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One of My Students Spoke Up and Claimed He Was The Auditor That Went From Bank To Bank Examining The Records To Be Sure They Were in Compliance

A student explains to a teacher how banks engage in fraudulent practices by loaning out depositors' money as loans and appearing to give borrowers cash when they actually give checks, and tells the teacher to keep this secret.

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Horton Glenn
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77 views1 page

One of My Students Spoke Up and Claimed He Was The Auditor That Went From Bank To Bank Examining The Records To Be Sure They Were in Compliance

A student explains to a teacher how banks engage in fraudulent practices by loaning out depositors' money as loans and appearing to give borrowers cash when they actually give checks, and tells the teacher to keep this secret.

Uploaded by

Horton Glenn
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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One of my students spoke up and claimed he was the auditor that went from

bank to bank examining the records to be sure they were in compliance. At


lunch time he gave me the bookkeeping entries. He said we credit (liability
column) cash and replace it with promissory note recorded as an asset. He
claimed this means the bank loaned other depositors' money. Then he showed
the seller of the house receiving the money by debiting the cash (recorded as
an asset) and crediting (recording as a liability) a new demand deposit account
(checking account). Then he said, "Do you see the fraud?" I said, "No, because
you gave the borrower cash." He said, "Look again, there is a new liability, cash
cancels out. Oh yes," he explained, "we redefine words. We call checks cash,
and we really gave them a check which is the opposite of cash." As he said the
word fraud, the other CPAs standing around gasped, pretending they did not
hear this conversation. The auditor explained, "We give the appearance of
loaning other depositors' money, but we change the intent of the agreement
and change the promissory note so it funds the check." Then he claimed the
average American would never figure this out. He looked at me squarely in the
eye and told me never to reveal this to anyone. He explained how it is like
stealing and using the value of the stolen property to create new money and
returning it back to the victim as a loan. He proceeded to explain that it is so
profitable to those involved, they wanted to keep the secret for themselves. As
long as the people never figured it out, the lawmakers, police, judges and
professionals could keep transferring the wealth from the people to those who
know the secret. The judges and police need the secret to continue or they
cannot enforce it. It is too profitable to expose.

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