So, what do we learn from this law, as someone who wants out of credit card debt or any debt for that matter, that the banks have to follow?

1) That there are certain accounting principles that must be followed by (FDIC) insured banks and financial institutions.
2) That certain reports or statements must be filed with federal banking agencies by insured depository institutions.
3) That these reports and or financial statements must accurately reflect the capital of these institutions.
4) That the institution's accounting principles shall be uniform and consistent with Generally Accepted Accounting Principles.

We have before us a copy of the Generally Accepted Accounting Principles (GAAP). This edition is a GAAP 2003 edition published by Wiley. It can be ordered new online for $75.00 or used for around $8.00.

Out of Credit Card Debt - Anything Accepted by a Bank for Deposit is Considered Cash

On page 41 under the section Cash and Cash equivalents the reader learns "ANYTHING ACCEPTED BY A BANK FOR DEPOSIT WOULD BE CONSIDERED AS CASH". This is a crucial statement. Why? Because we challenge the banks based in part upon this clear statement; that they are owed nothing according to their own books!

Let's look at the simple statement, "Anything accepted by a bank for deposit would be considered as cash". You could take a Savings Bond to the bank, and they could exchange it for cash, or deposit the amount into your checking account.

Out of Credit Card Debt - Who Funded the Loan

The entire process works like this: Banks accept credit card agreements and promissory notes and deposit them and they are considered as cash to fund your account. So, the original agreement/promissory note that you signed added electronic dollars to the banks books and YOU FUNDED YOUR OWN LOAN.

So if you were approved by a credit card company for a credit card with a $5,000.00 credit limit, the agreement/promissory note is deposited into a transaction account under your name at that credit card company.

So, they never loose a dime even if the consumer maxed out the card and never pays them!!! But, not only do they not risk or loose a cent, they gained a full $5,000.00 because they received this from the original agreement that you signed.

If you never use the card they made $5,000.00 from your promissory note/credit card agreement alone! And, every time you use the credit card they make the exorbitant interest (which is never created) they charge on top of that.

In summary they make $5,000.00 when you are approved, plus all the interest which is usually three to 10 times what you charged!

You may be in disbelief if you've been trying to get out of credit card debt by making payments for years, and now you're reading this.

Out of Credit Card Debt - Federal Publications

The Federal Reserve has also been very clear in their circulars that banks do not really lend money.

To understand the significance of this revelation in their official circulars one example that could be cited is a reference in statutory law. For instance the Uniform Commercial Code (UCC), which governs all commercial law, {and virtually every state has adopted and codified it in their state statutes} reads in the section on commercial paper which includes promissory notes "Regulations of the Board of Governors of the Federal Reserve System and operating circulars of the Federal Reserve Banks supersede any inconsistent provision of this Article to the extent of the inconsistency." UCC 3-102(c)

So, we can see that the circulars of the FED banks and the regulations of the Board of Governors of the FED have the power to override statutory law in commercial relations when there is a conflict between that law and the circular or regulation of the FED in a particular section.

That said, what have they said about banks lending money? I think two examples will suffice to prove the point, although many more could be offered.

Probably the most oft-quoted reference on the internet is the Federal Reserve publication, Modern Money Mechanics.

On page 6 it says in rather clear language, "Of course, they (banks) do not really pay out loans from the money they receive as deposits. If they did this no additional money would be created."

So, the question that we would ask while looking at getting out of credit card debt is if they do not "really" pay out loans from the money that they receive as deposits, where do they get the money to "pay out lo

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