INTRODUCTION TO MEMORANDUM OF LAW

Life-cycle of a “Loan”

October 2010

The following is an “overview” of the “life-cycle” of the

presently orchestrated real estate promissory note and mortgage

agreement scam. This “overview,” is not comprehensive and

inclusive of all of the facts and situations which may apply to

particular cases. Because of the suppression of all of the facts

about the banking industry’s biggest swindle in the history of the

planet, this “overview” can only expose discovered facts, as such

facts, are known to date.

1. Without full disclosure of all elements of the “system,”

or scam being conducted, and profoundly ignorant of how the

“lender” will exploit the possession and manipulation of the

promissory note and mortgage agreement issued by the unsuspecting

so-called “borrower,” papers are autographed and delivered into the

possession of the so-called “lender.”

2. The “lender” separates the promissory note and mortgage

agreement and deposits each as separate transactions, as cash, in

special “transaction accounts” belonging to the “lender.”

a. This step creates an increase in deposits to the

benefit of the “lender” in an amount equal to two
(2) times the face value amount of what the
“borrower” believes is the total amount of money in
the transaction. If the “loan” amount is
$100,000.00, the total amount of increased assets
to the benefit of the “lender,” is $200,000.00.
 3. The Federal Reserve authorized “deposit multiplication”

scam begins, which increases the total amount of money generated by

the deposits by an additional factor of approximately nine (9).

a. The banking system will benefit from the creation

of approximately $1,800,000.00, in addition to the
initial $200,000.00 originally deposited. A
$100,000.00 “loan,” will generate approximately $2
Million, out of which the “lender” will issue a
check to the “borrower” for $100,000.00,
benefitting from an immediate windfall of $1.9
Million.

4. The “lender” will then, sell the separated promissory

note and mortgage agreement to an entity known on Wall Street as an

“aggregator,” for transfer into a “pool,” and get paid $200,000.00

plus a commission of approximately 2.5%. (commission amount may vary).

a. So now, the banking system is in possession of a

windfall amount of cash of approximately $2.1
Million, based on the original $100,000.00 “loan.”

5. After “securitization” by government, either/or

authorized corporate entities, the Wall Street gurus “tranche,” or

slice up the “pool” into Mortgage Backed Securities (MBSs),

Collateralized Debt Obligations (CDOs), Collateralized Mortgage

Obligations (CMOs), Credit Default Swaps (CDSs), etc. Such

instruments are then traded in the stock market and generate

millions of dollars.

6. The bankers, in firm control of the monetary system and

the economy, then engineer recession and recovery cycles which

guarantee defaults on some of the “pooled” and “tranched”

mortgages.

2
 7. The CDSs, (Credit Default Swaps) function as insurance on

defaulted mortgages, and the insider traders cash in the CDSs and

generate additional millions of dollars as an added windfall of the

scam.

8. And then, after millions of dollars have been generated

from the initial so-called “loan” of $100,000.00, (the mortgage has

already been paid off many times over) the banks, and debt

collectors institute foreclosure actions against the hapless, and

clueless, “borrower,” and do it all over again.

9. After comprehension of the foregoing overview of the

life-cycle of the presently orchestrated real estate promissory

note and mortgage agreement scam, it becomes necessary to come to

“grips” with the following facts:

a. the “loan” has been paid in full as to

principal, and
b. the “lender” has been paid in full as to
disclosed fees, and
c. the “lender” has received undisclosed fees as
well, and
d. the “lender” has charged-off the so-called “debt”
after default declared, and
e. the “lender” has declared the “loss” in the
default as a tax write-off, and
f. the “lender” has received insurance payment on
the “loss.”
g. the “lender” has received a vast WINDFALL of
cash, all due to operation of the
Federal Reserve and Wall Street
scam.

10. The foregoing facts were never disclosed to the

“borrower.”

3
 11. Those non-disclosures were intentionally orchestrated in

order to rob the clueless “borrower.”

12. The “agreement” that was disclosed to the “borrower” was

an intentional act of misrepresentation of the actual truth of the

matter.

13. The “borrower” had no comprehension of the intentionally

un-disclosed actual facts of the transaction that would be used to

the extreme advantage of the “lender,” and to the extreme

disadvantage of the “borrower.”

14. In other words, the “agreement” was immediately and

materially altered by the “lender” without the knowledge or consent

of the “borrower.”

15. “A material alteration of a written contract by a party

to it discharges a party who does not authorize or consent to the

alteration, because it destroys the identity of the contract, and

substitutes a different agreement for that into which he entered.”

Mersman v. Werges and another, 112 U.S. 139, 5 S.Ct. 65, 28 L.Ed.

641 (1884). Online:

http://bulk.resource.org/courts.gov/c/US/112/112.US.139.html

Recent Major Bank Announcements

about “Fixing” Foreclosure Paperwork

16. The banks are announcing that they have a “handle” on the

problems with the essential paperwork to lawfully conduct

foreclosure proceedings.

17. Statements such as, “we are getting new documents

properly signed,” so that foreclosures may once again move forward.

4
 18. “New” documents will NOT “fix” their problems.

19. The foundational basis of the structure of the

government, separation of powers, would have to be “trash-canned,”

and many landmark case law decisions would have to be overturned,

for such a statement by the banking industry to have any validity

whatsoever.

20. The following MEMORANDUM OF LAW will explain the

impossibility of the ability of the banking industry to “save”

their criminal mortgage scam.

21. Preview: The banks cannot PROVE that they have

STANDING without PROVING the EXISTENCE of the

ORIGINAL AUTOGRAPHED promissory note and

mortgage agreement.

Any COPY of such documents, are

counterfeit, forged, photo-shopped and fraudulent.

All Promissory notes and Mortgage

Agreements are SECURITIES.

It is a CRIME to COPY a SECURITY and

attempt to CASH that COPY of a SECURITY for

something of value.

5
 MEMORANDUM OF LAW

I. MERS Naked Conclusory Averment of Being Nominee

II. MERS Always Submits Counterfeit, Forged,Photo-shopped, and Fraudulent Copies of

Promissory Notes and Mortgage Agreements

III. UCC and Person Entitled To Enforce the Note

IV. MERS or Any Other Foreclosure Claimant Lacks Standing To Invoke a Court’s
Particular-case-jurisdiction

V. For The Past 20 Years No Foreclosure Claimant Has Been Able To Meet Article III
Standing Requirements

VI. Foreclosure Claimants Fail To Demonstrate An Actual Injury

VII. Most Foreclosure Claimants Cannot Show That Any Alleged Injury Is Fairly
Traceable To the So-Called “Debtor” Or That the Relief Requested Is Likely to
Redress any Alleged Injury

VIII. Foreclosure Claimants Cannot Prove Prudential Standing

IX. CONCLUSION

I. MERS Naked Conclusory Averment of Being Nominee

1. MERS (Mortgage Electronic Registration System) invariably

makes naked conclusory averments of being the "nominee" of mortgage

holders with respect to the Assignment of Mortgages either/or

“accounts,” without including a CERTIFIED copy of the so-called

“nominee agreement.” Such naked claims are blatant

misrepresentation – fraud.

2. Without valid proof of a proper and correctly executed

nominee agreement, MERS cannot establish STANDING to institute

foreclosure proceedings.

3. There is no proof of any rights transferred by mortgage

lenders, (for lack of a better term), giving MERS the lawful

authority to “assign” the original autographed promissory note and

mortgage agreement. This is the reason the criminal banking

“industry” changes the language and words used to reference the

promissory note and mortgage agreement to the word “ACCOUNT.”

"The note and mortgage are inseparable; the former as

essential, the latter as an incident. An assignment of

the NOTE carries the mortgage with it, while an

assignment of the latter [mortgage agreement] alone is
a NULLITY." Carpenter v. Longan, 83 U.S. (16 Wall.)
271, 274 (1872). (emphasis added) (Access Carpenter here:
http://supreme.justia.com/us/83/271/case.html)

4. The above referenced currently binding opinion of the

Supreme Court of the United States, was recently utilized as basic

law in Landmark Nat’l Bank v. Kesler, No. 98,489, by the Supreme

Court of the State of Kansas, (August 2009).

5. Assignment of an ACCOUNT … is LUDICROUS. MEANINGLESS.

The NOTE and the mortgage agreement are the “things” that must be

ASSIGNED — TOGETHER . An “account” is NOT the NOTE and the

mortgage agreement. Was the NOTE assigned? Was the Mortgage

Agreement assigned with the NOTE?

6. “Assignment” of “accounts” is a red herring, a deliberate

attempt to divert attention away from the fact that the banks and

debt collectors are trading “accounts” and not the valuable

securities themselves.

7. Is a picture of a baby … the baby? Call the picture of

the baby, “account,” does that make the picture (account) … the

baby? An “account” is NOT the note, contract, agreement, etc.

-2-
 8. The claim of assignment of a so-called “account” fails to

establish anything other than the announcement of a naked

conclusory allegation, and the attempt to misrepresent an “account”

as a promissory note and mortgage agreement. FRAUD.

9. The sweeping assertion, based upon a naked allegation

concerning so-called “assignment,” and the uncertified alleged

links in the chain of claimed assignments that must be complete and

valid going all the way to the ORIGINAL initial holder of the

actually existing OWAPN and OWAMA, is simply not sufficient to

allow litigation.

10. A valid, certified, and unbroken chain of assignments

between the ORIGINAL holder and the present holder, and then to the

foreclosure claimant must be PROVED. If not demanded the courts

will “look the other way.”

II. MERS Always Submits Counterfeit, Forged, Photo-

shopped, and Fraudulent Copies of Promissory
Notes and Mortgage Agreements

11. All copies of securities must be considered to be

Counterfeit, Forged, Photo-shopped, and Fraudulent. A copy of a

“thing,” cannot be that “thing.” With respect to the Original

Autographed (Wet-ink) Promissory Note (OAWPN), and the Original

Autographed (Wet-ink) Mortgage Agreement (OAWMA), only the actual

OAWPN and OAWMA have any value.

a. The statement above is just as true as the

statement that “a COPY of a $100.00 Federal Reserve

Note has no value,” is true.

-3-
 12. MERS is notorious for possessing only non-negotiable,

electronic copies of mortgages and promissory notes.

13. Without production of the original, wet-ink autographed

mortgage and promissory note, to prove that such instruments

actually exist and are in physical possession of the holder (“in

possession of the instrument”), or the “non-holder in possession of

the instrument who has the rights of a holder,” there is no way to

prove the existence of a debt.

14. Without proof of the existence of a valid OAWPN and

OAWMA, there can be no evidence for a claimed injury in fact. NO

STANDING, which would entitle anyone to initiate foreclosure

proceedings.

III. UCC and Person Entitled To Enforce the Note

15. MERS amazingly claims to be a “person entitled to

enforce” the OAWPN and OAWMA. The Uniform Commercial Code (UCC),

section 3-301, establishes the requirements for enforcing a note:

UCC § 3-301 states,:

"Person entitled to enforce" an instrument means:
(1) the holder of the instrument;
(2) a nonholder in possession of the instrument who has the
rights of a holder; or
(3) a person not in possession of the instrument who is
entitled to enforce the instrument under UCC § 3-309.

16. Since MERS is not the original so-called “creditor,” and

CANNOT prove possession of the OAWPN and OAWMA, MERS cannot be

considered to be the holder.

-4-
 17. Since MERS can only produce a copy of the OAWPN and

OAWMA, they cannot be considered a “nonholder in possession of the

instrument who has the rights of a holder.”

18. Consequently, MERS can only claim to be “a person not in

possession of the instrument who is entitled to enforce the

instrument under UCC § 3-309 …”

19. Therefore, MERS status is governed by UCC § 3-309,

“Enforcement of lost, destroyed, or stolen instrument.” which

states in pertinent part —

“(a) A person not in possession of an instrument is entitled to enforce

the instrument if:
(1) the person seeking to enforce the instrument
(A) was entitled to enforce it the instrument when loss of
possession occurred, or
(B) has directly or indirectly acquired ownership of the
instrument from a person who was entitled to enforce the
instrument when loss of possession occurred;
(2) the loss of possession WAS NOT the result of a transfer by
the person or a lawful seizure; and
(3) 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. If that proof is made, Section 3-308 applies
to the case as if the person seeking enforcement had produced the
instrument. The court may not enter judgment in favor of the person
seeking enforcement unless it finds that the person required to pay
the instrument is adequately protected against loss that might occur
by reason of a claim by another person to enforce the instrument.
Adequate protection may be provided by any reasonable means.”
(Emphasis added).

20. Pursuant to UCC § 3-309, the burden of establishing

validity is on the person claiming validity, and MERS, or ANY OTHER

foreclosure claimant cannot produce the OAWPN and OAWMA. Therefore

-5-
– no standing, and particular case jurisdiction cannot be invoked

in any court.

21. Since the OAWPN and the OAWMA were actually SOLD and

securitized within a short period of time after being autographed,

the unavailability of the actual OAWPN and the OAWMA is the RESULT

OF A TRANSFER, UCC § 3-309(a)(2), which means that the entity that

SOLD the OAWPN and OAWMA LOST their right to enforce the

instrument, and therefore the right to assign enforcement rights to

any third party, because loss of possession was the result of a

transfer by the person. (UCC § 3-309(a)(2)).

IV. MERS or Any Other Foreclosure Claimant Lacks

Standing To Invoke a Court’s Particular-case-
jurisdiction

22. "[T]he core component of standing is an essential and

unchanging part of the case-or-controversy requirement of Article

III." Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992).

Without standing, a foreclosure claimant’s claim cannot move

forward. Indeed, "the [ ] courts are under an independent

obligation to examine their own jurisdiction, and standing is

perhaps the most important of the jurisdictional doctrines."

FW/PBS. Inc. v. City of Dallas, 493 U.S. 215, 231 (1990) (internal

quotation marks omitted); see also Vickers v. Henrv County Savings

& Loan Ass'n, 827 F.2d 228, 230 (7th Cir. 1987). Furthermore, the

burden is upon the plaintiff to establish standing and the presence

of jurisdiction [ ]. NLFC, Inc. v. Devcom Mid-America. Inc., 45

-6-
F.3d 231, 237 (7th Cir. 1995); Grafon v. Hausermann, 602 F.2d 781,

783 (7th Cir. 1979).

V. For The Past 20 Years No Foreclosure Claimant

Has Been Able To Meet Article III Standing
Requirements

23. Since the advent of the present ongoing “securitization”

of real estate OAWPNs and OAWMAs no foreclosure claimant has been

able to establish that a justiciable controversy exists that would

invoke the particular case jurisdiction of the courts.

24. Article III of the United States Constitution vests the

federal courts, with jurisdiction to decide only actual cases or

controversies. This constitutional concept must also be observed

in the state courts. See Lewis v. Continental Bank Corp., 494 U.S.

472, 477 (1990); Deakins v. Monaghan, 484 U.S. 193, 199 (1988);

DeFunis v. Odegaard, 416 U.S. 312, 316 (1974).

25. A central inquiry for determining whether a case or

controversy exists is whether there is a "'substantial controversy,

between parties having adverse legal interests, of sufficient

immediacy and reality."' Lake Carriers' Association v. MacMullan,

406 U.S. 498, 506 (1972) (citation omitted); see also Arizonans for

Official English v. Arizona, 520 U.S. 43, 64 (1997). The Supreme

Court has noted that standing is perhaps the most important of the

case or controversy requirements. See Allen v. Wright, 468 U.S. at

750. The United States Supreme Court has summarized the standing

requirement as having three elements:

-7-
 First, the plaintiff must have suffered an "injury in
fact” - an invasion of a legally protected interest
which is (a) concrete and particularized, and (b)
"actual or imminent, not 'conjectural' or
“hypothetical.”
Second, there must be a causal connection between the
injury and the conduct complained of - the injury
has to be "fairly … trace[able] to the challenged
action of the defendant, and not … th[e] result
[of] the independent action of some third party not
before the court."
Third, it must be "likely," as opposed to merely
"speculative," that the injury will be "redressed
by a favorable decision."

Lujan, 504 U. S. at 560-61 (citations and footnote omitted). "This

triad … constitutes the core of Article III's case-or-controversy

requirement, and the party invoking federal and state court

jurisdiction bears the burden of establishing its existence." See

Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 103-04

(1998) (citations omitted); Kyles v. J. K. Guardian Sec. Serv,

Inc., 222 F.3d 289, 293 (7th Cir. 2000) ("Implicit in that

limitation [that there be a case-or-controversy] is the requirement

that a party invoking the court's jurisdiction have standing.")

26. Today, there are virtually no foreclosure claimants

capable of satisfying the requirements of Article III standing.

VI. Foreclosure Claimants Fail To Demonstrate

An Actual Injury

27. As an initial matter, foreclosure claimants NEVER prove

that they sustained an actual injury in fact sufficient to

establish Article III standing.

-8-
 28. As noted above, a foreclosure claimant’s injury must be

"concrete and particularized" and "actual or imminent, not

'conjectural' or 'hypothetical."' Luian. 504 U.S. at 560; see also

Whitmore v. Arkansas, 495 U.S. 149, 155-60 (1990); Illinois v. City

of Chicago, 137 F.3d 474, 477 (7th Cir. 1998) ("[i]njury is an

indispensable element of a case or controversy," and "[tlhat means

a palpable harm to a concrete interest."). The plaintiff’s injury

must be one that is "peculiar to himself or to a distinct group of

which he is a part." Gladstone, Realtors v. Village of Bellwood,

441 U.S. 91, 100 (1979); see also Schlesinner v. Reservists Comm.

To Stop The War, 418 U.S. 208, 218 (1973). The plaintiff must have

a "personal stake" in the outcome of the litigation. See United

States Parole Comm. v. Geraghty, 445 U.S. 388, 396, 403-04 (1980).

29. No foreclosure claimant, today, has the capacity to

articulate a sufficiently particularized "injury in fact" to

satisfy the irreducible requirements of Article III.

30. Any COPY of an OWAPN and OWAMA can easily be fabricated

either/or “photo-shopped.” Without the ORIGINAL AUTOGRAPHED

documents, such copies are immediately suspect, and must be

considered to be, counterfeit, forged, photo-shopped, and

fraudulent.

31. Foreclosure claimants invariably fail to allege, in even

a broad perspective, just exactly the nature of any "harm" suffered

in order to substantiate an actual and concrete injury. See, e.g.,

Warth v. Seldin, 422 U.S. 490, 501 (1975) (absent an express

-9-
statutory right of action, plaintiff must "allege a distinct and

palpable injury to himself”).

VII. Most Foreclosure Claimants Cannot Show That Any

Alleged Injury Is Fairly Traceable To the So-
Called “Debtor” Or That the Relief Requested Is
Likely to Redress any Alleged Injury

32. Foreclosure claimants invariably fail to prove, with

valid evidence, any alleged injury that can be shown as "fairly

traceable" to the so-called “debtor” or that the relief requested

would likely address the alleged injury. See Lujan, 504 U.S. at

560-61. Unless the so-called debtor CONFESSES to the debt.

33. Foreclosure claimants invariably fail to allege and prove

the ability to produce any evidence to substantiate the existence

of any alleged ORIGINAL contract, any action, transaction, duty,

omission, or responsibility which would constitute a basis for

standing and subsequent invocation of a court’s particular case

jurisdiction. See Simmons v. Interstate Commerce Commission, 909

F.2d 186, 189 (7th Cir. 1990).

VIII. Foreclosure Claimants Cannot Prove Prudential

Standing

34. In addition to the irreducible requirement of Article

III, the standing doctrine has a prudential component. Lujan, 504

U.S. at 560. The prudential component ordinarily prevents

plaintiffs from invoking the rights of third parties. See Warth,

422 U.S. at 499 (1975); see also Powers v. Ohio, 499 U.S. 400, 411

(1991) (in addition to alleging injury-in-fact, a litigant seeking

-10-
to invoke the rights of a third party, must allege a sufficiently

close relationship with the third party so that the court is

assured that the litigant will be an effective proponent of the

cause and "there must exist some hindrance to the third party's

ability to protect his or her own interests"); Whitmore v.

Arkansas, 495 U.S. at 163-64.

35. Most foreclosure claimants seek to litigate the rights of

an unnamed and unknown holder of an alleged agreement that has not

been proved to even exist.

36. Without any showing of a concrete and particularized

injury in fact and any showing of the requisite "close relation" to

the actual and present holder of an alleged original agreement, the

foreclosure claimant cannot show that it is attempting to protect

its own interests. See Powers v. Ohio, 499 U.S. at 411.

37. To the contrary, most, if not all, foreclosure claimants

initiate foreclosure proceedings without any valid proof whatsoever

to demonstrate an unbroken and valid certified chain of assignment

to the alleged actual and present holder of the alleged original

autographed agreement.

IX. CONCLUSION

38. The foreclosure claimant entered the Court with

i. counterfeit, forged, photo-shopped, and fraudulent

COPIES of documents that are in fact counterfeit

SECURITIES. Counterfeiting a security is a

criminal act, and

-11-
 ii. fraudulent and invalid so-called “assignments,” and

iii. fraudulent affidavits.

39. A COPY of what purports to be a “signature,” is NOT the

signature.

40. A COPY of a Federal Reserve Note is NOT a Federal Reserve

Note.

41. With respect to a real estate promissory note and

mortgage agreement, the naked and conclusory allegation of the

existence and actual possession of the ORIGINAL AUTOGRAPHED

promissory note and mortgage agreement without certification by

sight comparison and verification of the ORIGINAL AUTOGRAPHED

promissory note and mortgage agreement in hand, to a purported COPY

of what is claimed to be the purported promissory note and mortgage

agreement, is fraud on its face.

42. Until proven to exist by actual production of the

ORIGINAL AUTOGRAPHED promissory note and mortgage agreement, the

defendant denies the existence of any such instruments, and

disputes the STANDING of the foreclosure claimant, in that no such

STANDING can be PROVED to exist.

43. Certified General Ledger(s) must be produced to establish

the chain of ownership, custody and actual possession of the

alleged ORIGINAL AUTOGRAPHED promissory note and mortgage

agreement.

44. Foreclosure claimant must prove that it has not entered

the Court with a counterfeit security.

-12-
 45. Foreclosure claimant must prove that its claim to a right

to a remedy upon the face of a counterfeit security is a valid

claim.

-13-