Non-endorsement

[antjraf]

I just thought of some more questions regarding non-endorsment.


Does it matter if a check is not a payroll check? For instance, one receives a check for $50,000 from a sale or a closing on property or sale of a business, is this method still valid? I assume that it is because we are still documenting the fact that we are redeeming lawful money.


Can we just use "DEPOSITED FOR CREDIT ON ACCOUNT" if we are depositing a check into our accounts, or do we still need to add "OR EXCHANGED FOR NON-NEGOTIABLE FED NOTES OF FACE VALUE" even if we are not requesting cash at the time of the transaction?


If we have an account at a bank without a social security number attached to it, can we just sign our real name only under the verbiage or do we still use the "True Name d.b.a. LEGAL NAME" technique?


thanks in advance

[David Merrill]

Originally Posted by antjraf

I just thought of some more questions regarding non-endorsment.


Does it matter if a check is not a payroll check? For instance, one receives a check for $50,000 from a sale or a closing on property or sale of a business, is this method still valid? I assume that it is because we are still documenting the fact that we are redeeming lawful money.


Can we just use "DEPOSITED FOR CREDIT ON ACCOUNT" if we are depositing a check into our accounts, or do we still need to add "OR EXCHANGED FOR NON-NEGOTIABLE FED NOTES OF FACE VALUE" even if we are not requesting cash at the time of the transaction?


If we have an account at a bank without a social security number attached to it, can we just sign our real name only under the verbiage or do we still use the "True Name d.b.a. LEGAL NAME" technique?


thanks in advance

If you only use the Deposit clause, then redeem lawful money when you Withdraw on the Withdrawal Slip or Signature Card if you have a checking account and are writing checks.

I use the model of cashing your paycheck at your boss's bank where you do not have an account. - Mainly because that teaches it for all more complicated models. Be objective oriented - Redeem lawful money.


Regards,

David Merrill.

[psholtz]

Originally Posted by David Merrill

If you only use the Deposit clause, then redeem lawful money when you Withdraw on the Withdrawal Slip or Signature Card if you have a checking account and are writing checks.

I use the model of cashing your paycheck at your boss's bank where you do not have an account. - Mainly because that teaches it for all more complicated models. Be objective oriented - Redeem lawful money.


Regards,

David Merrill.

This is kinda a silly question, but in theory, would the bank be able to make good on its obligation to redeem lawful money by returning to you U.S. Treasury securities, in the amount of check you are cashing?

After all, it's U.S. Treasuries that "back" the money supply (at least the "currency" part of it, i.e., the paper notes and coin).

[David Merrill]

Not a silly question at all.

I will answer it with the definition for lawful money. First the definition that was repealed by Congress in 1994:

http://uscode.house.gov/uscode-cgi/f...20%20%20%20%20

And here is a more layman definition.

http://www.investorwords.com/2733/lawful_money.html

The courts say Congress simply declares that US notes shall be lawful money and that FRNs are redeemable in lawful money.



Regards,

David Merrill.

[antjraf]

Originally Posted by David Merrill

If you only use the Deposit clause, then redeem lawful money when you Withdraw on the Withdrawal Slip or Signature Card if you have a checking account and are writing checks.

I use the model of cashing your paycheck at your boss's bank where you do not have an account. - Mainly because that teaches it for all more complicated models. Be objective oriented - Redeem lawful money.


Regards,

David Merrill.

Okay, so "DEPOSITED FOR CREDIT ON ACCOUNT" is sufficient if depositing in our own accounts without receiving cash. And we use "REDEEMED FOR LAWFUL MONEY PERSUANT..." when we withdraw from our accounts. You are also saying we should go to our banks and resubmit our signature cards to read "REDEEMED FOR LAWFUL..." and "EXCHANGED FOR NON-NEGOTIABLE FRNs..." above our true name signatures. Does this enable us to continue writing checks as we are now? How should we be writing checks out in the mean time?


Also, in regards to an account of ours without a SS# attached to it; when we deposit a check, do we non-endorse with the dba verbiage or just true name?

thanks

[psholtz]

The part that still slightly confuses me is "DEPOSITED FOR CREDIT ON ACCOUNT"

David, I've asked you about this before, and you explained that credit is not taxable. However, I thought that the use of private credit creates an irrecusable obligation to file a return of income:

The obligation to make a return of income for using private credit is recognized in law as an irrecusable obligation, which according to 'Bouvier's Law Dictionary' (1914 ed.), is "a term used to indicate a certain class of contractual obligations recognized by the law which are imposed upon a person without his consent and without regard to any act of his own." This is distinguished from a recusable obligation which, according to Bouvier, arises from a voluntary act by which one incurs the obligation imposed by the operation of law. The voluntary use of private credit is the condition precedent which imposes the irrecusable obligation to file a tax return. If private credit is not used or rejected, then the operation of law which imposes the irrecusable obligation lies dormant and cannot apply.

http://autarchic.tripod.com/files/commercial.html

[David Merrill]

Originally Posted by psholtz

The part that still slightly confuses me is "DEPOSITED FOR CREDIT ON ACCOUNT"

David, I've asked you about this before, and you explained that credit is not taxable. However, I thought that the use of private credit creates an irrecusable obligation to file a return of income:

That is right. Accepting private credit instead of lawful money. While the credit is on account at the bank, it is not income unless you deem it income.


Whenever you get cash in hand - redeem it in lawful money.


Regards,

David Merrill.

[Cropmeat]

I'm trying to cash a payroll check at a bank with which I don't have an account; at the bank that issued the draft. I went to them today and offered the draft for acceptance. The teller asked to see the check before I endorsed it, and she read on the back, "Deposited for credit on account or exchanged for non-negotiable [FRNs]." With this written on the back of the check, she said, I'd have to get my employer to write a new check for me because this one was now supposedly no good.

She then asked for ID, which I preferred not to show her, and, of course, they refused to cash the check. I also spoke with a financial assistant of some sort and the bank manager, who both refused to cash the check, so I left the bank after requesting a signed letter on their letterhead essentially stating that the check wasn't cashed because I didn't show an ID (she wouldn't state on the letter in any way that the check was refused, despite my repeated requests).

Isn't this still dishonor, though? I know the tellers in most banks aren't going to know the statutes (nor would I if it wasn't for you great bunch of folks), and correct me if I'm wrong, but the code says the check can be exchanged by the "bearer," doesn't it? In other words, if I wish to not show ID, isn't that my prerogative? They mentioned their bank's policy several times and she even showed me a cute sign that says the USA PATRIOT Act requires an ID for all new accounts. I wasn't opening an account, though, so that didn't matter.

Do you think I can call their legal department tomorrow and get this straightened out? This is my first attempt at this, and if any of you have some wise words, I would be very grateful.

[Cropmeat]

Starting from UCC § 3-104 NEGOTIABLE INSTRUMENT:

(a) Except as provided in subsections (c) and (d), "negotiable instrument" means an unconditional promise or order to pay a fixed amount of money, with or without interest or other charges described in the promise or order, if it:

(1) is payable to bearer or to order at the time it is issued or first comes into possession of a holder;

(2) is payable on demand or at a definite time; and

(3) does not state any other undertaking or instruction by the person promising or ordering payment to do any act in addition to the payment of money, but the promise or order may contain (i) an undertaking or power to give, maintain, or protect collateral to secure payment, (ii) an authorization or power to the holder to confess judgment or realize on or dispose of collateral, or (iii) a waiver of the benefit of any law intended for the advantage or protection of an obligor.

(b) "Instrument" means a negotiable instrument.

(c) An order that meets all of the requirements of subsection (a), except paragraph (1), and otherwise falls within the definition of "check" in subsection (f) is a negotiable instrument and a check.

(d) A promise or order other than a check is not an instrument if, at the time it is issued or first comes into possession of a holder, it contains a conspicuous statement, however expressed, to the effect that the promise or order is not negotiable or is not an instrument governed by this Article.

(e) An instrument is a "note" if it is a promise and is a "draft" if it is an order. If an instrument falls within the definition of both "note" and "draft," a person entitled to enforce the instrument may treat it as either.

(f) "Check" means (i) a draft, other than a documentary draft, payable on demand and drawn on a bank or (ii) a cashier's check or teller's check. An instrument may be a check even though it is described on its face by another term, such as "money order."

§ 3-106 UNCONDITIONAL PROMISE OR ORDER reads:

(a) Except as provided in this section, for the purposes of Section 3-104(a), a promise or order is unconditional unless it states (i) an express condition to payment, (ii) that the promise or order is subject to or governed by another record, or (iii) that rights or obligations with respect to the promise or order are stated in another record. A reference to another record does not of itself make the promise or order conditional.

§ 3-108 PAYABLE ON DEMAND OR AT DEFINITE TIME reads:

(a) A promise or order is "payable on demand" if it (i) states that it is payable on demand or at sight, or otherwise indicates that it is payable at the will of the holder, or (ii) does not state any time of payment.

§ 3-109 PAYABLE TO BEARER OR TO ORDER reads:

(a) A promise or order is payable to bearer if it:

(1) states that it is payable to bearer or to the order of bearer or otherwise indicates that the person in possession of the promise or order is entitled to payment;

(2) does not state a payee; or

(3) states that it is payable to or to the order of cash or otherwise indicates that it is not payable to an identified person.

(b) A promise or order that is not payable to bearer is payable to order if it is payable (i) to the order of an identified person or (ii) to an identified person or order. A promise or order that is payable to order is payable to the identified person.

§ 3-110 IDENTIFICATION OF PERSON TO WHOM INSTRUMENT IS PAYABLE reads:

(a) The person to whom an instrument is initially payable is determined by the intent of the person, whether or not authorized, signing as, or in the name or behalf of, the issuer of the instrument. The instrument is payable to the person intended by the signer even if that person is identified in the instrument by a name or other identification that is not that of the intended person. If more than one person signs in the name or behalf of the issuer of an instrument and all the signers do not intend the same person as payee, the instrument is payable to any person intended by one or more of the signers.

(b) If the signature of the issuer of an instrument is made by automated means (such as in my case), such as a check-writing machine, the payee of the instrument is determined by the intent of the person who supplied the name or identification of the payee, whether or not authorized to do so.

(c) A person to whom an instrument is payable may be identified in any way, including by name, identifying number, office, or account number.

It seems I'm not the "bearer," actually, since my name is on the check, but, if my understanding is correct, it still seems that I've sufficiently identified myself by saying, "My name is...." Any thoughts?

[David Merrill]

Originally Posted by Cropmeat

I'm trying to cash a payroll check at a bank with which I don't have an account; at the bank that issued the draft. I went to them today and offered the draft for acceptance. The teller asked to see the check before I endorsed it, and she read on the back, "Deposited for credit on account or exchanged for non-negotiable [FRNs]." With this written on the back of the check, she said, I'd have to get my employer to write a new check for me because this one was now supposedly no good.

She then asked for ID, which I preferred not to show her, and, of course, they refused to cash the check. I also spoke with a financial assistant of some sort and the bank manager, who both refused to cash the check, so I left the bank after requesting a signed letter on their letterhead essentially stating that the check wasn't cashed because I didn't show an ID (she wouldn't state on the letter in any way that the check was refused, despite my repeated requests).

Isn't this still dishonor, though? I know the tellers in most banks aren't going to know the statutes (nor would I if it wasn't for you great bunch of folks), and correct me if I'm wrong, but the code says the check can be exchanged by the "bearer," doesn't it? In other words, if I wish to not show ID, isn't that my prerogative? They mentioned their bank's policy several times and she even showed me a cute sign that says the USA PATRIOT Act requires an ID for all new accounts. I wasn't opening an account, though, so that didn't matter.

Do you think I can call their legal department tomorrow and get this straightened out? This is my first attempt at this, and if any of you have some wise words, I would be very grateful.

I do not see that as dishonor - about the ID. You should sign,

True Name dba Name on Check (legal name)

Then you can show the ID - if necessary explaining that is not your name on it. Your name is First Middle. That is what your parents named you. Somebody may have found your paycheck and is trying to cash it. If they do not attach you to it by ID then they would be responsible for that diversion of funds to the wrong man or woman. Indeed if you want to only be identified as "bearer" then your employer should write "Bearer" on the front - Pay to the Order of Bearer. Don't lose your paycheck because anybody who picks it up can cash it. But that goes for saying the same about the cash you leave the bank with - don't drop it or anyone can pick it up and tender it...

Then you will have them in dishonor. And if you read through this thread paying attention to the dates, you will discern a learning curve. As the US dollar index suffered a severe dip and a lowering of the Rate by the Fed (again), we might also discern a real fear of what may happen when banks have to account for a whole new currency of lawful money.

For example it was quite some time ago that a suitor had a rubber paycheck returned from his bank with the verbiage torn off. That revealed the attorneys know the remedy is still available and in the vast majority of these, where there are funds to cover the paycheck, the banks are fractionalizing the funds just the same as private credit.

You might consider striking it through this week, just to get it cashed. And next week you might write:

Redeemed in lawful money pursuant to Title 12 U.S.C. §411

That is more direct to your objective.

What I am noting specially about your post is that the teller said you must go back to your boss for a new paycheck. Note a member here was recording a bank's dishonor a few weeks ago by getting the strikethrough notarized. (also attached)

What I want to see is you getting dishonor on the record through the bank's notary. Sanitize the evidence and attach it for us. Of course what you want is groceries etc. so don't hurt yourself on my/our behalf.



Regards,

David Merrill.