View Full Version : Direct deposit then debit purchase? Getting lawful?

08-23-13, 07:53 PM
Here is a hypothetical...

If one has a merchant account individually (no corp., etc.) and the bank deposits the batch currency from transactions, I understand this to not be a lawful redemption without a new signature card filed. Thus, if one then uses that deposit currency to purchase a postage label from a company such as Stamps.com (not stamps, but a barcode label), what action must be taken to translate this into a lawful redemption?

Must one withdrawal and then deposit again?

Since this is not actually a stamp, but rather it is a directed label with a specific recipient named on the label, I don't view it as actual lawful money. I cannot exchange with someone else. I either use it, which would then constitute use of the label once scanned by a USPS worker, or request a refund if it is not used.

For that matter, it would seem to me that without some redemption step, any debit against the direct deposit would constitute using private credit, yes?

David Merrill
08-24-13, 09:18 AM
Notice and Demand is about all I have ever concerned myself with. - And that is with regards to suitors in the Lesson Plan.

However I enjoy mulling these things over in contemplation and thank you for bringing up the stimulating question. My mind looks to the simplest way to make your Notice and Demand known; and that is likely to the closest Fed Bank. We have several examples of the entire process around and once you have a notice and demand all marked up with the Fed and maybe even the county clerk and recorder too, you can just serve that on any other parties like the corner bank etc. and then just make the demand any time papers come across for you to sign for cash.

I have been making some complicated purchases for electronic devices lately - requiring some refunds and exchanges. When the clerks want my signature I simply sign - "Lawful Money".

Freed Gerdes
08-26-13, 02:10 AM
12 USC 411 says that "they (FRN's) shall be redeemed in lawful money on demand..." So there would be no problem with you bringing in $XX in FRN's, and demanding that they be deposited into your account as lawful money. The problem would only be with documenting that you had done so, and generally the bank wants you to fill out a deposit slip, so you could make your demand on it, and then get/keep a copy. Once you can show that you deposited lawful money into an account, any withdrawal from that account would be presumed to be lawful money. Your demand rebuts the presumption that you are dealing in FedRes securities. Since the use of FRN's, while presumed, is only optional, your demand is sufficient to establish lawful money. Whether the bank identifies and segregates your account balance from their Reserve Account balance, reported to the Regional Fed weekly, is not your problem.


David Merrill
08-26-13, 02:09 PM
You might find the "Chase" threads around here helpful.

Glancing again at the opening post I believe I may have missed your point. If you want to use a debit card then you owe no information. You paid cash. However in this case you are using direct deposit in conjunction with the debit card. So you have to give information like the debit card is a credit card. While giving that information you should make your demand clear or serve a Notice and Demand on the local Fed bank and then serve that NaD on the institution managing your debit card too.

That way the information will not be used against you to presume (assumpsit) that you have endorsed private credit from the Fed.