CHAPTER SEVEN
THE SWINDLE
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132 Fruit from a Poisonous Tree
HOW THE BANKERS SWINDLE YOU ON A HOME MORTAGE
Now apply what we have just learned about money and banking to buying a home. Let us presume that after years of saving and months of looking you finally find and select a home in which you want to raise your family. Interest rates vary from bank to bank, so you must shop around until you find the best deal. We are all nervous when we sit before the loan officer at the bank. But you have always paid your debts and for years have had excellent credit, so there should be no problem getting the loan. The loan officer calls you a week later with the news that you are a new homeowner (you and the bank).
In a few weeks, you go to the scheduled closing and are greeted with a mountain of papers in triplicate. After forty-five minutes, you have finished the paper work and the home is yours and the bank’s. Now the hard part begins – paying for it!
Your loan was for $85,000 at 8.5% interest, agreeing to pay it back at $653 per month for the next 30 years. In the next 30 years (assuming that you earn $10 per hour), 23,500 hours of your labor will go toward paying for that house. This works out to about 11 3/4 years at 40 hours per week.
This is the system of usury in all of its evil glory and this is how it works.
What you did not know and would never have believed is that the bank just defrauded you. This is how they did it. As a typical bank customer, you presumed that the money you borrowed from the bank came from its depositors or investors. That is what the bank wants you to believe. But that is not the truth.
Before you took out the loan from the bank, that money did not exist. The bank took your loan application and renamed it a “promissory note.” The bank then took your “promissory note” and attached it to the title of the property. Using the home as collateral, the bank wrote a check.
The moment the bank wrote the check, it created the money out of thin air. If you doubt that the bank is writing checks to create money using your promissory note as an asset read the following again. In the Federal Reserve Bank’s own words:
“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.”
Returning to our example, the bank made a check payable to the seller. The seller accepted the check and deposited it back into the system. No armored cars ever delivered money to anyone.
You believe the bank approved your loan because you are a splendid example of credit risk and would make good on your promise to pay. Actually, the bank doesn’t give a flip whether you pay or not; it doesn’t really matter to the bank whether you keep your promise or not. After all, if you don’t, they just foreclose and take your home.
What took the bank moments to create will take you 23,500 hours of labor to pay back.
Your intellect should be telling you about now that there is something terribly wrong in River City.
Now let’s create a legitimate scenario for a moment and, using the same numbers, make the transaction honest.
You want to buy the same home on a land contract, directly from the seller. You would pay the seller directly.
Would the exchange of the home for money be honest? Yes.
Would it be legal? Yes, of course it would be. Why? Because the home is a direct product of someone’s labor. The money you exchanged for the home has value because you exchanged your labor for it. Unlike the first example with the bank, it was not something which you created out of thin air. When you exchange your labor for money, the money has value and substance, because you exchanged your labor for it. It is labor which gives value to the money. In this example, value for value is exchanged.
Financing a home through a bank could be an honest transaction. Years ago it was. But the bank must lend you money that was either invested by its owners or placed on deposit by its customers. We all presume when we borrow from a bank that this is where the money comes from. It doesn’t, but this is exactly what the bankers want you to believe.
THE BUYER-THE CONTRACT – THE FRAUD
Every contract must have six elements in order to be legally binding. If any one of the elements is missing, then there is no legally binding contract:
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Offer by person qualified to make the contract.
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Acceptance by a party qualified to make and accept the contract.
3. Agreements, full disclosure, and complete understanding by both
parties.
Did you know that when you took out a bank loan or used a credit card,
the bank was creating the money out of thin air? If you didn’t, then there was no “full disclosure and complete understanding.” Therefore, there is no legally binding contract.
Mel Stamper 133
134 Fruit from a Poisonous Tree
4. Consideration given.
When you borrow from a bank that created money out of thin air, there can be no consideration. No equal consideration, NO CONTRACT.
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Every contract must have the element of time to make it lawful.
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All parties must be of lawful age, usually 21 years old.
YOUR REMEDY
You have been lied to, cheated and stolen from each and every time you borrowed money from a bank. If you want to help restore this country to a constitutional money system, then here is something practical that you might consider. You can sue every bank and credit card company that has ever stolen from you and force them to cancel your loans with respect to the credit cards and return all of the money you have given them. Some have taken the banks to court and had their mortgages canceled and kept possession of the home. This type of suit will stop a foreclosure if the judge knows anything about law.
Here on the following pages are a few suggested letters samples that you might use to get the process started in removing the debt on your credit cards. A bank, by the way, is always in back of a credit card issue.
Bank
Manager, Customer Service
Credit Card Division
P.O. Box .
City and State
Month, 200_
Dear Sir or Madam:
Mel Stamper 135 1st letter
Certified Mail #
It has come to my attention after reading a publication titled Modern Money Mechanics published by the Federal Reserve Bank of Chicago that (Name) Bank and other banks within the Federal Reserve System may be perpetrating a fraud on the American public. I have some questions which need to be answered before I continue to make payments on or use my (Type) Bank credit card. My account number is (Number). The following are my questions:
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Was an individual depositor’s money deposit used in order to pay the vendors when I made charges to my account?
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Was the money that was loaned created by my signing of the voucher when I made the purchase?
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Is it (Name) Bank policy to create checkbook money in amounts equal to the charges made by Bank customers?
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Does (Name) Bank have on file a contract signed by me with a bona fide signature?
-
Will (Name) Bank provide a copy of the journal entry that is made when I charge to my account?
Please answer these questions within ten (10) days so that I am not late in making my payment. If I do not hear from you, I will assume that what I have learned is the truth and will, therefore, rescind my contract with (Name) Bank, as I do not wish to be a party to fraudulent practices.
Thanking you in advance for your cooperation, I look forward to your immediate response to this most disturbing revelation. My hope is that you can dispel my fears and refute this troubling circumstance in which we find ourselves.
Sincerely,
Your Name
c/o Your Street
Your City, Your State, Your Postal Zone
136 Fruit from a Poisonous Tree
Date
Certified Mail No.
Credit Card Company Address City, State, Zip
Dear Manager,
I wrote you a letter on (date), a copy of which is attached, asking that you supply me with information regarding how (credit card company) operates and how charges made by me are handled within your system. As of this date my questions remain unanswered. Since that writing I have done an exhaustive amount of research regarding the subject matter of that letter. (Credit card company) has refused to answer my questions. I have taken this to mean that your bank is doing as other banks are, loaning or creating credit on its books, then using my debt as an asset of the bank.
I am withholding any future payment based on your refusal to answer the questions contained in that letter of (date). If you can evidence to me that your bank actually gave me or the vendors involved something other than an electronic entry using my charge as a deposit on your books in order to create an electronic deposit to the vendors’ accounts (checkbook money), then I will be willing to pay the balance(s) due.
In addition to my original requests, I would also like you to provide me with the following information:
A copy of your bank charter.
The names of the Board of Directors.
As I indicated in my first writing I am in possession of a booklet published
by the Federal Reserve Bank of Chicago called Modern Money Mechanics. The booklet describes who creates money.
Please respond within ten (10) days with the information I have requested. Unless I hear from you refuting my stated facts, I will consider my account with you closed and this matter settled. Please be sure to have the person replying sign any further correspondence under penalty of perjury, and send it only to the address exactly as it appears below by certified mail. Thanking you in advance for your cooperation.
Sincerely,
Your Name
c/o Your Street
Your City, Your State, Your Postal Zone
2nd letter
STATE OF COUNTY OF
Affidavit of Revocation of Signature for Cause
Mel Stamper 137 Attach to 2nd Letter
Comes now Affiant having full, first-hand knowledge of the facts herein and, by making this affidavit of his own first-hand knowledge, affirms that the facts stated herein are true and correct to the best of his knowledge and belief.
On or about (date you signed your credit card application), Affiant signed documents without knowledge that a fraud was being perpetrated upon Affiant:
That Affiant was coerced into signing documents without any knowledge that a fraud was being perpetrated upon Affiant;
That Affiant’s revocation of signature constitutes a recession of signature. Thus, the contract no longer exists.
Affiant hereby revokes and makes void all signatures for cause pursuant to UCC 3-501.
Now Affiant is formally and timely removing the aforementioned signature(s) for all time and removing any nexus that (credit card company) may presume to have over Affiant by virtue of said signature(s).
Further Affiant sayeth not.
________________________
(your name
________________________ ________________________
(name of witness) (name of witness)
STATE OF COUNTY OF
On this ____ day of ____________,200_, before me personally appeared Affiant , ____________________, who under oath attests to the truth of the aforementioned Affidavit and identified by a valid Drivers license, is hereby acknowledged by me.
___________________________________ NOTARY PUBLIC
138 Fruit from a Poisonous Tree
Date
Certified Mail No.
Credit Card Company
Address
City, State, Zip
Dear Sir or Madam:
I am returning your correspondence, which is enclosed. This matter has been settled. Please reference the attached copies of my correspondence of (dates). To date I have not received a satisfactory response to questions asked of you within these letters. A complete response from you is necessary in order to comprehend a full understanding of my contractual relationship with your bank. In the absence of a satisfactory reply, I have, therefore, concluded that (credit card company) is operating fraudulently and has not loaned me anything but a liability.
Until you prove to me that your bank has advanced to me a bank asset, I am under no obligation to repay the bank whatsoever. (Credit card company) has not fulfilled its contract with me.
I know that your bank’s records still show that it owes me an asset because what (credit card company) loaned me was created by my note to them. If (credit card company) wants payment in like funds, I will be pleased to send you a promissory note, which is all that (credit card company) ever gave me.
I will consider this matter to be closed on your part also, unless (credit card company) truthfully answers my questions. Any further contact from you will be considered harassment and will be dealt with accordingly. If you find it necessary to contact me, please do by certified mail so only at the address below, exactly as it appears, and have the person supplying the answers sign under penalty of perjury. All other correspondence will be refused, and telephone calls will not be accepted.
Sincerely,
Your Name
c/o Your Street
Your City, Your State, Your Postal Zone
3rd letter
Date
Certified Mail No.
Attn: Legal Department Credit Card Company
Address City, State, Zip
Manager Legal Department:
REFUSED FOR CAUSE WITHOUT DISHONOR UCC 3.501
Enclosed please note my returned credit card issued by your bank (card number). I demand proof of its cancellation. In addition I demand that all related computer-generated bookkeeping entries concerning my account be destroyed. Failure on your part to comply with my demands will result in court action to compel performance of said demands. Further, be advised that any action by you or your agents in any attempt to collect on this account will result in immediate court action.
My actions are taken in a timely manner with this refusal for cause, pursuant to UCC 3-501.
Refusal for Cause Without Dishonor, UCC 3-501(b)(3) states: “Without dishonoring the instrument, the party to whom presentment is made may (i) return the instrument for lack of a necessary endorsement, or (ii) refuse payment or acceptance for failure of the presentment to comply with the terms of the instrument, an agreement of the parties, or other applicable law or rule.
The reasons for my refusal for cause are as follow:
Constructive Fraud
When applying for my credit card, I was under the mistaken belief that (credit card company) would be loaning me depositor’s money, which it received from its depositors or investors. I have found by researching relevant case law on the matter and reading Modern Money Mechanics, published by the Federal Reserve Bank of Chicago, that (credit card company) created the
Mel Stamper
139 4th Letter
140 Fruit from a Poisonous Tree
money I borrowed by using my promise to pay. It generated computer entries to my account, listing the loan as a credit, in effect, creating money out of thin air.
In none of my transactions with (credit card company) did any officer or employee notify me that your bank created money by a journal entry (out of thin air). After discovering this, I am prepared to proceed against (credit card company) for bank fraud. The bank’s transactions relating to me lacked two necessary elements of a valid contract.
Perhaps you should be aware of the following:
United States Code, Title 32, Section 24, Paragraph 7 confers upon a bank the power to lend its money, not its credit. In First National Bank of Tallapoosa v Monroe, 135 Ga.614; 69 S.E. 1123 (1911), the court stated:
“(T)he provisions referred to do not give power to a national bank to guarantee the payment of the obligations of others solely for their benefit, nor is such power incidental of the business of banking. A bank can lend its money but not its credit.”
Again in: Howard & Foster Co. v Citizens National Bank of Union, 133 S.C. 202; 130 SE 758, (1927) “It has been settled beyond controversy that a national bank, under federal law, being limited in its power and capacity, cannot lend its credit by guaranteeing the debt of another. All such contracts being entered into by its officers are ultra vires and not binding upon the corporation. See also Merchants Bank of Valdosta v Baird, 160 F 642; 17 Lns 526 (1876).
(Credit card company) did not notify me that it created money by journal entry (out of thin air), defined as “bank credit.” To do so would have disclosed that there was no consideration from (credit card company) to me.
“A lawful consideration must exist and be tendered, to support the note.” See Anheuser Busch Brewing Co. v Emma Mason, 44 Minn. 318, 46 NW 558 (1890).
If there is no full disclosure and no consideration, there is no contract.
Peonage
(Credit card company’s) manner of transacting business has made me a debt slave, in violation of the Thirteenth Amendment to the Constitution of the United States, which expressly forbids involuntary servitude. The United States Supreme Court addressed involuntary servitude, also called peonage, in Clyatt v. U.S., 197 U.S. 207, 215-216; 25 S.Ct. 429; 43 L. Ed. 726 (1905), when it said:
“Peonage is sometimes classified as voluntary or involuntary, but this implies simply a difference in the mode of origin, but none of the character of the servitude. The one exists where the debtor voluntarily contracts to enter the service of his creditor. The other is forced upon the debtor by some provision of law.”
In addition, (credit card company)’s method of creating money out of thin air and charging interest upon the transaction is a violation of the Biblical law of “just weights and measures.” (Credit card company) created in moments money which takes me years of labor to pay off. (Credit card company) made me a debt slave by controlling my labor when it loaned me “bank credit” and not money.
BE NOTICED that I no longer consent to accepting (credit card company)’s demands upon me for my money. Your manner in the conduct of your banking business is in direct violation of the laws of contracts, the Constitution of the United States of America, God’s law and my civil rights.
Revocation of Signature
By my refusal of (credit card company)’s statement in a timely manner pursuant to UCC 3-501, I hereby revoke, rescind, and repudiate my signature on the original application presented to (credit card company). The original application was fraudulent on its face, as full disclosure was not provided. The application did not inform me that (credit card company) was loaning me “bank credit” created out of thin air.
Had (credit card company) so disclosed this fact to me, that I was in fact borrowing “bank credit,” I would have known that the element of consideration was missing from the contract and would have not entered into that agreement. It is a well-established principle of law that fraud has no statute of limitations and that its presence vitiates any and every contract or agreement. I make demand upon your bank to cancel our agreement and to return to me every dollar of my labor plus all interest I have ever paid to you for the duration of the agreement. I will contact the vendors directly and pay them for the products or services I purchased from them.
Mel Stamper 141
142 Fruit from a Poisonous Tree
You and your fellow bankers have been allowed to defraud the American public for many years. This can be explained only by the knowledge that the Federal Reserve Banks are a privately owned, operating for profit, corporation. Because of your inter-relationship and practices, all banks in this country are to be considered in law as one and the same, in that each bank in the Federal Reserve System is obligated to accept the checks of other member banks as if they issued it. I find it unconscionable that (credit card company) has been able to transfer my labor to its balance sheet by mere bookkeeping entries into its computer. This egregious violation of law and my civil rights shocks the conscience of all law-abiding citizens.
NOTICE
UCC 3-503 allows you thirty (30) days from receipt of this Refusal for Cause Without Dishonor notice to state under oath your rebuttal to my following causes:
That (credit card company) did not create money by loaning its credit and charging interest upon that loan, in violation of the law of contracts.
If you do not respond within thirty (30) days from the date of your receipt of this NOTICE, a default will be created by your material misrepresentation which vitiates any transaction occurring from the beginning of our doing business together until thirty (30) days from the date first above written. UCC 1-103.
If, within thirty (30) days, you do not either answer the above under oath or provide me proof of the cancellation of this computer-generated debt, the return or destruction of my application, and the return of all Federal Reserve Notes that I have paid to you since the beginning of our business relationship, I will seek damages against your bank for fraud. The Uniform Commercial Code allows me to seek the return of all Federal Reserve Notes paid to (credit card company) plus triple damages.
GOVERN YOURSELF ACCORDINGLY.
I will guarantee you only this: this set of letters will get their attention at the very highest level. You will get one heck of an education reading their replies. What will you do with all of the extra money, after you pay off the vendors?
CONSPIRACY
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