Resistance and Refusal by Banks

[Freed Gerdes]

Thanks for your thoughtful insights, David. I have a few residual questions concerning the process, and the presumed (or feared) response of the IRS.

1. Redeeming lawful money, whether by stamp on a check, or by service of the recorded demand on the bank, creates the same result: demand has been made to refuse to deal in private credit/money substitutes, and this switch to public money puts the resulting transaction out of the reach of the IRS. I only use this method because I never see any checks; SSA has just forced everyone to use direct deposit. The same with my stock accounts; when I sell a stock they just credit my account; no check appears that I could non-endorse. I suspect this is to keep suitors from non-endorsing the checks (but maybe I am giving the IMF lawyers too much credit here). Thus the only way to make the demand is by changing the signature card, and the banks are being trained to refuse this request. Now they can't refuse the demand, as it exists in the federal law that created the Federal Reserve system. But most people will not know this, and will be intimidated by the banks' refusal. Because the account agreement is a private contract, can BofA say that 12USC411 attempts to interfere with a private contract, and thus is void? Alternately, their only option would be to close the account, which they could do, but they haven't. They are apparently claiming that the account was not changed to an irregular deposit account. I will go in tomorrow and try to open an irregular deposit account.

2. I get 1099's which show purported money movements, so I need to file a return. I am debating whether to not show the income received after July at all, and defer to the statement that after July it was all redeemed, or to show it all and then back it out on Line 21 and provide an addendum which lists all transactions after July.

3. Making the demand for lawful money converts the bank account from a Federal Reserve Account (insured by FDIC for $250k) to an irregular deposit account, which changes the relationship from one of debtor (bank) and unsecured creditor (me) to one of bailor (me) and bailee (bank). In the one case I make a loan to the bank (I pay an excise tax on the privilege of being a state bank), and in the other I keep title to the money and only use the bank for secure storage and bookkeeping functions. The Supreme Court ruled in 1894 that an income tax was repugnant to the Constitution, so when using Constitutional money (ie, any money issued by the Treasury), it can't be taxed. In fact, all these myriad taxes we now face are based on this private money scheme, as they are all* un-Constitutional otherwise. As you noted, Social Security is a benefit, and Congress can levy a tax to pay for a benefit, so SS* is a valid tax, but still an excise tax. As long as you are listed as a US Citizen (thus eligible for SS), you cannot get out of paying the SS tax, and it is extracted before you ever see it. Redeeming lawful money will not get you a refund of the SS tax; only opting out of SS will stop that tax. For young people, I would heartily recommend opting out. As Johnny Cash shows us, you can quit SS any time you want, and you will still get benefits when you retire, although less because it is based on how much you paid in...
But, if income tax is a valid tax, what is the benefit? Apparently, we all benefit from the Fed printing more worthless paper money. I wonder why the Articles expressly forbid this? To get around the Constitutional prohibition, the Fed banksters put the tax on private money. Ergo, don't use private money, and the whole problem goes away.

4. You suggested that I forgive the IRS for 40 years of fraud. Since money damages for fraud would be an equity claim, there is no statute of limitations: I could ask for a refund of all income taxes I ever paid. Is your concern that the IRS will recognize this in the Notice of Demand (now, ab initio, and nunc pro tunc), realize that they may have a $400,000 claim on their hands, and feel that they have to fight back? Your suggestion that I send a Form 834 would surely make them aware of this issue, in case they somehow missed it before, and since one has to file a separate Form 834 for every tax year, one might not put them at ease. Presuming that I state forgiveness of the entire amount and sign it, they would have some protection against later filings, so maybe that would set them at ease.

5. I have tried to learn a little about the Clerk of the Superior District Court here in Mecklenburg County, but there is damned little info available. The insider club of practicing attorneys no doubt know all these little tricks, but I haven't a clue how to proceed. Can I just go to the Clerk's office and ask to open a Miscellaneous Case file? What would they file it under, with no pending case or existing case number? And should I put my other records in it? Presumably this is to get evidence into the record in advance, and to let the IRS know that it is in the record (of the court that they would have to go through to get to me). Can you clarify this a little?

Finally, please note that I do not have any properly redeemed paychecks, as I am retired; all important money transfers occur by direct deposit; that is why I am using the blanket bank account route.

Thanks again for all your thoughtful comments. I appreciate your concern about not using the remedy until I need it even better now. But I have had the stamp for a year now and haven't used it yet...

[David Merrill]

Thanks for your thoughtful insights, David. I have a few residual questions concerning the process, and the presumed (or feared) response of the IRS.

1. Redeeming lawful money, whether by stamp on a check, or by service of the recorded demand on the bank, creates the same result: demand has been made to refuse to deal in private credit/money substitutes, and this switch to public money puts the resulting transaction out of the reach of the IRS. I only use this method because I never see any checks; SSA has just...

2. I get 1099's which show purported money movements, so I need to file a return. I am debating whether to not show the income received after July at all, and defer to the statement that after July it was all redeemed, or to show it all and then back it out on Line 21 and provide an addendum which lists all transactions after July.

3. Making the demand for lawful money converts the bank account from a Federal Reserve Account (insured by FDIC for $250k) to an irregular deposit account, which changes the relationship from one of debtor (bank) and unsecured creditor (me) to one of bailor (me) and bailee (bank). In the one case I make a loan to the bank (I pay an excise tax on the privilege of being a state bank), and in the other...

4. You suggested that I forgive the IRS for 40 years of fraud. Since money damages for fraud would be an equity claim, there is no statute of limitations: I could ask for a refund of all income taxes I ever paid. Is your concern that the IRS will recognize this in the Notice of Demand (now, ab initio, and nunc pro tunc), realize that they may have a $400,000 claim on their hands, and feel that they have to fight back? Your suggestion that I send a Form 834 would surely make them aware of this issue, in case they somehow missed it before, and since one has to file a separate Form 834 for every tax year, one might not put them at ease. Presuming that I state forgiveness of the entire amount and sign it, they would have some protection against later filings, so maybe that would set them at ease.

5. I have tried to learn a little about the Clerk of the Superior District Court here in Mecklenburg County, but there is damned little info available. The insider club of practicing attorneys no doubt know all these little tricks, but I haven't a clue how to proceed. Can I just go to the Clerk's office and ask to open a Miscellaneous Case file? What would they file it under, with no pending case or existing case number? And should I put my other records in it? Presumably this is to get evidence into the record in advance, and to let the IRS know that it is in the record (of the court that they would have to go through to get to me). Can you clarify this a little?

Finally, please note that I do not have any properly redeemed paychecks, as I am retired; all important money transfers occur by direct deposit; that is why I am using the blanket bank account route.

Thanks again for all your thoughtful comments. I appreciate your concern about not using the remedy until I need it even better now. But I have had the stamp for a year now and haven't used it yet...

an irregular deposit account

I suggest you start calling it a special deposit account here, and not referring to it as anything irregular when dealing with Customer Service at your bank. It is a great deal of hardship to close down an account and has only happened to two suitors. One, as I showed somewhere here sets up accounts for others and that hardship hit the bank as several employees being fired. So there was a reason to exercise the "Close the Account for Any Reason" clause. But that happened again recently, I believe with a different bank.

Just recently we have an instance where a single suitor - much like you and the average reader here reported:

An update in regard to the bank which I refused to re-sign a signature card without the Demand for lawful money verbiage.

On Friday I received a letter from FSB along with a money order with the proceeds of the account which they closed. The letter reads:

"Dear N,

This letter is to inform you that we are exercising our right to close your accounts as stated in your Deposit Account Agreement. I have enclosed a copy of the Deposit Account Agreement along with a money order for the funds in your account.

Sincerely,
Nickname
Branch Manager"

This is a significant validation because if the Demand was trivial, the bankers would just ignore it as a peculiarity of the customer's personality.


Item 1. You asked:

Because the account agreement is a private contract, can BofA say that 12USC411 attempts to interfere with a private contract, and thus is void?

That may be well the case but the Signature Card Agreement has a clause that the Bank need not explain why they shut down the account. Deduction says you are correct in my opinion.

They are apparently claiming that the account was not changed to an irregular deposit account.

Again deductions and presumptions. But intuition says you are correct again too. This is why it is helpful to defer perspective to you as the Patron (bailee as below) who just tracks whether proper Notice and Demand has been made or not.

Item 2. I am too removed from filing to be very good advice exactly how to fill out the forms. I have seen others do it both ways and get the appropriate refund. There has been only one suitor charged with the $5K FrivPen and that was shortly after he started adding pages of Ed RIVERA's lecture material to his R4C clerk instructions. So I consider that an inadvertant soft sting. The FrivPen is a bill of indictment (confession) against the IRS.

Item 3. You said:

Making the demand for lawful money converts the bank account from a Federal Reserve Account (insured by FDIC for $250k) to an irregular deposit account, which changes the relationship from one of debtor (bank) and unsecured creditor (me) to one of bailor (me) and bailee (bank).

It is delightful to come across a resource like you among the members here at StSC! Thank you for that insight.

This also discloses that you will be utilizing the bank for their vault for free. Mostly up until now (in the redemption timeline) we (you) have been accepting that the bank might well convert your account to non-interest bearing. Well that leaves the bank storing your money and cashing your checks for no consideration paid by you to the bank.

It is no wonder that the bank attorneys are figuring it best for the stockholders to just close down the accounts. They have no fee schedule for special deposit only accounts!

Item 4. That sort of thing. I do not like people getting hurt because they listen to my postings on the Internet. But more the truth in Ignorance of the Law is no excuse. The central banks, mainly the Fed have been banking on your endorsement signature and undoing that will cause... well, the damage we are doing. I have phrased it as carefully regulated release valves for a highly compressed information infrastructure (falsity that debt is money). You can blow the lid off the whole deal but don't be surprised what comes along with what you wish for. I for one like cell phones and flush toilets...


Item 5.

We are finding that the USDC clerks are tightening up about MC filing rules. We have found success though, by Applying for an Order and putting the Notice and Demand right there on the front page. So the Notice and Demand gets a FILED stamping in wet ink. The Application is fluff but the clerk of court files the Application and therefore the Notice and Demand gets published.