Stamp Endorse Send ©

By: Paths2Frdm Director Caleb Holt ©

Welcome to the comprehensive guide on SES better known as Stamp Endorse Send.
Oftentimes members of the Paths2frdm family hear the question “ What is Stamp Endorse
Send?”, and the answer is very simple. In layman's terms it is a 3 step process for paying all of
your so-called bills. It doesn't particularly matter the type of bill as the process remains the same
for all types of consumer transactions like credit cards, utilities, car notes, and really anything
that comes with a payment coupon attached. This guide will cover in depth everything you need
to know about SES and how to do it properly. This guide does assume you have some foundation
so we will only briefly cover some of the regulations and foundation that go along with the
process.

A Brief Review
In this section we will give you a brief background before moving into the process. As
we have covered in Escape the matrix the U.S went bankrupt in 1933 and seized all the gold,
from the People of the United States, our lawful currency and in return we were given unlimited
private credit and securities. Also since the federal common law was abolished in 1938 due to
the Erie Thompkins railroad decision all of our contracts fall under the commercial jurisdiction
due to the delegation of powers doctrine. With that understanding we 1st had to learn the rules of
commerce to be able to operate in honor and properly manage our own affairs.
 The most important thing to realize is your place in the transaction once you understand
your place you better understand your responsibilities. In every company you do business with
you are the investor. If you want more evidence look no further than the SEC filings for any
particular company. This is from the THIRD AMENDED AND RESTATED INDENTURE for
AMERICAN EXPRESS ISSUANCE TRUST II as Issuer and THE BANK OF NEW YORK
MELLON as Indenture Trustee and as Securities Intermediary it states that “Eligible
Investments” means negotiable instruments, investment property, or deposit accounts which
evidence: (a) direct obligations of, or obligations fully guaranteed as to timely payment by, the
United States of America;” or this section from the AMENDED AND RESTATED
INDENTURE DISCOVER CARD EXECUTION NOTE TRUST as Issuer And U.S. BANK
NATIONAL ASSOCIATION as Indenture Trustee which states “ “Permitted Investments”
means: (a) negotiable instruments or securities represented by instruments in bearer or registered
form which evidence: (i) obligations issued or fully guaranteed, as to timely payment, by the
United States of America or any instrumentality or agency thereof when such obligations are
backed by the full faith and credit of the United States of America;” you will find similar clauses
in most company filings. The reason these examples were chosen was to demonstrate that even if
you are not aware you have invested into these companies by way of your application which is a
negotiable instrument. And also that you have deposit accounts with all of these institutions
which in most cases also qualifies as an investment into any particular company. The reason your
application can be considered a promissory note is because it is a signed document that is
transferable to 3rd parties and also promises a sum of payment.

Now that the facts have been established let's take a closer look at your monthly
statements from a company.
 More often than not you will have a payment coupon attached like in the example above.
We have been misled about what the coupon is and how we should go about using it. We know
that these companies use the CBES system but what most people are not aware of is the fact that
your statement is evidence of a security created and registered in your name. Even though it is a
predecessor note as defined in the indenture agreements you will find that it evidences the same
debt. These companies have been sending us our money every month and having us return to
them freely as a gift which they can redeem. The statement is also bond with a payment coupon
attached and the regulations are well established. More specifically it is a registered bond.

According to investopedia a registered bond is a debt instrument whose bondholder's

information is kept on record with the issuing party. By archiving the owner's name, address, and
other details, issuers ensure they're making the bond's coupon payments to the correct person. A
registered bond has its owner's name and contact information recorded with the issuing entity,
ensuring coupon payments are correctly distributed. As of 2024 virtually all bonds in the U.S.
now are registered bonds, be they corporate bonds, U.S. Treasury bonds, or municipal bonds.

There are two ways to register bonds. In the first way, the issuer records the name and
address of the owner, which is physically printed on the bond certificate. This is evidenced by
your monthly statement. Transferring the ownership of registered bonds requires registered
owners to either endorse the back of the certificate or sign the certificate over to someone else.

Bonds can be registered electronically, using computerized databases to record a

bondholder's information. Under this scenario, if an individual wishes to transfer a bond to
another person, they must relay the recipient party's personal information to the electronic bond
issuer, via phone, snail mail, or fax. This is why we give instructions to the companies as we
must give explicit instructions on how to redeem our instruments. Only the individual
recognized as the registered owner, as of the interest payment date, may receive the agreed-upon
earnings. Anyone who presents a bond certificate that is not the registered owner on file will be
denied the coupon payment. Unless it is detached from the certificate as they have us do every
month.

Stamp

Now we will go over the actual process of Stamp Endorse Send. Starting off with the 1st
part which is stamp. This is in reference to the regulations for endorsing securities. More
specifically 31 CFR 328.5-8. From Title 31 Money and Finance which contains the Regulations
Relating to Money and Finance. This section deals with restrictive endorsements of U.S bearer
securities. 31 CFR 328.5 covers the forms of endorsement. It tells you that when presented by
banks securities should have the following endorsement “ For presentation to the Federal
Reserve Bank of __________, Fiscal Agent of the United States, for redemption or in exchange
for securities of a new issue, in accordance with written instructions submitted by __________.
(Insert name of presenting bank)”. Since we know that we are now dealing with Book Entry
Securities it also contains an endorsement for those types of securities as well. It is as follows
“For presentation to the Federal Reserve Bank of _________, Fiscal Agent of the United States,
for conversion to book-entry securities by _________. (Insert name of presenting bank)” Now if
you stopped reading there you would think you have the correct endorsement however you
would be incorrect. You must read the rest of the subchapter to find out the proper way it's
supposed to look. This can be found in the next section 328.6 which gives the requirements for
endorsement.

31 CFR 328.6 gives the dimensions of the endorsement and states that “ The endorsement
must be imprinted in the left hand portion of the face of each security with the first line thereof
parallel to the left edge of the security and in such manner as to be clearly legible and in such
position that it will not obscure the serial number, series designation, or other identifying data,
and cover the smallest possible portion of the text on the face of the security. The dimensions of
the endorsement should be approximately 4 inches in width and 1 1/2 inches in height, and must
be imprinted by stamp or plate of such character as will render the endorsement substantially
ineradicable…When securities are to be presented to the Bureau of the Fiscal Service, the words
“United States Treasury” should be used in lieu of the words “Federal Reserve Bank of _______,
Fiscal Agent of the United States.” No subsequent endorsement will be recognized. If the form
of endorsement on a security is different than that prescribed in § 328.5, the provisions of §§
328.7 and 328.8 shall not apply to the security.

This tells us 5 things that we need to pay attention to. The 1st is that the security must be
imprinted on the left hand portion of the security parallel to the left edge. This will be
demonstrated in the example provided below on where to stamp. The 2nd is that it should be
legible and not obscure the serial number or identifying data. So long as you can read it and it
doesn't cover any of the mentioned information it is ok if it covers some words. The 3rd thing is
the dimensions which are 4 in W by 1 and ½ in L. The 4th is that it should be imprinted by a
stamp or plate of such character as will render the endorsement substantially ineradicable. This
is where the Stamp comes from in our process. I would like to mention that it doesn't need to be
a stamp, it can be anything that makes a permanent mark. You can format the endorsement on a
computer but make sure it's around the proper dimensions. A link will be provided to the
Paths2frdm approved stamp at the end of the book. The last thing is that when presented to the
bureau of fiscal service which is where the banks present our instruments for exchange the words
United States Treasury should be used in lieu of Federal Reserve Bank.

That being said, what you should have on your stamp is as follows:
 “ For presentation to the United States Treasury for redemption or in exchange for
securities of a new issue, in accordance with written instructions submitted by __________.”
Or for Book Entry Securities it should say:
“For presentation to the United States Treasury for conversion to book-entry securities
by _________.”
Of course you want to make sure when you make your Stamp it fits the dimensions. You
can have the stamp made anywhere that does custom stamps. If you can't get the exact dimension
that is ok as the regulations say it should be approximate so don't stress if you can't find it
exactly.

Endorse

Now that we have covered the “Stamp” it's time to cover the next piece of the process
which is “Endorse”. According to the UCC Endorsement means “a signature, other than that of a
signer as maker, drawer, or acceptor, that alone or accompanied by other words is made on an
instrument for the purpose of (i) negotiating the instrument, (ii) restricting payment of the
instrument, or (iii) incurring endorser's liability on the instrument, but regardless of the intent of
the signer, a signature and its accompanying words is an indorsement unless the accompanying
words, terms of the instrument, place of the signature, or other circumstances unambiguously
indicate that the signature was made for a purpose other than indorsement.” This part of the
process is very important as without a proper endorsement the companies can continue to claim
that you are gifting instruments to them. There are many types of endorsement including, Special
Endorsement, Blank Endorsement, and Restrictive Endorsement.
Special Endorsement:
When specially endorsed, an instrument becomes payable to the identified person and
may be negotiated only by the indorsement of that person.
(b) If an indorsement is made by the holder of an instrument and it is not a special
indorsement, it is a "blank indorsement".

Blank Endorsement:
 When endorsed in blank, an instrument becomes payable to bearer and may be
negotiated by transfer of possession alone until specially endorsed.
(c) The holder may convert a blank indorsement that consists only of a signature into a
special indorsement by writing, above the signature of the indorser, words identifying the person
to whom the instrument is made payable.

Restrictive Endorsement:
A restrictive endorsement is a conditional guarantee of a transfer of a negotiable
instrument. That is, an endorsement that takes effect only on the occurrence or non-occurrence of
another act or event.
It can also limit payment to a particular person or otherwise prohibit further transfer or
negotiation of the instrument but not beyond the payment for which the endorsement applies.

When it comes to our instruments, if we followed the company instructions we would be

sending them a bearer instrument endorsed in blank every month leaving them free to claim what
belongs to us. By simply signing with no further instructions we are endorsing our instruments in
blank. Think about everything you’ve ever signed and realize that it was a blank endorsement
and you just gave out a gift. That's what the companies are claiming at least. Now since we know
what the types of endorsement are let’s see how they affect our instruments.
 If you have a blank endorsement your instrument becomes payable to bearer and anyone
holding the instrument is able to redeem it. This is how these companies have been stealing
what's ours and also why they wanted to push to paperless billing so we have less opportunities
to discover their misdeeds. When you use a restrictive endorsement it limits payment to whoever
you name as payee and also prevents further trading of the instrument if the conditions are not
fulfilled. When using a special endorsement the instrument is payable to whoever you name as
payee and the instrument can continually be traded as long as there are subsequent endorsements.
We are able to endorse our instruments either restrictively or specially. However if you use a
restrictive endorsement that limits the money the companies are able to make off of your
instrument. This is why we encourage a special endorsement. You name the company as payee
and that way you both win. You are able to redeem the value of your instrument and the
company is able to get their portion as well. Fair exchange has never been robbery.

The proper way to endorse your instrument is very simple. All you have to write is “Pay
to the Order of” and name a payee. It really is that simple everyone else is making it a lot more
complicated than it needs to be. Also you have to understand your position in the transaction and
when you sign your name make sure to include “By ( Your Name)/ Agent for (All Caps Name)
By Accomodation/Principal.” As you are the agent for your Strawman which is the principal.

Please see the 2 Examples below of properly stamped and endorsed statements.
↓
 As you can see the stamp is parallel to the left edge in both examples even though it is in
different places. Once you have your instrument stamped we also recommend you get your
statement a medallion stamped or get a bank notary to verify your signature on the instrument
when you endorse. This will not keep your instruments from being accepted without them
because both examples above are from students who had remedy with the company but they did
not do those things. If you can it will only help you out so there is no harm in getting it done for
extra security. We know the law as do the companies but if we are not overly explicit with our
instructions they will continue to feign ignorance and if anything isn't done right it allows the
company wiggle room to avoid complying.

Send

Now that we have covered “Stamp”, and “Endorse” we are ⅔ of the way to fully
understanding what SES entails. Last thing to cover is the final portion which is “Send”. Once
you stamp your instrument and properly endorse it all that's left is to send it to the proper place
and then sit back and wait for remedy. But there is a lot of confusion about where the proper
place is so we are going to clear that up today.

When sending your instruments it is important to send it to the proper address. Many
companies have rules governing how they process instruments and if you don't send it to the
proper place you must be aware of the companies rights in regards to what is sent to them.
Certain companies will tell you explicitly that if you send your payments to the wrong address
the company reserves the right to keep the instrument and not return it to you. This is why you
must be careful and not just send it anywhere. Most companies also tell you where to send your
instruments if you know what to look for. American Express and Discover tell you exactly which
addresses to send your instruments too. It will be different for every company so make sure you
thoroughly review your cardmember agreements or other company related materials so you
know where to send your payments no matter what kind of account you have or the type of
transaction that it is.

It is also important to briefly discuss the Trustee and the Indenture Trustee and whether
or not to send your instruments there. The company is able to process the instrument as well as
the trustee. Ultimately it's always going to follow the same path as if it’s sent to the company
they also send it to the trustee anyway. When you look at any indenture agreement you will find
that any paying agent is able to take care of the notes and they are responsible for making sure it
gets to the right party. The paying agents include the trust itself, the company and its
subsidiaries. So while you can send it to the trustees you do not have to. If your instructions are
lacking or your endorsement isn't right that will cause you to have trouble but if you don't send it
to the trustees that will not make or break your process.

When it comes to getting your security deposited into your TDA account that is a
separate process from sending to the trustee or the company for getting your payment. They can
be done at the same time but that is a little harder and requires a bit more foundation. We
recommend making sure they process your instruments 1st before trying to get it deposited into
your TDA because if you can't even get them to process your payment you will have even less
success trying to make them do that. I will however cover that process as well. In order to direct
your security into your TDA it is about the endorsement you place on the instrument. You would
use a restrictive endorsement. Instead of naming the company as payee you would be the payee.
So it would be Pay to the Order of (Your Name) followed by For Deposit Only ( TDA Routing
and Account Numbers). But again we highly recommend getting your instruments processed 1st
before attempting that. Once you have that figured out I recommend checking out Freedom
Edition Treasury Direct for more information about other places you can deposit your
instruments. It is also important to mention that if you have not revoked the power of attorney
from the company you are attempting to send your instrument to, they are more likely to ignore
it. So make sure you revoke POA and all other necessary elements before beginning.

Cover Letter Examples

Example 1

Intent to Sue

Company Name
Legal Department
Address
City, State, Zip

Your Name
Address
City, State, Zip
Phone
Email

Re Account Number:
 To whom it may concern the account referenced above has been audited for violations of
the securities laws. I have evidence that the above stated Mortgage that I have received from
your company has been securitized which is a scheme in which companies issue credit to
consumers and then seek to collect the amounts allegedly owed to them which are not legally due
to them. In this case Mortgage Company, in accordance with (Trustee Bank) have unlawfully
purported to assign, transfer, or convey its interest in my promissory Note on or before the
Closing Date of (Trust it was sold into). Mortgage Company, also never negotiated the Tangible
Note by operation of law for full value in accordance with all applicable law to Sponsor. The
audit displays that there has been a clear separation between the note and deed and these were
never properly recorded.

Furthering the fraud Mortgage Company, and (Trustee Bank) still services the account
by sending out bills and accepting payment. Mortgage Company, has sold the payment stream
(The Debt) to the Genie MAE who has placed the payment stream (The Debt) into the ( Genie
MAE Trust) and yet the Note is endorsed to the servicer (Trustee Bank) who has decided to
transfer to the tangible Note an as of Yet Unnamed Payee.

However, Mortgage Company, has given up ownership rights, as required under

contract, to the Guaranteed REMIC Pass-Through Securities and MX Securities Ginnie Mae
REMIC Trust 2021-215; therefore Mortgage Company,and its affiliated or successor entities
,including (Trustee Bank) , have given up their rights to sue its customers when they default on
their debt because Mortgage Company, intentionally sold and relinquished its beneficial interest
in Mortgage Company, accounts.

You have already transferred beneficial ownership in the account and continue to act as
servicer so I would be none the wiser. Seeing as I tendered the instrument I do not believe it's fair
for you to keep all of the money received from the proceeds of your trading on the secondary
markets. If you continue to feign ignorance and deny my claims that this account has been sold
into trust and that I have tendered an instrument that constitutes full payment please be prepared
to prove it in arbitration or equity court as this account has been audited and I have an expert
witness willing to testify to your securitization tactics. I will also be seeking claims for unjust
enrichment; violations of the Fair Credit Extension Uniformity Act (“FCEUA”);violations of the
Fair Debt Collection Practices Act (“FDCPA”); Negligent and Intentional Infliction of Emotional
Distress; Racketeering; and further violations of the securities laws. I will also send the report
over to the SEC as I'm sure they would love to be informed as to how you are defrauding
consumers.

See the following provisions of the UCC.

3-309. ENFORCEMENT OF LOST, DESTROYED, OR STOLEN INSTRUMENT.
 (a) A person not in possession of an instrument is entitled to enforce the instrument if
(i) the person was in possession of the instrument and entitled to enforce it when loss of
possession occurred, (ii) the loss of possession was not the result of a transfer by the person or a
lawful seizure, and (iii) the person cannot reasonably obtain possession of the instrument because
the instrument was destroyed, its whereabouts cannot be determined, or it is in the wrongful
possession of an unknown person or a person that cannot be found or is not amenable to service
of process.
(b) A person seeking enforcement of an instrument under subsection (a) must prove
the terms of the instrument and the person's right to enforce the instrument.
§ 3-301. PERSON ENTITLED TO ENFORCE INSTRUMENT.
"Person entitled to enforce" an instrument means (i) the holder of the instrument, (ii) a
non-holder in possession of the instrument who has the rights of a holder, or (iii) a person not in
possession of the instrument who is entitled to enforce the instrument pursuant to Section 3- 309
or 3-418(d). A person may be a person entitled to enforce the instrument even though the person
is not the owner of the instrument or is in wrongful possession of the instrument.
2. HOLDER IN DUE COURSE.
(a) Subject to subsection (c) and Section 3-106(d), "holder in due course" means the
holder of an instrument if:
(2) the holder took the instrument (i) for value, (ii) in good faith, (iii) without notice that
the instrument is overdue or has been dishonored or that there is an uncured default with respect
to payment of another instrument issued as part of the same series, (iv) without notice that the
instrument contains an unauthorized signature or has been altered, (v) without notice of any
claim to the instrument described in Section 3-306, and (vi) without notice that any party has a
defense or claim in recoupment described in Section 3-305(a).
§ 3-305. DEFENSES AND CLAIMS OF RECOUPMENT.

(a) Except as otherwise provided in this section, the right to enforce the obligation of a
party to pay an instrument is subject to the following:
(1) a defense of the obligor based on (i) infancy of the obligor to the extent it is a defense
to a simple contract, (ii) duress, lack of legal capacity, or illegality of the transaction which,
under other law, nullifies the obligation of the obligor, (iii) fraud that induced the obligor to sign
the instrument with neither knowledge nor reasonable opportunity to learn of its character or its
essential terms, or (iv) discharge of the obligor in insolvency proceedings;
(c) Except as stated in subsection (d), in an action to enforce the obligation of a party to
pay the instrument, the obligor may not assert against the person entitled to enforce the
instrument a defense, claim in recoupment, or claim to the instrument (Section 3-306) of another
person, but the other person's claim to the instrument may be asserted by the obligor if the other
person is joined in the action and personally asserts the claim against the person entitled to
enforce the instrument. An obligor is not obliged to pay the instrument if the person seeking
enforcement of the instrument does not have rights of a holder in due course and the obligor
proves that the instrument is a lost or stolen instrument.
§ 3-305. TRANSFER OF INSTRUMENT: RIGHTS ACQUIRED BY TRANSFER
(a) Transfer of an instrument, whether or not the transfer is a negotiation, vests in the
transferee any right of the transferor to enforce the instrument, including any right as a holder in
due course, but the transferee cannot acquire rights of a holder in due course by a transfer,
directly or indirectly, from a holder in due course if the transferee engaged in fraud or illegality
affecting the instrument.

Example 2
Company Name
Address
City, State, Zip

Your Name
Address
City, State, Zip
Phone
Email

Account number

Dear Company Name,

I am writing to you as an investor seeking to redeem my instruments. I have not only

provided you with a promissory note via my original credit application, but I am also entitled to
receive the interest on the coupon payments I receive every month. These are notes I am able to
collect pursuant to the indenture agreement you have on file with the SEC. Pursuant to UCC
3-604, if the instruments, notes, or any tender of payment is rejected, surrendered, or mutilated, I
am able to consider the debt discharged. I am able to send you the notes every month.
(Company) can be assured all obligations I incur will be tendered as a form of payment and I
will never become delinquent. I have a forensic auditor at my disposal who is willing to testify to
your securitization tactics.. if my concerns are not addressed I will report the CUSIP and other
relevant information to the SEC. Your prospectus clearly states the notes will not be placed on
any secondary market!

Sincerely,
 By: _______________________ / Agent For: ALL CAPS NAME - Principal

Notary Seal:

Conclusion
Now we have covered everything you need to know about the SES process. If you are
unable to get remedy after this serious reflection is in order and I would recommend going back
to the basics and praying to whatever you believe in because lord knows there isn't anything else
we can do to lay it out. This is the 1st time we have done something like this and we have
included everything you could possibly need to know with examples so there can be no excuse. I
wish all of you the best of luck. If you made it this far your remedy is knocking at the door go
and let it in!

Here are the links for the supplementary materials:

https://www.rubberstampchamp.com/products/restrictive-endorsement-stamp-1-1-2-x-4
Freedom Edition: Treasury
Direct
By Paths2frdm Director:
Caleb Holt©
 In order to understand what the Treasury Direct system is we must 1st understand our
role in it and how it is meant to operate. To put it simply we are investors who are eligible to
trade securities on the primary and secondary markets.

Laws That Govern the Securities

Industry
In order to better help understand our position we must 1st familiarize ourselves with the
laws that govern the securities industry. Lets begin with the Securities Act of 1933 also known as
the truth in securities law. It answers the most basic question of all, “what is a security?” A
security is any note, stock, treasury stock, security future, security-based swap, bond, debenture,
evidence of indebtedness, certificate of interest or participation in any profit-sharing agreement,
collateral-trust certificate, preorganization certificate or subscription, transferable share,
investment contract, etc. The Securities Act of 1933 has two basic objectives the 1st being a
requirement that investors receive financial and other significant information concerning
securities being offered for public sale; and also to prohibit deceit, misrepresentations, and
other fraud in the sale of securities. This was a necessity back then just as much as it is today
because if you are at this point you should have a good understanding of all the
misrepresentation and lack of other education on matters of significant information that we as
investors need. To help accomplish these goals in general, securities sold in the U.S. must be
registered. The registration forms companies file provide essential facts while minimizing the
burden and expense of complying with the law. Registration statements and prospectuses become
public shortly after filing with the SEC. If filed by U.S. domestic companies, the statements are
available on the EDGAR database accessible at www.sec.gov. Registration statements are subject
to examination for compliance with disclosure requirements. This information enables investors,
not the government, to make informed judgments about whether to purchase a company's
securities. While the SEC requires that the information provided be accurate, it does not
guarantee it. This is why we must hold them to their filings. Investors who purchase securities
and suffer losses have important recovery rights if they can prove that there was incomplete or
inaccurate disclosure of important information. Not all offerings of securities must be registered
with the Commission. By exempting many small offerings from the registration process, the SEC
seeks to foster capital formation by lowering the cost of offering securities to the public.

Next up is the Securities Exchange Act of 1934. With this Act, Congress created the
Securities and Exchange Commission. The Act empowers the SEC with broad authority over all
aspects of the securities industry. This includes the power to register, regulate, and oversee
brokerage firms, transfer agents, and clearing agencies as well as the nation's securities self
regulatory organizations (SROs). The various securities exchanges, such as the New York
Stock Exchange, the NASDAQ Stock Market, and the Chicago Board of Options are SROs.
The Financial Industry Regulatory Authority (FINRA) is also an SRO. SROs must create
rules that allow for disciplining members for improper conduct and for establishing measures to
ensure market integrity and investor protection. SRO proposed rules are subject to SEC review
and published to solicit public comment. While many SRO proposed rules are effective upon
filing, some are subject to SEC approval before they can go into effect. The Act also identifies
and prohibits certain types of conduct in the markets and provides the Commission with
disciplinary powers over regulated entities and persons associated with them.The Act also
empowers the SEC to require periodic reporting of information by companies with publicly
traded securities. For example companies with more than $10 million in assets whose
securities are held by more than 500 owners must file annual and other periodic reports.
These are the 10k and 8k forms. These reports are available to the public through the SEC's
EDGAR database. The Securities Exchange Act also governs the disclosure in materials used to
solicit shareholders' votes in annual or special meetings held for the election of directors and the
approval of other corporate action. This information, contained in proxy materials, must be filed
with the Commission in advance of any solicitation to ensure compliance with the disclosure
rules. Solicitations, whether by management or shareholder groups, must disclose all important
facts concerning the issues on which holders are asked to vote. The securities laws broadly
prohibit fraudulent activities of any kind in connection with the offer, purchase, or sale of
securities. These provisions are the basis for many types of disciplinary actions, including
actions against fraudulent insider trading. Insider trading is illegal when a person trades a
security while in possession of material nonpublic information in violation of a duty to withhold
the information or refrain from trading.

The last Act I would like to touch on is the Trust Indenture Act of 1939 This Act applies
to debt securities such as bonds, debentures, and notes that are offered for public sale. Even
though such securities may be registered under the Securities Act, they may not be offered for
sale to the public unless a formal agreement between the issuer of bonds and the
bondholder, known as the trust indenture, conforms to the standards of this Act. This is
why every company we deal with has a trust indenture agreement otherwise they would not be
able to operate in the same capacity. These laws will be essential to your understanding of what
the system is and how to operate within it. I suggest you read them all the way through to further
supplement your understanding of the material.

Primary and Secondary Markets

 The primary market is a source of new securities. Often on an exchange, it's where
companies, governments, and other groups go to obtain financing through debt-based or
equity-based securities. For the primary market it's important to remember:
● In the primary market, new stocks and bonds are sold to the public for the
first time.
● In a primary market, investors are able to purchase securities directly from the
issuer.
● After they’ve been issued on the primary market, securities are traded between
investors on what is called the secondary market—essentially, the familiar stock
exchanges.
The primary market is where securities are created. It's in this market that firms sell or “float”
new stocks and bonds to the public for the first time. All issues on the primary market are subject
to strict regulation. Companies must file statements with the Securities and Exchange
Commission (SEC) and other securities agencies and must wait until their filings are approved
before they can offer them for sale to investors. Take, for example, U.S. Treasuries—the bonds,
bills, and notes issued by the U.S. government. The Dept. of the Treasury announces new issues
of these debt securities at periodic intervals and sells them at auctions, which are held multiple
times throughout the year. This is an example of the primary market in action. Now, let's say
some of the investors who bought some of the government's bonds or bills at these
auctions—they're usually institutional investors, like brokerages, banks, pension funds, or
investment funds—want to sell them. They offer them on stock exchanges or markets like
the NYSE, Nasdaq, or over-the-counter (OTC), where other investors can buy them. These
U.S. Treasuries are now on the secondary market.

The secondary market is where investors buy and sell securities. Trades take place on the
secondary market between other investors and traders rather than from the companies that issue
the securities. People typically associate the secondary market with the stock market. National
exchanges, such as the New York Stock Exchange (NYSE) and the NASDAQ, are
secondary markets. The secondary market is where securities are traded after they are put
up for sale on the primary market. The secondary market provides investors and traders with a
place to trade securities after they are put up for sale on the primary market. Investors trade
securities on the secondary market with one another rather than with the issuing entity. Through
a massive series of independent yet interconnected trades, the secondary market drives the price
of securities toward their actual value. The secondary market provides liquidity to the financial
system and allows smaller traders to participate. The stock market and over-the-counter markets
are types of secondary markets. As noted above, securities are bought and sold by investors
among one another on the secondary market after they are first sold on the primary market. As
such, most people call the secondary market the stock market. Transactions that occur on the
secondary market are termed secondary simply because they are one step removed from the
transaction that originally created the securities in question. For example, a financial institution
writes a mortgage for a consumer, creating the mortgage security. The bank can then sell it to
Fannie Mae on the secondary market in a secondary transaction. With equities, the distinction
between primary and secondary markets can seem a little cloudier. Essentially, the secondary
market is what's commonly referred to as "the stock market," the stock exchanges where
investors buy and sell shares from one another. But in fact, a stock exchange can be the site of
both a primary and secondary market. The stock market is made up of centralized exchanges that
allow buyers and sellers to come together to trade stocks and other assets. There is no contact
that takes place between each party—physical or otherwise. Most trading takes place
electronically. Traders must abide by the rules and regulations set forth by the appropriate
regulatory bodies, such as the Securities and Exchange Commission (SEC) in the United States.
The over-the-counter (OTC) market involves the trading of stocks, bonds, and other financial
assets. But rather than take place over a centralized exchange, trades occur through broker-dealer
networks. As such, these assets aren't traded on an exchange. Stocks on the OTC market are
normally those of smaller companies that don't meet listing requirements.

Commercial Book Entry

Now that we understand the primary and secondary markets we must understand the commercial
book entry system. The commercial book-entry system (CBES) is a way for investors who work
with banks, brokers, and dealers to get and pay for Treasury securities. Look at the example
below:

A customer of Broker M is selling a security to a customer of Financial Institution J. In this

situation here's what happens through CBES:
Broker M delivers the securities to Depository Institution A by sending a message wire
instructing Depository A's computer to deliver the securities to Financial Institution J.
Depository A's computer sends the message to the Federal Reserve's book-entry computer, which
debits Depository A for the security and credits Depository B's account for the security.
Depository B's computer sends a message wire to Financial Institution J's computer to confirm
electronic receipt of the security.
Financial Institution J applies the security to the buyer's account.
The money debits and credits follow a similar transaction path as the securities, but in reverse.
The Federal Reserve Bank debits Depository B's reserve (money) account at the Fed and credits
Depository Bank A's reserve account for the same amount.

The CBES is a multi-tiered automated system. At the top tier, the Federal Reserve Banks run
the National Book-Entry System. At the top the Federal Reserve Banks keep book-entry
accounts for the U.S. Treasury, as well as for depository institutions, foreign central banks, and
most government-sponsored enterprises. At the next tier, depository institutions keep book-entry
accounts for their customers. Customers include brokers, dealers, institutional investors, and
trusts. At the bottom tier, each broker, dealer, and financial institution keeps book-entry accounts
for individual customers, corporations, and other entities.
As you see, the transaction is between the brokers, dealers, or financial institutions. Neither
Treasury nor the Federal Reserve Banks have records for individual owners of securities held in
the commercial book-entry system. Disputes must be settled with the broker, dealer, or financial
institution. Individual customers with Treasury securities in the commercial book-entry
system have no direct recourse against the U.S. Department of the Treasury or the Federal
Reserve Bank. As in any financial transaction, investors should exercise care in selecting a
book-entry custodian or a broker-dealer. Fidelity, Charles Schwab, etc. Book-entry securities
are investments such as stocks and bonds whose ownership is recorded electronically.
Book-entry securities eliminate the need to issue paper certificates of ownership. Ownership
of securities is never physically transferred when they are bought or sold; accounting entries are
merely changed in the books of the commercial financial institutions where investors maintain
accounts. Book-entry securities can also be referred to as uncertificated securities or paperless
securities. Book entry is a method of tracking ownership of securities where no physically
engraved certificate is given to investors. Securities are tracked electronically, rather than in
paper form, allowing investors to trade or transfer securities without having to present a paper
certificate as proof of ownership. When an investor purchases a security, they receive a receipt
and the information is stored electronically. Book-entry securities are settled by the
Depository Trust Company (DTC), which is the Depository Trust & Clearing Corporation’s
(DTCC) central securities depository. An investor receives a statement providing evidence of
ownership instead of a stock certificate. Dividend payments, interest payments, and cash or
stock payments due to a reorganization are processed by DTC and transferred to the appropriate
investment bank or broker to deposit in the account of the securities’ holder Stock in direct
investment plans, Treasury securities purchased directly from the US Department of the
Treasury, and recently issued municipal bonds are held in book-entry form. In August 1986, with
the introduction of a program named Treasury Direct, the Treasury began marketing all new
notes and bonds only in book-entry form. The program was expanded in 1987 to include
T-bills. Treasury Direct makes principal, interest, and redemption payments directly into
an individual investor's account at a financial institution. These payments are made
electronically rather than by check. An investor may also use the Legacy Treasury Direct system,
also operated by the Treasury, to buy and sell directly with the Treasury which issues an account
statement to the investor as confirmation of a transaction. The government issues book-entry
securities to reduce the expenses associated with paperwork. Individuals who still own old
paper securities may exchange them for electronic, book-entry securities.

The commercial book entry system is governed by 31 CFR 356 and 31 CFR 357
Government agencies must ensure the security of public money on deposit at depository
institutions, such as a bank. A bank must pledge collateral (as detailed in Treasury’s lists of
acceptable collateral) to secure these funds. The collateral list can be found 31 CFR 202 and 31
CFR 225

Lawful Money Vs Legal Tender

In 1933 the United States went bankrupt. When that happened we lost access to lawful money
and were given legal tender instead. All homes and property in the country were mortgaged to
back the credit of the nation and in return we became investors with unlimited purchasing power.
This is stated in the congressional record March 9th 1933 “ Under the new law the money is
issued to the banks in return for Government obligations, bills of exchange, drafts, notes, trade
acceptances and banker's acceptances. The money will be worth 100 cents on the dollar, because
it is backed by the credit of the Nation. It will represent a mortgage on all the homes and
other property of all the people in the Nation.”This is supported by 18 USC 8 which states
that all obligations and other securities belong to the United States. Banks can only borrow and
give security therefore according to 12 USC 1431 and they must pay us back as well. According
to HJR 192 of the 73rd Congress “Whereas the existing emergency has disclosed that
provisions of obligations which purport to give the obligee a right to require payment in gold or a
particular kind of coin or currency of the United States, or in an amount of money of the United
States measured thereby, obstruct the power of congress to regulate the value of the money of the
United States, and are inconsistent with the declared policy of the Congress to maintain at all
times the equal power of every dollar, coined or issued by the United States, in the markets and
in the payment of debts. Now therefore be it Resolved by the Senate and House of
Representatives of the United States of America in Congress Assembled, That (a) Every
provision contained in or made with respect to any obligation which purports to give the obligee
a right to require payment in gold or a particular kind of coin or currency, or in an amount of
money of the United States measured thereby, is declared to be against public policy; and no
such provision shall be contained in or 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 coin or currency which at the time payment is legal tender for public and
private debts. Any such provision contained in any law authorizing obligations to be issued by
or under authority of the United States, is hereby repealed, but
the repeal of any such provision shall not invalidate any other provision or authority contained in
such law.” It also states that “ As used in the 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 coins or
currency of the United States including Federal Reserve Notes”

Federal Reserve Act Section 16 Part 1 Note Issues Codified at 12 USC 411
Issuance of Federal Reserve notes; nature of obligation; where redeemable Federal reserve
notes, to be issued at the discretion of the Board of Governors of the Federal Reserve
System for the purpose of making advances to Federal reserve banks through the Federal
reserve agents as hereinafter set forth and for no other purpose, are hereby authorized.
The said notes shall be obligations of the United States and shall be receivable by all
national and member banks and Federal reserve banks and for all taxes, customs, and
other public dues. They shall be redeemed in lawful money on demand at the Treasury
Department of the United States, in the city of Washington, District of Columbia, or at any
Federal Reserve bank. We are not the board of governors and under the Trading With The
Enemy Act of October 6, 1917, AS AMENDED by the Emergency Banking Relief Act, 48 Stat
1, Public Law No. 1, which is presently codified at 12 USC 95a and confirmed at 95b we are all
enemies of the state for using Federal Reserve Notes in our current capacity. They are not lawful
money, only legal tender our remedy to the bankruptcy of the United States is securities. By not
claiming them properly we remain in dishonor and the public debt will continue to grow.

Federal Reserve Act Section 16 Part 2 Application for notes by Federal Reserve banks Codified
at 12 USC 412
Any Federal Reserve bank may make application to the local Federal Reserve agent for such
amount of the Federal Reserve notes hereinbefore provided for as it may require. Such
application shall be accompanied with a tender to the local Federal Reserve agent of collateral in
amount equal to the sum of the Federal Reserve notes thus applied for and issued pursuant to
such application. The collateral security thus offered shall be notes, drafts, bills of exchange, or
acceptances acquired under section 10A, 10B, 13, or 13A of this Act, or bills of exchange
endorsed by a member bank of any Federal Reserve district and purchased under the provisions
of section 14 of this Act, or bankers' acceptances purchased under the provisions of said section
14, or gold certificates, or Special Drawing Right certificates, or any obligations which are direct
obligations of, or are fully guaranteed as to principal and interest by, the United States or any
agency thereof, or assets that Federal Reserve banks may purchase or hold under section 14 of
this Act or any other asset of a Federal reserve bank. In no event shall such collateral security be
less than the amount of Federal Reserve notes applied for. The Federal Reserve agent shall each
day notify the Board of Governors of the Federal Reserve System of all issues and withdrawals
of Federal Reserve notes to and by the Federal Reserve bank to which he is accredited. The said
Board of Governors of the Federal Reserve System may at any time call upon a Federal Reserve
bank for additional security to protect the Federal Reserve notes issued to it. Collateral shall not
be required for Federal Reserve notes which are held in the vaults of, or are otherwise held by or
on behalf of, Federal Reserve banks. What this is saying is that the notes, drafts, bills of
exchange that we provide to companies in the form of applications are collateral for the federal
Reserve Notes they apply for, they are short term advances that must be paid back to us.

This is evidenced by 16 CFR 433.1 which defines a Purchase money loan. Which is “A cash
advance which is received by a consumer in return for a “Finance Charge” within the meaning of
the Truth in Lending Act and Regulation Z, which is applied, in whole or substantial part, to a
purchase of goods or services from a seller who (1) refers consumers to the creditor or (2) is
affiliated with the creditor by common control, contract, or business arrangement.” As you can
see we were supposed to receive the funds 1st but due to all the deceptive practices we were
uninformed. It's also not helped by the fact that we assigned the company security interest
allowing them to keep all proceeds from insurance and otherwise. We also gave them the right to
transfer the note so we must correct that. In order to do that you must rescind the security interest
you gave in in the contract as well as revoking their right to transfer the note.

Commercial Paper and Marketable

Securities
Now that we understand the laws and the system we need to understand what types of securities
we are working with. These are commercial paper and marketable securities. "Marketable"
means that you can transfer the security to someone else and you can sell the security before it
matures (reaches the end of its term). Marketable securities are assets that can be liquidated to
cash quickly. These short-term liquid securities can be bought or sold on a public stock exchange
or a public bond exchange. These securities tend to mature in a year or less and can be either
debt or equity.Marketable securities include common stock, Treasury bills, and money market
instruments, among others. The federal government finances its operation in part by selling
various types of securities. More specifically, The United States Treasury offers five types of
Treasury marketable securities: Treasury Bills, Treasury Notes, Treasury Bonds, Treasury
Inflation-Protected Securities (TIPS), and Floating Rate Notes (FRNs). All these securities are
backed by the full faith and credit of the United States government. Commercial paper is an
unsecured, short-term debt instrument issued by corporations. It's typically used to finance
short-term liabilities such as payroll, accounts payable, and inventories. Commercial paper is
usually issued at a discount from face value. It reflects prevailing market interest rates.
Commercial paper involves a specific amount of money that is to be repaid by a specific date.
Minimum denominations are $100,000. Terms to maturity extend from one to 270 days. They
average 30 days. Commercial paper was first introduced over 150 years ago when New York
merchants began to sell their short-term obligations to dealers in order to access capital needed to
cover near-term obligations. These dealers, or middlemen, purchased the paper, (also known as
promissory notes) at a discount from their par value. They then sold the paper to banks and other
investors. The merchants would repay the investors an amount equal to the par value of the note.
Commercial paper is not backed by any form of collateral, making it unsecured debt. It differs
from asset-backed commercial paper (ABCP), a class of debt instrument backed by assets
selected by the issuer. In either case, commercial paper is only issued by firms with high ratings
from credit rating agencies. These firms can easily find buyers without having to offer a
substantial discount (at a higher cost to themselves) for the debt issue. There are four types of
commercial paper: promissory notes, drafts, checks, and certificates of deposit (CDs).
● Promissory notes, or, simply, notes, are debt instruments written by one party to another
that promise to pay a specific amount of money by a certain date. Notes are a common
way for companies to issue commercial paper.
● A draft is a written agreement between three parties: a bank (the drawer), a payer (the
drawee), and a payee. The bank instructs the commercial paper issuer to pay the lender
(payee) a specific amount of money at a specific time.
● Checks are paid on demand by a bank rather than by a certain time. They are the fastest
way to issue commercial paper. For this type of commercial paper, the issuing company
instructs a bank to give the payee a specific amount of money instantly.
● A certificate of deposit is exactly what the name implies: a bank receipt, or certificate,
that asserts that the bank has received a sum of money deposited by an investor. It
agrees to pay back this money plus interest at a specific time in the future. The CD also
states the interest rate to be paid and the maturity date.

Here are some important things to remember about Commercial Paper. The issuer of commercial
paper is the entity that is creating the short-term debt to fund their short-term cash needs. As
mentioned earlier, most issuers are large corporations with strong credit, as the issuer may
demonstrate a high probability of being able to pay back debt especially in the short-term. The
maturity of commercial paper designates how long the debt is outstanding for the issuer.
Commercial paper often has a term up to 270 days, though companies often issue commercial
paper with a maturity of 30 days. At the end of the maturity period, the commercial paper is
technically due, and the issuer is now liable to return investor capital (though they may choose to
simply re-issue more commercial paper). Commercial paper is often unsecured, which means
there is no collateral for the debt the issuing company is taking on. If the issuing company goes
bankrupt, holders of the issuer's commercial paper may not have recourse in receiving funds. The
idea is because commercial paper's maturity is so short and the credit worthiness of issuers is
higher, the debt does not need backing by corporate assets. Commercial paper is issued at face
value, meaning a debt instrument has a value to it often in denominations of $100,000. Instead of
paying interest, commercial paper is instead often issued at a discount, or a price that less than
face value. When the commercial paper reaches maturity, the investor will receive the face value
amount of the instrument even though they paid a lower discount amount. Commercial paper is
often tied to liquidity, the measurement of well a company's short-term cash flows will be able to
cover its short-term debt. Therefore, issuers often create commercial paper to increase their
liquidity as it may need cash in the short-term. On the other hand, buyers of commercial paper
may not need cash right away, so they are willing to buy and hold the instrument to increase their
cash on hand in the future. Commercial paper is just like bonds, though each instrument has its
own unique characteristics. A major benefit of commercial paper is that it does not need to be
registered with the Securities and Exchange Commission (SEC) as long as it matures in no more
than nine months, or 270 days.This makes it a cost-effective and a simple means of financing.
Although maturities can go as long as 270 days before coming under the purview of the SEC,
maturities for commercial paper average about 30 days. Commercial paper is short-term,
unsecured debt issued by institutions who want to raise capital needed for a short amount of
time. It's an alternative to having to go through the effort and cost involved in getting a business
loan. Due to the large minimum denominations (usually $100,000 or more), large institutions
comprise the main buyers of commercial paper. According to the SEC, these include "investment
companies, retirement accounts, state and local governments, financial and non-financial firms."
The minimum investment in commercial paper is usually $100,000. So the best way for smaller
investors to invest in commercial paper is to put their money in the companies that buy it. These
include money market funds, mutual funds, and even exchange-traded funds.

Transaction Structure
 Above is an example of a typical transaction structure. All transactions begin with the
sponsor. This is the company who you initially fill out an application with. They are often the 1st
point of contact for all matters concerning a specific consumer transaction. However your note
doesn't stay with them for long. If you look closely at what you signed I guarantee you gave
them permission to transfer the note. And transfer they did before you left the chair that you were
sitting in. Once it has been transferred your application was submitted as commercial paper
which they then deposit. After it has been deposited they protect it by moving it into a trust.
From here it goes to the owner and indenture trustees who they use to trade these securities on
the secondary market. They are not reporting all of this to the SEC.

Where to redeem your instruments

If you have been paying attention until this point you know where I am headed. Banks according
to their proper duties are nothing more than security transfer agents. So instead of constantly
making “deposits” with these institutions we need to focus on selling them our securities and
have them trade them on our behalf. You can do this with any bank that has a T-6 on file with the
SEC as transfer agents. If your specific bank cant do it they most likely have a portion of that
company that does it on their behalf. Brokerages like Fidelity and Charles Schwab are literally
begging us to sell them our securities. I would suggest developing a relationship with a broker at
one of these agencies in order to have someone in your corner who's ready to help you make
money. 80/20 is the law so we will keep it fair but you can give your broker as high of a
percentage as you want just do not go below 20%. Let's review the ways to redeem your
securities. The 1st way would be to send your security to the trustee and indenture trustee of
whatever company and have them exchange your statement for commercial book entry into their
system. If you have your treasury direct account open you can have them run it through the
primary market as a T-Bill and have them deposit it there this would be the 2nd way. The 3rd
way would be to take your instrument to a broker, sell it to them and have them trade it on the
primary and secondary markets for you. All things are done in 3’s take advantage of all options
available to you but it wouldn't be possible without proper foundation.

Civil Money Penalties/Endorsement

Enforcement

Under the Federal Reserve Act Section 29 there are 3 tiers under which you can assess
companies for violating the provisions of that act. Under the First Tier any member bank which,
and any institution-affiliated party with respect to such member bank who, violates any provision
of section 22, 23A, or 23B, or any regulation issued pursuant thereto, shall forfeit and pay a civil
penalty of not more than $5,000 for each day during which such violation continues. So if you
send your instrument to the trustee and they dont respond or perform within 21 days you can
begin to assess them according to the 1st tier. After that when you send your second notice also
known as the notice of dishonor with opportunity to cure you can begin assesing them according
to the fees under the 2nd tier.Under the 2nd tier you can charge a civil penalty of not more than
$25,000 for each day during which such violation, practice, or breach continues. If they are still
not performing after your 2nd letter you move on to the final letter which is the notice of default
and you assess them according to the fees listed in the 3rd tier. Under the 3rd tier they are
required to forfeit and pay a civil penalty in an amount not to exceed the applicable maximum
amount determined under subsection (d) for each day during which such violation, practice, or
breach continues. Under section D you can assess 1,000,000 dollars a day for non member banks
and 1,000,000 dollars or 1 percent of the banks assets for member banks. An assessment is any
penalty imposed under subsection (a), (b), or (c) . The assessment shall be collected by in the
case of a national bank, by the Comptroller of the Currency; and in the case of a State member
bank, by the Board of said bank. Once you have secured a default judgment file a complaint with
the OCC and begin all enforcement measures including arbitration or court actions deping on
which is applicable to your situation. All penalties collected shall be deposited into the Treasury.

Freedom Edition: Treasury

Direct
By Paths2frdm Director:
Caleb Holt©
Freedom Edition: UCC Enforcement
By: Paths2Frdm Director
Caleb Holt ©
 Table of Contents
● Introduction Page 2
● What is the UCC? Page 2
● Articles of the UCC Page 3
● Article 1 General Provisions Page 5
● Article 2 Sales Page 12
● Article 3 Page 16
● Article 8 Page 28
● Article 9 Page 31
● Enforcement Page 35

Introduction
At this point in your journey if you are reading this it is because you have an understanding that
most people lack. This understanding is that all bills are prepaid. You understand that these
corporations are committing fraud and stealing money that belongs to all of us. You have seen
the receipts and you are ready to try for yourself or maybe you already have tried and got some
pushback and would like to know how to respond. Either way this guide is for you. I will be
focusing this ebook on the Uniform Commercial Code and its enforcement. This is the law that
governs business transactions and securities. This guide will help you learn to use the Uniform
Commercial Code (UCC) to help you force the companies into compliance with the law. No
more letting companies tell you that they can not accept your legal tender instrument. Learn how
to fight back today and the other power that lies within the UCC.

What is the UCC?

The Uniform Commercial Code or UCC is a comprehensive set of laws governing all
commercial transactions in the United States. It is not a federal law, but a uniformly adopted state
law. Meaning all states have adopted their own version of the UCC but it is similar enough in
most jurisdictions to be used. This is due to the fact that they have to adopt entire articles of the
UCC, not just certain provisions. A UCC code should have the same meaning in each state.
Uniformity of law is essential in this area for the interstate transaction of business. Because the
UCC has been universally adopted, businesses can enter into contracts with confidence that the
terms will be enforced in the same way by the courts of every American jurisdiction. The
resulting certainty of business relationships allows businesses to grow and the American
economy to thrive. For this reason, the UCC has been called “the backbone of American
commerce.”
The Uniform Law Commission was formed in 1892 in part to create uniform commercial laws.
The Uniform Negotiable Instruments Law was approved in 1896, and soon enacted in every
state. More commercial laws soon followed: the Uniform Sales Act and Uniform Warehouse
Receipts Act in 1906; the Uniform Bills of Lading Act and Uniform Stock Transfer Act in
1909; and the Uniform Conditional Sales Act in 1918. The ULC officially took on the task of
drafting a comprehensive code to provide guidelines for all commercial transactions in 1940. In
1942, the ULC and the American Law Institute joined in a partnership that put all the component
commercial laws together in a comprehensive Uniform Commercial Code that was offered to the
states for their consideration in 1951. Pennsylvania became the first state to adopt the UCC in
1953, and every other state followed suit over the next twenty years.

Articles of the UCC

Article 1 of the UCC deals with General Provisions

Uniform Commercial Code Article 1 contains definitions and general provisions applicable as
default rules to transactions covered under other articles of the UCC.

Article 2 of the UCC deals with Sales

Uniform Commercial Code Article 2 governs the sale of goods. Article 2 represented a
revision and modernization of the Uniform Sales Act, which was originally approved by the
National Conference of Commissioners on Uniform State Laws in 1906.

Article 2A, Leases

Uniform Commercial Code Article 2A governs leases of personal property. It was first added to
the Uniform Commercial Code in 1987 and amended in 1990.

Article 3 of the UCC deals with Negotiable Instruments

Uniform Commercial Code Article 3 governs negotiable instruments: drafts (including
checks) and notes representing a promise to pay a sum of money, and that have independent
value because they are negotiable. An instrument is negotiable if it can be transferred to
another person and remain enforceable against the person who originally made the
promise to pay. The substance of Article 3 has its roots in the Negotiable Instrument Law first
approved by the National Conference of Commissioners on Uniform State Laws in 1896. That
early uniform law was revised and incorporated into the original version of the UCC in 1951,
and a further revision was approved in 1990. Finally, a set of amendments to UCC Articles 3 and
4 was approved in 2002.
Article 4, Bank Deposits and Collections
Uniform Commercial Code Article 4 governs bank deposits and collections, providing rules for
check processing and automated inter-bank collections.

2002 Amendments to Article 3, Negotiable Instruments and Article 4, Bank Deposits

These 2002 amendments to Uniform Commercial Code Articles 3 and 4 update provisions
dealing with payment by checks and other paper instruments to provide essential rules for new
technologies and practices in payment systems.

Article 4A, Funds Transfers

Uniform Commercial Code Article 4A provides a comprehensive body of law on the rights and
obligations connected with fund transfers. It was added to the UCC in 1989.

2012 Amendments to Article 4A, Funds Transfers

These 2012 Amendments to Section 108 of Uniform Commercial Code Article 4A provide that
Article 4A applies to a remittance transfer that is not an electronic funds transfer under the
Federal Electronic Funds Transfer Act (EFTA). The amendment was necessary to conform the
UCC with the federal law and associated regulations.

Article 5, Letters of Credit

Uniform Commercial Code Article 5 governs letters of credit, which are typically issued by a
bank or other financial institution to its business customers in order to facilitate trade. Article 5
was updated in 1995 to address advances in technology and modern business practices.

Article 6, Bulk Sales

Uniform Commercial Code Article 6 covers bulk sales - a topic many states have determined is
obsolete. The original version of Article 6 was withdrawn by the Uniform Law Commission and
the American Law Institute in 1989 and replaced with two options for every state to consider:
replace Article 6 with a revised version 6, or repeal Article 6 entirely. The ULC recommends
repeal, and nearly every state has followed that recommendation.

Article 7, Documents of Title

Uniform Commercial Code Article 7 covers documents of title for personal property, including
warehouse receipts, bills of lading, and other documents typically used for commercial trade.
Revised Article 7, approved in 2003, updates the original version to provide a framework for the
further development of electronic documents of title, and to update the article in light of state,
federal and international legal developments.
Article 8, Investment Securities
Uniform Commercial Code Article 8 provides a modern legal structure for the system of
holding securities through intermediaries. The 1994 revision sets forth rules concerning the
system through which securities are held, specifying the mechanisms by which ownership and
other interests in securities are recorded and changed, and setting out some of the rights and
duties of the parties who participate in the securities holding system.

Article 9, Secured Transactions

Uniform Commercial Code Article 9 provides a statutory framework that governs secured
transactions--transactions that involve the granting of credit secured by personal property.
Each state maintains an office for filing finance statements to publicly disclose security interests
in encumbered property. A substantial revision to Article 9 was completed in 1998 and adopted
in all states. The article was further amended in 1999, 2000, 2001, and 2010.

Article 1

Article 1 of the UCC is split into 3 Parts. Part 1 deals with the general provisions. Part 2 is really
important and it deals with the definitions and principles of interpretation. While Part 3 deals
with territorial applicability and other general rules. I recommend reading the entire title but I am
going to focus on a few important definitions and break them down for you all while also
explaining how you can use each of these laws and definitions to your advantage and help
enforce your instruments. Part 1 is split into 8 sub sections. Let's focus on a few.
UCC 1-103 Construction of the UCC

The UCC is constructed to comply with the principles of common law and equity. This includes
the law of Merchants which is exactly what it sounds like. As well as the law of contracts which
requires proper capacity to contract, good faith, equal consideration etc. It also is very against
fraud, misrepresentation and much more tactics that these companies use to violate our rights.
This is shown to demonstrate that they are not allowed to break the law and if any provision of
the UCC clashes with law and equity the other 2 will prevail.

UCC 1-105 Severability

If any portion of the UCC is found to be invalid or unenforceable the rest of the UCC shall
remain unaffected. You will also see this clause in most of your contracts so that if they include
any clause that is unenforceable the rest of the contract remains.

UCC 1-201

Action - Any proceeding where rights are determined. Examples of Actions include arbitration,
equity court, federal court.
Aggrieved party - The injured party in the transaction or as it says the one entitled to receive
remedy. This can be you or the bank depending on who is bringing the action.
Agreement - The deal or bargain between the parties as distinguished from the contract. The
agreement you entered into can be different from the contract that you signed.

Bearer - You are the bearer of the instruments or statements you receive from these companies
each month if you have a service contract.
Branch - this definition is important because the primary location for most businesses or banks
is in Delaware so any other locations or branches are foreign to the original location.
Burden of Establishing - In order to have your claim accepted the aggrieved party has to take
on the burden of establishing whether it's you or the bank/creditor the person making the claim
must have evidence to support it. The aggrieved party must prove their claim is more probable
than not.

A Buyer in The Ordinary Course of Business is someone who engages in a transaction in good
faith and therefore is entitled to all defenses and protections of the law. This is why there can be
no fraud or misrepresentation on your part for why you are acquiring the goods or services. We
must remain with clean hands and move in good faith to receive our remedy.

Conspicuous - Written or Displayed in a way that it is reasonable to expect that someone saw it.
Large font, contrasting bright colors, anything meant to capture attention.
Consumer - Transactions for Household or family purposes
Contract - The legal obligations resulting from an agreement.
Delivery - Voluntary transfer which is important because it is all done by consent in each of your
contracts you give them the right to transfer.

Fault - Wrongful acts or omissions such as the fact that your promissory note already prepaid the
balance, they are double dipping, they are selling the contract on the 2ndary market, you
voluntarily gave them security interest.
Genuine - Free of forgery or counterfeiting. (They forge our signatures on the IRS Power of
Attorney Form and other forms)
Good Faith - They must be honest in their dealings.
Holder - Person in possession of the Instrument
Money - A medium of exchange not exclusively FRN’s. Negotiable instruments are money and
legal tender. No company can force you to only pay one way.

Remedy - What you are entitled to before taking any action. What they owe you due to their
fraudulent actions.

UCC 1-202 Notice

What it means to give notice according to the UCC. And how to properly give notice which is
important for enforcement later on.
UCC 1-304
Every contract imposes an obligation of good faith in its performance. If you are frauded in
any way the contract is void!

The point of remedy is to be put into the position you would have been in if the other party
performed correctly and did not fraud you.
UCC 1-306

You as the aggrieved party can stop any claim out of an alleged breach at any time without the
consideration of the other party. Doing this however is a waiver of your rights and I would not
recommend it.
UCC 1-308

This clause allows you to reserve your rights and not enter into any unlawful contract. When
signing, adding the words without prejudice means you only agree to be bound by law and equity
and can not be entered into any unlawful agreements unknowingly.
 Article 2 Sales
Article 2 Governs Sales and the rules regarding them. It is split into 7 Parts each dealing with an
important aspect of contracts.

Part 1 contains the definitions relevant to this article I would recommend you focus on 2-103 and
2-106

Part 2 Deals with the formation and adjustment of contracts I would focus on 2-201, 2-206,
2-209, and 2-210
Part 3 Focuses on the Obligations imposed by Contracts I will highlight a few important
provisions

UCC 2-302

If the court finds any part of the contract unconscionable they can choose not to enforce the
contract. This is why we aim to prove certain elements of unconscionability.
UCC 2-304
Unless it specifically lists one specific payment in the terms of the contract you can pay however.

Part 4 is pretty self explanatory

Of course I would read all the subsections of this part as they are very important.

Part 5 deals with Performance of contracts it is another self explanatory section

Part 6 is what you want to focus on as it deals with Breach of contract and other important
elements.
UCC 2-607 Notice of Breach
You are to immediately notify the seller of any breach of contract. It is also on you to establish
the burden of proof for any alleged breach. If you don't give proper notice you may be barred
from receiving remedy in litigation. This is why we must contact the companies 1st and try to
resolve the issue before jumping straight to litigation.

Part 7 Contains Remedies for a number of different scenarios. I would focus on 2-701, 2-711,
2-714, and 2-721
Article 3

Article 3 is Split into 6 Parts

UCC 3-103

I would pay specific attention to all the definitions listed in article 3.

UCC 3-104 Negotiable Instrument Very Important Code!!!!

This code is the most important because it proves that your monthly statements are negotiable
instruments especially once endorsed. If you look at subsection d it tells you that in order for
it to not be considered a negotiable instrument there must be a conspicuous statement that
the instrument is not a negotiable instrument governed by this article. We learned what a
conspicuous statement was supposed to look like earlier. Now you know why they can't tell you
they don't accept that type of payment because it is a fully negotiable instrument that is legal
tender governed by article 3 of the UCC.

UCC 3-106

This code is what constitutes an unconditional promise or order and you will come to realize
your instruments meet the requirements.
UCC 3-3115

This code defines an incomplete instrument. Our instruments that we send back each month if
not properly endorse are incomplete. This is why the companies are allowed to take our
payments as a gift. It's also why rights are lost when transferred with an incomplete endorsement
in the case of a mortgage once endorsed in blank they are purporting to transfer less than the
entire value of the instrument and it invalidates the mortgage and does not transfer rights of a
holder in due course.

Part 2 Deals with Negotiation, Transfer, and Indorsment (Endorsement)

UCC 3-201 Negotiation

Negotiation is a transfer of Possession voluntary or involuntary

UCC 3-203

This code is also very important. The transferee cannot acquire rights of a holder in due course if
they engaged in fraud or illegality surrounding the instrument. No negotiation can occur without
proper endorsement if transferred for value and can not become a colder without it. Also if you
try to transfer less than the whole instrument no negotiation can occur.

UCC 3-204

This code deals with endorsement. This is why we say to sign in a specific manner in the SES
guide.
UCC 3-205

This code deals with different types of endorsements and their functions. More specifically blank
endorsements which is how we were taught to sign as well as others.

Restrictive endorsements are useful for trying to deposit things directly in the TDA.
Part 3 Deals Specifically with Enforcement of Instruments it is another very Important Section

UCC 3-301

Whoever you send the instrument to as an agent for the company becomes the person entitled to
enforce the instrument.

UCC 3-302

A person who acquires an instrument in good faith through proper negotiation.

The other subsections describe the rights of a holder in due course in the event of discharge or
other scenarios including if the person entitled to enforce the instrument only has security
interest which is the case most times for us. It also describes why we are entitled to claim certain
balances on the instruments.

UCC 3-303

If it doesn't meet the requirements listed above an instrument is not transferred for value. We are
missing liens and all types of other issues with every transaction. A proper negotiation does not
occur. It's very important to understand value and consideration.
UCC 3-305

This code literally gives you a list of defenses that can be used against these companies including
Infancy, duress, illegality of the transaction, fraud that induced a signature without
knowledge or opportunity to properly learn the terms. Every contract you have is guilty of
at least fraud inducing a signature and illegality affecting the transaction.

Part 4 Deals with liability of the parties but we will focus a bit more on parts 5 and 6
UCC 3-501

A presentment is the delivery of an instrument to a party for the purpose of making a payment.

UCC 3-502

If they do not pay the note on the date it comes due they are in dishonor.

UCC 3-503
Notice is the backbone of American Jurisprudence a notice of dishonor must be given whether it
be written, oral, or electronic means. Without notice you can impose no obligations on the person
who is entitled to enforce the instrument.

UCC 3-505

Anything they send you that states they won't accept the payment or they dont take that type of
payment. Any protest they have is your evidence of dishonor. If they send nothing back and dont
respond, that is also evidence of dishonor.

UCC 3-601

What's important to focus on with this code is subsection B. Discharge is not effective against a
person trying to acquire rights of a holder in due course without a notice of discharge. This is
why we let the companies know or give notice that the debt has been discharged after they
dishonor our presentments.
UCC 3-602

Defines what payment is under the law. Payment is the delivery of a note so by sending in your
instrument you have effectively paid whatever obligation is owed. This is why things are
considered done once in the mail.

UCC 3-603

This code is really the meat and potatoes of the UCC. If you tender a payment in any form and
they refuse there is discharge to the extent of the tender. At this point the roles flip for you and
the company as they have failed to perform a fiduciary duty. Now they are the ones who have to
establish the burden of proof. You have paid them in good faith and so if they chose to bring any
action against you they will have to prove you owe them which is impossible. They would have
to prove not only that your instruments were non - negotiable but also that they fully complied
with the law throughout the entirety of the transaction. In the case of a mortgage for example
they can not prove that they hold the note and the deed, for a car contract they can't prove a lien
was ever on you, or for credit cards they cant prove they didn't transfer all rights titles and
interests into a trust. Flipping the burden of proof onto them is what you aim to do by putting
them in the position of an aggrieved party.

UCC 3-604

Any of the acts listed above constitute discharge. If they destroy your instrument, send it back,
refuse to send it back, trying to erase the endorsement or any other action will discharge the
obligation make sure to cite this code when enforcing your instruments.

Article 8 Investment Securities

Article 8 deals with investment Securities and is split into 6 parts once again. I recommend
reading the whole article but I am going to focus on a few specific parts and sections.
As you can see this article establishes the rules for defining investment securities. This entire
article applies to almost 99% of our commercial dealings.
Part 3 Deals with transfer of securities and the rules that must be followed as well as your rights
as a protected purchaser.

Part 4 Deals with Proper Registration of Securities and the rules that must be followed

Part 5 I would also recommend reading this entire part. This deals with the duties of the
companies when maintaining securities and also gives you ammunition to use against them. They
violate a good portion of this section when unlawfully transferring your note to the trust
company.
 Article 9 Secured Transactions

Article 9 is split into 8 parts I want to Focus on 4 Parts Specifically Parts 1, 2, 3, and 5

Part 1 Obviously contains the general provisions but more importantly the definitions.

From this part I would read 9-102 through 9-106

Part 2 deals with perfecting security interest and the requirements of a security agreement
UCC 9-210

When you do a request for accounting they must respond within 14 days after they receive the
request. They have a duty to respond under the law and you have a right to request the
accounting; this is a part of establishing your burden of proof.
Part 3 is also very important; it deals with perfection and priority of liens. This section is where
bona fide purchaser defense comes into play. It is due to the priority of security interests and
liens and since you were defrauded that automatically gives you the highest rights and priority. I
would intently read this entire Subpart.
Part 5 Deals with the Filing of documents for secured transactions

I would recommend reading 9-502 and 9-506

Enforcement

At this point you should have a better understanding of how the UCC interacts with the processes
you are attempting and how to use it to enforce and back them up. The uniform commercial code
is the law on business transactions and I have demonstrated how they violate its provisions
multiple times throughout the ordinary course of any transaction. You should have a better
understanding of your position and rights in a transaction, understanding what you can and
cannot ask them to do. As well as the duties that they have in compliance with the law. You are
presenting negotiable instruments for payment. If they are Dishonored they have discharged the
debt and now the burden of proof falls on them. We now know that our instruments fall 100%
within the definition of a negotiable instrument governed by article 3 of the UCC because there
is no conspicuous statement that it is not. Therefore, no company can tell you that they do not
accept that form of payment as it is legal tender. Here are a few cases where the courts have ruled
that negotiable instruments and bills of exchange are legal tender.
The Floyd Acceptances. 74 U.S 666 (1868)
Wheeler V. Nationalbank 96 U.S. 168 (1877)
Bank Of Pittsburgh V. Neal, 63 U.S. 96 (1859)
After you send off your initial endorsement and they respond if they do anything besides
crediting your account. They have dishonored your payment and you begin the steps of trying to
solve this with them before taking another action, whether that be arbitration or equity court.
Most companies that we deal with are headquartered in Delaware and their jurisdiction exists
wholly in Delaware. Due to this, to receive proper remedy for our contracts, we must go to
equity Court. However, if there is an arbitration clause, arbitration would be the proper action to
take first. And remember that arbitration goes both ways, so if they repossess your vehicle or
have taken any negative actions against you without going to arbitration, you can use that to your
benefit. We have also established that once you send in a payment the burden of proof falls to
them. So any action they bring against you, they would still have to prove that you owe them
money in the first place. However, if you are in the position that the burden of proof is on you
because you are the one bringing the action, you must be able to meet that burden and
demonstrate what the company has done. We do this through the prospectus, the 8K and the 10K
forms. For example, almost all of the companies say that they transfer all rights, titles and
interests to the receivables of your contracts into a trust. When this is done, they lose beneficial
ownership and no longer have a right to collect. In order to meet the burden of proof and
demonstrate that this is the case, you would simply go to the 10K and pull the section that states
that they transfer it into a trust. You can make a lawful request for accounting underneath the
UCC such as a statement of accounting to demonstrate that it has already been paid off. That is
another way to meet the burden. They say they won't trade on the secondary market but they are
trading on the secondary market. That is something. If you can prove it will be very beneficial to
you that can be proved through an audit report or through interrogatories there are ways to force
them to give you the information that you request. All of your correspondence should be for the
purpose of gathering evidence that they have defrauded you in some way, misrepresented you in
some way and you use the codes listed in the UCC to support why it's wrong and that you are
entitled to remedy. The codes I have gone over in this ebook are very important and will be a
great help to start, but I highly recommend focusing a bit extra on articles 8 and 9 as they have a
lot of good information and a lot of good defenses. At this point you should have a good enough
understanding of what they are doing wrong and now you have the understanding of why it is
fraudulent, why it is bad and you can use that to win in any action that you choose to take
moving forward.

Under the Federal Reserve Act Section 29 there are 3 tiers under which you can assess
companies for violating the provisions of that act. Under the First Tier any member bank which,
and any institution-affiliated party with respect to such member bank who, violates any provision
of section 22, 23A, or 23B, or any regulation issued pursuant thereto, shall forfeit and pay a civil
penalty of not more than $5,000 for each day during which such violation continues. So if you
send your instrument to the company and they don't respond or perform within 21 days you can
begin to assess them according to the 1st tier. After that when you send your second notice also
known as the notice of dishonor with opportunity to cure. This letter states that they are now in
dishonor for refusing your payment and you are giving them a chance to fix it before taking
further action against them. Then you can begin assessing them according to the fees under the
2nd tier. Under the 2nd tier you can charge a civil penalty of not more than $25,000 for each day
during which such violation, practice, or breach continues. If they are still not performing after
your 2nd letter you move on to the final letter which is the notice of default. This letter states that
they have defaulted on their obligations and that you have done everything in good faith. Now
you assess them according to the fees listed in the 3rd tier. Under the 3rd tier they are required to
forfeit and pay a civil penalty in an amount not to exceed the applicable maximum amount
determined under subsection (d) for each day during which such violation, practice, or breach
continues. Under section D you can assess 1,000,000 dollars a day for non member banks and
1,000,000 dollars or 1 percent of the banks assets for member banks. An assessment is any
penalty imposed under subsection (a), (b), or (c) .Once you have sent your 3 letters and they
refuse to act, begin all enforcement measures including arbitration or court actions depending on
which is applicable to your situation. Use the evidence of discharge you gathered as well as your
prior correspondences and use that to help meet the burden of proof for your claim. Once you
have met the burden of proof, file a claim based on breach of contract fraud or other
misrepresentation that you can prove with the facts you've gathered and it's time to battle. This is
the closest way I can prepare you, shy of filling out the documents for you and sending you off I
hope you are successful because this has been the enforcement guide.
Freedom Edition: UCC Enforcement
By: Paths2Frdm Director
Caleb Holt ©