 110. Repealed. Pub. L. 103-325, title VI, Sec. 602e5-11, f2-4A, g9, Sept. 23, 1994, 108 Stat. 2292, 2294
SUBCHAPTER VI - REDEMPTION AND REPLACEMENT OF CIRCULATING NOTES
· Sec. 121. Repealed. Pub. L. 103-325, title VI, Sec. 602f4B, Sept. 23, 1994, 108 Stat. 2292
· Sec. 121a. Redemption of notes unidentifiable as to bank of issue
· Sec. 122. Repealed. Pub. L. 97-258, Sec. 5b, Sept. 13, 1982, 96 Stat. 1068
· Sec. 122a. Redeemed notes of unidentifiable issue; funds charged against
· Sec. 123 to 126. Repealed. Pub. L. 103-325, title VI, Sec. 602e12, 13, f4C, 6, Sept. 23, 1994, 108 Stat. 2292, 2293
· Sec. 127. Repealed. Pub. L. 89-554, Sec. 8a, Sept. 6, 1966, 80 Stat. 633
As stated in ‘Money and Banking”, 4th edition, by David H. Friedman, publ. by the American Bankers Association, page 78, “Today commercial banks no longer issue currency, ….“
It is clear, federally incorporated banking institutions subject to the restrictions and repealed provisions of Title 12, are not those primarily referred to maintained in the current definition of “legal tender”.
The legal statutory and professional definitions of “bank”, “banking”, and “banker” used in the United States Code and Code of Federal Regulations are not those commonly understood for these terms and have made the statutory definition of “Bank” accordingly:
UCC 4-105 PART 1 "Bank" means a person engaged in the business of banking,”
12CFRSec. 229.2 Definitions (e) Bank means—“the term bank also includes any person engaged in the business of banking,”
12CFR Sec. 210.2 Definitions. (d)” Bank means any person engaged in the business of banking.”
USC Title 12 Sec. 1813. –Definitions of Bank and Related Terms. – (1) Bank. - The term ''bank'' – (A) “means any national bank, State bank, and District bank, and any Federal branch and insured branch;”
Black’s Law Dictionary, 5th Edition, page 133, defines a “Banker” 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. “
“Banking”- Is partly and optionally defined as “The business of issuing notes for circulation……, negotiating bills.”
Black’s Law Dictionary, 5th Edition, page 133, defines “Banking”:
“The business of banking, as defined by law and custom, consists in the issue of notes payable on demand intended to circulate as money……..
And defines a “Banker’s Note” as:
“A commercial instrument resembling a bank note in every particular except that it is given by a private banker or unincorporated banking institution.”
Federal Statute does not specifically define “national bank” and “national banking association” in those sections where these uses are legislated on to exclude a private banker or unincorporated banking institution.
It does define these terms to the exclusion of such persons in the chapters and sections where the issue and circulation of notes by national banks has been repealed or forbidden.
"In the absence of a statutory definition, courts give terms their ordinary meaning. "Bass, Terri L. v. Stolper, Koritzinsky, 111 F.3d 1325,7thCir. Apps. (1996).
As the U.S. Supreme Court noted, "We 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.” See, e.g., United States v. Ron Pair Enterprises, Inc., 489 U.S. 235, 241 -242 (1989); United States v. Goldenberg,168 U.S. 95, 102 -103 (1897);
"The legislative purpose is expressed by the ordinary meaning of the words used. “Richards v. United States, 369 U.S.1 (1962).
Therefore, as noted above, the legal definitions relating to ‘legal tender’ have been written by Congress and maintained as such to be both exclusive, where necessary, and inclusive, where appropriate, to provide for the inclusion of the Principals, Sureties, Prime- Creditors and Holders in Equity over THE UNITED STATES, who, since 1933, have collectively and nationally constituted, by such statutory definitions, a “national bank” or “national banking association” with the right to issue, as legal tender, notes… ‘upon “the full faith and credit of THE UNITED STATES” for Obligation OF THE UNITED STATES and sub-corporate chartered entities to the discharge and recovery of the public debt,… to the Principals, Prime-Creditors, and Holders in Equity over THE UNITED STATES as Sureties for its obligations, currency and credit.’, as remedy for equity interest recovery over US Corporate public debt due them.
With out all the legal foundations that accompany it here is why this is:
A brief review of the historical events that led up to the authorization and use of this type of instrument which is not familiar to most or in common use today is important:
During the financial crisis of the depression, in 1933 substance of gold, silver and real money was removed as a foundation for our financial system.
In it s place the substance of the American citizenry: their real property, wealth, assets and productivity that belongs to them was, in effect, ‘pledged’ by the government and placed at risk as the collateral for US debt, credit and currency for commerce to function.
The commerce and credit of the nation continues on today under bankruptcy reorganization or financial reorganization as it has since 1933, still backed by the assets and wealth of the American citizenry: at risk for the government’s obligations and currency.
Constitutionally and in the laws of equity, the United States 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 an equitable and orderly remedy for recovery of what is due them on their assets and wealth that are at risk.
This principle is well established in English common law and in the history of American jurisprudence.
The 14th amendment provides: “no person shall be deprived of…property without due process of law”.
And Courts have long ruled to have one’s property legally held as collateral or surety for a debt even when he still owns it and still has it is to deprive him of it since it is at risk and could be lost for the debt at any time.
The rights of a surety to recovery on his risk or loss when standing for the debts of another was reaffirmed again as late as 1962 in Pearlman v. Reliance Ins.Co., 371 U.S. 132 when the Supreme Court 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”:
“One who undertakes to pay or to do any other act in event that his principal fails therein. Everyone who incurs a liability in person or estate for the benefit of another, without sharing in the consideration, stands in the position of a “surety.”
So these obligations for recovery due the Principals, Prime-Creditors, and Holders in Equity over THE UNITED STATES as Sureties for its obligations, currency and credit are part of the public debt:
(2) ''public debt obligation'' means a domestic obligation issued or guaranteed by the United States Government to repay money or interest.
Title 31 USC 3123 makes a statutory pledge of the United States government to:
- Payment of obligations and interest on the public debt
- (a) The faith of the United States Government is pledged to pay, in legal tender, principal and interest on the obligations of the Government issued under this chapter.
As we see, in the laws of equity, Constitutionally and statutorily, the United States can not borrow or pledge the property and wealth of its private citizens, put at risk as collateral for its currency and credit without legally giving them remedy for recovery of what is due them on their risk.
The government is able to do this with our implied consent, because it has provided us such a remedy.
The provisions for this are found in the same act of “Public Policy” HJR-192, public law 73-10, that suspended the gold standard for our currency, abrogated the right to demand payment in gold, and then redefined the terms “coin or currency” and “legal tender” to include federal reserve notes and “notes of national banking associations”, both, backed by the same thing: the credit of the nation”,i.e., the real substance of the American citizenry.
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.
All US currency since that time is only credit against the real property, wealth and assets belonging to the private soverign American people, taken and/or ‘pledged’ by THE UNITED STATES to its secondary creditors as security.
Federal Reserve Notes, although made legal tender for all debts public and private in the reorganization, can only discharge a debt. Debt must be “payed” with value or substance (i.e. gold, silver, barter or a commodity). For this reason HJR-192 (1933), which established the “public policy” of our current monetary system, repeatedly uses the technical term of “discharge” in conjunction with “payment” in laying out public policy for the new system. A debt currency system cannot pay debt.
So from that time to the present, commerce in the corporate UNITED STATES and among sub-corporate subject entities has had only bank notes and other debt note instruments by which debt can be discharged and transferred in different forms. The unpaid debt, created and/or expanded by the plan now carries a public liability for collection in that when debt is discharged with debt instruments, (i.e. Federal Reserve Notes included), by our commerce, debt is inadvertently being expanded instead of being cancelled, thus increasing the public debt. A situation potentially fatal to any economy.
The Congress and government officials who orchestrated the public laws and regulations that made the financial reorganization anticipated the long term effect of a debt based financial system which many in government feared, and which we face today in servicing the interest on trillions upon trillions of dollars in US Corporate public debt and in this same act made provision in the recovery remedy provided to its Prime-creditors to simultaneously resolve this problem as well.
As we have said, all US currency since that time is only credit against the real property, wealth and assets belonging to the private soverign American people, taken and/or ‘pledged’ by THE UNITED STATES to its secondary creditors as security for its obligations. Those backing the nation’s credit and currency could not recover what was due them by anything drawn on Federal Reserve notes without expanding their risk and obligation to their own selves. Any recovery payments backed by this currency would only increase the public debt its citizens were collateral for, which an equitable remedy was intended to reduce, and in equity would not satisfy anything. And there was no longer actual money of substance to pay anybody.
Since it is, in fact, the real property, wealth and assets of the sovereign American citizenry that is the substance backing all the other obligations, currency and credit of THE UNITED STATES and such currencies could not be used to reduce its obligations for equity interest recovery to its Principals and Sureties, HJR-192 made the notes of such a “national banking association” of the Principals, Sureties, Prime- Creditors and Holders in Equity over THE UNITED STATES on a par with its other currency and legal tender obligations and declared, ……..“every provision….which purports to give the obligee 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. Every obligation, heretofore or hereafter incurred, whether or not any such provision is contained therein or made with respect thereto, shall be discharged upon payment, dollar for dollar, in any such coin or currency which at the time of payment is legal tender for public and private debts.”
And thus provided as “Public Policy” the means for discharge and recovery on US Corporate public debt due the Principals, and Holders of THE UNITED STATES without expansion of credit, debt or obligation on THE UNITED STATES or these its prime-creditors in the discharge of “every obligation”, “including every obligation OF and TO THE UNITED STATES”, allowing those backing the US financial reorganization to recover on it by discharging an obligation they owed TO THE UNITED STATES or its sub-corporate entities, against that same amount of obligation OF THE UNITED STATES owed to them; by the right to issue as legal tender, notes…….’upon “the full faith and credit of THE UNITED STATES” for Obligation OF THE UNITED STATES and sub-corporate chartered entities to the discharge and recovery of the public debt, “dollar for dollar”, to the Principals, Prime-Creditors, and Holders in Equity over THE UNITED STATES as Sureties for its obligations, currency and credit.’ This, as remedy provided by Congress for the orderly recovery of equity interest on US Corporate public debt due the Sureties, Principals, and Holders of THE UNITED STATES, discharging that portion of the public debt without expansion of credit, debt or obligation on these its prime-creditors it was intended to satisfy equitable remedy to, but gaining for each bearer of such note discharge of obligation equivalent in value ‘dollar for dollar’ to any and all “lawful money of the United States”.
Although this has been public policy as a remedy for the discharge of debt in conjunction with removal of gold, silver and real money as legal tender currency by the same act of public policy in 1933, we acknowledges it has been a difficult concept to communicate for others to accept and to know what to do with it, so its never gained common use and for obvious reasons the government has discouraged public understanding of the remedy and recovery under it and therefore it is little known and not generally accessed by the public. But it is just as much public policy today for the discharge and recovery of the public debt to those to whom it is due as it was in 1933, and is still there as a remedy for those who need to find how to access it.
And, as noted above, in accordance with “Public Policy” established in HJR-192, respondent, as obligee, may not require of the Principal tender of other particular kind of coin or currency in place of it.
We state again, this instrument makes no claims except such claims as supported by law or any such claim as is voided, precluded, excluded, prohibited, or disqualifies this presentment as a legal tender obligation of The United States by federal or state statute or regulation.
And accordingly, Principal will withdraw this tender in discharge of this obligation upon the citing of any law or federal regulation that precludes, excludes, prohibits, or disqualifies this presentment as a legal tender obligation of The United States, and is of full knowledge and belief that none exists.
This bankers acceptance note may now be used in the discharge of your obligations, “for all debts, public charges, taxes, and dues. “ negotiated and exchanged in the course of business with other obligations of the United States or commercial paper of private corporations as bonds, certificates, notes, or other security instruments commonly traded, exchanged and tendered in this way by yourself, or received by your bank as an asset on deposit from you, held as an obligation OF THE UNTED STATES to your bank, to be exchanged and negotiated in these ways or by whomever may become the bearer of it.
But always, representing this already existing obligation of THE UNITED STATES in the exchange or discharge of debt, thereby discharging that portion of the public debt due its prime-creditors without expansion of credit, debt or obligation on THE UNITED STATES or these its Principals it was intended to satisfy equitable remedy to, but gaining for each bearer of such note discharge of obligation equivalent in value ‘dollar for dollar’ to any and all “lawful money of the United States”.
Under this remedy for discharge of the public debt and recovery to its Principals and Holders, TWO debts that would have been discharged in Federal Reserve debt note instruments or checks drawn on the same, equally expanding the public debt by those transactions, are discharged against a single public debt of the Corporate UNITED STATES and its sub-corporate entities to a prime-creditor without the expansion and use of Federal Reserve debt note instruments as currency and credit, and so, without the expansion of debt and debt instruments in the monetary system and the expansion of the public debt as burden upon the entire financial system and its Principals, and Holders in Equity the recovery remedy was intended to relieve.
This instrument is tendered in good faith in discharge and settlement of this obligation to our mutual benefit.
5.Caveat. In the absence of a clear written contract between us as to the manner of discharge of this debt, my statement of facts and its addendums will result in a clear understanding and meeting of the minds of the parties clearly identified and will stand as truth in commerce.
6. Statement of Account: By authority of law and federal regulation herein noted the tender in discharge of this obligation you have received is a statutory legal tender obligation of THE UNITED STATES and upon proof of receipt constitutes immediate discharge of this debt up to its face amount and/or that amount accepted of its attached presentment unless you or your banking institution can show you have cause to dispute this from Federal or state statute or regulation.
Therefore, as of this date, upon tender to you the Respondent, the amount of unpaid obligations for account #_________________________________for all transactions with Respondent is zero.
Tender in Discharge of this Obligation $_________________
Ending Balance of Charges: 0
The balance shown above reflects my good faith Statement of this Account. Any over payment may be refunded. Your Account Representative or his designee may correct or approve the statement. If you determine the balance is different than as shown above, your documented correction must be returned to me within two weeks of time allowed for holding and settlement of this instrument by your banking institution or other parties to whom you may tender it in discharge of obligation, or within thirty (30) days of your receipt of this Statement of Account:
(a)Subject to subsections (c), (d), (e), and (f), a secured party ……shall comply with a request within 14 days after receipt: 2) in the case of a request regarding a list of collateral or a request regarding a statement of account, by authenticating and sending to the debtor an approval or correction.
including records of. evidence or documentation in law authenticating that in fact the bankers acceptance note tendered to you in settlement of this account has been dishonored by your banking institution or other obligee or endorser on the authority of Federal or state statute or regulation as being precluded, excluded, prohibited, or disqualified as a legal tender obligation of The United States.
Please send these documents along with a short letter signed in blue ink by a title-identified party asserting your claim if you would wish to dispute my statement of account. Any unsigned, anonymous letter will have to be ignored
by me as a matter of law, since someone must take responsibility for asserting the validity of your claim that the tender of this presentment has not legally discharged this obligation by the citing of any such law or federal regulation that precludes or disqualifies this presentment as a legal tender obligation of The United States.
Note: the Uniform Commercial Code in its entirety is also codified as state law in all 50 states and as such is included here by reference for Mississippi or any other state under whose jurisdiction you are registered.
In the event you need additional information or instruction in processing the instrument I have failed to provide, please do not hesitate to contact me by mail or by phone or by email: firstname.lastname@example.org.
Thank you for your prompt handling of this matter.
James Bruce Weatherly
It will be observed, however, that this reasoning in regard to the probative force of the documents in question does not rest upon any positive provision of the Spanish law then and there in force giving that effect to such recitals. The only positive provision on that subject to which we are referred is that contained in Ley 1, tit. 18, partida 3, which says: "Every writing executed by the hand of a notary public of the council, or sealed with the king's seal, or with that of any other person having authority to affix his seal, is an authentic act (escritura) which is of itself full proof. From the faith given to these writings the greatest good arises; for they are the evidence of what has taken place, and full proof of the contract they contain." 1 Moreau and Carleton's Partidas, 222, tit. 18, law 1. SABARIEGO v. MAVERICK, 124 U.S. 261 (1888)
Two Faces of Debt: Page 19, Paragraphs 3-5:
“But a depositor’s balance also rises when the depository institution extends credit-either by granting a loan to or buying securities from the depositor. In exchange for the note or security, the lending or investing institution credits the depositor’s account or gives a check that can be deposited at yet another depository institution. In this case, no one else loses a deposit. The total of currency and checkable deposits-the money supply-is increased. New money has been brought into existence by expansion of depository institution credit. Such newly created funds are in addition to funds that all financial institutions provide in their operations as intermediaries between savers and users of savings.” 
Points of Interest: Page 6-7, Paragraphs 7-10:
“Banks and Deposit Creation.- Depository institutions, which for simplicity we will call banks, are different from other financial institutions because they offer checking accounts and make loans by lending checkbook deposits. The deposit creation activity, essentially creating money, affects interest rates because these deposits are part of savings, the source of the supply of credit. Banks create deposits by making loans. Rather than handing cash to borrowers, banks simply increase balances in borrowers’ checking accounts. Borrowers can then draw checks to pay for goods and services. This creation of checking accounts through loans is just as much a deposit as one we might make by pushing a ten-dollar bill through the teller’s window. With all of the nation’s banks able to increase the supply of credit in this fashion, credit could conceivably expand without limit. … When banks create checkbook deposits, they create money as well as credit since these deposits are part of the money supply.”
Modern Money Mechanics continues:
Page 7, Example 3, Expansion-
Stage 1: “Expansion takes place only if the banks that hold these excess reserves increase their loans or investments. Loans are made by crediting the borrower’s deposit account, i.e., by creating additional deposit money.”
“Stage 7: Expansion continues as the banks that have excess reserves increase their loans by that amount, crediting borrowers’ deposit accounts in the process, thus creating still more money.”
2.16 The context or nature of the contract into which the [Plaintiff] persuaded the [Defendant] to enter is not one where money is borrowed, so much as it is one where the [Plaintiff] creates money out of thin air by simply paying out promises-to-pay and not paying out real dollars.  This fundamental difference between what the [Defendant] was led to believe was accurate and what was actually true constitutes a fraud against the [Defendant], containing all essential elements of such. 
(1) A representation of an existing fact; (2) Its materiality; (3) Its falsity; The bank said that it would let the [Defendant] borrow money on credit. This is the type of contract the [Defendant] was looking for and solicited the [Plaintiff] for exactly that. What the Plaintiff actually offered was the service not of letting the [Defendant] borrow money, but rather, the [Plaintiff] was in fact converting without lawful authority the [Defendant]’s request for a loan into actual money, inflating America’s money supply and affecting interest rates. Since there was no money to borrow, no sums to “repay or return” to the [Plaintiff] which were available to the [Defendant], it cannot be said that the [Plaintiff]’s initial representation is one which was truthful or representative of the legal obligations or abilities for satisfaction of the contract now in controversy.
(4) The speaker’s knowledge of its falsity or ignorance of its truth; From publications published from the [Plaintiff]’s governing body we learn that the transaction or contract sought by the [Defendant] cannot even remotely be associated or compared with the transaction to which the [Defendant] ultimately became a party; [Plaintiff] had full knowledge of the lack of authority to conduct such a transaction, and knew that such was misrepresented to the [Defendant] to get his money.
(5) His intent that it should be acted on by the person to whom it is made; This action and the [Plaintiff]’s assertion that sums are owed under the very contract in controversy provides ample proof that the [Defendant] was expected and believed to be willing to perform in the [Plaintiff]’s money creation scheme against America.
(6) Ignorance of its falsity on the part of the person to whom it is made; (7) The latter’s reliance on the truth of the representation; The [Defendant] is no accountant, banker, or even scholar of finance. Indeed, the [Defendant] sees the [Plaintiff] as a person licensed to do business and under an obligation to meet those standards for the conduct of such set by authorities paid by the public to protect the public interest; [Defendant] was made for the scheme of the [Plaintiff]. Persons like the [Plaintiff] do business throughout the United States and there is no clear reason for the [Defendant] to question or doubt the validity and truth of the practices of a business allowed to operate by such authorities. The [Defendant] believed the [Plaintiff] when it was portrayed that money could be borrowed by the [Defendant] and then “repaid” or “returned” to the [Plaintiff], when indeed, the [Plaintiff] had no money for the [Defendant] to borrow or to return/repay, but rather must rely upon the [Defendant] to provide the note which allows the [Plaintiff], without authority, to create money out of thin air.
(8) His right to rely upon it; As a licensed business, the [Plaintiff] is understood to be a legitimate and gainful enterprise under the laws of the state wherein its business is permitted. Unless reasonable grounds for doubt in the intentions of the [Plaintiff] on the part of the [Defendant] can be articulated, while institutions such as the [Plaintiff] exist and do business coast to coast and in every town, city, county, and state in America, [Defendant] cannot be said to be without right to believe the [Plaintiff] when he was told that he could borrow money.
(9) His consequent damage; The [Defendant] is now embroiled in litigation over an obvious fraud committed upon him by an institution out of control, unlawfully creating money out of thin air, inflating America’s money supply and affecting rates. The [Defendant] originally sought a contract that did not damage his country, did not counterfeit obligations of America, and which was to be governed under its express terms. RATHER, [Defendant] has damaged his country, he has been unwittingly enlisted to aid in the unauthorized creation of U.S. currency, and has so done solely through his unwitting and naive trust in the [Plaintiff]. Every aspect and dynamic of this is repugnant to the [Defendant].
Id. at 485. Mr. Justice Brandeis noted that “a court will not redress a wrong when he who invokes its aid has unclean hands,” id. at 483, and that, in keeping with that principle, the court should not lend its aid in the enforcement of the criminal law when the government itself was guilty of misconduct.
Then aid is denied despite the defendant’s wrong. It is denied in order to maintain respect for law; in order to promote confidence in the administration of justice; in order to preserve the judicial process from contamination.
Id. at 484. See also id. at 469-471 (Holmes, J., dissenting); id. at 488 (Stone, J., dissenting); Lopez v. United States, 373 U.S. 427, 453, n.3 (1963)(BRENNAN, J., dissenting).” 
 Contact: Federal Reserve Bank of Chicago, Public Information Center, P.O. Box 834, Chicago, IL 60690-0834, phone #312-322-5111.
 Inquire: Federal Reserve Bank of Chicago, Public Information Center, P.O. Box 834, Chicago, IL 60690-0834, phone #312-322-5111, for these Federal Reserve Corporation publications: Modern Money Mechanics, Points of Interest, Two Faces of Debt, supra.
 See Martin v. Miller, 24 Wn.App. 306, 600 P.2d 698 (1979); (1) A representation of an existing fact; (2) Its materiality; (3) Its falsity; (4) The speaker’s knowledge of its falsity or ignorance of its truth; (5) His intent that it should be acted on by the person to whom it is made; (6) Ignorance of its falsity on the part of the person to whom it is made; (7) The latter’s reliance on the truth of the representation; (8) His right to rely upon it; (9) His consequent damage.
See U.S. v. Payner, 447 U.S. 727, 745 (1980).