WEREX Lien Notice, Statement & Report

Appendix 1 A – BAYFIELD Offer Letter

Appendix 1 B – Nominal Mortgage & Terms

Appendix 1 C – Stewart Title Insurance Docs

Appendix 2 – WEREX Preamble and Advisory

Appendix 3 – A General Theory of Financial Relativity

Appendix 4 – All Unreal – Account Falsification (Reason #7 from My Top 7 Reasons)

Appendix 5 – Nominal Method Fraud

Note: The following Forensic Analysis & Report as presented (92 pages) has a few minor corrections and additions to the hard copy version (90 pages) sent by mail to the recipients named below. A pdf of the 90-page original will be made available shortly on the site. The main difference is that there were several references to the total payments in advance or from the nominal proceeds as being $50,820 whereas the actual amount was $60,820 and which has now been corrected.

Also, there were a few references to a number of the apparent (prima facie) offences being complete upon registration of the security. Such references (except those dealing directly with the registration) have been amended to read upon swearing and signing and / or delivery of the writing / nominal-security (which itself includes the authorization for its registration).

Finally, the Title Insurance Terms under Appendix 1C are from a different transaction between the same two parties. We believe that they are substantially the same standard terms as those supplied under this transaction but Ms. Pryce has not as yet been able to locate them. The evidence referred to under the said terms, however, is sufficient to make the title insurance company a party to multiple criminal offences regardless. – TPM.

January 8, 2021

To, jointly and severally:




C. Robert Pearson,


Allan MacCallum,





Trevor S. Fowler,

Entity d.b.a. The Crown in Right of Canada,

Entity d.b.a. Law Society of British Columbia,

Entity d.b.a. The Crown in Right of British Columbia,

Entity d.b.a. The BC Financial Services Authority (BCFSA),

Entity d.b.a. Registrar and / or Office of the Registrar, Victoria, and

Certain associated beings of conscience / equity in their nominal personal capacity.

TAKE NOTICE that a worldwide equity lien has been published against you and all of your assets, jointly and severally, in respect of, inter alia:

  1. your unlawful and illegal acquisition or obtaining of credit from SHERRIN JUNE PRYCE on or about July 17, 2017, by fraud or false pretence;
  2. your unlawful and illegal direct or indirect filing (as CA6209889 at the Victoria Land Title Registry on or about August 9, 2017) of what you knew or ought to have known was an egregious libel denouncing SHERRIN JUNE PRYCE as a debtor, when you knew or ought to have known that SHERRIN JUNE PRYCE was and remains your creditor in-fact and in-law; and
  3. that you are, and are recognised in equity, as constructive absconding debtors who are attempting to fraudulently induce the Crown Courts to aid and abet your attempt to compound the damages you have caused to SHERRIN JUNE PRYCE and to Sherrin June Pryce, and to avoid and evade your legal and lawful debts to Sherrin June Pryce as the equitable or master creditor to SHERRIN JUNE PRYCE;

TAKE NOTICE also that the amount of the said worldwide equity lien is the USD-equivalent[1] of $10 million ($10,000,000), converted or to be converted to Bonded Equity Exchange Credits (BEEC’s) via the World Equity Repository & Exchange (WEREX.org) special equity restitution trust.

The material facts and allegations in support of the said worldwide equity lien are detailed in the attached or included Forensic Transaction Analysis and Report, dated December 27, 2020.

If you wish to challenge or dispute any of the facts as so presented, then you may do so in writing and for publication at WEREX.org in opposition to the said equity lien. Be advised, however, that any bare denial or otherwise failure to address the said material facts honestly and in good faith, and not in an evasive or misleading manner, will be taken as additional prima facie evidence of mens rea and an intent to further escape equity / justice.

The aggregate $10 million in damages includes a reasonable estimate of any gain, benefit or advantage obtained by you from the nominal Assignment of Rents (registered as CA6209890) that you concurrently obtained from SHERRIN JUNE PRYCE by fraud or false pretence on or about July 17, 2017. If you wish to claim a commensurate reduction in the aggregate amount, then you must provide comprehensive disclosure of all such gain, benefit, or advantage so obtained by you, and by naming any and all parties who subsequently may have trafficked in the said nominal securities.

If you wish to do equity and settle with Sherrin June Pryce directly, you may do so and thereby reduce the said joint and several worldwide equity lien pro rata to the amount of damages so paid to Sherrin June Pryce, within 30 days of your receipt of this NOTICE.

TAKE NOTICE also that your nominal foreclosure action against SHERRIN JUNE PRYCE in respect of the property at 608 Trutch Street, Victoria, is in fact and in law an application or petition to the Court to launder proceeds of crime, contrary to s. 462.31(1) of the Criminal Code, and in material reliance on the aforesaid fraudulently published and registered libel against SHERRIN JUNE PRYCE.

If you choose to do nothing, then the equity claim and lien published by Sherrin June Pryce will be taken as ratified by you, and converted in due course to BEEC’s.


Timothy Paul Madden, for WEREX.org.


STATEMENT of Equity Fraud Victim

I, Sherrin June Pryce, a natural woman and being-of-conscience / equity, solemnly state as follows:

1. That on or about the 17th of July, 2017, I was induced by certain people holding themselves out to me as employees, agents, solicitors, and / or officers of VERSATILE MORTGAGE CORP. (LANGLEY BC), and UPTON CAPITAL CORP. (LANGLEY BC), (VERSATILE / UPTON), to swear, sign, and provide for the registration of what I now believe to have been a false-document and falsified security or securities, in favour of VERSATILE / UPTON as beneficiaries.

2. The said nominal securities were later registered and assigned the numbers CA6209889 and CA6209890, respectively, by the Registrar (Victoria Land Title Office) on August 9, 2017.

3. At the time I did not read the nominal mortgage security in any great detail other than to note the stated Principal Amount ($800,000), the stated Interest Rate (7.45% per annum) and the maturity / due-date when I would have to pay $800,000. I did not pay too much attention to the stated monthly payments because the real agreement was that all of the interest and principal for the one-year term was required to be paid in advance from the proceeds.

4. I now believe that I may have allowed myself to be used as a metaphoric pawn in a scheme by the owners, management, and solicitors of VERSATILE / UPTON to defraud myself, as well as certain parties, known (or subject to discovery) and unknown, in the financial markets and elsewhere.

5. And that I regardless committed a constructive fraud against the equity investments and interests in the property of my mother, my sister, and my brother, as and when I swore, signed and delivered the security and provided for its registration. Those equity investments (in my then three properties) totalled about $800,000, including a material equity interest in 608 Trutch Street, Victoria.

6. My beliefs as stated above under paragraphs 1, 4, and 5 in this regard are based in part on the analysis and report that I requested and received from a forensic financial economist who analyses transactions on the financial meaning and import of their terms, and not on the labels attached by the usually more dominant party who has substantive sole-control over the form of the agreement. A copy of that Forensic Transaction Analysis and Report is attached to or included with this my Statement.

7. I believed generally at the time that VERSATILE / UPTON had undertaken to loan to me $800,000 of pre-existing money sourced from some outside party or parties, provided that I would pay them approximately $82,000 from the proceeds, including $62,800 for the total interest (about $61,500) and principal-repayment ((about $1,300) in advance. From my position, I expected to receive about $718,500 and would then not have to make any payments for one year until $800,000 came due on the named maturity date, and I believed that I was swearing and signing and delivering a mortgage security for that anticipated loan.

8. I now understand and believe that my role in the process was to undertake and underwrite what was in fact a conditional or contingent liability of $800,000 in favour of VERSATILE / UPTON, but by and through a security falsified by omission and otherwise to evidence an unconditional liability.

9. Everything that I agreed to do under the actual agreement was contingent or conditional in fact on my subsequently receiving an approximate $718,500 payment from VERSATILE / UPTON.

10. The security I was induced to issue has been falsified in multiple independent ways to conceal or deny that conditionality or contingency and liability-in-fact of VERSATILE / UPTON in exchange.

While I did not realise it at the time, I have recently discovered that that distinction and deception is near essential to VERSATILE / UPTON’s ability to convert the falsified security in the financial markets (or to sell it to an accomplice), and that I may have unwittingly exposed myself to commensurate liability as the author-in-law and issuer of the false document and security.

11. More specifically, the stated consideration under clause 2

2 (1) In return for the lender agreeing to lend the principal amount to the borrower, …

is a fictitious or illusory consideration because it is not possible to make a loan without making the loan, and I have since learned that the particular device of nominal or pretended creditors, and even genuine money-lenders, to the contrary is a well-recognised and documented fraudulent double-counting device and technique. Such deceit is then compounded by the concurrent negation clause under clause 6

6 (13) The lender does not have to advance… the principal amount …to the borrower…unless the lender wants to

that turns the arrangement regardless into a wager or game of chance. As such, as and when I swore and signed the nominal security, I gratuitously alienated and gave away all of my family-members’ equity in the property, in exchange for the bare chance of receiving anything at all in return. I now understand and realise that my (and VERSATILE / UPTON’s) fraud against the equity of my family members was complete at that moment.

12. The security as sworn, signed, and delivered by me, also directly purported itself (via the “Interest Act Statement”) to evidence an equity investment of $800,000 already made by VERSATILE / UPTON, when in fact VERSATILE / UPTON had made no equity investment, nor any investment, did not concurrently make an equity investment, nor any investment, and were expressly-not-liable under the terms of the nominal security to make any equity investment, nor any investment, or to do anything at all, in the future.

13. Conversely, as and when I swore and signed the writing / security, it was my actual and rational intent to honour the security only on condition of VERSATILE / UPTON making a subsequent payment to me in the amount of (about) $718,500.

14. The document and security that I was induced to swear, sign, and deliver, however, falsely purports itself to be an unconditional acceptance and underwriting of an $800,000 liability and charge in favour of VERSATILE / UPTON, and omits any mention of the fact of the then known contingency, and in fact directly denies it under clause 6(13), while concurrently and independently ratifying the presentation and representation by and under the “Interest Act Statement” that $800,000 had already been paid / invested by VERSATILE / UPTON.

15. My purpose here in part is to advise the public, and law enforcement authorities, of the existence of the falsified documents and securities in the financial markets, so as to mitigate any such damages which may be experienced by innocent people or persons relying on the genuineness of the securities; and to advise of the most obvious reasons for my beliefs.

16. More specifically, with respect to the nominal mortgage security registered as number CA6209889, I was required by VERSATILE / UPTON and / or their solicitors, to falsify and issue the document / security as follows:

17. The said security that I issued provided for the falsification of Box “(a) Principal Amount: 800,000.00”.

The actual principal amount contemplated (by me) was approximately $718,500, and not $800,000. The $81,500 difference was comprised of about $61,500 of interest-in-advance, plus about $1,300 of principal-repayment-in-advance, plus about $20,000 of interest-capitalized-in-advance as nominal loan fees.

Notwithstanding the true or net amount nominally so contemplated, the actual principal amount in fact, as and when the security was sworn, signed, and delivered, was zero or nil.

18. The security that I issued provided for the falsification of Box “(b) Interest Rate: 7.45% per annum”.

The contemplated interest rate as defined by the net $718,500 and single required / combined payment of $800,000 one year later, is 11.3% per annum, and not 7.45% per annum.

19. The security that I issued provided for the falsification of Box “(d) Interest Calculation Period” to indicate and state: “MONTHLY”, when the actual interest calculation period was “Annually” or “ANNUALLY” and “In advance”.

20. The security that I issued provided for the falsification of Box “(e) Payment Dates: 15th Day of Every Month”.

Other than the approximate $81,500 to be paid from the proceeds by side-agreement not mentioned in the nominal mortgage, I was in fact obligated to make only one payment of $800,000 at the end of one year. I have since been informed and I concur that the payment-frequency-in-fact is an important measure under which registered securities are assessed and valued in the financial markets, and that, all else being equal, an annual-pay mortgage is of inherently or relatively greater risk, and therefore relatively less valuable, than a monthly-pay mortgage, such that it is important to truthfully disclose and declare the real payment period (ANNUALLY) and to not positively misstate and falsify the category as “MONTHLY”.

21. The security that I issued provided for the falsification of Box “(g) Amount of each periodic payment: $5,235.00”.

The actual amount of each periodic payment was $800,000, and it was to be made annually, and was inclusive of the $62,800 of principal and interest payments required in fact to be paid in advance from the nominal proceeds.

22. The security that I issued provided for the falsification of Box “(h) Interest Act (Canada) Statement: The equivalent rate of interest calculated half yearly not in advance is 7.56659%”

First, here, it has since been brought to my attention, and I concur, that a rate of interest is a unit of measure, and which is not calculated, per se. As noted in the aforementioned analyst’s report, stating or otherwise asserting that an annual rate of interest is calculated half-yearly, is like telling a judge that you weren’t driving at 80 miles per hour, but only 60 miles per hour calculated half-hourly.

As and when the writing was sworn and signed, the principal advanced (past or present (concurrent) tense) was nil or zero, and so plainly the Interest Act (s. 6) had no application to the security, and I should have declared as much on its face.

Based on what I now know, and before any consideration of the true transaction being credit-reinsurance and not money-lending at all, had I been consulted on the particulars of the disclosure / declarations under the Interest Act, I would have disclosed and declared that the principal amount is $718,500, that $800,000 is due in one year, and that the rate of interest is 11.3% per annum, provided, however, that it be recognised and recorded that as of the swearing, signing and delivery of the security, VERSATILE/ UPTON had loaned no principal nor advanced any credit, and that all of my undertakings and liabilities under the security are expressly contingent upon and conditional upon a subsequent payment of $718,500 to me by VERSATILE / UPTON.

23. I was also required to directly falsify the nominal mortgage to expressly deny the known fact of the requirement and intent of the payments in advance. The $62,820 of payments in advance that I agreed to make to VERSATILE / UPTON from the proceeds was a stated condition under the BAYFIELD offer letter:

1) Mortgage to be prepaid from proceeds for 12 months

Of the total $62,800 that was subsequently paid to VERSATILE / UPTON as payments in advance from the nominal proceeds, about $61,500 was nominally for interest-in-advance, and the $1,300 excess was technically prepaid-principal-in-advance, although I did not grasp the full absurdity and naked-fraud of such at the time.

It was regardless the intent of both parties that all of the interest under the agreement was to be calculated and payable in advance, and that is what occurred in fact after the execution and delivery of the mortgage security.

But the nominal mortgage security that I swore under oath, signed, and delivered states categorically [and falsely] that there is no such interest in advance payable under the agreement (italics in original):

3(2) Interest is not payable in advance. This means that interest must be earned before it is payable.

Here, too, I believe that I was induced into swearing, signing, and delivering the nominal security to VERSATILE / UPTON by fraud or false pretence, for reasons known to management of VERSATILE / UPTON.

24. None of the nominal legal-professionals involved gave me any indication that by swearing and signing the writing and nominal security I would be committing at least several actual or strict liability criminal-law and anti-racketeering law violations.

25. None of the nominal legal-professionals involved disclosed to me the objective reality of the transaction that I was advancing real-estate-secured-credit to VERSATILE / UPTON as my debtor-in-fact.

26. None of the nominal legal-professionals involved disclosed to me that by swearing and signing the nominal-security that I was falsely denouncing SHERRIN JUNE PRYCE as a debtor in respect of a transaction under which SHERRIN JUNE PRYCE was and remains the creditor-in-fact, and that VERSATILE / UPTON intended to register and act upon such denunciation as a registered-libel against SHERRIN JUNE PRYCE at the Land Title Office in Victoria.

27. I make this my Statement in good faith and for no improper purpose.

Signed this 7th day of January, 2021


Sherrin June Pryce



Forensic Analysis

Nominal Financial Transaction




Transaction date: July 2017.

Analysis and Report by Timothy Paul Madden, forensic financial economist, and historian of equity, law, and policy.

Summary and Conclusion

Forensically, or by its terms, the nominal agreement and transaction was that if Ms. Pryce would first unconditionally underwrite and assume a debt and registered charge of $800,000 to / in-favour-of VERSATILE / UPTON, and unconditionally convey all right, title, and interest in her property at 608 Trutch Street, Victoria to VERSATILE / UPTON as security therefore, and for a further payment of $800,000 to VERSATILE / UPTON, on the named Maturity Date, then VERSATILE / UPTON might, but would not be contractually obligated or liable to, advance a net $718,000, or any amount, to Ms. Pryce.

The nominal agreement is a non-agreement on its face, superseded, among several other fatal defects, by the prima facie illegality of the wager or game-of-chance so defined.

In addition to the required prior transfer and delivery of the aforesaid assets to VERSATILE / UPTON (as a constructive entry-fee or application-fee), the foundational consideration, and as provided prominently in the nominal agreement and registered security is:

2 (1) In return for the lender agreeing to lend the principal amount to the borrower, …

6 (13) The lender does not have to advance… the principal amount …to the borrower

To anyone with even a tertiary understanding of finance, the nominal securities and collateral documentation are cartoonishly defective and prima facie illegal. The substance of the proposal and transaction, and as executed in fact, was:

“Legally and unconditionally convey to us all of the assets (everything real or financial and specific to this nominal transaction), and then maybe we will agree that we owe you something in return, and maybe we won’t.”

The terms are on-its-face (prima facie) offensive to at least the following indictable (Criminal Code of Canada) offences / felonies (most are “serious [organized-crime / racketeering] offences”) and most of which are international-treaty-enjoined racketeering / designated offences:

  • s. 206(1)(a) (scheme or proposal to loan money or to advance credit by any mode of chance),
  • s. 298(1) (defamatory libel),
  • s. 347(1)(a) of the Criminal Code (entering into agreement or arrangement to receive interest at a criminal [infinite or astronomical] rate),
  • s. 347(1)(b) of the Criminal Code (receiving payments or partial payments of, interest at a criminal [infinite or astronomical] rate),
  • s. 362 of the Criminal Code (obtaining credit (underwriting / assumption of debt from issuer of the security (nominal / pretended borrower) by fraud or false pretence)),
  • s. 363 of the Criminal Code (obtaining execution of valuable security by false pretence),
  • s. 366 of the Criminal Code (making [and / or soliciting] false document with intent (forgery-in-law)),
  • s. 368 of the Criminal Code (uttering forged-document-in-law),
  • s. 375 of the Criminal Code (obtaining (subsequent nominal payments) by instrument based on forged-document-in-law),
  • s. 380(1) of the Criminal Code (fraud),
  • s. 380(2) of the Criminal Code ((incipient) fraud upon the (financial) markets).
  • s. 386 of the Criminal Code (false statement / omission of material particular to deceive registrar),
  • s. 388 of the Criminal Code (false / misleading receipt),
  • s. 397(1)(a) of the Criminal Code (falsification of an accounting record),
  • s. 397(1)(b) of the Criminal Code (fraudulent omission of material particular from valuable security),
  • s. 462.3(c) of the Criminal Code (counselling to commit enterprise crime / designated offence(s)),
  • s. 462.31(1) of the Criminal Code (laundering of proceeds of crime).

Note: Except where specifically noted, this analysis and report does not state, imply, nor assert, any act or action as criminal solely on the basis of a bare technicality.

All acts and actions hereunder stated as criminal are both unlawful or malum in se, and a codified offence under the criminal law.

For the public record.

MISPRISION. (1) Misprision of felony: “Every one who knows that any other person has committed felony and conceals or procures the concealment thereof, is guilty of misprision of felony” (Steph. Cr. (9th ed.) 158. See also Sykes v. Director of public prosecutions [1962] A.C. 528. [Stroud’s Judicial Dictionary of Words and Phrases, Fourth Edition, 1973]

27 December 2020

To: Ms. Sherrin Pryce

608 Trutch Street

Victoria, B.C.

V8V 4C5

cc: RCMP Commercial Crime Division, Victoria / Vancouver

Vancouver Stock Exchange (VSE) [(TSX-V post-1999)],

Toronto Stock Exchange (TSE),

And to whom it may concern.

Re: Your nominal financial relationship with:




C. Robert Pearson,


Allan MacCallum,





Trevor S. Fowler,

Entity d.b.a. The Crown in Right of Canada,

Entity d.b.a. Law Society of British Columbia,

Entity d.b.a. The Crown in Right of British Columbia,

Entity d.b.a. The BC Financial Services Authority (BCFSA),

Entity d.b.a. Registrar and / or Office of the Registrar, Victoria, and

Certain associated beings of conscience / equity in their nominal personal capacity.

Dear Ms. Pryce, and to whom it may concern;

The analysis and report which follows is in respect of your request for same in reference to your nominal (or pseudo) financial relationship with the above-referenced legal entities and / or people, as the case may be.

I have now reviewed the documentation that you have provided to me with respect to your July, 2017 nominal mortgage transaction with VERSATILE / UPTON on the property at 608 Trutch Street, in Victoria, B.C.

An outline for a special-action-of-the-class equity-remedy will be by a separate report to follow.

First, however, and although such does not appear to be in the documentation that I have seen, you will have likely also received some form of fairly detailed offer / term letter or other constructive or actual proposal from either or both purported lenders or else either or both purported / nominal mortgage brokers laying out their essential and material terms. If so, and you can obtain a copy of same, then the issues may be administratively simplified.[2]

The nominal mortgage regardless contains the following provision:

6 (13) The lender does not have to advance or readvance the principal amount or the rest or any further part of the principal amount to the borrower unless the lender wants to even though

(a) the borrower has signed this mortgage,
(b) this mortgage is registered in the land title office, or
(c) the lender has advanced to the borrower part of the principal money.

The provision is that upon execution and / or registration of the security and charge in favour of VERSATILE / UPTON, VERSATILE / UPTON may, but are expressly not obligated or liable to, loan money or to advance credit, but also subject to a chance-event-based exception. It defines the arrangement as a scheme or proposal to loan money or to advance credit by “any mode of chance”, contrary to s. 206(1)(a) of the Criminal Code. Caprice is the most basic form of chance. It creates or defines a lottery-of-one, where either you win the prize, or you don’t.

Either way, the instant the mortgage is sworn, signed, delivered and / or registered, you lose, and VERSATILE / UPTON obtain and gain something of value to VERSATILE / UPTON (and formerly to you), in exchange for no binding obligation to return anything at all, and where the sole potential or implied or constructive prize for same (the named exception subject to the chance event) is the awarding or making of a loan of money or the advancing of credit.[3]

The constructive and actual wagering provision defined by clauses 2(1) & 6(13) is material to several much more serious criminal-law violations, but even the seemingly bare technicality under s. 206(1)(a) is sufficient to void the entire arrangement ab initio. I mention it here at the outset because under s. 206(1)(a) the offence is the making or soliciting of the offer or proposal, and so procedurally dominates. Everything that follows from it becomes at best a legal-nullity for civil-law purposes.

But on top of the bare technicality, the question here is: Did VERSATILE / UPTON (and / or by / through BAYFIELD) make or solicit an offer or proposal to loan money or to advance credit by any mode of chance?

Yes they did. And directly and emphatically so.

That in itself is a wrongful act (malum in se), and an independently illegal act. It is not even necessary to prove or require any kind of entry-fee or application-fee to commit the offence. It is like making or soliciting an offer or proposal to deal in stolen-goods – it is illegal on the face of it with or without any more specific terms. The making or soliciting of the offer is the employment of a racketeering device – legally akin to the offence of being found in possession of burglar’s tools where the mere fact of having them is sufficient proof of intent to use them as such. The offence (actus reus) under s. 206(1)(a) is regardless complete on the making or soliciting of the offer.

In your case they in fact took it a step further by using that illegal offer (and the perceived-probability that you would win the lottery-of-one) to induce you to assume and unconditionally underwrite $800,000 of liability / credit to them, to transfer and convey the legal-title to a (circa) $1.4 million property, and to underwrite a further liability to pay them another $800,000 on the maturity date, and agree to rebate or kick-back some $82,000 to them from the proceeds, and all in exchange for an express disavowal of any liability to return anything at all, save for the occurrence of a chance event (if the lender wants to) that is outside of your control.

So it was and remains malum in se or evil / wrongful-of-itself.

It was and remains contrary to equity.

And it was and remains illegal as contrary to law.

At a minimum and regardless, you were required, as a condition of the transaction, to consent to structuring the transaction and securities as a wager or game-of-chance, for reasons known to VERSATILE / UPTON and / or to the owners and management of VERSATILE / UPTON.

And, again, management / counsel at VERSATILE and UPTON did in fact employ the illegal device to obtain at least $3 million of assets for a zero cost or investment, and to their own unjust and unearned (no value given in return) enrichment. If the transaction is stopped and audited at the point of execution and / or registration of the mortgage, VERSATILE and UPTON have a net asset increase or gain of at least $3 million, and expressly no liability to you or to anyone in exchange.

Also at that moment, the constructive and actual frauds against the equitable interests of your brother, your sister, and of your mother (“family members”) were complete.

Conversely, in exchange for your assets (and your unconditional undertakings of liability), you received, again as and when executed, a bare chance to be awarded a loan or advance of credit, subject to a chance event (being that the lender wants to) that won’t be determined until after the securities and charge are executed and / or registered in favour of VERSATILE / UPTON. That is why it is illegal and criminal.

The transfer or conveyance of a legal right of property in a financial security (or “valuable security” under s. 2 of the Criminal Code) in exchange for a potential or chance-based award of a loan or advance of credit on the occurrence of a chance event, even a lottery-of-one, is very close to the purest definition of racketeering.

“Legally and unconditionally convey to us all of the assets (everything real or financial and specific to this nominal transaction), and then maybe we will agree that we owe you something in return, and maybe we won’t.” – is neither a lawful nor legal business model.

Even ignoring most of the deliberately-confusing financial terminology / jargon, the nominal transaction as structured was in fact a wager or game-of-chance. It would be and remain illegal even if there were no separate s. 206(1)(a) that makes it more specifically illegal (or a separate offence) to hold out a loan of money or an advance of credit as the prize in any such already-illegal wager.

Everything subsequently returned to you was from an actual or de facto liquidation and / or conversion of those assets so obtained by the illegal device. The purpose of the conditionality (chance-event / wagering-structure) is to allow the offender to book or capitalize their asset gain, to then support a new kited (unsecured or unfunded) liability out the back-end. It is the underlying ratcheting device that drives a Ponzi-scheme forward.

There are as many as twenty-four (24) domestic criminal-law and international racketeering-law offences defined under the documentation, as discussed in detail below.

Strictly-speaking, however, and again on the criminal-law side, there may be a very significantly greater number of offences and / or offending parties because under the criminal-law definition of an organized-crime / racketeering-law / designated offence:

Commission of offence – In this section and in sections 467.11 to 467.13, committing an offence means being a party to it or [the nominal creditors’s solicitors, lawyers, and / or other counsel] counselling any person to be a party to it.

If VERSATILE / UPTON (management) are counselled to commit a designated offence by their solicitors and subsequently commit it, then (based on the available evidence) everyone involved in the enterprise (including also the nominal brokers) is / are equally / jointly guilty of committing the offence, or of the commission of the offence.

And, for future and ongoing reference:

[T]he UNODC Module Series explains that the UN Convention against Transnational Organized Crime defines organized crime as “A structured group of three or more persons, existing for a period of time and acting in concert with the aim of committing one or more serious crimes or offences established in accordance with this Convention, in order to obtain, directly or indirectly, a financial or other material benefit.”

Most critically, it is not a given business-entity that first constitutes a criminal organization – but rather the people who make up the organization who define the criminal organization in law. The same applies under the domestic Criminal Code definition.

My apologies for the extended length of the analysis and report, but it is important to be thorough, and this report may also serve in support of the aforementioned special-action-of-the-class and several other potential remedies.

Also bear in mind throughout that many of the criminal-law violations are to allow or facilitate VERSATILE / UPTON to (falsely) enhance the apparent value of the writings / nominal-security to third-parties or to constructive (strict liability) or actual (direct mens rea) accomplices in the domestic and international financial markets and elsewhere.

From a slightly different perspective, as and when you were induced or solicited by VERSATILE / UPTON to swear and sign the nominal mortgage, your actual and wholly-rational intent-in-fact was to honour the terms of the security only on condition of a subsequent payment of (approximately) $718,000 by VERSATILE / UPTON to you.

As such the nominal $800,000 security was a contingent / conditional-in-fact assumption and underwriting of liability, but where the security as executed and / or registered expressly and falsely purports itself (by the “Interest Act Statement”) to evidence an $800,000 equity investment already made by VERSATILE / UPTON, and so as to give the conditional-liability-security-in-fact the false and fraudulent appearance of an unconditional-liability of its issuer, you, to VERSATILE / UPTON.

More generally, it was an executable contract-and-security falsely purporting on its face to be an executed contract-and-security. That distinction is most foundational in the financial markets.

VERSATILE / UPTON (management and solicitors), as both the beneficiary and the author-in-fact of the falsified security, subsequently converted the security (or obtained a benefit from its conversion / registration) as a pre-funded-equity-instrument knowing that it was in fact an unfunded-and-conditional-underwriting and liability of its issuer, and knowing-in-fact of its true status as a false-document and forgery-in-law.

Whether local, national, or international, that is securities-fraud, conversion, and money-laundering.

Notwithstanding the larger deception of credit-reinsurance being passed-off as money-lending, at a minimum the arrangement as proposed by the brokers and / or VERSATILE / UPTON was (round numbers): “We will loan or advance to you a net $718,000 at 11.3% per annum for a year, provided that you agree also to (1) falsify the mortgage security to claim and swear that we have loaned you $800,000 at 7.45% per annum, (2) that you provide a false declaration and statement that the mortgage / security complies with the federal securities law (Interest Act, s. 6), and (3) that you convert and rebate / kick-back the $82,000 difference to us under an unregistered side-agreement, including $62,800 for payments in advance, but which payments in advance you must also expressly and falsely deny under the security / mortgage.”

Otherwise, again at a minimum, and again notwithstanding the apparently overwhelming number of criminal-law violations, the provision negating / disavowing any obligation of VERSATILE / UPTON literally defines the arrangement as a non-contract.

You incur a loss of your assets, and gain all manner of unconditional liabilities to VERSATILE / UPTON, in exchange for no obligation of VERSATILE / UPTON to do anything at all. And, again, all this is complete (at the latest) the instant the mortgage is registered and VERSATILE / UPTON obtain the benefit of the charge and / or Assignment of Rents.[4]

As will be discussed in greater detail below, that in itself automatically voids the non-agreement, and equity, subject to what is called estoppel, is automatically revived. And, as can be objectively and conclusively demonstrated, VERSATILE / UPTON had no equity and contributed no equity.

Both in fact and based on the nominal documentation, VERSATILE / UPTON and all of these other parties arrived at the nominal transaction with metaphoric empty-pockets, and did not contribute anything that they did not obtain, directly or indirectly, from you, and at the additional expense of, and to the material prejudice of, certain third-parties (family-members) who had a pre-existing equitable / investment interest in the property.

The nominal security means what it says – that in exchange for no actual, recognised, or recognisable legal consideration, you unconditionally and irrevocably transfer and convey legal title to the property to VERSATILE / UPTON as security for a concurrently assumed debt of $800,000 to VERSATILE / UPTON, plus an obligation to pay another $800,000 to VERSATILE / UPTON in one-year’s time.

Note that the nominal security is not of the form: “I promise to repay the amount of the loan to VERSATILE” where the amount that you owe is premised on or defined by the amount that they ultimately return or reinsure to you, but rather:

“The borrower promises to pay the mortgage money to the lender…” where the amount is directly stipulated (minimum $862,800) and not conditional on any other event or consideration in return. That is the cognitive sleight-of-hand under which they quietly obtained $800,000 of real-estate-secured-credit from you.

Also, the instant the nominal security was registered the legal and equitable rights of your family members (and of your own) were legally subordinated to a registered legal claim / charge in favour of VERSATILE / UPTON, and which is itself founded upon a multi-layer cartoonishly-defective proposition:

2 (1) In return for the lender agreeing to lend the principal amount to the borrower, …

6 (13) The lender does not have to advance… the principal amount …to the borrower

The same applies independently in terms of the separate Assignments of Rents.[5] The arrangement could be additionally or concurrently characterized (like a parallel crime) as VERSATILE / UPTON going-after and obtaining the Assignment of Rents both by fraudulent means (bait and switch) and in fraud of your family-members’ equity in the property (even if they themselves are not aware of it). All of the essential and material elements of fraud here are prima facie (R. v. Olan, et al. (1978) S.C.C.).

I recommend that, before proceeding to the main body of the report, shortly below, you first read the attached (Appendix 2) Mortgage Payment Abatement Advisory which provides a general overview and frame-of-reference for much of what follows.

Most briefly, however, such pretended-creditors and pretended-money-lenders normally employ at least one of three principal fraudulent devices as follows:

  1. Direct false-receipt,
  2. Fictitious or Illusory Consideration, and / or
  3. Bait and Switch.

Here the above-named entities have employed all three devices, as described in some greater detail, below.

A potentially complicating-factor, however (because of civil versus criminal, and the actual chronology / sequence of events), is that here again the primary statement of the consideration exchanged is a text-book example of a bait-and-switch:

2 (1) In return for the lender agreeing to lend the principal amount to the borrower, the borrower grants and mortgages the land to the lender as security for repayment of the mortgage money [unconditional defined sum of about $862,000] and for performance of all the borrower’s promises and agreements.

The two provisions combined, and reduced to their essential and material elements:

2 (1) In return for the lender agreeing to lend the principal amount to the borrower, …

6 (13) The lender does not have to advance… the principal amount …to the borrower

The nominal agreement is thus a non-agreement on its face (for insufficient consideration under 2(1)).

But it is far more than just insufficient consideration. VERSATILE / UPTON’s bare agreement to loan is (1) an illusory or fictitious consideration,[6] (2) an essential and material element in a bait-and-switch, and (3) an illegal consideration (under GAAP).

It is the employment of an illusory consideration to obtain secured-credit (from you) by fraud or false pretence and in execution of a directly presented and stated / naked bait-and-switch,[7] all compounded by three additional layers of criminal-law / false-document offences to disguise, convert and launder the resulting proceeds of crime.

So there are at least several layers of criminal versus civil-law jurisdiction and liability tracts.

The nominal securities are cartoonishly-criminal and egregiously-defective on the face of it. In theory the Courts / judges were required (Canada Evidence Act, s. 18) to answer the foreclosure application by providing for the arrest of the moving party / petitioner and their solicitors and lawyers.

The fact that the perpetrators would lay such prima facie defective documentation and claims before the Court equally prima facie brings the administration of justice into disrepute, and is likewise prima facie a contempt of the Court (like submitting a petition / claim based on a Title Deed from a Game of Monopoly – it makes the Court / Crown look foolish and exposes it to ridicule).

Other questions

Where did the Registrar obtain authority to register a prima facie fraudulent security (by reason of the fictitious-consideration and / or bait-and-switch device and / or the various disclaimers)?

Is the Registrar a judicial office subject to s. 18 of the federal Evidence Act? Is not the Registrar regardless bound to protect the integrity of the Registrar’s Office (Land Title Office) by vetting the individual securities as registered?

And the integrity of the financial markets to which the Land Title Office registrations are a major source of new liabilities to convert (new equity to harvest and leverage)?

And where does the Court obtain its authority to act upon it with knowledge of such defect or defects? Regardless of whether the Courts / judges can even be charged with the offence of laundering of proceeds of crime, surely to do so in fact is to bring the administration of justice into disrepute.

Finally, here, there is the question of whether the Courts generally have any remaining jurisdiction or capacity at all. You have to consider the possibility that the Courts are merely de facto. A properly constituted / lawful Court has no capacity to convert illegal contracts.

The principle of law is clear. The courts, which exercise the judicial power of the Crown, will not enforce a contract that Parliament, which exercises the legislative power of the Crown, has made unlawful. In the words of Lord Mansfield in Holman v. Johnson [1775]:

“The principle of public policy is this: Ex dolo malo non oritur actio. No court will lend its aid to a man who founds his cause of action upon an immoral or illegal act.”[8]

VERSATILE / UPTON have done so more indirectly here, but management and counsel at several of the major nominal (and privately-owned) financial institutions have, for example, been directly providing for the inclusion of quasi-disclaimers or declarations under the nominal securities that they prepare and solicit from nominal borrowers that the parties agree that the security remains valid and enforceable even if the Courts should directly rule otherwise – and even if it is criminal or otherwise illegal.

Once the Courts / judges have been exposed-in-fact to such provisions (as they have on several occasions of which I am specifically aware) and fail to even take objection to them, then the Crown irrevocably loses a measure of its inherent jurisdiction.

Like sailing into the Port of London under a pirate flag, while the King pretends not to notice. It all makes a statement. And it is all cumulative.

Taking the nominal disclaimer phenomenon in its entirety, the financial solicitors are metaphorically b*tch-slapping Her Majesty in public, and / but without any protest from, nor anyone coming to the defence of, the Crown.

NOTWITHSTANDING the provisions of any Statute [any lawful Act of Parliament, including the criminal law] relating to the rate of interest payable by debtors this contract [and security] shall remain in full force and effect whatever the rate of interest received or demanded by [the Bank].

With translation to the vernacular: “The parties agree that the Crown, its Parliament, and its laws, can all get stuffed.”

There is not a lot of room for interpretation.

Once the Crown and its Courts have responded, both in fact and as a matter of public record, to the effect: “Yea. O.K. We’re good with that.” – the relationship is irreconcilably altered.

What happened in fact is paramount

Finally, before proceeding with the primary analysis and report, I have noted a kind of background-pseudo-logic among those who work in the nominal financial-services industry, to the effect that: “Well, yes, technically such-and-such might be technically illegal, but if anyone had said anything we could have found a way to achieve the same result legally.”

First, here, by definition there is no way to legally achieve what has been achieved in fact, and, even if there were, such would be wholly irrelevant.

The very definition of equity is fact, and the law follows [from] the facts. As noted and applied in the decision of the judges of the House of Lords in ratifying the decision of the judges of the Supreme Court of Canada in BANKING SERVICE CORP. Ltd. v. TORONTO FINANCE CORP. Ltd. et al. [1928] (in material part, emphasis added):

LORD BUCKMASTER:-Their Lordships do not think it is necessary to call upon the respondents in this case, for, having heard the matter fully argued, they are of opinion that the appeal must fail.

It might have been possible, as no agreement was entered into, that even after the original proposal the two heads could have been separated, and two independent agreements might have been prepared…, but that is not, in fact, what was done.

As and when the writing / security was executed and / or registered, VERSATILE / UPTON obtained in fact some $3 million of value, for no value in fact in return, and by means of a fictitious or illusory consideration compounded by a naked bait and switch, and by a false receipt by and under the “Interest Act Statement”. The actus reus of several criminal-law and anti-racketeering-law offences by VERSATILE / UPTON was complete at that moment.

Quae ab initio non valent, ex post facto convalescre non possunt.

Things invalid from the beginning cannot be made valid by a subsequent act.

At the most basic level, and one which even the broadly-defined public can perhaps most easily grasp, is the naked fraud and forgery in respect of the $62,820 of payments in advance that was paid in advance from the nominal proceeds of the conversion of the security itself. According to the BAYFIELD offer letter:

1) Mortgage to be prepaid from proceeds for 12 months.

The term was one year, such that all of the interest-called-interest under the agreement was to be, and was in fact, paid in advance from the nominal proceeds (about $61,500 of the total nominal payments ($62,820) that were paid in advance (with the other (about) $1,300 paid to pre-paid-principal-in-advance (and ignoring the absurdity of it (pre-paid principal) for the time being)). And there was no interest that was not to be paid in advance.[9]

The registered mortgage, however, omits entirely the fact and amount of the interest both illegally converted and paid in advance, and directly and positively denies it:


3(2) Interest is not payable in advance. This means that interest must be earned before it is payable.

The average citizen probably does not fully appreciate the truly monumental scope and scale of criminal law violations, nor the equally monumental aggregate financial costs, involved in the illegal capitalization of interest-in-advance.

But such becomes irrelevant where, as here, the security is directly falsified to objectively and specifically deny the known fact of it.

[Note: The Table of Contents, following, refers to the page numbers of the original printed report and not to this e-version]

Table of Contents

Summary and Conclusion 1

Other questions 11

What happened in fact is paramount 12

Table of Contents 14

Summary and Conclusion: 16

Background / Causal factors 16

Specifics to the nominal transaction 17

Preamble and General frame of reference 18

Constructive trust arises automatically 21

Background 22

Section 347 and interest-in-advance. 23

100%-plus loan-fees 29

Massive equity-fraud founded on dispensation 34

Double-cross-leveraged loan-fees 40

$62,820 accounted for as payments-in-advance 46

On the meaning of principal 48

Fraudulent omissions 49

Federal securities law / Interest Act fraud / forgery 51

Fraudulent and absurd calculation of the rate-of-interest 55

Illegal Late Payment Penalties 56

Charges independently contrary to s. 347 60

Automatic Debit / NSF Racket 61

Diminished-capacity / Not fundamentally What!!? 64

Technical deficiencies 70

Business custom defence 73

Macro-Conclusion 75

Commercial law is Admiralty law 77

Appendix A – Macro Chronology of closely-relevant events 79

Appendix 1 – Copy of Mortgage and Terms and other material documents

Appendix 2 – WEREX Mortgage Payment Abatement Advisory

Appendix 3 – A General Theory of Financial Relativity

Appendix 4 – All of this is Unreal –

Reason #7 – On systematic account falsification

Appendix 5 – Nominal-Method Fraud

Summary and Conclusion:

Background / Causal factors

The two most related and significant socio-financial and socio-economic contributing factors occurred in 1981 and in 1989 / 90, respectively.

  1. In 1981, the Crown in Right of Canada unlawfully and illegally revived the practice known as non obstante or selective-non-prosecution or administrative-apartheid, and also took the unprecedented step of purporting to extend it into the criminal-law realm, to give de facto permission or dispensation to private financial institutions and other so-designated friends-of-the-Crown to violate a certain and highly-critical / foundational criminal (and accounting) law “At the Pleasure of Her Majesty”.
  2. In 1989 / 90, consecutive unanimous panels of the Ontario Court of Appeal and of the Supreme Court of Canada, respectively, ruled or ratified that criminal / racketeering / organised-crime offences committed by private financial entities and their solicitors are not illegal because (1) the criminal law only provides for the severe punishment of offenders, but does not otherwise directly state: Don’t do it, and because (2) the said institutions / friends-of-the-Crown are not of the class of persons to whom the criminal law was intended to apply, and (3) because the plaintiff / offending party had been aided and abetted by members of the BAR.

Both measures / actions greatly contributed to a general and ever-escalating state of lawlessness in the broadly-defined Canadian financial system, notwithstanding that both were and remain wholly unlawful, illegal, unconstitutional, and of no legitimate force or effect, and would not, and do not regardless, negate multiple collateral consequences under domestic and international-treaty-law. In practice, both measures / actions merely demonstrated, and continue to demonstrate, egregious bad faith and / or criminal-incompetence and / or (cogno-linguistically-induced) diminished-capacity.

The core intention of both was to aid and abet the unlawful and illegal harvesting and de facto confiscation of the assets and productive capacity of the majority of the People of Canada by, and to the unjust enrichment of, the aforementioned friends-of-the-Crown.

Both VERSATILE and UPTON, and the people who own and operate them, appear to be such friends-of-the-Crown who have engaged here in prima facie racketeering / organized-crime activities At the Pleasure of Her Majesty, and as aided and abetted by members of the entity holding itself out as, and doing business as, the Law Society of British Columbia.

Specifics to the nominal transaction

  1. All of the nominal documentation is defined and classified in-fact and in-law as false documents and forgeries-in-law.
  2. No right of property in anything given over to the custodial possession of any of the named entities, or any direct or derivative financial capacity, ever passed to them.
  3. All such chattels, capacity / charges, and broadly-defined assets formed a constructive-trust with yourself as ultimate beneficiary the instant they came into the direct or indirect possession and / or control of said entities.
  4. In law and equity you are entitled to full restitution which includes comprehensive disgorgement of all gain, benefit or advantage obtained by the wrongdoers from their direct or indirect use of the assets / capacity, whether directly obtained from you, or in the domestic or international financial markets, or otherwise.[10]
  5. The substance of the nominal transaction, and the nominal documentation, is / are saturated with criminal-law violations and offences to equity (i.e., they are not just technicalities), as will be detailed below, but the dominant reality is that the corporate entities (via their managers), passing-themselves-off as lenders, in fact first obtained real-estate-secured-credit from you by fraud or false-pretence, and then reinsured or returned unsecured-credit to you (and as a constructive prize in a game-of-chance).
  6. Constructively, in both law and equity, all of the above-mentioned people and entities are a collective or aggregate of absconding debtors attempting to orchestrate an avoidance and evasion of their lawful and legal debts to you.

Preamble and General frame of reference

While I have not otherwise done an extensive or comprehensive analysis of the more general phenomenon, when I started doing research into equity, law, and policy in the early 1990’s, I encountered the following two articles in the local Edmonton newspapers, as per one of my earlier reports:

Consider the following newspaper accounts of civil lawsuits involving even potentially minor and unintentional technical misrepresentations by the little people:

Where there’s smoke there’s a smoker, court rules

The Canadian Press – Montreal

A smoker is a smoker even if he takes only an occasional puff, the Quebec Court of Appeal has ruled in upholding an insurance company’s refusal to pay death benefits. The court ruled Wednesday [the Insured’s wife] was not eligible for her husband’s $150,000 in life insurance because he had made a false declaration to the insurers that he was a non-smoker. *** [The Insured] took out the policy in November 1984, making his wife a beneficiary. He died in a car accident the following August. On his application, [the Insured], who had quit smoking 18 months earlier, had answered No to the question “Have you used tobacco, in any form, in the previous 12 months?’ *** The L’Industrielle-Alliance insurance company gave him a non-smoker’s policy, with a premium which is less than half what smokers pay. The problem was that [the Insured] indulged in an occasional small cigar. He didn’t consider that smoking. But the insurers did, and rounded up four witnesses who had seen him puffing. The company argued [the Insured] had made a false declaration, and his policy was invalid.

Often the first inclination is to perceive the above-described decision as being unfair (which it is but for other reasons). Many assume that the Court should have awarded at least the amount of insurance that the insured would have received under a smoker’s policy for the same premium. But that is not the civil court function. It is not up to the courts to make a new agreement between the parties – only to determine whether the agreement which the parties have made can be enforced. In this case the parties had an apparently valid agreement for life insurance. The insured died in a car accident, but the insurance company (management) held that since there was a misrepresentation in the signed contract, it would not honour the policy.

Thereupon, by way of a lawsuit (which appears to have lasted several years), the wife of the insured (as beneficiary) requested the state’s assistance in enforcing the agreement. The decision of the Court was that the insurance company was correct. Regardless of the intent of the insured, there was a misrepresentation in the written agreement, and the Court therefore had no legal authority to lend its assistance to the beneficiary by compelling the insurance company to honour the policy. It could not assist the beneficiary without violating the rights of the insurance company. The law is the law.

Likewise, and more or less concurrently, an insurance company in Ontario declared a murder victim’s life insurance policy void because he had not disclosed a mild previous heart attack of which he himself had apparently not been aware[11] (emphasis added):

Life policy void, widow told

The Canadian Press – Toronto

A woman whose husband was slain last fall [1994] has been denied his $50,000 life insurance policy. *** Since [the insured] hadn’t told the insurance company about a previous heart attack, the policy was ruled invalid. *** “He was murdered” the 56-year-old widow said Monday. “Somebody took my future. And now the (life insurance) security blanket has been pulled out from under me.” *** [The insured] was killed last Sept. 14 [1993], when armed robbers used his vehicle as a getaway car after fleeing a shoot-out at a sports store in nearby Oshawa, Ont. *** His body was found in nearby Pickering last January. The case is still under investigation. *** After his death, [his wife] was sent a letter from Metropolitan Life Insurance Co. declaring her husband’s policy “null, clear and void” along with a check for $2,700 for reimbursed premiums. *** A Metropolitan Life spokesman said the company wouldn’t have insured [the man] in the first place if proper medical information had been provided. *** The company first learned about [the insured’s] heart attack when police sent in his file a few months ago, said Jim Hiller, an agent in Whitby, Ont., for the insurer. “Do we make an exception and pay out the money or go by the rules and the law,” asked Hiller, who said the decision has caused him some sleepless nights.

The legal principle itself is simple and clear – a material misrepresentation (or material illegality), no matter how circumstantially trivial, renders a civil contract unenforceable. The law is the law.

Also note that in both cases, the insurance company management had made no attempt to determine whether the representations on the respective applications were accurate before taking the premium money. Like the people who run all insurance companies, they wait until a claim is made before doing such due diligence.[12] It is much more efficient and profitable that way. And such is considered a virtue by those in the industry.[13]

Also note, and in fairness, that in the case of the smoker, if the insured had in fact deliberately and willfully lied on the application with the intent of concealing his consumption of the occasional small cigar (with the intent of obtaining the same amount of insurance for a lower premium), then the application would have been or become a false document and legal forgery or forgery-in-law in accordance with the Supreme Court of Canada decision in The Queen against Gaysek [1971] S.C.R. 888. It would remain void either way, but it is important to act on the most serious and significant reason, all else being equal.

The underlying socio-economic-control device remains as it has for centuries, at least as it is applied to the little people. From Parkin v. Dick [1809] 3 Taunt. 6 (emphasis added):

Lord Ellenborough. – The objection is fatal. I have got a clause declaring [insurance] policies on prohibited voyages, introduced into acts of parliament, for the purpose of warning the public. But it is clearly unnecessary. The illegality of such [insurance] policies is a consequence of law. Nor can I separate one part of the subject matter insured from the residue. It may be a hard case if only a small quantity of [illegal] naval stores [war material] be included in a cargo which is insured ; but the smallest quantity renders the adventure illegal, and I have no scales to weigh degrees of illegality. The contract is entire, and is wholly void. Plaintiff nonsuited [i.e., constructively denied locus standi in curia (standing before the Court)].

The Court of Admiralty had no jurisdiction over the contract / policy because it was illegal. This principle is the theoretical foundation of civil / contract law because it keeps the system honest.


What has happened in practice, however, is that the private institutional structure has developed its own coercion-based interceding-sub-system of all-or-nothing. As long as all the players commit the same crimes, the Courts / judges are always faced with the same dilemma of looking the other way to incrementally accommodate institutional crime – or else the system will collapse.

That process has run rampant in Canada for the past 40 years, and is now wholly out of control.

The only way to accommodate it – for a while at least – is for a society to establish two materially different systems of equity-law or justice. One for the little people, and one for the entrenched-money-power. Canada has become the world’s poster-child for little-people-law versus money-power-law.

As will be examined in greater detail below, while such justice as described in the above articles / cases was being meted out to the little people, more or less concurrently, thirteen (13) consecutive judges, from the trial judge to the Supreme Court of Canada, all held that a pure and gratuitous guarantor (Mr. Carpenter)[14] was still liable on his promissory note to guarantee what all of the Courts / judges agreed was unquestionably a criminal contract and which, on the established facts, involved a minimum of 14 prima facie criminal-law and racketeering / organised-crime offences by the plaintiff nominal creditor, aided and abetted by one of the big five private banks, and by what the trial judge had described as “two leading Toronto law firms”, on the grounds that the criminal law provides only for the severe punishment of offenders, but does not otherwise expressly state: Don’t do it.

And many of the collateral criminal offences were in respect of the plaintiff and its solicitors falsifying the securities to conceal and deny what they and the solicitors / lawyers knew to be a criminal / racketeering offence. They committed at least four additional criminal / racketeering offences in their efforts to conceal and launder the proceeds from the first one.

What is critical to appreciate is that (1) the former-bank-lawyer / judges were not corrupt – they genuinely believed it because it was the answer that they needed, and (2) all Courts across Canada then acted quickly to ratify and entrench such new doctrine into the fabric and substance of Canadian jurisprudence. They all believed it too.

On that basis alone, the Canadian justice system is, or ought to be, the laughing-stock of the international community.

With all due respect to the individual men and women, lawyers, and especially solicitors, are trained in the art of deceiving humans by stringing together statements that are not categorically false. Over time they ever-increasingly tend to experience a cogno-linguistically-induced diminished capacity that materially affects their ability to perceive reality and / or to understand the concept of restraint, or more precisely the consequences of a lack thereof.

Constructive trust arises automatically

Under otherwise well-established law and equity, if the nominal contract or arrangement is even merely and innocently void (e.g., for insufficient consideration), then a constructive trust is automatically created, again in both law and equity. In the present case, it means that VERSATILE / UPTON became a constructive trustee of everything you ever gave over to their direct or indirect possession, including the mortgage, the legal title to the property, the Assignment of Rents, and all of the payments of nominal principal and interest.

There are several Canadian cases that arrive at or ratify the same essential conclusion (e.g., Central Trust Co v Rafuse, [1986] 2 S.C.R. 147), but the U.K. decision of the House of Lords in Guiness PLC v. Saunders [1990] 2 A.C. 663 gives at once the most simple yet comprehensive explanation of the principles involved.

In the Guiness case, one of the directors (Mr. Ward) of the beer conglomerate (and public company) Guiness Plc. had entered into a nominal contract with / through two other directors of the company under which Mr. Ward would be paid a commission on the purchase / acquisition price of Distillers Plc. in exchange for his expertise and negotiation skills. After the purchase and sale was complete Guiness paid the resulting commission of £5.2 million to Mr. Ward (or rather his own private consulting company).

It was later discovered or raised as an issue that under the legally binding Guiness corporate bylaws, directors could only receive such special remuneration / payments under a contract pre-ratified by the entire board of directors. Guiness (led by its minority shareholders) sued to recover the £5.2 million on the ground that it had been paid over pursuant to a legal nullity – a non-existent or illusory contract.

[at p. 689, Lord Templeman] If the bid for Distillers had not led to allegations of misconduct by Guiness it is possible that the payment of £5.2 m. to Mr. Ward’s company, apparently for services rendered by his company, would not have been questioned or, at any event, that Mr. Ward would not have been required to repay that sum. But there never was any contract by Guiness to pay special remuneration to Mr. Ward for services rendered in connection with the bid for Distillers.

[p. 693] The fact is that Guiness never did contract to pay anything to Mr. Ward. The contract on which Mr. Ward relies is not voidable but non-existent.

[at p. 696, Lord Goff of Chieveley]. In the Court of Appeal [1988] 1 W.L.R. 863, Mr. Ward’s appeal against that decision was dismissed. It was said of him, at pp. 870-871, that he had “succeeded in getting his hands on the company’s money,” and that the company had never ceased to own the money which he had been paid. Accordingly Mr. Ward was a constructive trustee of the money which he had received, and must pay it back.

[at p. 702] Finally, I cannot see any prospect of success in a claim by Mr. Ward to relief under s.727 of the Act of 1985. Given that Guiness’s claim must be one for the recovery of money paid to Mr. Ward under a void contract and received by him as a constructive trustee, there is no question of his being able to claim relief from liability for a breach of duty, as might have been the case if Guiness’s claim had been founded upon breach by Mr. Ward of his duty of disclosure. [i.e., Mr. Ward is estopped by the fact of the by-law from a defence based on the equitable doctrine of quantum merit.]

I have been very conscious, throughout this case, that Guiness is seeking summary judgment for the sum claimed by it, without any trial on the merits. Even so, I have come to the conclusion that Mr. Ward has no arguable defence to Guiness’s claim. The simple fact emerges, at the end of the day, that there was, in law, no binding contract under which Mr. Ward was entitled to receive the money [security or premium] and that, as a fiduciary [constructive trustee[15]], he must now restore that money to Guiness. For these reasons I would dismiss the appeal.

Likewise in your case – there isn’t even a triable issue, and it is not in the least bit complicated. There are myriad civil and criminal law violations in the agreement and on the face of the nominal-security, and which reflect (and / or conceal) an underlying fraud against equity and the unjust enrichment of the perpetrators. While VERSATILE / UPTON may appear to suffer a relative loss, they are at least theoretically entitled (if totally innocent) to recover from the solicitors who created and approved of the arrangement and of the defective securities, provided (and however unlikely) that there was no material collusion between management and the solicitors.[16]

Very simply, a solicitor who practices commercial law is responsible, if he undertakes to draft a promissory note [or any financial security], to see to it that it expresses the interest rate [or any material provision] in a form that is enforceable [i.e., and most certainly not criminal]. Ontario Court of Appeal – Elcano Acceptance Ltd. v. Richmond, Richmond, Stambler & Mills; 1991, 68 O.R. (2d) 165.


To fully appreciate the nature and extent of the actual and constructive frauds practiced against you, it is necessary to go back to the English Bill of Rights of 1689, under which the English Crown made a contract with the People that it would never again “in perpetuity” engage in the practice of non obstante – what today would be called selective-non-prosecution or administrative-apartheid. An adequate summary was provided by Bouvier’s in 1883 as follows:

NON OBSTANTE. In English law.

These words, which literally signify notwithstanding, are used to signify the act of the English king whereby he dispenses with the law, that is, authorizes its violation. He cannot by his licence or dispensation make an offence dispunishable which is malum in se [evil/wrongful of itself and therefore unlawful]; but in certain matters which are malum prohibita [merely illegal by statute and not inherently wrongful] he may, to certain persons and on special occasions, grant a non obstante. (Vaughn 330-359 ; Lev. 217. ; Sid. 6, 7 ; 12 Co. 18, 7 Bacon Abr. Prerogative (D 7) 2 Reeve, English L.C. 8, p. 83. But the doctrine of non obstante, which set the [Crown] prerogative above the laws, was demolished by the bill of rights at the revolution. 1 W. & M. Stat. 2 c. 2 ; 1 Bla. Com. 342 ; 1 Steph. Com. 460 ; (Bouvier’s Law Dictionary 1883).

Note especially that the above is in respect of civil law violations or in respect of so-called revenue (taxation) statutes. Historically, no one had been brazen enough to even officially attempt it with respect to the criminal-law, except via laws of apartheid.

Under direct-apartheid, a government would or could, for example, make it illegal for Black people to walk on the public sidewalks. Under administrative-apartheid, the same government would make it illegal for anyone to walk on the public sidewalks, and then choose to prosecute Black people but not White people.

Apartheid, broadly-defined, means using the law to create different classes of people or legal-persons, substantively for the purpose of making them or maintaining them as legally superior or subservient, respectively, to other classes of people or legal-persons for its own sake.

Under the Bill of Rights, the Crown agreed to concede in perpetuity that the law is the law of the land – and not the law of the person.

If the Crown were to subsequently materially and maliciously breach its contract, then it would cease to exist, or forfeit its Crown. That was the de facto contract and for which the Crown received and enjoyed consideration from the People.

Section 347 and interest-in-advance.

Returning to the present, if today we were to rank-order all offences under the Criminal Code of Canada according to how much money or wealth is obtained-in-fact in violation of them, then the section (s. 347(1)(b)) making criminal the conversion or otherwise receipt of interest in advance, or otherwise at a criminal rate, would be ranked Number-one and which is easily more than 100-times-greater than the next closest competitor, and regardless greater than all of the other offences combined. If you can capitalize interest in advance, or even merely contrary to GAAP, then you can near-literally buy the Earth with ill-gotten-gains / proceeds-of-crime in a single generation.

In practice, illegal nominal loan-fees (double-counting-fees) are the sine qua non or one-essential-element of even just all significant conventionally-recognized pyramid / Ponzi schemes (e.g., Eron Mortgage in B.C. prior to its collapse / shutdown in 1997).[17] Given access to a sufficient and ready supply of investors and nominal borrowers, and with a 30% added-loan-fee rate, for example, a nominal mortgage-broker can turn a $1 million investment into $350 million in 28 days or iterations of the process (and in fraud of the said borrowers and investors).

The single most egregious form of interest-in-advance, however, (and as here in your case) is full / instant or specialdouble-counting by the unadulterated / naked-usury-device of holding-out ones bare agreement-to-loan as a commensurate separate or distinct consideration (requiring a 100% loan fee) from the loan itself.[18]

Even in respect of just those expenses that are reasonably and justifiably necessary, it is still wrongful to capitalize them to the borrower’s debt because they are first and foremost incurred for the benefit of the lender, and not the borrower. As per the modern CICA (Canadian Institute of Chartered Accountants) Handbook explanation:

In the opinion of the Accounting Standards Steering Committee, loan fees are an integral part of the return earned from permitting borrowers to use an enterprise’s resources. A lender carries out certain activities in order to originate, refinance, restructure or renegotiate a loan. The risks addressed by the lender in carrying out these activities and the risk of the asset not being recoverable are intertwined and will extend over the term of the loan. The receipt of loan fees does not alter the nature of these activities, nor does it mean that a distinct or separate service has been performed. A borrower would not normally pay an enterprise for carrying out these activities unless the borrower expects that a loan will be provided.[19]

Bear in mind also and throughout that the above is in specific reference to loans or genuine money-lending transactions where a lender makes an equity investment of pre-existing money.

The same principle applies also and more-so to nominal credit-underwriting-based transactions (as here) which are credit-reinsurance-in-fact, but where the consequences of non-compliance are leveraged and vastly more serious.

The Bank Act, for example, provides under a general Interpretation Section (which then / concurrently applies to the entire Act):



Interpretation and Application

488(2) For the purposes of this Part [Interpretation, and Self-Dealing], the fulfilment of an obligation under the terms of any transaction, including the payment of interest [including loan fees] on a loan or deposit, is part of the transaction, and not a separate transaction.

Whenever the question is asked, the answer has to be the same because the system cannot officially work at all under the alternative.

Assume, either way and for example, that there were to be a legitimate law that for whatever reason restricted the price of a given vehicle to $10,000, and that someone were charged with illegally selling the said vehicle to another for $20,000.

The position of the accused, however, is that the purchaser was required to agree that the price of the vehicle was $10,000, and that the other $10,000 was for the seller’s agreement to sell it to them.

Do you think that the judge would reply: “Oh that’s ok then – What clever fellows you are”? Or would they convict them once for the offence, and again for the inherent contempt in insulting the judge’s intelligence? Blind acceptance of anything claimed to be industry practice is just another form of de facto apartheid / little-people-law versus money-power-law.

Next, is there any historical precedent for it? Has it ever come up before? It has in fact done so with a rather disturbing persistence and regularity:

“A man shall not have interest for his money and a collateral advantage besides for the loan of it…” – Jennings v. Ward [1705] 2 Vern. 520, 18 R.C. 365

Every benefit taken indirectly by a creditor, for the granting of which no impulsive cause appears but the money lent, will be voided as extorted. (Principles of equity: Kames, Henry Home, Lord, 1696-1782).

[A] stipulation capitalising interest [in advance], turning it into principal and charging interest upon it, however formally expressed, was not allowed to prevail. [and] A stipulation that [a lender]… should be paid a commission…was always defeated; – Mainland v. Upjohn, [1889] Chancery Division [Vol. XLI] 126.

MP Mr. WHITE: …Not only have borrowers to pay large [concealed and cross-leveraged] commissions to the agents of these loan societies, many of whom are lawyers, but [the “double machinery” of] high rates of interest as well. (Hansard, Canada, House of Commons, March 31, 1880 p. 968 re: (what is now) s. 6 of the federal Interest Act / securities law).

MP Mr. LAYLOR: It seems to me that we overlook the greatest evil there is in money lending as it is usually carried on, when we confine ourselves to the question of interest. It is not a question of interest, but of the [concealed and cross-leveraged] bonus [double-counting fee] that is charged, that we must provide against. (Hansard, Canadian House of Commons ((1898) re: (what is now) s. 4 of the federal Interest Act / securities law).

Whereas it has become the common practice for money-lenders to make charges against borrowers claimed as discount [i.e., concealed interest-in-advance falsely claimed as investment of principal], deduction from an advance, [i.e., concealed interest-in-advance falsely claimed as investment of principal] commission [i.e., concealed interest-in-advance falsely claimed as investment of principal], brokerage, chattel mortgage and recording fees [i.e., concealed interest-in-advance falsely claimed as investment of principal], fines and penalties, or for inquiries, defaults or renewals, which, in truth and substance are, in whole or in part, compensation for the use of money loaned or from the acceptance of risk of loss [i.e., concealed interest-in-advance] or are so mixed with such compensation as to be indistinguishable therefrom and are, in some cases, charges primarily payable by the lender [i.e., in respect of expenditures incurred by and for the benefit of the nominal creditor] but required to be paid by the borrowers;  and whereas the result of these practices is to add to the cost of the loan without increasing the nominal rate of interest charged [i.e., to falsify and misstate the amount invested and real rate and amount of interest] so that the provisions of the law relating to interest and usury have been rendered ineffective: [Preamble to Small Loans Act of 1939]

Therefore His Majesty, by and with the advice and consent of the Senate and the House of Commons of Canada, enact as follows:-

6.(2) The cost of any such loan[20] or any part thereof … shall not be compounded or deducted or received in advance.[21]

The most insidious aspect in practice, however, is that the direct (misrepresentation) fraud against the nominal borrower functions as a socio-financial misdirection or red herring. There are in fact (at least) six primary frauds achieved and facilitated by front-loading / interest-illegally-capitalized-in-advance:

  1. Interest rate disclosure / declaration fraud,
  2. Accounting / GAAP / IFRS fraud,[22] or ex temporal fraud (fraud against time),
  3. Third-party Unsecured / Subordinated creditor fraud,
  4. Taxation (Income versus capital gain) fraud,
  5. Regulatory-capital fraud, and
  6. Financial-market fraud.

Of these, by far the single most significant is financial-market fraud where all of the others are in effect cross-leveraged, one-against-the-other(s), and where the total financial fraud is vastly greater than the mere sum-of-its-parts.

The easiest perhaps to understand and appreciate for laypeople, however, is the third-listed category – that of third-party unsecured / subordinated creditor fraud. That is the substance of Lord Homes’ exposition of the equity principle:

Every benefit taken indirectly by a creditor, for the granting of which no impulsive cause appears but the money lent, will be voided as extorted.

Just taking the nominal (bonus / expense-based) loan-fees (ordinary double-counting-fees) in isolation, for at least the past 120 years the balance of humanity has proved unable to protect itself from the multi-faceted fraud in the following form of terms from a banker or other nominal (pretended) creditor (and even genuine money-lender):

I will loan you $100,000 at 10% per annum, provided that you give me a security claiming and swearing that I have loaned you $120,000 at 8%, plus a $20,000 check as a kick-back directly or indirectly drawn against the falsified / inflated principal amount, but by separate side-agreement and not mentioned in the falsified security.

More generally,

“I will loan you a certain amount at a certain rate of interest, provided that you agree to falsify the security to claim and swear that I have loaned you a greater amount, and at a lower rate, than in fact; plus a kick-back equal to the difference to juice my current income as well.[23]

I am making it a condition of the loan that you aid and abet me to commit, and in anticipation of, a fraud against any of your other creditors – past (pre-existing), present or future – by agreeing to falsify the securities to claim that I have loaned or invested-in-you a greater amount and at a lower rate than in fact. That way, if you go bankrupt, then I get even more unjustly enriched at the expense of your other less-powerful creditors.”

The facts as established in Meagher v. London Loan (1930), for example, are especially relevant and instructive in this area. The actual or net loan in 1922 had been (round numbers) $25,500 at 17% per annum, but provided also that the borrower agree to falsify the mortgage to claim $30,000 at 7.5%, with a $4,500 kick-back to London Loan by an unregistered side-agreement.

The borrower / theatre-company subsequently went bankrupt (about 1925) and the receiver (Meagher) had paid out London Loan’s $30,000 secured claim in full, and at the expense of unsecured creditors, believing that that had been the actual amount of the loan. It was not until later that he discovered the documents revealing the real / full transaction and kick-back, and he sued to recover on behalf of the unsecured creditors.

Important to note here is that as and when London Loan received the $30,000 from the liquidation of the borrower’s assets in 1925, its yield on the net loan of $25,500 was crystallized or capitalized at about 40% per annum – and regardless significantly more than either 7% per annum or 17% per annum.

London Loan advanced a net $25,500 in 1922, then collected interest on $30,000 for about three years, and then received nominal repayment of $30,000 from the receiver for a net return of about 40% per annum over the period.

That process and fraud against unsecured creditors in Canada is ongoing – constantly operating in the background to drain and channel unearned-wealth to the money-power at the expense of the earned-wealth and equity of the majority.

And as extensively detailed and emphasised by the Supreme Court of Canada in R. v. Olan, et al. (1978),[24] the offence of fraud by the accused (nominal creditor in the present case) is complete at the instant the securities are obtained or exchanged, and does not depend on any subsequent default by the issuer / nominal borrower.

Applied to the circumstances here, and even if it had been an equitable investment instead of a credit-reinsurance-based transaction, it is the increased risk and prejudice to unsecured creditors (also including the equitable interests of your family members) that result from the violation of GAAP and the falsified principal amount from the illegal and unlawful acceleration of accrual of interest (nominal loan-fee-rake-offs and including independently the interest-in-advance)) that satisfies the test of dishonest deprivation as and when the transaction is made.

Just to be clear, falsifying the securities, to claim a greater amount at a lower rate than in fact, is a massively important fraud (against at least the Registrar) that provides for and accommodates the unjust enrichment of the nominal lender (in, among others ways, domestic and international financial markets for example), even if there were no required rebate or kick-back from the falsified principal amount.

The additional side-agreement provision for such rebate or kick-back is another independent crime / racketeering offence, and what is sometimes called a compounding of the felony.[25] Also technically money-laundering.

And the further constructive or actual provision to omit the fact and amount of such required kick-backs from the registered security is a third and independent criminal / racketeering offence (under s. 397(1)(b) – more on this aspect below).

100%-plus loan-fees

Here again, the greatest loan-fee of all is the macro or specialdouble-counting device of the purported lender holding out its bare agreement to loan as a commensurate separate or distinct 100% consideration from the loan itself (and often – as here in your case – double-compounded on top of bonus / expense-based or ordinary illegal-loan-fees).

With respect to the nominal documentation and financial-security / funding-instrument for your pretended loan from VERSATILE / UPTON (emphasis added):

2 (1) In return for the lender agreeing to lend the principal amount to the borrower, the borrower grants and mortgages the land to the lender as security for repayment of the mortgage money and for performance of all the borrower’s promises and agreements.

The mortgage money so-defined (via the initial / first one-year nominal term) is a minimum of (another[26]) $860,820 ($60,820 + 800,000) and the named principal amount is $800,000 not yet accounting for any fraudulently-omitted additional loan-fees. Constructively the named consideration becomes:

2 (1) In return for the lender agreeing to lend $800,000 to the borrower, the borrower (1) agrees that it owes $800,000 to the lender, now, and (2) grants and mortgages the land [conveys all right, title and interest in the property] to the lender as security for repayment of (another) $860,820 to the lender and for performance of all the borrower’s promises and agreements.

More generally:

2 (1) In return for a fictitious or illusory consideration, the borrower unconditionally assumes an $800,000 debt / liability to the lender, now, and also grants and mortgages the land to the lender as security for repayment of (another) $860,820 to the lender at the end of the term (inclusive of the $62,820 paid from the conversion proceeds), and for performance of all the borrower’s promises and agreements.

If and when VERSATILE / UPTON is compelled to produce its general-ledger and balance-sheet under the Canada Evidence Act, it will be shown that management of VERSATILE / UPTON acted in fact on such construction to record the capitalized value of the nominal security (including also your secured-credit to them) as an increase in its / their own cash-equivalent money-assets – just like any other borrower or debtor would recognise the receipt of loan / credit proceeds. (Although technically the concordance of their books is not required because the fact of it is already conclusively established on the face of the securities (funding-instruments-in-fact)).

The substance of the transaction-in-fact was that you were required to first underwrite and advance a minimum of $800,000 of real-estate-secured-credit to VERSATILE / UPTON in exchange for the bare or constructive chance that VERSATILE / UPTON might return or reinsure such credit as unsecured-credit to you. All of your obligations and underwritings (assumptions of liability) are defined as unconditional liabilities to pay set amounts of money:

“mortgage money” means the principal amount, interest, and any other money owed by the borrower under this mortgage, the payment of which is secured by this mortgage.

“principal amount” means the amount of money shown as the principal amount on the mortgage form [i.e., $800,000.00].

There is no requirement for VERSATILE / UPTON to loan money, or to advance credit, or to do anything at all in addition to its purported bare agreement, to make binding your obligation / underwriting to VERSATILE / UPTON. And that is an advance of money or credit by you to VERSATILE / UPTON even if their own books were to fail to disclose it, or be otherwise falsified:

“What is said to be an unconditional promise to pay a sum certain in money is itself money. The words on the face of the paper money, “will pay to the bearer on demand”, cannot alter its character as money and turn it into a different document which calls for the payment of money.” Bank of Canada v. Bank of Montreal, [1978] 1 S.C.R. 1148, at 1155

The substance of this S.C.C. decision was and remains that (Bank of Canada) currency is money because it is evidence of unconditional Bank of Canada debt – evidence that the Bank of Canada agrees that it owes money to the bearer of it – and not due to any additional undertaking to convert it into some other form of evidence of debt. It is the bare and unconditional undertaking or underwriting of the liability which constitutes the provision of money or credit.

So even if solicitors for VERSATILE / UPTON were acting in good faith, they were prima facie and materially negligent in their drafting of the securities. The nominal securities are in fact funding-instruments that prima facie constitute and evidence an underwriting / advance of credit by you to VERSATILE / UPTON (and any competent inquiry will reveal that they employed them as such – either directly themselves, or through an actual or constructive accomplice / member-of-Payments-Canada (formerly known as the Canadian Payments Association)).

If the solicitors for VERSATILE / UPTON had been acting in genuine good faith and competence, and notwithstanding the wagering format, the nominal security would have stated:

In return for the lead-underwriter (You / Ms. Pryce) advancing $800,000 of real-estate-secured credit to VERSATILE / UPTON, VERSATILE / UPTON will return or reinsure $718,000 to the lead-underwriter as unsecured credit.

The fact that they did not do so causes the arrangement to fall most precisely under the reasoning and conclusion of the Quebec Court of Appeal in R. v. Émond, [1997] 117 C.C.C. (3d) 275:

The first dishonest means appears to me therefore to be the intended and planned non-disclosure of the objective reality of the transaction.

In Émond the Courts / judges confirmed that the intentional concealment of ones own unearned enrichment is a wrongful / dishonest act of itself and, where applicable, sufficient to satisfy the test of dishonesty under a criminal prosecution for criminal and / or civil fraud.

Bait and Switch

Next and concurrently, even if VERSATILE’s / UPTON’s bare agreement to loan were not a fictitious or illusory consideration, it is provided on a string that can be arbitrarily yanked-away without affecting your unconditional obligation:

6 (13) The lender does not have to advance or readvance the principal amount or the rest or any further part of the principal amount to the borrower unless the lender wants to even though

(a) the borrower has signed this mortgage,
(b) this mortgage is registered in the land title office, or
(c) the lender has advanced to the borrower part of the principal money.

By the above two provisions ((2 and 6 as highlighted) the pretended-lender(s) obtained real-estate-secured credit from you by fraud or false-pretence (Criminal Code s. 362), and (2) they did so also and independently as a criminal-fraud bait and switch:

In return for the lender agreeing to lend the principal amount The lender does not have to advance…the principal amount…

You cannot get much more obvious and flagrant than that – it is evidence of the solicitors’ recklessness and / or grievous contempt for your legal and equitable rights as lead-underwriter and creditor-in-fact / equity (and it remains criminal even if it were an actual money-lending transaction instead of credit-reinsurance).

The owners and management of VERSATILE / UPTON had already achieved a minimum near $3 million score by obtaining (1) legal-title to the property, (2) your unconditional underwriting / undertaking of an $800,000 debt to them, and (3) your unconditional obligation to pay them another $800,000 plus interest-called-interest, in exchange for their bare agreement to essentially return your own equity-backed-credit back to you (less the premium / security), under the pretence of an interest-bearing loan or equity-investment by VERSATILE / UPTON. A rational criminal would have been satisfied and stopped at that point. But they got greedy by adding the negation-clause that turned it all into a wager or game-of-chance.[27]

The security is a registered contract. What does the contract provide for? It provides that you agree that VERSATILE / UPTON obtain all right, title and interest in the real estate property, and that you agree that you owe them $800,000, now, and must pay them another $800,000 plus $62,800 of payments-in-advance to buy it back from them in one year.

And what does the contract evidence or require of VERSATILE / UPTON in return?

Answer: Nothing. Nothing at all.

In colloquial terms – the solicitors for VERSATILE / UPTON were too clever by half. They drew-you-in with the fictitious / illusory consideration technique into gratuitously giving over some $3 million in quantifiable real assets and financial assets to them, and then shot-themselves-in-the-foot with the bait-and-switch (notwithstanding that it was independently already criminal / illegal under s. 380(1), and s. 347(1)(b), etc.).

In the aforementioned Elcano Acceptance v. Richmond Richmond Stambler & Mills, the law-firm / solicitors had merely negligently omitted a statement of the equivalent annual rate to the monthly rate it had stipulated for under promissory notes that it had drafted for its client financial institution, yet was still held liable for the resulting relative loss of $177,000 just due to the civil unenforceability.

The larger purpose of the bait-and-switch is to facilitate VERSATILE’s / UPTON’s (or any constructive or actual accomplice’s) further use and employment / conversion of the false-document / falsified security in the domestic and / or international financial markets (and for which it (and / or an accomplice) will have likely obtained a CUSIP or other securities registration number (i.e., on either or both of the nominal Mortgage and the Assignment of Rents)).

Further evidence of fraudulent intent is inherent to the illegal or irrational subsequent return or reinsurance of the secured-credit as unsecured-credit after the nominal mortgage / charge had been executed and / or registered.[28] As and when VERSATILE made the nominal net $718,000 advance, you had zero remaining assets related to this arrangement, and $800,000 (actually a minimum $1.6 million) of outstanding liabilities.

Why would VERSATILE / UPTON advance / return from $718,000 to $800,000 of credit to someone with no remaining transaction-specific assets when the security clearly states that it has no liability to do so? VERSATILE / UPTON had already obtained your unconditional assumption of the $800,000 liability, and all right, title and interest in the property in exchange for their bare and expressly non-binding agreement to lend. Why not simply choose to do nothing – as is its stated contractual right, and then foreclose?

Because it would expose and make obvious the substance of the fraud already complete and manifest in the transaction as stated and in fact. Although, strictly speaking, under the criminal law their constructive intent or motivation would be (automatically deemed to be) to keep their Ponzi scheme going (and / or that of an accomplice – often a private chartered bank).

Also here, VERSATILE / UPTON acts contrary to (selectively-ignores-or-amends) the definition of principal amount in the mortgage. As and when the mortgage was executed and / or registered you owed (or agreed that you owed) VERSATILE / UPTON $800,000. When VERSATILE / UPTON subsequently returned (rounded) $718,000, the balance ought to have increased to $1,518,000 (actually to $1.6 million to accommodate the circa $82,000 of required kick-backs (see below)):

“principal amount” means the amount of money shown as the principal amount on the mortgage form [$800,000] [and] as increased by the advanceof money to the borrower by the lender from time to time [$718,000], and includes all money that is later added to the principal amount under these mortgage terms:

So why did management of VERSATILE / UPTON not follow the express terms of the mortgage to increase the principal amount to $1,518,000, being $800,000 for their agreement to loan plus $718,000 for the later actual advance (reinsurance)?

Because it would have exposed their unearned and unjust enrichment and the underlying fraud (cogno-linguistic sleight-of-hand) in the arrangement.

Also, and critically, it was practically unnecessary to do so, because the deal itself practically guaranteed the failure of the business upon which the payments depended. All that was necessary was to wait a year or two, and then cash-in again on the inevitable final liquidation / foreclosure.

The business brought in about a gross $8,000 per month, and the advertised best rates offered by the larger institutions, at about 2.5% per annum, would have consumed about $2,000 per month for interest, leaving about $6,000 per month to properly operate the business and pay the maintenance, increased expenses, taxes, etc.

But here the nominal monthly payment is about $5,200, leaving only $2,800 per month to pay for everything else, including any kind of payment to yourself (Ms. Pryce) in exchange for your full-time labour in running the business. Whether you realised it or not at the time, you were metaphorically dead-in-the-water after your first encounter with them (although your equity was first substantively broken by Fisgard in 2011).

It will probably be necessary to bring in at least one qualified psychiatrist to properly explain, but the entire nominal agreement and security package is an orchestrated-interplay of fact and fiction plainly intended to provide for the unearned and unjust enrichment of whomever drafted it or had it drafted for them.

Massive equity-fraud founded on dispensation

Returning to the issue of the criminal-law violation under s. 347, how is VERSATILE / UPTON achieving such in the face of the Criminal Code? Charging-off the real-estate-secured-credit that it obtained from you as a 100% loan-fee defines an infinite or at least astronomical rate of interest / conversion, contrary to s. 347(1)(b):

Mr. Paul-Emile Wong, Consumer Research Branch, Department of Consumer and Corporate Affairs: Without belabouring the point, there was one brief comment I wished to make in support of Mr. Gibson’s contention, and that is that there is nothing magical or mystical about the word “rate”. “Rate” simply defines a relationship among three things: first, a certain amount of principal or credit advanced; second, a certain amount of repayment; and third, timeand time, of course, is very important in the definition of “rate”. (SSCBTC transcripts; 4-11-1980, 24:22)[29]

The witness is referring also and concurrently to the per diem principle, notwithstanding the obvious absurdity of any professional nominal creditor even pretending that they do not understand the concept of interest not existing until it has been earned by the actual passage of the time to which it is existentially-tied.

The answer regardless is actual and / or constructive dispensation or non-obstante from the provincial Attorney General.

Here we have to return to the fall of 1980. At the time, the private broadly-defined Canadian financial system was all but officially insolvent and bankrupt, and the bankers, especially, were desperate to get rid of the Small Loans Act of 1939 so that they could radically increase the interest rate on most credit-card accounts from a stated 6% to a stated 24% (The single bill in 1980 was to repeal the 1939 Act and to amend the Criminal Code to provide for a criminal rate of interest (anything over 60% per annum)).

But they also wanted regardless to suppress or get quasi-rid-of the Act’s damning Preamble (quoted earlier above) that spells-out the evils of interest-in-advance and loan-fees more generally. Only quasi-rid-of because a preamble is an equity device or element that survives the repeal of a statute (as part of the larger record). The purpose of a preamble is to spell-out an evil-in-fact or wrongful-act / state-of-affairs to prevent judges from interpreting their way around the true purpose of a statute.

The preamble had been insisted upon (in 1939) by certain several members of Parliament because of the clear and consistent pattern of (often-former-bank-lawyer) judges ruling that the purpose of anti-loan-fee legislation was to ensure that the said fees were reasonable rather than to prohibit them entirely as malum in se or evil / wrongful-of-themselves (inherently coercion-based and fraudulent as double-counting).

Either way, it was recognised before the Senate banking committee on several occasions over five dedicated sessions in the fall of 1980 that banks and other nominal creditors would routinely violate the proposed amendment to the Criminal Code creating a criminal rate of interest, via nominal loan-fees received in advance and / or as a kick-back from the nominal or pretended-principal-amount of a financial security.

It was all very odd or surreal to begin with, because such was (and remains) already illegal under GAAP and the Bank Act, and under several other existing provisions of the Criminal Code – and especially those sections relating to the falsification of securities to conceal, convert, or deny such kick-backs.

At one point, however, the issue was most directly addressed as follows (in material part, emphasis added):

Mr. Wong (Department of Consumer and Corporate Affairs): Senator Buckwold, in one of the submissions made to the department at an earlier stage, the question was raised whether or not a standby [loan] fee, being a fee [received-in-advance] would be included in the definition of “interest”, and if it were, how would the interest [rate (i.e., rate of conversion with respect to time)] be calculated, because, being infinite, it would certainly be above 60 per cent [per annum],….

Senator Buckwold: Is that illegal?

Mr. Wong: As the section stands, that would be illegal, yes.

Senator Buckwold: Then….the bank, theoretically, could be prosecuted for charging a criminal rate of interest for a standby [loan] fee…[30]

Mr. Wong…theoretically, yes. That is one of the reasons this section is unusual, in that it requires the consent of the Attorney General before [criminal] prosecutions are initiated, thus preventing the application of the section to [criminal] commercial practices to which it was not intended [by the bankers and other controllers of the money / credit system] that it apply. It then becomes a question of the Attorney General’s discretion [administrative apartheid]. (Select Standing Committee on Banking, Trade and Commerce) (SSCBTC) transcripts; 4-11-1980 [November 4, 1980], 24:28)

Note also the near wholly-staged-nature of the specific “standby-fee” example and question. Anyone with even a tertiary understanding of the historical record would have raised the issue of a nominal bonus or Loan-Fee / Lender-Fee, as for example:

Mr. Smith: Senator Buckwold, what about a nominal bonus or application fee or other de facto double-counting device, where the real purpose of it is in fraud of the Bank Act and GAAP and the per diem principle, and which also quietly and exponentially-leverages the cost-of-credit while concurrently juicing the bank’s balance-sheet to simultaneously obfuscate the corresponding illegal kick-back to the bank and its solicitors? The rate of conversion of interest would be infinite or at least astronomical – would that not also technically offend the proposed new criminal-law?

Regardless of the obvious contrivance in the specific example of a stand-by fee (which is and is recognised-in-fact in the financial world as a premium on a credit-insurance transaction), the nominal solution of dispensation by selective-non-prosecution was, and remains, both logically and legally absurd, and of itself a manifestly incompetent and grievously wrongful and unlawful and illegal act by the Crown / government of Canada. Legally it does not matter whether a given provincial AG chooses not to prosecute – it is still fraud / constructive-forgery and a codified criminal act with myriad collateral consequences in both criminal and commercial law.

The financial law community picked up on such detail or technicality right away, but was seemingly arrogant (and / or delusional) enough to think that it could contain the damage (while still massively profiting from the fraudulent and illegal practice) implicitly by manipulating the Courts / judges. As nominally cautioned, for example, in Participatory Loans: The Criminal Problem in National Banking Law Review[31] (in material part, emphasis added):

[F]ees and commissions for arranging the loan were paid by the borrower at the time of the advance. Are you committing a criminal offence?

Of greater concern to the lender is the apparent illegality of the transaction where the transaction offends the Criminal Code, which can result in restrictions on recovering principal and interest in civil actions… [32]

In response to the question of whether you are participating in the commission of a criminal offence in the loans described, the answer, in many instances, is yesbankers, and possibly even their solicitors, may well be participating in a criminal offence.

Except that there isn’t any maybe about it.

And here too, note the first-step in the ongoing cognitive-distancing technique(s) employed by the solicitor-authors. The crime defined under the section is the receipt of a payment of interest at a criminal rate by the nominal creditor – yet the finance lawyers, who are otherwise trained to be very precise, pose it as “…were paid by the borrower at the time of the advance.”

Lawyers, and especially finance-solicitors, are trained in such cognitive-distancing techniques as are analogous to or consistent with the following joke:

I asked my father for $50. He replied: “Forty dollars!!! I don’t have thirty dollars!! What do you want twenty dollars for!?”

Cognitive-distancing by means of stringing together statements that are not categorically false is, in a nutshell, how Canada and its Peoples have been systematically looted generally over the past century, and absolutely since the 1981 revival of selective-non-prosecution and extension of it to cover the criminal law and especially anti-racketeering-law.

Contrast with a full and honest inquiry into the totality of it such as:

[F]ees and commissions for arranging the loan were received by you at the time of the advance, and as a rake-off or kick-back from the falsified and falsely-inflated principal amount of the security, also already contrary to the Bank Act, to GAAP, and to several already existing sections of the Criminal Code regarding fraud, forgery, and the falsification of securities by omission. And what about the anti-organized-crime sections of the Code that make it a specific separate offence for lawyers and solicitors to counsel and / or aid and abet anyone to commit, as here, an enterprise-crime offence? Are you committing a criminal offence?

The domestic enterprise-crime / racketeering section was regardless subsequently expressly named and enjoined with several international anti-racketeering / anti-organized-crime treaties as an enterprise-crime / designated-offence, to which treaties Canada is a Contracting State Party (e.g., UN Convention on / against Transnational Organized Crime).[33]

The nominal mortgage was regardless obtained in violation of s. 347(1)(b) and in reliance by VERSATILE / UPTON on selective non-prosecution by the Crown / AG, and therefore (1) it never had any legal existence, and (2) the Registrar independently never had any authority to register it.[34] The fact of it was also misrepresented (by omission) to the motions judge in order to obtain the foreclosure order and / or support the process of it.

But here again, the Crown was and remains under contract by the Bill of Rights (1689) not to engage in any act of non obstante “in perpetuity”.

Anyone who, with knowledge and / or by strict liability, participates in attempting to seize or foreclose will be personally liable as well as an outlaw and / or guilty of piracy and of the laundering of proceeds of crime under both domestic and international treaty law.

Further, and even ignoring the criminal-law offences, the normal rule is that:

When a legal agreement / contract fails, equity is automatically revived.

But VERSATILE / UPTON have no recognisable equity in the transaction. They arrived with metaphoric empty-pockets and did not contribute anything that they did not obtain directly or indirectly from you. They may have kited an unsecured liability to third parties after the fact but that was and remains in furtherance of an ongoing pyramid or Ponzi scheme that does not and cannot qualify as an equitable contribution to this nominal or pretended transaction.[35]

They first obtained execution and / or registration of the mortgage so as to obtain $800,000 of real-estate-secured underwriting-credit from you, plus the legal title to the land and building, in return for an illusory or fictitious consideration that allowed them to capitalize / convert the secured-credit received by them as debtors-in-fact / equity:

6 (13) The lender does not have to advance… the principal amountunless the lender wants to even though

(a) the borrower has signed this mortgage,
(b) this mortgage is registered in the land title office, or
(c) the lender has advanced to the borrower part of the principal money.

And in material violation of s. 347(1)(b) “At the Pleasure of Her Majesty”.

Perhaps the most efficient way to perceive it is to ask: How does the physical security registered at the land-title office change depending on whether the named mortgagee does or does not later choose to return any unsecured credit (to award the constructive or actual prize)?

Answer: It doesn’t. That’s the point. At the instant of execution and / or registration (at the very latest) the fraud is complete.

They also will have likely worked with one of the private banks or similar institution as ringleader and principal facility for the laundering of their proceeds of crime (i.e., to complete the circuit they have to go through a member institution of Payments Canada – and where the entire chain of collateral dealing falls directly under s. 462.31(1) (laundering of proceeds of crime)).

Since at least 1981, the nominal Crown has aided and abetted the private banks and other pretended creditors / friends-of-the-Crown to systematically loot the wealth of the People of Canada by violating its contract under the Bill of Rights not to engage in non obstante or selective-non-prosecution “in perpetuity”.

If the Crown violates its contract – it loses / forfeits its Crown – that was the contract.

Double-cross-leveraged loan-fees

One key to understanding the proliferation of criminal-law violations associated with nominal loan-fees is in the meaning of the seemingly simple word “for” under the Criminal Code definition of “interest” (in material part, emphasis added):

“interest” means the aggregate of all charges and expenses, whether in the form of a fee, fine, penalty, commission or other similar charge or expense or in any other form, paid or payable for the advancing of credit under an agreement or arrangement,…

A typical bank solicitor will look at that and immediately conclude: Then just call it something else – say that it is “for” something else. But if you look up the word “for” in an English dictionary you will often find page-after-page of alternative senses to it. The critical thing here is that a fine or penalty does not and cannot apply at the time an agreement is entered into, and that of itself objectively disqualifies such an interpretation. The only sense in which the word “for” can be interpreted in this context is “as a condition of” as in

“…whether in the form of a fee….or in any other form paid [or made payable]…[as a condition of] the advancing of credit under an agreement or arrangement.

And of course VERSATILE and UPTON have to, and do in fact, directly or indirectly recognise the nominal loan-fees as interest when they receive them. So do the accountants. And the taxman. In fact, the only entity in society to whom the fees are pretended to be something other than interest is the nominal or pretended borrower who is required to carry them and to pay them.

From the Conclusions and Recommendations of the 1964 to 1967 Investigation into Consumer Credit Practices by the Standing Senate Committee on Banking, Trade and Commerce (p. 9):

In any case the word “interest” is studiously avoided by lenders,…

More precisely, “lenders” habitually and pathologically mis-present and fraudulently pass-off what they know to be interest as being something that is not-interest.

Returning briefly to 1889 England, and because of the way mortgage-law had developed, the only things that could be secured by a mortgage of real-estate were principal and interest and nothing else. So the lawyers there thought themselves compelled to argue to the Courts that virtually anything that isn’t principal is interest. Thus while Canadian lenders were arguing in Canada that these bonuses and commissions and fees are not interest to defeat the Canada Interest Act, the English lenders / lawyers, as here in Mainland v. Upjohn (1889), were so compelled to argue that a bonus, etc. is simply interest in another form (and consistent with current s. 347 definition):

Assuming that the contract between [a borrower] and [a mortgage lender] is not otherwise impeachable, there is no reason why a stipulation in it for payment of a commission or bonus should not be valid. Commission or bonus is only interest in another form. There is no magic in the word “interest”. Interest may be paid in advance; it may be £5 one year and £10 the next; it may be paid in a lump sum in respect of several years. The question is one of accommodation – what will the borrower give the lender for [as a condition of] the accommodation required?

Here again, although technically correct (or at least closer to it) this time, the finance lawyers genuinely and sincerely believe whatever is necessary for the answer they need. Eventually they lose the ability to discern even the concept of an objective reality.

That is why they almost never make reference to or even acknowledge the existence of s. 347(1)(b) – “Every one who receives a payment or partial payment of interest at a criminal rate is guilty of…” and instead automatically default to the safety of a niche-construction of an “agreement-based” offence under s. 347(1)(a).

As explained before the Senate banking committee in 1980, the pith and substance of the law is under s. 347(1)(b) where every payment of interest physically or actually received or converted by a creditor is subject to a rate-of-conversion test (legally binding on the Courts by s. 18 of the Canada Evidence Act requiring judicial recognition of all Acts of Parliament) – and interest in advance or received as a kick-back from the proceeds on or about the day of the deal virtually always fails that test.

The offence under s. 347(1)(a) of “Every one who enters into an agreement or arrangement to receive…” was only added as an afterthought in case the lender were caught before the criminal rate interest payment were actually paid or received. They could then still be charged and convicted on the basis of evidence of their intent to receive it under an oral or written agreement or arrangement.

That is what caused (or at least facilitated) the series of erratic and contradictory decisions from the Courts throughout most of the 1980’s – the judges were almost all former bank-lawyers who automatically default to the “agreement” because it is comprised of words written by solicitors that can be manipulated to arrive at the answer they need, instead of looking at the facts of what the purported lenders actually received, and when did they receive it. It is the same reason that no Court / judge (as far as I am aware) has comprehensively addressed the alternative “arrangement”. The words “agreement or arrangement” (under (1)(a)) were chosen because the drafters recognised that if a lender or creditor were violating the criminal law, then they would very likely attempt to construct any written agreement so as to hide, obfuscate, or deny the fact of it.

It wasn’t until 1984 at the B.C. Court of Appeal in NELSON v. C.T.C. MORTGAGE CORP., with Hutcheon, J.A. dissenting,[36] that anyone even raised the issue that (what are now) subsections 347(1)(a) and 347(1)(b) are two different and independent criminal laws that must be considered independently (at the time of the offence they were s. 305.1 (1)(a) and 305.1 (1)(b) respectively):

[45] ….I think that s. 305.1(1)(b) is applicable. The question is: did the mortgagee [nominal lender] receive a payment of interest at a criminal rate? That question is to be answered by an analysis of what has been received in fact and a calculation based upon the period that has elapsed since the money was advanced.

By direct / close analogy, since the amendment to the Criminal Code in 1981, the private financial system in Canada has illegally smuggled-in a linear average of about $1 billion per day[37] of illegal financial-narcotics into the country. And after almost 40-years the government and the courts’ only explanation is that in every case for 40-years they have never actually looked in the trunk of a banker’s car or required them to open their suitcases, but have instead relied exclusively on the bankers’ (false) written customs-declarations that they are not carrying any such illegal-narcotics. The level of systemic incompetence or incompetence-by-design is simply mind-boggling.

Likewise, and more generally, the English appeal court long-ago addressed the foundational issue in Armstrong v. Armstrong and Warner [1834] 3 Milne & K. 64 that if either or both parties intend to break the law, then it is utterly irrational to expect that they are going to say so directly in the written agreement between them – and especially when the form of the agreement has been under the dominant control of the dominant offending party.

My apologies for the length of the following quote and explanation, but it might easily be directly addressing the present issue of using undisclosed / unregistered side agreements to conceal multiple violations of the criminal law.

The case was somewhat of a comedy of errors because the parties (Armstrong & Warner) had entered into an illegal high-interest loan agreement contrary to the usury laws, but disguised it as what the lender had failed to realise was an equally illegal secret (unregistered) partnership in a pawnbroker business (which were notorious at the time for fencing stolen goods and so had to be registered with all partners declared and disclosed).

…. where, the contract being silent, the law is broken under it, though not by force of it, there arises a very natural suspicion that the written articles, though true as far as they go, do not contain the whole truth, and that another agreement was entered into, collateral to the one in writing, and to which the illegal acting may be referred.

Then, if such an agreement shall appear from all the circumstances plainly to have subsisted, the inference is irresistible, that the two, the written and the unwritten, [the registered part and the unregistered part] must be taken together in order to get at what the true contract [agreement or arrangement] between he parties was. For this is not the case of two independent contracts between the same parties touching the same thing. The nature of the transaction prescribes silence as to some parts of it which will not bear the light [loan-fee kick-backs], while the innocent and producible portion is reduced to writing [registered security]. Hence the two must be taken as one contract, the production of one and suppression of the other portion being easily explained.

… No man can so far abstract himself from his common feelings, so far shut his eyes to the plainest indications of common sense, as to hesitate one instant in what light he shall regard the transaction between Messrs. Armstrong and Warner. To call it a partnership at all is incorrect, indeed it is an abuse of terms. It was a loan transaction much rather than a partnership ; but to escape the usury laws, and obtain relief here, the party must treat it as a partnership….

The question is, whether or not any man of plain and ordinary understanding can hesitate a moment how he shall explain all this, and to what contract, if partnership there be in the matter, all this acting shall be referred?

To the facts in this case I cannot shut my eyes… A secret understanding, amounting to a collateral agreement, subsisted between the parties, in execution of which it was that Warner was, if a partner at all, a dormant or secret partner, nay, a partner concealed, and not merely dormant ; carefully, designedly, craftily concealed, breaking the statutory provisions, not so much by non-feasance or mere omission, as by a course of cunning contrivance. The existence of both agreements [registered security and the side-agreement], the open and the secret, is clear, and they were parts of one contract, wholly illegal.

Such also underscores the tactical errors made by solicitors for VERSATILE / UPTON. Not only do the side-agreements for the kick-backs taint the entire agreement or arrangement, but the registered part is itself near saturated with illegalities and deceit. There is no “innocent and producible portion” here at all.

According to the nominal disbursement letter from MCCALLUM LAW GROUP LLP dated July 21, 2017, the actual or net proceeds of the reinsurance from VERSATILE AND UPTON were or were to be $718,566.14, with the $81,433.86 differential comprised of (1 to 10, numbering added):

  1. To UPTON CAPITAL CORP. the sum of $571.52 for Interest Adjustment;
  2. To VERSATILE MORTGAGE CORP. the sum of $571.52 for Interest Adjustment;
  3. To UPTON CAPITAL CORP. the sum of $1,250.00 for Lender Fee;
  4. To VERSATILE MORTGAGE CORP. the sum of $2,000.00 for Lender Fee;
  5. To UPTON CAPITAL CORP. the sum of $31,410.00 for 12 months of payments;
  6. To VERSATILE MORTGAGE CORP. the sum of $31,410.00 for 12 months of payments;
  7. TO MACCALLUM LAW GROUP LLP for services rendered the sum of $1,270.82 as per the attached Statement of Account;
  8. To STEWART TITLE GUARANTY COMPANY the approximate sum of $200.00 to obtain Title Insurance;
  9. TO BAYFIELD MORTGAGE PROFESSIONALS LTD. the sum of $4,750.00 for Broker Fee;
  10. TO YARDALE MORTGAGE the sum of $8,000.00 for Broker Fee;
  11. The balance in the approximate sum of $718,566.14 to PEARSON & CO., lN TRUST on behalf of SHERRIN JUNE PRYCE.

Likewise here too, the first question that arises is: Where is all this indicated and disclosed and declared in the registered security and funding / underwriting instrument in compliance with at least s. 397(1)(b) of the Criminal Code (fraudulent omissions)?

Answer: It isn’t.

The totality of the offer or agreement-in-fact to this point is:

First, underwrite and advance $800,000 of real-estate-secured-credit to us via a mortgage under which you agree unconditionally that you owe us $800,000, now, plus another approximate $60,000 of interest over the next year, and to transfer all right, title, and interest in the property to us, in exchange for a constructive repurchase-option to buy it back from us by paying us another $800,000 in one year’s time.

Then sign and give us a series of side-agreements under which you agree to kick-back or redirect some $82,000 to us or to third-parties as we direct.

Then register the mortgage in favour of us at the land title office.

And then in return: Maybe we will return $800,000, less the rake-offs and / or to fund the rake-offs, as unsecured credit to you, and maybe we won’t.

Take it or leave it.

It appears as well that the entire year’s interest or stipulated payments was / were deducted in advance (or paid on or about the same day from the proceeds) under a registered mortgage that clearly states and certifies that the “Interest is not payable in advance” or even calculated in advance. That alone independently makes the registered mortgage into a false-document and forgery-in-law.[38]

Further to same, and even ignoring all of the other issues and offences, the total stipulated monthly payments of $5,235 (x 12 = $31,410 + $31,410 = $62,820) were comprised of both principal and interest (40-year amortization) such that by deducting them in full in advance, the target / mark (you) pay(s) interest-in-advance on interest-in-advance (about an extra $3,000) on a (pretended) principal-portion they never receive nor gain any use from. That is a separate and distinct fraud-within-a-fraud which also and independently renders the security / document false in a material particular and therefore a false-document / forgery-in-law (and another example of not knowing when to quit).

At a minimum, each of Items 1, 2, 3, 4, 7, 8, 9, and 10, were converted at an astronomical and criminal rate and as a rake-off and kick-back / conversion from the falsified principal amount on or about the day of the transaction, and in prima facie violation of s. 462.31(1) (laundering of proceeds of crime) irrespective of whether the AG chooses to prosecute for the triggering violation under s. 347(1)(b) and / or s. 347(1)(a) (and /or s. 206(1)(a), or 397(1)(b) (fraudulent omission from security), or s. 380(1) (fraud), or whatever)).

Further, what is the difference between a GAAP-fraud concealment-fee, and a section 347-violation-and-criminal-rate-conversion-concealment-fee, and a section 462.31(1) money-laundering-concealment-fee, a Ponzi-scheme-Accommodation-fee, and a Lender-Fee?

Answer: A name or label.

And with respect to the $12,750 in nominal Broker Fees, the technical and actual violation of just s. 347(1)(b) renders all of them members of the same criminal organization and again regardless of whether the AG chooses to prosecute, and so it does not really matter how the organization-so-defined divvies-up the proceeds-of-crime among themselves.

None of these entities brought any money to the transaction – yet they walked away – just on or about the day of the deal – with over $80,000 in rake-offs, plus an $800,000 mortgage-secured-underwriting-credit, plus the legal title to a $1 million-plus property!

They then voluntarily (and irrationally) agreed that they owed about a net $718,000 to you (or rather to the law firm), and ultimately to some third-party / parties (to whomever you ultimately assigned their unsecured debt to you), and most likely to or through an accomplice and who also profits from the continuation of the pyramid / Ponzi scheme.

What. A. Racket.

And with reference again to Eron Mortgage and its collapse / shutdown in 1997, how can the Provincial Minister responsible today conceivably not know that VERSATILE / UPTON are prima facie engaging in the same obviously illegal techniques and practices that had cost Eron’s investor-victims some $222 million when it all fell apart?

What does the Minister think VERSATILE / UPTON is doing with the illegal interest-in-advance other than using it to fuel and leverage yet another pyramid / Ponzi-scheme as a balanced fraud between nominal borrowers and nominal investors?

$62,820 accounted for as payments-in-advance

Another special criminal nexus occurs with respect to the $62,820 that was paid or withheld from the nominal proceeds as payments in advance. It is clearly a fraud against you, but it is also a significant fraud against the financial markets.

The only reference that I could find to it [other than the lawyer’s disbursement letter] is under the BAYFIELD OFFER OF FINANCING letter dated July 11, 2017:



1) Mortgage to be prepaid from proceeds for 12 months.

The rate defined by the quasi-actual / constructive transaction where you received $737,180 (i.e., $800,000 minus just the $62,820 of payments-in-advance) and were required to pay another $800,000 on the maturity date in one year’s time, was 8.52%, and not 7.45% as claimed and declared under the registered mortgage. The interest rate is 11.3% when the other $20,000 or so of nominal loan fees are factored in.

It is such an obvious and naked fraud against the financial markets. Otherwise anyone could register, say, a $1 million principal amount security, on the basis of a net $1 loan and an undisclosed $999,999 interest reserve account.[39] And most of the information legally required to be declared and disclosed is regardless rendered near meaningless under the fact of the interest-reserve or pre-paid-principal and interest (which is an absurdity regardless) device, and completely so where, as here, the device is concealed and denied by omission from the registered security.

The mortgage on its face declares that the required payments are $5,235.00 per month, and that the interest calculation period is “Monthly”, when in fact all of the interest-called-interest under the contract was both calculated and received / converted by VERSATILE / UPTON (under the omitted / unregistered side-agreement), and as a conversion of and from the falsified security itself.

If the mortgage as sworn and registered were to have claimed and declared that the “Amount of each periodic payment” is “$62,820.00” and that the “Interest Calculation Period” is “Annual – In advance”, then the writing would be accurate, and would not be a false document with respect to these two declarations / disclosures (except of course to the extent that interest-in-advance remains illegal regardless of disclosure).

There are in fact two material falsifications of the securities here (i.e., under this sub-heading). The first is the failure or omission to disclose the real one-year-payment-period or payment-interval[40], and the calculation and receipt / deduction of the interest in advance.

The second crime is the actual or positive provision of false information which was known and believed to be false as and when the writing / security was registered and executed.

On the meaning of principal

Before continuing, note that despite the managed-mental-illness among those in the industry, the word principal is a noun or matter of fact, and not an adjective or matter of opinion:

Principal. 1. The amount of debt not including interest; the capital sum of a debt or obligation, as distinguished from interest or other additions to it (payment of principal). (West’s Legal Thesaurus/Dictionary. William P. Statsky Professor of Law Western State University College of Law (San Diego), West Publishing Company St. Paul New York Los Angeles San Francisco

Principal, n. An amount of money that has been borrowed or invested. The capital sum of a debt or obligation, as distinguished from interest or other obligations to it. An amount on which interest is charged or earned. Amount of debt not including interest. The face value of a note, bond, mortgage etc. that must be repaid as distinct from the interest that is paid thereon. Capital sum placed at interest, due as a debt, or use as a fund, as distinguished from interest or profit. Black’s

Principal. The capital as distinguished from the income. (A Dictionary of Words and Phrases used in Ancient and Modern Law. (Arthur English, Washington D.C.: Washington Law Book Co. 1899.)

PRINCIPAL. Means (1) in relation to a loan, the amount actually lent to the borrower (17 & 18 Geo. V, c. 21, s. 15) A Dictionary of Legal Terms and Citations H.A.C. Sturgess and Arthur R. Hewitt, Gordon Press New York 1976.

principal: (2) the original amount of a deposit, loan, or other amount of money on which interest is earned or paid. (3) finance: the face value of an instrument, which becomes the obligation of the maker or drawee to pay to a holder in due course. Interest is charged on the principal amount. Dictionary of Banking Jerry M. Rosenberg, Professor, Graduate School of Management, and School of Business Rutgers University. John Wiley & Sons, Inc. New York 1990.

Principal 2. The amount of a debt, i.e. the capital sum, excluding any PREMIUM or INTEREST (International Dictionary of Finance Graham Bannock and William Manser, Hutchinson)

principal balance The outstanding balance of a mortgage or other loan, exclusive of interest and any other charges. Banking Terminology 3rd ed. 1989 American Bankers Association.

principal 1. face amount of a loan evidencing the amount repayable, exclusive of interest, according to the terms of the NOTE securing the obligation. Barron’s Dictionary of Banking Terms, by Thomas P. Fitch New York London Toronto Sydney 1990.

“principal”means the amount of money borrowed and outstanding at any time, but does not include any portion of the cost of borrowing.(Canada, Bank Act, Cost of Borrowing (Banks) Regulations, SOR/92-320(May 21, 1992) amended SOR/94-367 (May 26, 1994))

Any alleged loopholes in a few of the definitions can only be asserted via the logical fallacy of begging the question, and by creating an irresolvable contradiction among the others. It all comes down to one thing – Is the amount of principal a question of fact? Or is it by the agreement of parties? Is it a noun / fact? Or is it an adjective / opinion?

“I will loan you $100,000 at 10% per annum provided that you give me a security claiming and swearing that I have loaned you $200,000 at 5% per annum.”

Assuming that the borrower accepts, what is the principal amount?

If the answer is $200,000, then it follows that a lender can loan more principal than they possess. It follows that no lender is bound in any way from lending any amount whatever – even if they have nothing at all.

And, if so, why does the nominal / pretended borrower often have to swear under oath and penalty of perjury that the lender has paid them, and that they have received, $200,000?[41] Why not simply provide for the security to truthfully state that the borrower only gets $100,000 but has to agree that the principal is $200,000?

And how could any legitimate society even function on such basis?

The truly shocking reality is that bankers, lawyers, solicitors, and judges are the only humans on planet Earth who cannot see the objective and grievously criminal substance of the offer itself.

Fraudulent omissions

A mortgage is an evidentiary instrument that evidences the transaction that it purports to secure. That such legal documents shall tell the verifiable truth about themselves has long been a foundation of English law (i.e., at least for the poor and others of the little people). The Manitoba Court of Appeal, for example, long-ago explained the common sense nature of the underlying principle in Bathgate v. The Merchants Bank, Man. C.A. ([1888] Manitoba Law Reports, pp. 210-218, at 216-7) in terms of bills of sale (emphasis assed):

Our [Canadian Bills of Sale] Act does not require in so many words that the consideration is to be set out, but it seems to me to imply and require that it shall be set out just as strongly as if it had expressly said so in the words used in the English Act. In the first place it requires that every sale of goods that comes within the Act shall be in writing, and this can only mean that all the essential elements that must combine to constitute a sale, shall be set out in writing, and one of these elements is certainly the price or consideration…. Clearly, therefore, some consideration must be set forth in the writing of sale, and this being so, and remembering the object of the Act, it would appear to me to be impossible to suppose that the Legislature intended that the statement of any but the actual and true consideration between the parties would satisfy its provisions.

By what perversion of reason would something that is so plain and obvious on a bill-of-sale become a de facto heresy on a loan or credit security?

The same is codified today under s. 397(1)(b) of the Criminal Code, not because it is some highly technical financial principle only understood by bankers, but because it is a simple and obvious principle of commercial dealings between parties and in protection of the public:

Falsification of Books and Documents

Books and Documents – Privy

397 (1) Every one who, with intent to defraud,

    1. destroys, mutilates, alters, falsifies, or makes a false entry in, or

(b) omits a material particular from, or alters a material particular in, a book paper, writing, valuable security or document is guilty of an indictable offence and liable to imprisonment for a term not exceeding five years.

(2) Every one who, with intent to defraud his creditors [the lead-underwriter(s)], is privy to the commission of an offence under subsection (1) is guilty of an indictable offence and liable to imprisonment for a term not exceeding five years.

How can a contractually known and stipulated rebate or kick-back from the proceeds of a registered security be anything but a material particular? It is the most material of all particulars.

A loan of $200,000 with interest at 5% is a financially different thing from a loan of $100,000 at 10%, and it is a fraud to misrepresent one as the other, and a compounded fraud to do so by means of a material omission.

And the fact of the security claiming and declaring compliance with the federal securities law (Interest Act) further makes it material even if it were not already. In fact, the mere fact of the Interest Act makes it material even if it ultimately does not apply because the omission aids in evading the question of it (see again R. v. Foley).

And every time the word “principal” appears, it is a de facto positive declaration that there are no loan-fees.

Even under a genuine money-lending transaction, what is the point of a federal securities law / Interest Act requiring a mortgage to expressly state the actual amount advanced regardless of the amount secured, and the real rate of interest as measured against such actual / net amount advanced, if it were intended to be defeated by such an additional obvious and independently prohibited device under the Criminal Code?

Even the formal definition of Fraud (also independently under s. 380(1)) emphasises the constructive or actual crime or device of omission:

Fraud. In civil fraud is a misrepresentation or contrivance to deceive, commonly by way of a statement knowingly made false, or without honest belief in its truth, or recklessly, careless whether it be true or false, and intended to be, and in fact, relied on, by the person deceived, but it may equally be made by concealment, or deliberate omission to make a statement where one should have been made, or by actings. If a contract is induced by misrepresentation made fraudulently, the contract may be held totally void, but is at least voidable at the instance of the party deceived,…[42]

And that was the deal-in-fact made between Parliament and the entrenched-money-power during the crisis of 1880 that resulted in the Interest Act. That if Parliament would agree not to impose a 6% interest rate limit all across the country – then the nominal creditors would agree to disclose and declare the true and complete terms on the face of their securities.

Federal securities law / Interest Act fraud / forgery

By practical necessity, the first step here is by way of what used to be called a demurrer – a kind of trial before a trial that, among other things, can serve to materially simplify or eliminate (render unnecessary) the main action. I believe that today there is a functionally similar rule under the B.C. Rules of Court.

The issue is to first determine as to whether s. 6 of the Canada Interest Act applies to the nominal mortgage.

If the Court rules that the Interest Act does not apply to the mortgage, then it becomes an obvious false-document and forgery on its face by claiming certification or compliance with a law that does not even apply to it. Like a cheque that is falsely stamped “certified” when it is not in fact certified, nor even capable of being certified.

In the alternative, if the Court rules that the Interest Act does apply to the mortgage, then it again becomes an obvious false-document and forgery because it falsely claims compliance while providing both a false statement of the amount of principal advanced (net of kick-backs and / or interest-in-advance) (versus secured) and a false statement of the rate of interest “chargeable thereon”.

And whether the Act applies or not, it is in fact a double / compounded-fraud here because as and when sworn and / or registered the “amount of principal advanced(past-tense) was nil / zero. The provision of the “Interest Act Statement” gave the security the false appearance and status of a receipt for money (principal) already paid, and therefore an unconditional promise to pay (by the named mortgagor) for what was in fact a conditional promise to pay, and where that falsity was subsequently acted-upon-in-fact by VERSATILE / UPTON.

In most universal terms, s. 6 obviously and directly only applies to mortgages where the mortgagee / creditor has already or concurrently loans or advances credit in exchange for the security. It does not apply to nominal mortgages where the mortgagee has made no loan nor advance of credit, because of the words “amount of such principal” (“advanced “[past tense])”.

Assume four otherwise identical mortgages, where in case (1) the nominal lender has made no loan, nor advanced any credit, and has no liability to do so under the mortgage; and in case (2) the lender has already paid $800,000 to the issuer of the security to obtain it; case (3) where the lender has already paid $800,000 and received an undisclosed kick-back of $82,000, and case (4) where the lender has paid nothing, is not contractually obligated to do anything at all, and is required to be paid $82,000 by the borrower even if the lender chooses to do nothing. All four claim that the principal amount advanced [past tense] is $800,000 and that the security is in compliance with the federal securities law. Obviously they cannot all be legitimate.

A claim of compliance with the Interest Act is a de facto declaration that the stated amount of principal is “the amount of such principal” (“advanced”) or already / concurrently invested by the named mortgagee in exchange, and so renders it a false document (Criminal Code s. 321) and legal forgery as and when it is solicited by the mortgagee with knowledge of its falseness (R. v. Gaysek (1971) S.C.C.).

The nominal civil remedy (zero interest is enforceable) for non-compliance under s. 6 only applies if there is no statement of either the amount of principal advanced (versus secured) or no statement of the rate of interest defined by that amount and the required payments. That is, if the mortgage makes no claim at all in these areas.

But a direct false statement regarding either or both is not a deficiency or non-compliance – it is prima facie a falsification of the security.

The Ontario Court of Appeal judges unanimously held while it was perhaps still possible to save the system in Lastar v. Poucher (1926) (which mortgage was at least a constructive fraud, but did not directly claim compliance with the Interest Act):

These contentions all seem to converge on one and the same point, namely, that if a mortgage prima facie conforms to the statute in naming a sum as principal and providing for a specific rate of interest thereon, the genesis of the indebtedness cannot be inquired into – a mixture put into a labelled bottle must be what the label calls it. But parties cannot make substantive law for themselves by agreement: Rex v. Paulson, [1921] 1 A.C. 271.

Strictly speaking, s. 6 directly makes a distinction between the amount secured versus the amount advanced, and so logically the Court, or any observer, must always make inquiry to ascertain compliance. It is not possible for the mortgage to prima facie comply “by naming a sum as principal and providing for a specific rate of interest thereon”. The underlying non sequitur is created by the fact that if the stated principal amount has been increased by any fees, then it ceases to be “principal” at all, because by definition “principal” means “as distinguished from interest or other additions to it”.

The judges were in effect applying the result of the civil law (zero interest can be enforced) while obfuscating or suppressing the fact that the facts were sufficient to establish fraud under the criminal law.

The Supreme Court of Canada later regardless nominally bailed them all out in Meagher v. London Loan (1930) by ruling that s. 6 did not apply to the particular mortgage in that case, but that particular device won’t work if the Court has to first determine the applicability of the Act as a separate issue as described above.

It is clear from the historical record that s. 6 was intended to apply to virtually every mortgage. But the Supreme Court judges twisted the language to conclude that due to a set of unusual circumstances, the Interest Act section did not apply to the London Loan mortgage. And then for the next 90 years to 2020 the Courts / judges have ruled in virtually every case that s. 6 does not apply “to this particular mortgage” (i.e., it was a de facto policy directive to the solicitors that they could ignore the federal securities law – actually that they must ignore the securities law because the fraudulent system won’t work if some nominal creditors comply while others do not).

So if s. 6 has regardless no application to any real mortgage – then why do the majority of nominal mortgages in Canada continue to claim and swear that they comply with a statute to which they do not even apply and vice versa? That is technically racketeering to the extent that the target (and / or the financial markets) is intended to believe that the pretended lender has complied with the statute.

Just to be clear, a simple non-compliance crisis had built-up in the 1920’s as the Ontario Courts applied s. 6 in the following cases:

SINGER v. GOLDHAR – Ontario Court of Appeal, January 25, 1924 55 O.L.R. p. 267 – 272

LASTAR v. POUCHER – Weekly Court, Toronto, April 3, 1926; 58 O.L.R. pp. 589-597.

PROUSKY v. ADELBERG – October 11, 1926 – 59 O.L.R., pp. 471 – 475

ROGERS v. LABOW – Ontario Court of Appeal; April 12, 1926; 64 O.L.R. pp. 309-314.

THOMPSON v. WILSON Weekly Court – Toronto., 32 O.W.N. pp. 317-318; June 1, 1927

RE BROWN – Ontario Court of Appeal, May 26, 1927; 61 O.L.R. pp. 601 – 609

But it was all constructive from the terms of the mortgages and the unregistered side-agreements. None of the cases appears to have involved any statement of compliance or even the lender’s otherwise awareness of the existence of the Interest Act.

Then after the unanimous Ontario Court of Appeal decision in 1929 upholding the trial court’s decision in Meagher v. London Loan, which also concluded that there was a simple non-compliance with s. 6, the Supreme Court of Canada played theThe-law-does-not-happen-to-apply-to-this-particular-mortgagecard that had been deliberately planted by the appointed members of the Senate in 1880 to complicate the language of the section just enough to give the Courts that opening. And then for the next 90 years (post-1930) virtually every Court has ruled the same – that s. 6 does not apply.

Somewhere along the line post-1930 and London Loan, the nominal creditors appear to have concluded to the effect that: “Well if the courts are going to be compelled to cover for us anyway, then we might as well further falsify the securities to claim compliance with the Act. That way we can forestall Parliament from making any more of these annoying securities laws that interfere with our precious kick-backs and our ability to launder and leverage the proceeds.”

But claiming compliance with s. 6 is the same as stating on the face of the mortgage: “This mortgage is certified compliant with the federal securities law (s. 6) and states the net amount of principal advanced to the nominal borrower’s own use irrespective of the amount secured, and the stated rate of interest is the real rate of interest as measured against that amount.”

But that is a false-certification and results in a false-document and forgery-in-law regardless of whether the Court rules that s. 6 applies or not. It is a massive fraud against both the financial markets and any unsecured or subordinated creditors, and the nominal issuer / borrower has no lawful capacity regardless to falsify the security (omit disclosure / declaration of the kick-backs) as a condition of even any real loan – let alone a pretended loan.

Also, in your case, even if it were a genuine money-lending transaction, the actual rate of interest defined was approximately four-times the advertised mortgage rate from a chartered bank, while VERSATILE and UPTON provided for the registered mortgage to claim roughly only twice such amount, and that has a material affect on your perception of your own financial situation.

From my investigation and analysis of the modus operandi of Eron Mortgage 23-years ago, such material understatement of the real rate of extraction / enrichment of the brokers / pretended-lenders was crucial to their ability to attract both new investors and new pretended borrowers.

Fraudulent and absurd calculation of the rate-of-interest

Even if it were a money-lending transaction involving VERSATILE / UPTON’s pre-existing funds, the amount advanced is as low as $718,566.14, and the rate of interest chargeable thereon is 11.334% per annum, and not either 7.45% per annum nor the ridiculous and insulting 7.56659% “calculated semi-annually”.

A rate of interest is not so “calculated” at all – and the assertion to the contrary is a naked-fraud fabricated out of whole cloth by nominal creditors in Canada after the enactment of (what is now) s. 6.

The adjective “chargeable” clearly relates to and qualifies the word “rate”. The participle “calculated” equally clearly relates to and qualifies the word “interest”. It cannot apply to the word “rate”, a “rate of interest” is not calculated. Standard Reliance v. Stubbs [1917] S.C.C. VOL. LV 423, at p. 429 (Anglin, J.).

Now, it is absurd, to my mind, to talk about the rate of interest being “calculated yearly or half-yearly.” – 1917 Canadian Mortgage Investment Co. v. W. F. Cameron [1917] S.C.C. VOL XV 409, at 415 (Davies, J.).

The affinity of those who draw up mortgages for this rather unusual use of the term [“calculated”] is perhaps explained by its appearance in the magic phrase of the Interest Act……it [“calculated”] is not a term that appears in textbooks on business mathematics and seems to be peculiarly Canadian in this usage. (The Law of Interest in Canada, by M.A. Waldron, Carswell 1992, at p. 38.)

Every reasonably intelligent man or woman on Earth knows that a rate of interest is a unit-of-measure that is not calculated, per se. It is like arguing to a judge that you weren’t driving at 80-miles-per-hour but only 60-miles-per-hour “calculated half-hourly”. It is just another pathetic and embarrassingly-transparent fraud employed to understate the real rate of interest and to normalize such fraud and understatement.

And made even more embarrassing in the present case by the provision of five-decimal points of precision (7.56659%) to describe a number that management at VERSATILE and UPTON essentially fabricated and which bears no relation to the transaction that it purports to disclose.

It is an especially grievous characteristic of the Canadian system that the Parliament and the government and the Courts all work together to aid and abet the money-power to systematically loot the People by and through the shameless manipulation of the very laws enacted allegedly to protect them.

And the first question here that would be posed by a competent psychiatrist is: What does it cost even a legitimate money-lender to disclose the real or net amount, and the real rate of interest – the same one that it has no problem reporting to its own shareholders?

Answer: Nothing. Nothing at all. Unless they are using the falsified securities to deceive other parties such as taxation authorities, capital-adequacy-regulators, domestic and international financial markets, other subordinated or unsecured-creditors, etc., etc.

See Appendix 5 on Nominal Method Fraud for a summary of the scope and scale of fraud committed under the pretence of the nominal-method or calculating of the rate of interest.

Illegal Late Payment Penalties

The nominal mortgage security provides for (first level) $100 late payment penalties, in violation and fraud of the federal securities law, and (independently) of s. 347 of the Criminal Code (in material part).

IT IS UNDERSTOOD AND AGREED that if the mortgagor shall not make the mortgage payments on the payment date…then the MORTGAGEE shall charge the MORTGAGOR the sum of ONE HUNDRED ($100.00) DOLLARS for each late payment.

Section 8(1) of the federal securities law (Canada Interest Act) provides that (emphasis added):

8. (1) No fine or penalty or rate of interest shall be stipulated for, taken, reserved or exacted on any arrears of principal or interest secured by mortgage of real estate, that has the effect of increasing the charge on any such arrears beyond the rate of interest payable on principal money not in arrears.

What is critical to appreciate here is that the $100 late payment penalties are not about the $100 penalties, per se.

Late payment penalties are rampant across Canada on mortgage-secured debt despite the express prohibition against even stipulating for them – let alone collecting them. By wilfully ignoring them the Courts / judges signal their understanding to the money-power that it is the money-power and neither the Courts nor the legislature who is in charge.

The remainder of the clause (in the nominal mortgage) stating that the parties agree that the stipulated penalty is not a penalty is merely evidence of VERSATILE / UPTON and its solicitors’ conscious awareness of its illegality and direct prohibition.

4. (b) It [the stipulated monetary consequences] will be held to be a penalty if the breach [of the agreement] consists only in not paying a sum of money, and the sum [then] stipulated is a sum greater than the sum which ought to have been paid: Kemble v. Farren (1829), Bing. 141, 130 E.R. 1234. This though one of the most ancient instances is truly a corollary to the last test. Whether it had its historical origin in the doctrine of the common law that when A. promised to pay B. a sum of money on a certain day and did not do so, B. could only recover the sum with, in certain cases, interest, but could never recover further damages for non-timeous payment, or whether it was a survival of the time when equity reformed unconscionable bargains merely because they were unconscionable – a subject which much exercised Jessel M.R. in Wallis v. Smith (1882), 21 Ch. D. 243 (C.A.) – is probably more interesting than material.

All nominal creditors have always incurred expenses for late payments – that is why the interest-clock continues to run on the late-payment. But any additional amounts were made illegal under s. 8(1) of the federal securities law. The law does not say – “Except if the nominal creditor provides an explanation of why they have stipulated for the penalty or denies that it is a penalty or agrees that it is not a penalty.”

The mortgage then stipulates for second level / additional penalties:

In addition, should the Mortgagee deem it necessary to forward a letter of demand for payment to the Mortgagor…the Mortgagor shall pay to the Mortgagee the sum of THREE HUNDRED ($300.00) DOLLARS for each such demand letter… Both of the aforementioned sums shall immediately form part of the Principal Amount and be further secured by the Mortgage.

To deem means to pretend and the above is just another constructive fictitious or illusory provision intended as an insult to the Court’s / judges’ intelligence.

Even in a quasi-legitimate money-lending transaction, the mortgagee has normally taken what is generally the mortgagor’s most valuable security, and late-payment penalties are a form of theft against unsecured or subordinated creditors of the same borrower.

What VERSATILE / UPTON have provided is a threat to the mortgagor that if it comes down to a choice between making the mortgage payment versus paying the water or electricity bill, for example, then be certain to pay us first otherwise you will incur up to another $400 as a penalty.[43]

The essence of a penalty is a payment of money stipulated as in terrorem of the offending party

Likewise, the extra-penalty provision itself is sufficiently vague as to invite further fraud and abuse. Were you to become unable to make a given payment, then VERSATILE could charge you, say, 30-consecutive such $300 penalties for an end-of-month total of $9,000.

And all they would need to do is to deem it necessary to send the demand letter. Under the express terms of the contract you will have agreed to the $9,000 in aggregate penalties for that month.

In an important sense, this may be the most wrongful offence of all. In theory, the entire nominal contract is null and void ab initio because (1) it is expressly illegal and prohibited under the federal securities law, and (2) it is prima facie evidence of coercive bad faith.

Procedurally, however, the violation and offence under the federal securities law has to be approached through s. 126(1) of the Criminal Code because the securities law does not itself otherwise provide for a penalty for its violation:

126. (1) Every one who, without lawful excuse, contravenes an Act of Parliament by wilfully doing anything that it forbids [“no penalty…shall be stipulated for”] or by wilfully omitting to do anything that it requires to be done is, unless a punishment is expressly provided by law, guilty of an indictable offence and liable to imprisonment for a term not exceeding two years.

Just taking the offence against s. 8(1) in isolation, the facts are near identical, in terms of their essential and material legal elements, with those in Central Trust v. Rafuse in 1986. In Rafuse, the law firm had prepared a mortgage for a corporate-borrower, where the corporation had been expressly prohibited by provincial statute from issuing any such mortgage. Just as any mortgage stipulating for late penalties is an illegal contract.

The S.C.C. held that the solicitor(s) had been negligent, and that they were responsible for all of the consequent financial damages.

Applied to your case, the Courts are theoretically bound to hold the illegal contract as null and void (just on the basis of the illegal penalties), and the solicitors responsible would become liable for negligence. It is near impossible to misinterpret the words: “No…penalty shall be stipulated for”.

With reference again to the extensive paragraph / clause in the mortgage asserting that (and / or the parties agreeing that) the stipulated $100 late payment penalty is not a penalty (for the purposes of the sworn and registered security), the BAYFIELD OFFER OF FINANCING letter dated July 11, 2017 states under OFFER OF FINANCING – SCHEDULE [emphasis added]:


The following fees and disbursements will be charged, and will be added to the remaining mortgage balance until they are repaid in full, or the mortgage is paid in its entirety. Any amounts added to the mortgage will accrue interest at the same rate as the mortgage:

  1. NSF/Non-payment penalty: $100

Most briefly, the solicitors involved are fully aware that they are soliciting you to commit an offence under the federal securities law by issuing a mortgage stipulating for late payment penalties on mortgage-secured debt (which is at least a constructive fraud against any unsecured or subordinated creditors of the mortgagor (you)).

They know it is an illegal penalty (and so need to hide it) but they also need your express agreement to pay it or convert it / charge it to the mortgage balance. So they solve that problem by creating two parallel realties – the first is under the offer letter where the penalty is expressly acknowledged and conceded as a penalty, while the registered mortgage deals with it by expressing and noting the parties’ agreement that the penalty is not a penalty, and by omitting the directly-contradictory terms from the offer letter.

The same modus operandi was applied with respect to the $62,800 deducted in advance or paid from the proceeds back to VERSATILE / UPTON (about $60,000 of which was interest-in-advance). It is made an express term of the agreement under the offer letter, but both omitted entirely and expressly / positively denied under the registered mortgage (emphasis added):


3(1) Interest is chargeable on the mortgage money and is payable by the borrower.

(2) Interest is not payable in advance. This means that interest must be earned before it is payable.

It is just another lie put to paper, that is then sworn under oath and penalty of perjury by some hapless homeowner whose equity assets are concurrently converted to pay for it all. Here again, this isn’t rocket science (although it is prima facie evidence of VERSATILE’s / UPTON’s awareness of the illegality of interest-in-advance and of the reason(s) why).

Charges independently contrary to s. 347

Further, the said $100 penalty accrues immediately and in its entirety on the day that the stipulated $5,235 payment becomes overdue. The penalty-rate of conversion is therefore:

=(((1 + (100/5235))^365)-1)

= 99,779% per annum

The additional $300 penalty increases the total to $400 for a rate of conversion of:

=(((1 + (400/5235))^365)-1)

= (rounded) 46.9 trillion per cent per annum.

Even ignoring their direct prohibition under the Interest Act, regardless of their label or stated purpose for imposing them as a function of non-payment or late-payment, they are still interest in fact and under s. 347:

“interest” means the aggregate of all charges and expenses, whether in the form of a fee, fine, penalty, commission or other similar charge or expense or in any other form, paid or payable for [as a condition of] the advancing of credit under an agreement or arrangement, …

Here again, a fine or penalty obviously cannot apply at the time an agreement is entered into, such that the words “for the advancing of credit…” can only mean “as a condition of the advancing of credit…”. That is another reason why it is irrelevant that VERSATILE / UPTON have provided an explanation for why they have provided for the stipulation for the illegal penalties or why they feel they are entitled to ignore the direct prohibition. It is simply a bare statement of what VERSATILE intends to use the proceeds of the penalty for.

And here again, because the federal Interest Act does not itself directly impose a penalty on the nominal creditor for a violation of the Act, such automatically falls under s. 126(1) of the Criminal Code (Penalty for violation of federal statute where none otherwise provided).

Automatic Debit / NSF Racket

The larger provision also includes payments returned for non-sufficient funds, and which payments are provided, as required and directed by the nominal lenders, pursuant to an automatic debit arrangement through another nominal financial institution.

IT IS UNDERSTOOD AND AGREED that if the mortgagor shall not make the mortgage payments on the payment date or if payments shall be returned due to non-sufficient funds then the MORTGAGEE shall charge the MORTGAGOR the sum of ONE HUNDRED ($100.00) DOLLARS for each late payment or for each payment that is returned for non-sufficient funds…

As such VERSATILE / UPTON are also particeps criminis (partners-in-crime) with whatever bank is orchestrating the Automatic-debit / NSF scheme or racket. (The name of the bank / institution is not indicated on the Pre-Authorized Debit form provided to me).

The so-called NSF charges under nominal automatic debit arrangements involve multiple criminal law violations. If it is illegal (and it is) for an entity to issue a cheque or other demand-instrument with insufficient funds, then the account administrator (bank) cannot act on any nominal pre-authorization or automatic-debit form to commit the offence in the name of, or as agent for, the entity.

Wilfully issuing a demand-instrument / order against an NSF account is a criminal act and financial crime for which real people go to real prisons. It requires the essential and material element of mens rea.

An automatic debit is merely a promise to pay in the future in another form and where subsequent default does not require mens rea.

If the banker is aware of (or has the means of knowledge to determine) the NSF status of the account, then it is equally a crime for the bank to issue the payment order anyway – and to do so with the object of generating fees for its own account is simply scandalous. And it becomes triple-wrongful and illegal if and when it is done by a bank on a mortgage where the real intent is to defeat and evade or otherwise in fraud of the federal securities law (s. 8(1) of the Interest Act).

The owners of the banks are alpha-predators who are obsessed with domination and punishment for its own sake. But they have no right regardless to compel or coerce the ordinary employees of the bank to adopt such viciously wrongful behaviour and especially not to commit objective criminal acts on behalf of the bank’s owners.

Please refer to The Falsification of Accounts Technique (attached pdf (Appendix 4)) for an account of a further extension of the same fraudulent practice. Most briefly, however, in the early / mid-1990’s I had been analyzing the operating account of a Home Hardware franchise in Vermillion Bay, Ontario, when I noticed that the Bank of Montreal had declined to honour an automatic debit in the amount of (rounded) $92,800. Once per quarter the franchise owner had to make royalty payments to head office whose account was at the Royal Bank of Canada.

The owner had earlier explained the situation to me, and how the manager of the bank had assured him that the Bank of Montreal would increase his line-of-credit under the operating account to cover the then approaching royalty-payment due-date. The reason the existing limit had been insufficient was because his sales were up and he had purchased additional inventory – also with the encouragement of his Bank of Montreal branch manager.

But when the royalty payment came due, the bank declined to honour the pre-authorized automatic debit. The manager then went to the owner of the franchise and explained that the “higher-ups” at head-office had refused his request to increase the credit limit – and that the bank would first have to obtain additional security in the form of a mortgage against his and his wife’s home.

Regardless, the bank assessed what was then its standard $16 NSF charge for the pre-authorized debit that it had declined to honour, but also increased the debit balance of the operating / overdraft account by the $92,800 anyway.

It then allowed the falsely-inflated balance to remain for four days, followed by a $92,800 credit under an actual or constructive error correction code.[44] Then at the end of the month it charged him almost $200 as interest for four days on the fictitious overdraft at the overdraft rate of 21% per annum. It then used the mails to deliver or otherwise traffic-in the falsified account statements.

The scope and scale of criminal-law / racketeering offences involved was simply mind-boggling. I then performed a comprehensive audit of the operating account for the full year from September 1, 1990 to August 31, 1991 to discover that the bank (management) had done the same thing 29-times!!! so as to charge him a total of about $1,200 of interest on wholly falsified accounting records and non-existent advances-of-credit that it had never made.

I then discovered that virtually all banks and credit unions in Canada were doing the same thing.

Just in respect of that single near $200 overcharge in May of 1991, at the same rate of interest as under the operating account, the bank today would owe him a refund (or minimum disgorgement) of just over $100,000, and over $600,000 just on the total $1,200 in fraudulent charges obtained that year. And they are still doing it!

This one despicable and utterly indefensible act / system of carefully coordinated racketeering activity with its seemingly minor financial consequences in fact accounts, by total amount, for all debt currently in Canada, period. Compounded interest is a double-edged-sword. And the private-banks have literally dozens of equally fraudulent practices and techniques that they employ to systematically loot the People of Canada.

Beyond that, it is evidence of a deeply-engrained and pathological obsession of the owners of the banks to dominate and to punish – as well as revealing themselves to be no more than grubby-little Dickensian thieves.

The fact that the owner of the franchise had demonstrated what they perceived as vulnerability because of the bank’s own decision to decline the automatic debit for its own equally coercive purposes, caused them to move in like jackals, and it did not matter in the slightest that they were prima facie violating over a dozen domestic criminal law, mail-fraud, and international racketeering laws.

Among the most intriguing aspects is that if bank-management had identically cooked its books or falsified its accounts to create bogus earned interest income for itself from a fictitious account, then no one in the industry would have the slightest problem seeing the multi-level-criminality of it. But because there was a direct-real-victim who got directly robbed or defrauded (and punished), everyone involved was required to pretend that is was standard operating procedure. The owners of the banking system are doing real and substantial (and actionable) damage to the psyches of their own employees by coercing them to participate in such flagrantly harmful and hurtful / and self-destructive activities. The same applies to VERSATILE / UPTON and the rest of them.

The owner of the franchise told me years later that he had run into his by then ex-bank-manager (who no longer worked in the financial services industry) several years later, and asked him as to whether the employees of the bank had been aware of the practice. He is said to have replied to the effect: “Of course we were aware of it – but anyone who complained was simply told that maybe they need to consider a different line of work.”

The owners and management of VERSATILE / UPTON know or ought to know of the incredibly wrongful nature of such arrangements, and it is accordingly just as wrongful and criminal for them to set up their own nominal-contracts so as to profit from it themselves directly, or by aiding and abetting some larger entity to orchestrate it.

The inability of nominal or pretended legal-professionals to see the unquestionably wrongful substance of the so-called automatic-debit system as practiced, and as an obvious organized-fraud against the s. 8(1) of the federal securities law (Interest Act) prohibiting penalties on mortgage secured debt, is simply breathtaking.

Although not quite as breathtaking as PriceWaterhouseCoopers et al., failing to notice for at least 50 years that these financial institutions are systematically falsifying their operating accounts to juice their yields by 30%, per se, in an environment that purports to measure performance by the basis-point or 1/100th of 1%. Well done, Sherlock.

Over an approximate 10-year-period from 1985 to 1995, the owner had moved his accounts from the Toronto-Dominion to the Bank of Montreal to the Royal Bank of Canada. Over the whole period the three banks collectively falsified the accounts some 300-times to burn the owner for some $10,000 employing the above-described device.

And it was all nominal Automatic-Debit-based – not once did he write a bad or NSF cheque.

Diminished-capacity / Not fundamentally What!!?

After its scandalous revival of dispensation in violation of its contract the Courts (which are the personal property of the same Crown) made a series of ever more erratic and irrational decisions regarding s. 347 in an obvious ongoing effort by the judges to cover for the financial institutions and their owners, and of course for the legal profession and its malpractice-liability underwriters.

It all cumulated in a 1989 unanimous endorsement by a panel of the Ontario Court of Appeal, subsequently ratified by the S.C.C. in 1990 (via denial of Leave to Appeal), that criminal acts committed by certain commercial entities and “classes of persons” are not illegal as long as they are advised and assisted by members of the Bar Association.

To any sufficiently-educated observer, the judges’ immediate purpose was prima facie to fix-up the problem with the criminal-law violation voiding the securities regardless of the AG’s illegal and unlawful dispensation (i.e., as expressed in the Banking Law Review article (emphasis added)):

Of greater concern to the lender is the apparent illegality of the transaction where the transaction offends the Criminal Code, which can result in restrictions on recovering principal and interest in civil actions…

Where here again we find the ever-present cognitive-distancing. Compare with:

Of greater concern to the lender is the criminal-illegality of the transaction where the transaction offends the Criminal Code, which results in the voiding of the security in civil actions, and up to five years in prison for the offending bankers, and independent money-laundering and racketeering charges against the solicitors who aid and abet them.

Literal accuracy tends to put a significantly different spin on the facts.

Also bear in mind that the defendant in the case, Mr. Carpenter, had had the same functional status as the insurance companies, discussed at the outset, that had refused to honour their policies. Mr. Carpenter was not the nominal borrower. He had simply been required to give a personal guarantee (or insurance contract) as a condition of the advance (credit reinsurance) to the corporate entity of which he and the owner (Mr. Thomson) of the nominal creditor were both directors. He had not received any premium or otherwise consideration for his agreement to re-insure the debt (lead-underwriting) of the corporation. When he later discovered that the transaction was criminal, he refused to honour his guarantee, and was sued by the nominal creditor (Thomson Associates Inc.).

1989 / 90

Judges of the Ontario Court of Appeal and of the Supreme Court of Canada seized upon the civil case of William E. Thomson Associates Inc. v. Carpenter to depose Parliament and the Crown in Right of Canada, and to take de facto dictatorial-control of government on behalf of the BAR Association and its most dominant or controlling-minds who are overwhelmingly comprised of broadly-defined commercial, corporate and financial law specialists.

On the facts, the trial judge had found that the plaintiff had undoubtedly committed a criminal offence (under s. 347), where such offence is objectively a designated enterprise-crime or organized-crime / racketeering offence, and that the plaintiff had been aided and abetted in so doing by its financial solicitors – described by the trial judge as a “leading Toronto law firm”.

And it was not merely incidental but in fact defined the whole action. The plaintiff was asking / petitioning the civil Crown Court to convert a promissory note that it had demanded and received in the commission of – and as security for – a criminal transaction. The plaintiff was literally asking / petitioning the Court to launder proceeds of crime for them.

The plaintiff had also committed several additional / collateral racketeering offences – including fraud and forgery – by providing for the falsification of the securities to conceal the underlying criminal interest rate of 145% per annum (legal max is 60%), and an independently-illegal and criminal $45,000 kick-back to the plaintiff and its leading Toronto law firm, and that the nominal plaintiff was a constructive middleman that had obtained its nominal loan funds (reinsurance-in-fact) from the CIBC (Canadian Imperial Bank of Commerce) whose management had apparently been aware of the real (criminal) terms of the agreement, thus making the bank’s management (and all of the lawyers involved) the technical ringleaders of the resulting criminal organization as defined under the Criminal Code.

In total, the facts established at trial – and accepted and maintained by all of the Courts throughout – established at least fourteen (14) domestic criminal-law and international racketeering-law offences, and the Courts / judges acknowledged as much:

“[T]here is no doubt that the corporate plaintiff [directly funded / reinsured by the CIBC] committed an offence under s. 347(1)(a) by entering into an agreement or arrangement to receive interest at a criminal rate” [also via front-loading ($45,000 kick-back converted-in-advance)[45] contrary to s. 347(1)(b), (and also forgery / falsified-securities and money-laundering) to conceal it] [and] “The parties…acted on the advice of their solicitors” [described elsewhere by the trial judge as “two leading Toronto law firms”]

Based on the established facts, (1) the Courts had no jurisdiction to even hear the civil-claim-case / petition, (2) the nominal plaintiff had no right or capacity to even be there (no capacity to assert or maintain locus standi in curia), and (3) the lawyer(s) for the plaintiff ought to have been disbarred and arrested for even filing the petition asking the Court to convert / launder proceeds of crime. (For bringing the administration of justice into disrepute, and for an act of attempted-money-laundering).

By law the judges of the Courts were required to provide for the arrest of the controlling mind of the plaintiff corporation, the solicitors from the Toronto law firms, and the bank officers who had approved and funded (reinsured or re-reinsured) the criminal transaction – also involving significant accounting fraud and an entire raft of offences against the Bank Act.

Instead, the former bank-lawyers, many of whom had been directly appointed or elevated as judges by a former bank-director (Prime Minister Brian Mulroney of the same CIBC that had provided / reinsured the funds for the criminal transaction), ruled and / or ratified that although clearly criminal and racketeering, what the bank, the plaintiff, and its leading Toronto law firm had done is not fundamentally illegal because the criminal law only provides for the severe punishment of offenders but does not expressly state: Don’t do it (and by a virtual masterpiece of cognitive-distancing by stringing together statements that are not categorically false)):

“…[The criminal law [Section [347(1)(a)]][1], … provides only for punishment of persons agreeing to receive interest at criminal rates but does not prohibit agreements providing for such rates….”

The purpose of [the criminal law [s. 347(1)(a)]] is to punish everyone who enters into an agreement or arrangement to receive interest at a criminal rate. It does not expressly prohibit such behaviour, nor does it declare such an agreement or arrangement to be void. The penalty is severe, and designed to deter persons from making such agreements. … It is designed to protect borrowers … It is not designed to prevent persons from entering into lending transactions per se…. Therefore the agreement [which the Court / judges have found and acknowledged to be contrary and offensive to the criminal law, and which criminal law is a designated / racketeering offence] is not fundamentally illegal.”[46] (Thomson, (William E.) Associates Inc. v. Carpenter [1989] 34 O.A.C. 365).

Notwithstanding that the judges’ reasoning was (1) directly contrary to 400-years of well-established and obviously-correct law (that a penalty legally imparts a prohibition), and (2) regardless clinically and criminally-insane by real and existing medical and psychiatric standards, the Court / judges then wholly and unlawfully and illegally ignored all of the domestic and international criminal-law and racketeering violation(s) by the plaintiff, by the bank, and by the financial solicitors, and then gave the offending plaintiff full judgement.

The Court / judges were bound also by the federal Evidence Act to take judicial notice of all of these multiple additional offences that were automatically (prima facie) established on the same facts, including and especially, laundering of proceeds of crime, constructive forgery, fraud, and the solicitors having counselled (and independently aided and abetted) their clients to commit several enterprise-crime / racketeering offences, and to conceal it through falsified securities and / or falsified collateral documentation (emphasis added):

Judicial notice shall be taken of all Acts of Parliament, public or private, without being specially pleaded. R.S., c. E-10, s. 18.,

Note also and especially that this law is in the form of a direct order that the Courts / judges shall do it, thus making their decision regardless fundamentally illegal – a racketeering and sedition-level Catch-22.

Note also the functional similarity of s. 18 to the common law offence of Misprision of felony:

MISPRISION. (1) Misprision of felony: “Every one [judges included] who knows that any other person [Plaintiff in a civil action] has committed felony and conceals or procures the concealment thereof [by violating s. 18 of the Evidence Act], is guilty of misprision of felony” (Steph. Cr. (9th ed.) 158. See also Sykes v. Director of public prosecutions [1962] A.C. 528. [Stroud’s Judicial Dictionary of Words and Phrases, Fourth Edition, 1973]

The whole justification for allowing judges to be directly appointed by politicians is that there is no great level of discretionary powers. The judges have no lawful authority to look-the-other-way on the objectively-defined racketeering offences nor the offences committed by the lawyers and the bankers simply because they don’t like the legal consequences. Even just under s. 462.3(c) and the Court’s finding that the plaintiff had been aided and abetted by a leading Toronto law firm:

enterprise crime offence [now (and post-2001) called a “designated offence”]” means

(c) a conspiracy or an attempt to commit, being an accessory after the fact in relation to, or any counselling in relation to, an offence referred to in paragraph (a), (b) or (b.1) [e.g. ss. 462.3(a)(xiii.1) (s. 347)(criminal interest rate)].

The fact of it was directly contrary to the answer that the judges and the bank solicitors needed in Thomson, and the whole sub-issue was simply omitted from the appellate Court’s written decision as if it had never existed. Do you think that maybe they all just forgot? Or were they perhaps incapable of even forming the thought of it?

They certainly didn’t have a problem with it while throwing the widow of a man killed in a car accident under the bus because he had almost but not quite entirely quit smoking. The law is the law.

The same system had no problem likewise throwing the widow of a man taken hostage and murdered during a botched robbery attempt under the same bus due to a little scar tissue on his heart – After all “Do we make an exception in this case – or do we go by the rules and the law?”

And the But-the-system-will-collapse defence has no ultimate merit because the Courts always have the legal De Facto doctrine or doctrine of necessity to fall back on in precisely these circumstances. In the Manitoba Reference case in 1970, for example, the Supreme Court of Canada ruled / upheld that all the laws in the Province of Manitoba were legally null and void as unconstitutional because they had been enacted solely in English instead of both English and French as required by law.

But they then invoked the legal De Facto doctrine to hold it all in abeyance while giving the Province a year or however long it took to fix it. And that is the real issue here and now. The former bank lawyer / judges and the people they really represent absolutely do not want to fix it at all. They want their racketeering-based false-document, forgery and kick-back-fuelled free-ride on the financial gravy-train to last forever.

The same judges and the same Courts regardless then asserted (under the same decision) that henceforth the Courts have jurisdiction to (1) grant standing before the civil Courts to criminal-law violators, and (2) enforce contracts and financial securities that are in violation of the criminal law, including and especially racketeering / organized-crime offences (and all other laws enacted by Parliament) and the international anti-racketeering / anti-organized-crime laws and treaties to which Canada is a contracting-state-party, and based solely on the former-bank-lawyer-judges’ personal opinion of:

[T]he serious consequences of invalidating the [criminal] contract, the social utility of those consequences, and a determination of the class of persons for whom the [criminal] prohibition was enacted…[47] [!!!!!!]

Henceforth the directly-appointed former-bank-lawyers and professional-language-manipulators will take the laws of Parliament and the international treaties under advisement, but the Courts and judges are now the absolute authority, and not either Parliament or the People it lawfully and legally represents.

Henceforth the law is no longer the law of the land – but instead the law of the person – also known as government by administrative-apartheid or selective-non-prosecution.

It was, in-fact and in-law, a political and criminal coup d’état. And all for the noble cause (and independent financial crime by the Courts / judges) of covering-up and avoiding responsibility for the most massive criminal and racketeering operation in the history of the world.

Also contrast the final condition mentioned above: “…the class of persons for whom the [criminal] prohibition was enacted” with its observation under its main chain-of-reasoning that this criminal law that makes it a criminal offence to enter into an agreement or arrangement to receive interest at a criminal rate was not intended to apply to lenders or creditors because “It is designed to protect borrowers.”

Just more prima facie and overwhelming evidence of a system wholly driven by the answer it needs and reason-be-damned.

Actually the true coup de grâce was the Court’s final word ordering Mr. Carpenter to also pay Mr. Thomson’s legal costs for Mr. Carpenter having had the audacity to rely on the criminal law as a defence to a civil action.

The Courts across Canada then acted quickly to apply, ratify, entrench and expand the new doctrine of Criminal and Racketeering but not fundamentally illegal.

BCORP Financial v Baseline Resort Developments Inc. (1990), 46 B.C.L.R. (2d) 89 (B.C. S.C.); J.D.M. Capital Ltd. V. Smith (1997) , 39 B.C.L.R. (3d) 340 (B.C.S.C.); Loghlean v. McNabb, [1997] I.L.R. I-3482 (Ont. Gen. Div.); Milani v. Banks (1997), 32 O.R. (3d) 557 (Ont. C.A.); Pilan Properties Ltd. & Carpentry Ltd. V. Masnyk (April 2, 1996), Doc. 27695/91/U (Ont. Gen. Div.); 271053 N.B. Ltd. V. Burton (1996), 183 N.B.R. (2d) 155 (N.B. C.A.); Keevil v. PT Southern Cross Aqua Culture Indonesia (1995), 15 B.C.L.R. (3d) 45 B.C.S.C.); Olympic Enterprises Ltd. V. Dover Financial Corp. (1995), 147 N.S.R. (2d) 121 (N.S. S.C.); Barrie v. 687844 Ontario Ltd. (1994), 43 R.P.R. (2d) 267 (Ont. Gen. Div.); Hajek v. Riedelsheimer (March 2, 1994), Doc. CA C12640 (Ont. C.A.); Painter v. 745100 Ontario Ltd. (January 14, 1994), Doc. Hamilton 955/89 (Ont. Gen. Div.); Standard Trust v. Brillinger (September 19, 1994), Doc. CA C9872 (Ont. C.A.); T.F.P. Investments Inc. (Trustee of) v. Beacon Realty Co. (1994), 17 O.R (3d) 687 (Ont. C.A.); Terracan Capital Corp. v. Pine Projects Ltd. (1993), 75 B.C.L.R. (2d) 256 (B.C. C.A.); Ingram v. Dorian (1992), 22 R.P.R. (2d) 198, (Ont. Gen. Div.); Kebet Holdings Ltd. v. 351173 B.C. Ltd. (1992) 25 R.P.R. (2d) 174, (B.C. S.C. [In Chambers]); Terracan Capital Corp. v. Pine Projects Ltd. (1991), 20 R.P.R. (2d) 187 (B.C. S.C.); Affordable Payday Loans v. Harrison, 2002 ABPC 104, [2003] 2 W.W.R. 757 (Alta. Prov. Ct.); 1512759 Ontario Ltd. v. OLE Canada Inc., 2002 CarswellOnt 4060 (Ont. S.C.J.); Dunlap v. Iveszic, 2001 CarswellOnt 2656 (Ont. S.C.J.); Garland v. Consumers’ Gas Co., 2001 CarswellOnt 4244, [2001] O.J. No. 4651 (Ont. C.A.); Fernandez v. Colucci, 2000 CarswellOnt 5225 (Ont. S.C.J.); Degelder Construction Co. v. Dancorp Developments Ltd., 1998 Carswell B.C. 2246 [1999] 5 W.W.R. 797 (S.C.C.); L & M Downtown Legal Services Inc. v. Ontario Realty Corp. 1998 CarswellOnt 322, [1998] O.J. No. 379 (Ont. Gen. Div. [Commercial List]; Roberts v. Buhr, 1998 CarswellBC 1962 (B.C. S.C.);

These decisions define official commercial policy of the Courts in Canada so as to affect virtually every commercial (credit / securities) contract in the country. The first fifty-plus written decisions that so quickly followed Thomson were, and remain, a clear and unambiguous message to the financial law community that anything goes – and a virtual crossing of the Rubicon by the civil court system and that the Canadian judiciary, radically over-comprised of high-level former “corporate, commercial and financial law specialists” at the appellate level, has no choice but to continue its clear policy of relentless accommodation of technical and actual racketeering activities by private financial institutions.

A few years later the Ontario Court of Appeal made another major / significant adjustment to the new system (i.e., to tie up some loose ends).

Technical deficiencies

In 1997 a panel of the Ontario Court of Appeal unanimously reversed an Ontario trial judge while concurrently demonstrating mens rea, or guilty mind, with respect to the same Court’s constructive / de facto coup d’état against the Parliament of Canada inherent to the earlier Thomson decision (nominally ratified in1990).

In Beer et als. v. Townsgate Developments I, et als. [1997] 152 D.L.R. (4th) 671, certain nominal purchasers of high-rise condominium units (Beer et. als. (and others)) were already suing the developer / vendor for rescission (legal nullification / cancellation) of contracts-of-sale due to (conventional) fraud and / or misrepresentation, when it came to light during the civil trial that the developer / vendor had also not been licensed as directly required by provincial statute.

The trial judge held the contracts-of-sale to be void and unenforceable therefore, and more so because, citing Thomson, the provincial statute (s. 6) expressly prohibits the sale of any units by an unlicensed vendor (emphasis added):

6. No person shall act as a vendor or builder unless he is registered by the Registrar under this Act.

The trial judge noted that these particular contracts “are fundamentally illegal” under the stated reasoning of Thomson. Again citing Thomson she concluded that the provincial legislation is “a clear and unambiguous prohibition” against sale prior to registration, and that such “prohibition in s. 6 of the Act is fundamental to the nature and purpose of the regulatory scheme”.

At that point the vendor’s mainstream (corporate) solicitors became liable for some very substantial financial losses. The vendor then appealed to the Ontario Court of Appeal, which then unanimously overturned the trial judge / decision by radically expanding and quasi-complimenting-yet-contradicting the new doctrine of “criminal and racketeering but not fundamentally illegal”.

From the headnote summary, at p. 671 (emphasis added):

On appeal to the Ontario Court of Appeal, held, allowing the appeal [i.e., reversing the trial decision], the effect of the breach of the statute was not to render the contracts void.[48] Public policy required that contracts should not be rendered void on account of technical deficiencies.

Ever since, the commercial / money-claim (Admiralty) courts in Canada have adopted an oscillating duology or duopoly for dealing with illegal provisions in commercial contracts and especially financial securities. If the provision is criminal, then they normally cite Thomson[49] as authority for the doctrine of criminal / racketeering but not fundamentally illegal, and enforce the contract anyway.

Alternatively, if the illegal provision is in the form of a direct prohibition, then they cite Beer et al. as authority for enforcing the contract anyway, because even expressly prohibited contracts should not be rendered void on account of such technicalities or technical deficiencies.

There exists in Canada as a result a literal and de facto codified two-tiered civil / money justice system that turns on the person of the offender. The whole policy of the law is now officially to maintain living humans as inherently subservient to a corporate superstructure, and more specifically to the entrenched-money-power.

The practical meaning of the words and policy is: Corporate domination over living humans should not be negated merely because the technically criminal human lawyers / solicitors behind the corporations mess up on the details of their fraud.

The journey to a perfected and balanced system of little-people-law and money-power-law is very near complete.

All civil and criminal statutes and other nominal laws in Canada are now mere guidelines that the Courts may consider, but which no longer have the force of law, per se. The Courts (as BAR / bar association front) have declared themselves ad hoc (special purpose / case-specific) dictators and outside of the control of Parliament notwithstanding that the broadly-defined appellate Courts are themselves created by Parliament or the provincial Legislatures.

Thirty years later (post-1990), virtually every nominal financial security in Canada is saturated with criminal and racketeering law violations.

The precedent set in Thomson, that criminal / racketeering offences are not illegal (fundamentally or otherwise), was only the opening round of an ongoing process – that is why the lawyers call it precedent. For the past thirty-years it has been as if there has been an ever-escalating global competition between the former-bank-lawyers who are directly appointed as judges – and the current-bank-lawyers who draw up the securities, to see who can come up with the most ridiculously fraudulent and irrational excuse or justification to accommodate flagrant criminal and racketeering activity by the bankers and the rest of the so-called global financial system.

Returning to the nominal security under which you underwrote and advanced $800,000 of real-estate-secured-credit to VERSATILE / UPTON, the security – paradoxically both carefully and carelessly prepared by solicitors for VERSATILE / UPTON, expressly and emphatically provides that:

In return for the lender agreeing to lend the principal amount The lender does not have to advance…the principal amount…

Given the dozen or so prima facie criminal and racketeering-law offences so defined, how did the judge who issued process under the foreclosure application by VERSATILE take “Judicial notice…of all Acts of Parliament, public or private, without being specially pleaded.” if they never read even the scandalously defective security – let alone the collateral documentation that is just as criminal?

How can a judge take judicial notice of the myriad domestic, accounting, and criminal law violations prima facie in the whole package if the judge never reads it?

The document is clearly false in a material particular (at least a dozen of them) and therefore a false document and forgery-in-law (again under Gaysek [1971][50], among others).

And why don’t the lawyers representing the nominal borrowers ever even seem to raise the issue of massive and overwhelming criminal-law offences in their opponent’s documentation? An honest observer would have to conclude that both lawyers are de facto representing (are gate-keepers for) the criminal offenders.

Management of VERSATILE and UPTON are in the business of knowing that their bare agreement to loan is a leveraged-double-counting device and not a real consideration and regardless contrary to GAAP and that no separate or distinct service is provided – even if it were a money-lending transaction instead of credit-reinsurance.

They have no more reason to believe in the bona fides of their alleged business than did management of Eron Mortgage in 1997.

They have illegally held out the bare chance of you obtaining a loan of money as an illegal / criminal consideration, and as the bait in a prima facie / naked bait-and-switch, so as to obtain real-estate-secured-credit from you by fraud or false pretence, all in primary concealment from you that they are merely converting your assets through a system of credit reinsurance and not bringing in any genuine outside money to loan to you.

Business custom defence

Normally the managed-mental-illness will manifest by a claim of what is called policy or a business custom. They don’t seem to grasp that offences against the criminal law cannot qualify as either policy or business-customs (there are objective rules for same and none of these practices-in-fact even come close to satisfying them).

As a matter or policy or business-custom, the mafia, for example, burn down businesses whose owners refuse to pay protection money.

Likewise, management of every bank and other nominal or pretended financial institution in the country may cook their books under the falsification of accounts technique (as a compounding of the Automatic Debit pretending to be NSF device) – but that does not make it proper, lawful, or legal. That is why they go to such extraordinary lengths to hide it or deny it. The error-correction code is an especially nice touch. In the case of our Home Hardware franchise-owner, the bank management provided a partial refund when it got caught – but then continued the scandalously criminal practice regardless. Too much money involved to stop.

The practice and process on its face involves falsification of an account, fraud, breach of trust, breach of fiduciary[51] duty, embezzlement, constructive and actual forgery, uttering forged documents, receiving payments or partial payments of interest at a criminal rate, mail fraud, laundering proceeds of crime, racketeering, and, strictly speaking (in this particular case), piracy.

And here again, the Royal Bank of Canada, and most, if not all, of the others, engage systematically in the same practice. In its case, when confronted by the customer (owner of the Home Hardware franchise) in 1994, (its) solicitors / lawyers sent a letter in reply (as the bank, i.e., on Royal Bank letterhead and under the legal persona of the bank itself) with an accounting of the interest assessed on the falsified balances and a refund notice for the total (on the few statements that he had sent them to identify and complain about the practice).

Re: 662[xxx] Ontario Inc. – Mr. [franchise-owner/customer]

Further to your letter of October 14th, 1994, the Overdraft Interest totalling $145.85 has been credited back to the company’s Current [i.e., operating/overdraft] Account at this office. Documentation to support these calculations is enclosed.

But then the bank (or rather its management) continued to employ the same device as it does to this day. The practice appeared to be worth at least $100 million per year to financial institutions in Canada (about $300,000 a day) in terms of new direct real interest charges and overdraft fees on falsified account entries and balances (based on the data I had in 1998 to the end of fiscal 1995).

The franchise-owner also took my preliminary report on his accounts at the Bank of Montreal to the local RCMP detachment, where the young officer in charge read it and said to the effect: “Well that’s not high finance – that’s just theft!”.

He went to speak with the manager of the Bank of Montreal, and three days later was called in to the local branch of the Royal Bank where he and his wife had their own home mortgage. He was informed via innuendo that if he did not drop the matter at the Bank of Montreal, then the Royal would likely lose confidence in him and be forced to call in his own mortgage.

Welcome to Canada.


Alleged securities are saturated with criminal and racketeering law violations

Today virtually every mortgage in Canada contains one or more (and normally most) of twelve primary and positive criminal devices (and one constructive (no. 13)). They are:

1. False receipt for payment of, and receipt of, money / proceeds;

2. False denials of nominal / pretended creditor (credit insurer / reinsurer) liability;

3. False declaration of property ownership and / or registration-status of ownership;

4. False declarations of compliance with securities-law disclosure requirements (including also in fraud of the financial markets).;

5. Fictitious and / or illusory consideration;

6. Bait and switch;

7. Wagering / racketeering provision(s);

8. Increased rates upon default / maturity and / or illegal penalties;

9. Civil and criminal-law Illegality disclaimers;

10. Deemed / pretended-damages provision(s) / jurisdictional fraud;

11. Unearned interest (credit / loan fees) illegally capitalized in advance (Front-loading);

12. Use of the nominal (“false and seriously misleading”) method of interest calculation; and

13. Concealment / suppression of any or all of the above by splitting the agreement into two or more separate documents.

And which is / are on-its-face (prima facie) offensive to at least the following indictable (Criminal Code of Canada) offences / felonies (most are “serious [organized-crime / racketeering] offences”) and most of which are international-treaty-enjoined racketeering / designated offences:

  • s. 206(1)(a) (making or soliciting scheme or proposal to loan or to advance credit by any mode of chance),
  • s. 347 of the Criminal Code (entering into agreement or arrangement to receive, and / or receiving, payments or partial payments of, interest at a criminal [infinite or astronomical] rate),
  • s. 362 of the Criminal Code (obtaining credit (underwriting / assumption of debt from issuer of the security (nominal / pretended borrower) by fraud or false pretence),
  • s. 363 of the Criminal Code (obtaining execution of valuable security by false pretence),
  • s. 366 of the Criminal Code (making [and / or soliciting] false document with intent (forgery-in-law)),
  • s. 368 of the Criminal Code (uttering forged-document-in-law),
  • s. 375 of the Criminal Code (obtaining (subsequent nominal payments) by instrument based on forged-document-in-law),
  • ss. 380(1) of the Criminal Code (fraud),
  • ss. 380(2) of the Criminal Code ((incipient) fraud upon the (financial) markets).
  • s. 386 of the Criminal Code (false statement / omission of material particular to deceive registrar),
  • s. 388 of the Criminal Code (false / misleading receipt)[52],
  • s. 397(1)(a) of the Criminal Code (falsification of an accounting record),
  • ss. 397(1)(b) of the Criminal Code (fraudulent omission of material particular from valuable security),
  • ss. 462.3(c) of the Criminal Code (counselling to commit enterprise crime / designated offence(s)),
  • ss. 462.31(1) of the Criminal Code (laundering proceeds of crime).

But the bankers, and the commercial, corporate, and financial law specialists who aid and abet them, are incapable of seeing the cesspool of rampant criminality into which they have descended – All they can see is their future bonus checks under which they earn a kickback as a rake-off from the corresponding proceeds of crime.

Almost the entire planet is under the de facto care-and-control of a professional-criminal-class, itself comprised of professional-schizophrenics and sycophants who are not competent to run a lemonade-stand, let alone a complex global economy.

And it is all ratified and justified by the former-bank-lawyers and bank-solicitors who are directly appointed as judges by former bank-directors as “not fundamentally illegal” because the criminal law only provides that offenders will be severely punished but does not expressly state: Don’t do it.

And these are among the purported keenest legal minds in the world.

Seventy-five years ago, at the end of World War II, we in Canada were fewer than twelve million people in possession of about one-tenth of the world’s broadly-defined diverse natural resources. Today we have a relative handful of elites who have done very well for themselves, by selling out the rest of us to organized-asset-harvesters who do not produce anything real.

That has to stop.

Commercial law is Admiralty law

The global finance and commercial law systems are founded in admiralty or maritime law where the captain’s (Crown / Court’s) word (policy) is law while the ship (of state) is at sea.

But what happens if the ship enters what are known to be dangerous waters while the captain appears on deck in a pink tutu and insists and orders that no one touch the ship’s wheel, and that the ship will be safe as long as he continues to dance Swan Lake on the foredeck?

At that point the crew has not just a right but a lawful obligation to relieve the captain of his command. And if the crew (government) is affected by the same disease or disorder of the mind, then that same obligation falls on the passengers (citizens).

The doctrine / policy of Criminal and racketeering but not fundamentally illegal is the Captain (English Crown in Right of Canada and / or its own invisible friend the English Crown) in a pink tutu attempting to dance Swan Lake on the foredeck of the ship of State.

These distinguished gentlemen (and increasingly, ladies) are prima facie not competent to hold their positions of nominal authority, and they are in fact a clear and present danger to the human species.

It is only a matter of time before someone in such nominal authority pushes the wrong button at the wrong time while believing absolutely that it is the right thing to do. We allow them to continue at our aggregate and collective peril.

Appendix A – Macro Chronology of closely-relevant events

1880 – Crisis in Ontario due to farmers leaving the country in droves for the United States due to a property-harvesting scheme run by quasi-mainstream bankers and lawyers.

Bankers send lawyers out into the countryside as their agents to persuade farmers to expand (normally double) the size of their farms by borrowing money from the bankers (loan societies).

Mortgages contain a variety of devices for misrepresenting the interest rate, including bonuses and loan fees, but also and critically, complicated legalese stipulating for de facto property forfeiture penalties for missed or late payment.

Bankers and lawyers sit back and wait for first widespread crop failure whereupon the whole expanded farms are forfeited to the bankers, and the farmers still owe the money, causing them to flee to the U.S. to start over and to avoid constructive or actual debtors’ prison.

Courts respond with – “Sorry, the law is the law – What else can we do?”

In response, House of Commons begins process to introduce law limiting all interest in Canada to a maximum of 6% per annum.

Appointed / unelected members of the Senate, as representatives of the entrenched-money-power, react to the effect: “No! No! No! – You can’t do that!” Here is the deal:

Senate introduces its own bill to create Canada Interest Act under which (1) all penalties on mortgage-secured-debt are directly prohibited and it is an offence to even stipulate for them. Any mortgage stipulating for late payment penalties or higher rates upon default is henceforth an illegal contract.

Under a different section (now s. 6), all mortgages are to state the actual or net amount received by the borrower for their own use (net of any fees, expenses or rebates or kick-backs to the nominal lender) irrespective of the amount secured, and the real or effective rate of interest defined-by and measured-against that amount actually advanced.

Certain members of the Senate insist on complicating the language of the disclosure section to spell-out every form of mortgage then known, with the sole and irrational exception of what they called a straight loan where in order to qualify for the exemption the mortgage would have to already comply with its requirements. At the time, it made no sense at all.

They also insist on adding a half-yearly interest rate option so that farmers who paid interest twice per year could agree to a half-yearly rate or rate-per-six-month-period instead of an annual rate so as to ensure there were no tricks or other deceptions.

Soon after the Act is passed, Canadian creditors invent the concept of “calculating” an annual rate of interest “half-yearly” so as to achieve by other means exactly one of the frauds that the law had been enacted to prevent. Hence Professor Waldron’s observation in her 1992 book, The Law of Interest in Canada:

The affinity of those who draw up mortgages for this rather unusual use of the term [“calculated”] is perhaps explained by its appearance in the magic phrase of the Interest Act……it [“calculated”] is not a term that appears in textbooks on business mathematics and seems to be peculiarly Canadian in this usage. (The Law of Interest in Canada, by M.A. Waldron, Carswell 1992, at p. 38.)

After 140 years, the aggregate financial fraud carry-forward from this one seemingly minor deception now accounts, by total amount, for all debt everywhere in Canada, and by several times over. Calculating semi-annually converts for example a stated 12% into 12.36% and that relative 0.36% differential currently forms a cumulative and aggregate trust amounting to several trillions of dollars.

See also Appendix 5 on the egregiously fraudulent nominal method of interest calculation of which calculating semi-annually is a form or subtype. An average or typical nominal payday loan in Canada, for example, bears interest at an annual rate of about 30,000% per annum, but passed-off, using the nominal method, as about 300%.

It is not just criminal in the ordinary sense of the word, but these are genuine crimes against humanity. These so-called micro-lenders are loaning money to the working-poor and more specifically targeted at minorities at average rates of about 30,000% per annum “At the Pleasure of Her Majesty” to cripple them financially and radically reduce their working-capital so that they remain in a state of perpetual poverty and political powerlessness (or which is at least a reasonably foreseeable consequence of it).

The same near-inconceivably fraudulent alleged interest calculation method has been banned in the U.K. since 1974 as criminal fraud on the grounds that it is “false and seriously misleading” – but Canada’s banker-lawyer-judges have made a policy decision that Canadians don’t need to know about that.[53]


By the early 1920’s nominal institutional creditors are ever-increasingly using-again as the concealed front-loading of illegal loan-fees starts to get out of hand again.

Main complicating factor is that the institutions are organized and the players (management and solicitors) know how to play the system, but there are also individual private lenders who see their ability to get away with it as anything-goes.

In 1926, however, the Ontario courts (on Appeal from the decision of a Master) threw a spanner / monkey-wrench into the whole process by unanimously upholding the trial decision in Lastar v. Poucher that the federal mortgage securities law could not be avoided by omitting the fact and amount of required side-agreements for kick-backs to the creditor.

The actual / net advance had been $3,000 at 75% per annum, while the registered mortgage claimed that the principal amount was $5,000 and that the rate of interest is 7%. There was also claimed to be an undisclosed (and unregistered) side-agreement for a $2,000 bonus payment / kick-back from the nominal proceeds to the creditor for “making the loan”.

Any rational society would have immediately prosecuted the creditor for the myriad self-evident or prima facie criminal offences involved:

Hypothetical Prosecutor: As I understand it Mr. Lastar, you agreed to loan $3,000 to Mr. Poucher at an interest rate of 75% per annum, on condition that he would agree to the falsification of the mortgage security to claim that you had loaned him $5,000 at 7%. You then provided for the registration of that falsified security at the public land-title registry. Is that correct?

Mr. Lastar: Yes that is correct. You see I use my investments in mortgage-secured-loans as security for other transactions of my own and a registered security claiming and evidencing that I have invested $5,000 at 7% is much more valuable to another creditor than one claiming $3,000 at 75%. Also, this way I can misrepresent the $2,000 difference as capital gain on my tax returns instead of having to declare it as interest income. And if Mr. Poucher were to go bankrupt, then I can use the falsified security to claim to be a secured creditor for $5,000 when I had only actually loaned or advanced / invested $3,000. The unsecured creditors get burned but, hey, its a rough world out there. And of course there is the pure public embarrassment of registering a mortgage-secured loan at the public land-title registry with an interest rate of 75% per annum – makes me look like some kind of sleazy opportunist – and $5,000 at 7% is much more socially acceptable.

Hypothetical Prosecutor: But don’t you realise that what you just admitted to involves at least half a dozen felonies related to fraud and to the creation and trafficking in falsified securities?

Mr. Laster: Well yes, but everybody knows that the criminal law in that respect only applies to the little people and not to the entrenched-money-power. I’m just a fringe player in all this but as long as I employ the same criminal techniques as the major institutions the Courts will be forced to protect me. My lawyer advised me that even if we were to get caught the civil court will still act as an apologist for the system and the worst I would do is to get my $3,000 back, and while collecting interest on $5,000 in the meantime. The civil court judges may even decide against me because of the non-compliance with the federal securities law but they won’t go anywhere near the criminal law.

The civil court was indeed happy to oblige and did the right thing up to a point:

These contentions all seem to converge on one and the same point, namely, that if a mortgage prima facie conforms to the [federal securities disclosure] statute in naming a sum as principal and providing for a specific rate of interest thereon, the genesis of the indebtedness cannot be inquired into – a mixture put into a labelled bottle must be what the label calls it. But parties cannot make substantive law for themselves by agreement: Rex v. Paulson, [1921] 1 A.C. 271.

By securing the repayment of the money lent by an “agreement,” [double-counting-side-agreement for making the loan] it is sought to avoid the effect of the Interest Act [federal securities disclosure legislation] upon a loan secured by a “mortgage.” The agreement is part of the mortgage transaction, and therefore, cannot be separately considered. Any other conclusion would be contrary to the intent and purpose of the Act. If the express intention of these sections is to be overcome by some parallel undertaking, simply because it is termed an “agreement” and not a “mortgage,” but forming part of one transaction, then these sections would be rendered meaningless. (Lastar v. Poucher Weekly Court, Toronto, April 3, 1926; 58 O.L.R. pp. 589-597).

The controlling minds of the legal profession in Ontario then panic, and the Editor of Dominion Law Reports (DLR) publishes a wholly irrational Editor’s Note re: Lastar v. Poucher, where instead of advising the lawyers and solicitors to simply comply with the decision and start disclosing the required information, he advises them to start recklessly falsifying mortgages to hide their fees and kick-backs.

In Lastar, the parties had not actually gone through the motions of the side agreement for the $2,000 bonus – it was a pure pretence to explain away the falsified securities, and the Court / judge had ruled that it was irrelevant anyway. In their written decision the judge assumed or pretended that the side-agreement was real so as to explain why it made no difference. But the Editor of DLR said in effect: “Wait – there is an anomaly here because the parties never actually went through the motions of the side agreement.” – and then advises the legal profession that the way to beat the federal securities law is to actually go through the motions of the side agreements.

The lawyers were already in way too deep, and if the decision were allowed to stand, then the pyramid-scheme-du-jour would have collapsed and many of the Province’s most prestigious lawyers, solicitors, and law firms would have been looking at catastrophic financial liabilities and personal criminal charges. By urging the lawyers to engage in a ramped-up campaign of falsifying securities by doing exactly what the Court had just ruled against, they would put massive pressure on either or both of the Ontario Court of Appeal or the Supreme Court of Canada to overturn the provincial court:

Editor’s Note: [to 1926 Ontario Court decision in Lastar v. Poucher] –

In view of the extensive practice of stipulating for a bonus in advancing money on second mortgage, this judgment is of far-reaching effect. The most important finding of fact is that a bonus is “interest” within the meaning of the Interest Act,…[54] The effect of this judgment would then seem to be that if the usual practice is followed of making the mortgage for a larger sum than the amount actually advancedin fact of adding the bonus to the amount advanced and so making up the principal on the face of the mortgage[55] – and if is as also usual, the principal is payable in instalments, the mortgage falls within the Act as it is then one providing for blended payments of principal and interest and the fact that interest is stipulated for in addition makes no difference as such interest is calculated on the basis of the bonus being part of the principal. …It would be beyond the scope of a note such as this to suggest a means of avoiding the consequences of this judgment [56] but an analysis of the judgment itself shews two facts; firstly that the stipulation for a bonus in itself is not of itself illegal

[Yes it is as a fraud against the real transaction (equity), against GAAP and per diem accumulation of interest, against unsecured creditors, against the taxman, against your regulators and against the financial markets and cannot be accomplished in practice without falsifying the securities, and every competent lawyer knows it][57]

and therefore semble a separate clause[58] as to bonus would not infringe the Act, and secondly that the inquiry of the Court must be directed to the principal actually advanced and so presumably if the full face value of the mortgage is advanced and the bonus then and there deducted[59] the transaction would then not be affected by the statute. The latter method would merely be an extension of the almost universal practice of deducting from the mortgage money the fees and expenses of the conveyancing matters necessary in connection with all mortgages and need only amount to a bookkeeping entry, involving of course a separate assignment by [the borrower] of the necessary portion of the principal advanced.

There is enough evidence of managed mental illness in the Editor’s Note to support a PhD thesis in the psychiatry of mens rea (guilty mind) but the legal profession took it generally as a consensus agreement that the disclosure law could be avoided by committing constructive and actual fraud and forgery, notwithstanding the decision being explained that expressly held that it could not.[60]

Up until this point there had been no serious or substantive discussion by any of the Courts / judges to the effect that the section might not apply. Again, in 1880 the stated intent had been to spell out every form of mortgage then known to exist with a single exception where it would not make a difference anyway.

Then it all hit the fan.

In December of 1929, and about six weeks after the great stock market price collapse in New York and Toronto, a virtual disaster for the financial solicitors occurred when a unanimous five-judge panel of the Ontario Court of Appeal upheld the 1925 ruling of the trial judge in London Loan and Savings Co. [of London, Ontario] v. Meagher, applying the federal statute (s. 6 of the Interest Act) and Lastar v. Poucher requiring a financial security to state its true and complete terms. For the lawyers and solicitors it meant – “Oh sh*t!!! Now we’re really screwed!! We should have followed what the court said in Lastar v. Poucher instead of that idiot Editor at Dominion Law Reports!”

In Meagher, the actual loan had been $25,500 (round numbers) at 17% per annum, but management of the financial institution had made it a condition of the loan that the nominal debtor agree to falsify the security (registered mortgage as evidentiary instrument) to claim $30,000 at 7.5%, and / or to omit to disclose either the fact or amount of a $3,000 bonus / kick-back to the financial institution (by undisclosed side agreement), and a $1,500 rebate / kick-back to its solicitor for “examining title and putting through the loan”.

Here the creditor and the lawyers / solicitors had actually done what the Editor of Dominion Law Reports had irrationally urged (or rather would later urge) as a way to avoid the disclosure law. The lawyer had insisted that the nominal borrower give a cheque for $3,000 to be held by the creditor until after it had advanced the full $30,000. But that does not cure the non-disclosure fraud and in fact adds yet another layer of criminal activity to the arrangement (today especially as there was no specific s. 397(1)(b) respecting fraudulent omissions from securities at that time – as a general observation, virtually all financial solicitors appear to believe that the way to deal with one criminal act is to commit another to balance-it-out).

A cheque is what is called a demand instrument (and constructively (also) an evidentiary instrument) and it is a fraud to issue a demand instrument at a time when there are no such funds to the credit of the account upon which it is drawn. The lawyer agreeing not to present the cheque until after the nominal loan funds have been deposited to cover it does not cure the fraud committed as and when the cheque is created / issued. If an alleged Picasso painting is a forgery-in-fact, then it cannot be converted into a genuine Picasso by putting it into escrow!

As and when the cheque is issued and delivered, it conveys a right of property in the nominal funds on deposit at the bank.[61] If the funds do not exist as and when the cheque is delivered, then a fraud (a form of counterfeiting) is committed at that moment. That is why a cheque-issuer’s intent to get to the bank to make a deposit before a given cheque is presented for payment is irrelevant to a charge of cheque-kiting.

A cheque can in law be signed and dated and given to an agent of the otherwise issuer to hold in quasi-escrow (although I think more correctly in abeyance), because under such circumstances it is not delivered or issued as a demand instrument. But where the party who receives the cheque is a party to a fraud against the federal securities law (Interest Act) and other false-document-based felonies, that position would fall apart (That is, if an issuer intends to commit a fraud, then the NSF cheque is tainted as such as and when it is signed and put into the hands of the lawyer, and regardless of whether the lawyer subsequently deems it to be in escrow. The cheque does not become bad when ultimately presented, but rather was bad / tainted from the outset).[62]

It could also be argued that the same result could be achieved if the $3,000 cheque were sent after the otherwise main deal had closed, but that would interfere with the fraud against the nominal borrower / issuer of the mortgage (i.e., help them to realise that it is just interest in another form and / or to clue in to the fact that they are being used by the nominal lender to commit several different frauds against third parties and on other laws binding on the lender).

Most significantly, management at London Loan was in fact committing the offence of kiting – it was the same crime that they would enthusiastically and self-righteously throw one of the little people into jail for. The sole difference was the nominal class of people committing the crime.

Even just on the face of it, the nominal borrower was to receive a net $25,500 for their own purposes, yet had to deliver a total of $33,000 in financial securities (a $30,000 mortgage plus a $3,000 cheque) to London Loan to obtain it.

The Court, below, explains the arrangement while exposing all of the essential and material elements of criminal fraud by the nominal creditor and its solicitor (by (among other things) soliciting the debtor to issue the fraudulent demand instrument):

While the transaction in 1922 was in form an advance by [the lender] of $30,000 and payment of a bonus by [the borrower] of $3,000, yet it was obviously one single transaction, in which the actual advance by [the lender] was $27,000. This fact is made quite plain by the correspondence. On the 18th March, 1922, [the borrower] wrote to [the lender] as follows:-

“Montreal, 502-4 Transportation Building

March 18th, 1922

M.J. Kent., Esq., Manager,

London Loan and Savings Co. of Canada,

220 Dundas St., London, Ontario.

“Dear Sir: With reference to the sum of $30,000 which you are loaning us on mortgage of our Grand Opera House property, London, Ontario, we hereby authorise you to deduct from said loan amount, the sum of $3,000 bonus due you, and also your solicitors’ fees [$1,500] in connection with this loan. Yours truly,

“S. W. Hicks, Secretary-Treasurer”

To which the [the lender] replied by letter dated the 31st March, which in part reads as follows:-[emphasis (italics) added by Court, while bolding/underlining in mine]

“Dear Sirs: Re Trans-Canada Theatres Ltd. and London Loan – Your file No. 2672.

“We beg to acknowledge receipt of your letter of the 29th inst. enclosing mortgage, resolution, and declaration, as therein stated, and your letter of March 30th.

It has been the custom of our clients to take back a cheque for the amount of the bonus rather than to deduct the amount from the loan. They prefer not to make an exception of this case; but we will undertake to hold the cheque in escrow until cheque for the amount of the loan, less costs, has been forwarded to you.[63]

In my opinion, we must decline to treat the agreement respecting the $3,000 bonus as an antecedent, collateral, and independent contract….

The mortgage on its face appears to be a straight mortgage for $30,000 with interest at 7 1/2 per cent., and [the bankruptcy trustee], when he paid off the mortgage in 1925, was in entire ignorance of the fact that $3,000 out of the $30,000 was a bonus.

A post-dated cheque would not have served the creditor’s deceptive purpose, which is why the fraud is complete as and when the current-date cheque is created and quasi-delivered irrespective of whether it is subsequently put into escrow.

In general, though, the thing to note is that the solicitor obviously knows and appreciates that he is committing several fraudulent acts (including being a party to cheque-kiting (and / or mortgage / securities-kiting), as evidenced by the words italicised by the Court) while simultaneously fooling himself into believing that it is just business-as-usual.

The substantive issue is that the total $4,500 of kick-backs are funded from a conversion-in-fact of the falsified security. One way or another the $4,500 comes from someone else’s money held by or obtained by the creditor, and the falsified receipt for $30,000 is substituted in its place when only a net $25,500 was actually loaned (or to be loaned) to the nominal debtor. Even if it were London Loan’s own money it is still a de facto act of counterfeiting (i.e., a way for London Loan to eat-its-cake while having-it-too).

So if we substitute the details into our universal template we get:

Nominal Lender: I will loan you $25,500 at 17% provided that you give to me a marketable security that claims and / or purports to evidence that I loaned you $30,000 at 7.5%, plus a separate / unregistered side-agreement for a bonus or loan / credit fee of $4,500 to me (or some designated third party) as a rebate / kick-back from the nominal proceeds.

Nominal Borrower: But if as you say you are prepared to loan me $25,500 at 17%, then why don’t I just agree to give you a security that accurately and truthfully states that you are loaning me $25,500 at 17%? The required net totals to me are the same either way. I am obviously willing to pay the higher real rate so why are you also requiring me to help you to conceal the fact of it, and to lie about your actual / net investment?

Nominal Lender: You don’t need to worry about my interest rate / cost-of-credit disclosure fraud. You don’t need to worry about my third-party unsecured creditor fraud. You don’t need to worry about my GAAP-fraud / accounting-book fraud. You don’t need to worry about my income-versus-capital-gain taxation fraud. You don’t need to worry about my capital requirement regulatory fraud. And, above all, you don’t need to concern yourself in any way with my financial-market fraud and the culture of the pyramid / Ponzi-scheme fuelled and facilitated by front-loading unearned-interest-in-advance and falsifying the securities to conceal it. Do you want the loan or don’t you? [“[We] would prefer not to make an exception of this case”.] Sign here.

Also, it was critical that the nominal borrower not be seen to send a $1,500 cheque / payment directly to the lawyer because the lawyer was working for the nominal creditor and not the nominal borrower. It may seem a minor point but in terms of administrative procedure, at the very least it was clearly more efficient to treat both the bonus and the nominal legal fees in the same way – either by separate payment or by nominal deduction. But the nominal creditor insisted that they be given separate nominal treatment. The bonus by separate cheque, but it would nominally deduct the $1,500 for the lawyer. That is because if there were any problems the lawyer could not risk the nominal borrower suing the lawyer for malpractice and taking the position that the lawyer was working for the borrower and producing the cancelled cheque to prove it.

The lawyer was quasi-representing both parties. What he said in essence was: “Send me your signed cheque for $3,000 and I will hold it as your agent until after my other client’s cheque for $30,000 has cleared, and then I will complete the fraud against you and the Interest Act and all of the other criminal-law statutes that are thereby violated.”

Either way, a mortgage for $30,000 with interest at 7.5% per annum and a 25-year amortization will require a monthly payment of $219 for a total of 300 (months) x $219 = $65,841. But if the same monthly payment as to be made by the debtor is applied against the actual / net advance of $25,500, then the mortgage is paid off in only almost exactly 17 years.

The front-loading (or accelerated-accrual) of $4,500 of bonus and solicitor kick-back cross-leverages the total cost of credit by 8 years (96 extra monthly payments) and a total of $21,000 or about a 4-to-1 ratio and accounting for roughly half of all the interest to be paid over the 25 year period.

This is truly the most critical point to grasp; that in an environment that accommodates the ex-temporal fraud of front-loading or leveraged super-fraud, the more money the financial system channels to the legal profession as kick-backs, the exponentially more money / profits made by both the solicitors and the creditors! It absolutely turns conventional economic theory upside down. In a front-loading financial universe, higher costs mean exponentially higher profits.

And anyone who is so delusional as to think that maybe both the bankers and the solicitors are not aware of it should contemplate again for a moment that the unit-of-measurement in the industry is the basis-point or 1/100th of 1%. Like they’re not going to notice something that juices gross interest revenue by 400%?

It also meant that London Loan could arrive at the transaction with no more than $25,500, yet walk away with a sworn, notarized and registered receipt evidencing its purported investment of $30,000 of its depositor’s / investor’s money.[64]

Meagher was a trustee in bankruptcy who had paid out London Loan’s $30,000 claim in full believing that that had been the actual amount of the mortgage-secured loan (and at the constructive and actual expense of unsecured creditors). It was not until later that he discovered documents that revealed the actual / net loan had been only $25,500 and that the securities had been falsified-by-omission, and he sued to recover the $3,000 bonus / difference on behalf of the unsecured creditors (oddly, or perhaps tellingly, the trustee / legal-professional did not even question the concealed $1,500 payment / kick-back to London Loan’s solicitor(s)).

The Ontario Court of Appeal unanimously agreed with the trustee (and the trial judge), with the constructive side-benefit (or consolation) to London Loan and its original solicitor(s) of avoiding the obviously criminal means by which it had achieved the deception. (Also there was apparently no issue raised over the fact that London Loan had been receiving interest payments for about three years on $30,000 when it had only advanced a net $25,500).

Dealing only with the real transactions / cash-flows London Loan and its partner / lawyer delivered $25,500 to the theatre business in 1922, then received interest on $30,000 for three years to 1925 (or whenever the bankruptcy occurred), followed by re-payment of $30,000 from the receiver, for an actual overall return of about 40% per annum based on a registered security claiming 7.5%, while the ordinary employees and other unsecured creditors got stiffed. The crime against the unsecured creditors was committed as and when the security was falsified, even though it did not fully manifest until the subsequent default and mis-payment of the liquidation funds by the trustee.

And here again, by late 1929 when the Ontario Court of Appeal unanimously ratified the trial judge in London Loan, applying Singer v. Goldhar and Lastar v. Poucher, the top-shelf of the legal profession in Canada had morphed into one big criminal organization specializing in the falsification of securities to conceal what was in effect (actually by definition) a massive Ponzi scheme, and just six weeks after the equally massive stock price collapse on Wall Street (and on Bay Street in Toronto) was not a good time to be compelled to give up (have to pay back) illegally obtained wealth.

Bear in mind also and especially that the solicitor for London Loan, at the time of the original transaction in 1922, had been paid $1,500, more or less, for perhaps an hour’s work (not counting whatever time he spent dealing with the other party to cover-up the illegalities). That was very likely more than a year’s pay for an ordinary worker at the time. That is what the lawyer / judges were asked to protect and conceal in 1930 and it remained and remains as such in 1990 and 2020.

Effectively the $1,500 was and remains a gate-keeper fee or what the ancient Roman Empire referred to as Tribute (to Caesar). Members of the bar associations and law societies are the modern-day Caesars who must be paid tribute before a plebe will be allowed to engage in commerce. But it was also a division of the $4,500 total fraud between the two parties as particeps criminis (partners in crime). We (the solicitors / lawyers) will aid and abet you to commit six kinds of fraud but we get 1/3 of the initial fraud as a kick-back for our part in it.

Had an ordinary man or woman walked into the same lawyer’s office asking for the lawyer to fill out a pre-printed mortgage form and walk a couple of blocks over to the land title office, then they would have likely been charged from about $50 to $100 max. But if you want the de luxe package of concealing a net $3,000 kick-back, then the cost of the lawyer’s services goes to $1,500! But don’t worry – we’ll help you to steal that from your constructive or actual depositors as well and to hide it from the whole world.

That is also why these things are almost always decided by judges (former practicing lawyers) and not juries (and certainly regardless at the appellate-court / fire-wall level). A jury of ordinary citizens making an average of less than $1 per hour (or less than $2,000 per year) would have had to have decided whether $1,500 is a reasonable sum for a lawyer to spend an hour or so falsifying (to be) registered securities to conceal kick-backs in fraud of federal law and unsecured creditors. As an additional frame of reference, that $1,500 was enough at the time to purchase two brand new automobiles – for an hour’s work. Nice work if you can get it.[65]

But then, although it had taken some five years to get to the Ontario Court of Appeal after the trial decision, just 88 days later an equally unanimous Supreme Court of Canada overturned them both. So why would they do that? Normally the Supreme Court will not even grant Leave to Appeal from a unanimous panel of a provincial Court of Appeal.

Why would a unanimous five-judge panel of the Supreme Court of Canada take a diametrically opposite view of the same simple words requiring financial securities to state their true and complete terms? Well they told us why, right at the end, after a litany of non sequiturs and incoherent rambling:

The [trustee’s] argument, if acceded to, involves very far-reaching consequences. …..It might even be argued that the [full and truthful disclosure] principle would extend to the common transaction of the retention by [the creditor] of the amount of his solicitor’s bill for examining title and putting through the loan.

That is what it is all about. If the Courts were to uphold the plain language and rational intent of the law that security / evidentiary instruments must state their true and complete terms, then the legal profession would not be able to provide for the falsification of securities to conceal rebates / kick-backs to the legal profession, with exponentially leveraged profits for the financial institutions. It is called quid pro quo. This isn’t financial-market and socioeconomic rocket science either.

Also and critically, London Loan had taken clear advantage of the social contract entered into on its behalf allowing it to charge 17% (instead of a maximum 6%) on a mortgage-secured loan of $25,500. And all that it needed to do to keep up its side of that bargain was to truthfully say so on the face of the registered security.

The nominal borrower was clearly willing to pay 17% on $25,500 because that is the net amount that it received, and the rate was defined by the amount of the required payments. There was absolutely no cost, per se, to London Loan, save for the ink on the paper, from disclosing those two facts on the face of the mortgage. But they just could not do it. Why?

Because of the other five primary frauds facilitated and committed by front-loading and concealment. What management at London Loan wanted was to fraudulently convert / put $4,500 of its broadly-defined depositor’s or investor’s money into their own pockets, while substituting a falsified security (to be used also directly or indirectly in the financial markets) that overstated the company’s principal investment by $4,500, and they were willing to kick-back a third or $1,500 of it to the lawyers to make it happen.

So that is the final resort of our system of English law and commerce, and prima facie evidence of its fatal flaw. It is all or nothing and by the time any given fraudulent practice arrives at the court of final appeal, it is a choice between collapsing the whole system, in which case the solicitors (and their malpractice-liability-underwriters) bear the legal, financial and criminal-law responsibility, versus coming up with some transparently absurd reason why the law cannot be applied.

And this is how the Canadian system shot itself in the foot and set itself up for the monumental folly (or socioeconomic poison-pill) of the Criminal Code amendment fifty years later in 1980 / 81. And of course “not fundamentally illegal” ten years after that, and which opened the flood gates on systemically and systematically falsified securities under the new de facto financial-law doctrine of “Yee-Haw!!! Anything goes!! Let’s Party!”

Oh! What a tangled web we weave.

And, for what it’s worth – the underlying managed-mental-illness required for its administration is also a major contributing factor why the legal profession has such high rates of depression, alcoholism, drug abuse, and suicide.

Conversely, in the major leagues – only the true psychopaths and sociopaths survive and thrive – while everyone else pays the price for it.

Final Summary

The fact that the judge is treating the action as a routine foreclosure is a strong indication that the judge has not examined the security nor the supporting or collateral documentation.

If so, then the judge / Court is relying in fact on the negligence of VERSATILE’s / UPTON’s lawyers who have an obligation – as officers of the Court – to bring any such defects to the judge’s / Court’s attention.

Technically the thing or res before the Court is a false-document and forgery-in-law and the action itself is a request / application to launder proceeds of crime. More specifically, the “Interest Act Statement” that the amount of principal advanced (past tense) as and when executed defines the writing as a registered libel and not a mortgage at all.

It falsely denounces SHERRIN JUNE PRYCE as a debtor in respect of a transaction under which SHERRIN JUNE PRICE was and remains the lead-underwriter and creditor-in-fact / equity.

The major or anchor-offences are under:

s. 126(1) (in respect of s. 8(1) of the federal securities law / Interest Act)

s. 206(1)(a) (making or soliciting offer to loan money or to advance credit by any mode of chance)

s. 347(1)(b) (at least eight counts)

s. 380(1) (fraud)

s. 397(1)(b) (fraudulent omission from document or security)

s. 366(1) (forgery)

s. 462.31(1) (laundering proceeds of crime)

s. 462.3(c) (counselling to commit enterprise-crime / racketeering offence)

Chronologically, however, the first offence is under s. 206(1)(a) (to make or solicit offer or proposal to loan money or to advance credit by any mode of chance) and which is co-committed by the solicitors who drafted the agreements (and BAYFIELD et al.).

In theory (both law and equity) the whole agreement was void from the outset and VERSATILE / UPTON need to release the nominal security that they obtained by fraud or false pretence, and then disgorge or return to you everything that they obtained from you and the nominal security directly or indirectly.

[Appendixes 1 through 5 under separate pdf].

Timothy Paul Madden, forensic-financial-economist, and historian of equity, law, and policy.

  1. Purely for the consistent relative measurement of damages across multiple currencies, and which does not directly or indirectly involve any action or transaction denominated in USD.
  2. I have a copy the original (July 11 2017) (and relatively brief) proposal / offer of finance letter from BAYFIELD. That may well be it, but often there are more extensive terms provided in advance.
  3. There is also a $75.00 purported Discharge Fee (like a retroactive entry-fee) that objectively and independently defines the procedure / arrangement as a game-of-chance.
  4. Bear in mind that if the writing is a false-document (which it is) under s. 321 of the Criminal Code, then multiple offences are committed as and when the writing / security is sworn, signed and notarized. And any subsequent registration of the mortgage is technically an independent money-laundering offence (under s. 462.31(1)).
  5. The Assignment of Rents represents or assigns the legal-title to the gross rents (income / cash-flow of the business) to the assignee / bank. It also allows the bank to step in and receive the rents-themselves (equity-title / possession) in case of default. The larger result is that the bank often makes more additional profits trading in the Assignment of Rents in the financial markets than they make from the mortgage itself. Determining the actual value obtained by the bank can only be determined by a process of discovery.
  6. Logically it is not possible to make a loan without making the loan.
  7. Note that the technique here is more precisely bait-and-negate than bait-and-switch, but it remains prima facie fraudulent either way. Under a bait-and-switch the perpetrator substitutes something of lesser value for the thing that is first presented. Under a bait-and-negate, the thing first presented is withdrawn entirely such that the target obtains nothing instead of something of merely lesser value.
  8. Snell v. Unity Finance, Court of Appeal, [1963] 3 All E.R., pp. 50-61, at p. 59. Although it should be noted that the Court / judge should have used the word “illegal” and not “unlawful”. Things that are unlawful are wrongful with or without a law against them, and so cannot be made unlawful by Parliament. A big part of the larger problem is that there is something about the legal profession that accommodates misuse of specialized terminology to an extent that would not be tolerated in any other profession.
  9. The precise amounts (mix of principal versus interest) cannot be known with certainty due to an additional material non sequitur. The larger agreement required all of the payments to be made in advance, and which included about $1,300 of principal-repayment-in-advance – which is an obvious absurdity. But it also and regardless required the repayment of the $800,000 “principal” on the maturity date for a total of $801,300 of principal repayment from a purported $800,000 loan of principal.
  10. Subject to the equity rights and priorities of any third party direct victims.
  11. Because the man had been murdered, he was automatically given an autopsy, and that apparently revealed some minor scar tissue on his heart that was a remnant of a mild previous heart attack. There was no indication that the man had knowingly lied or concealed the fact that he had technically experienced a heart attack. Nor would there be any incentive for him do so (also the insurance company would not have returned the premiums in such case (See The Manufacturers Life Insurance Company v. Anctil [1897] S.C.C. Vol. XXVIII p.122)).
  12. Also why it is important to fill out the application forms yourself directly and not allow the agent to do it for you. The agent in the first example may have simply asked the man if he were a smoker rather than read out the actual question. By the time a claim is made, the original circumstances are normally long forgotten. I have only ever taken out one life insurance policy, but I recall that the agent asked me the questions and filled out the application for me.
  13. In 1830, the House of Lords ruled that even deliberate and malicious breach of contract is a virtue for a corporation because its shareholders are entitled to unearned and unjust enrichment by any otherwise legal means possible. The Amicable Society for a Perpetual Life Assurance Office v. Bolland et al. [1830] 4 Bligh N. S. 194.
  14. Thomson, (William E.) Associates Inc. v. Carpenter [1989] 34 O.A.C. 365
  15. The court / judge is referring to Mr. Ward’s legal status as a fiduciary of the trust that arose with the illegal delivery of the cheque. The reference is otherwise unrelated to Mr. Ward’s independent fiduciary status as a member of the Board of Guiness.
  16. In practice I think that they would be totally precluded because the Criminal Code makes them all co-offenders.
  17. I had done extensive research and analysis of Eron Mortgage and had sent the (provincial) Minister responsible a fairly detailed report shortly before the Minister ordered the shutdown and liquidation of the company. I suspect that the timing was or may have been coincidence as the scope and scale of the fraud was near inconceivable, and the forced shutdown had been planned for some time according to the Minister’s press releases at the time.
  18. I will refer to ordinary loan-fees, normally from 3% to 30% of the stated principal amount, as ordinary-double-counting, and the practice of expressly holding out the purported lender’s bare agreement as a separate consideration and a 100% loan-fee as special-double-counting.
  19. 1992 CICA Handbook – Accounting Guideline – Fees and costs associated with lending activities (p.3). Note, however, that the members of the CICA appear to be as corrupt and / or unstable as the bankers and the solicitors. Either interest-in-advance is illegal, or it is not – and any competent association of accountants would have stated categorically that it is not – instead of merely implying as such to cover their asses while concurrently accommodating the fraudulent practices of the private financial system that pays their bonuses from their (the banks’) proceeds of crime. 
  20. 2.(a) “cost” of a loan means the whole of the cost of the loan to the borrower whether the same is called interest or is claimed as discount, deduction from an advance, commission, brokerage, chattel mortgage and recording fees, fines, penalties or charges for inquiries, defaults or renewals or otherwise, and whether paid to or charged by the lender or paid to or charged by any other person, and whether fixed and determined by the loan contract itself, or in whole or in part by any other collateral contract or document by which the charges, if any, imposed under the loan contract or the terms of the repayment of the loan are effectively varied. [Small Loans Act of 1939]
  21. Small Loans Act of 1939
  22. GAAP is Generally Accepted [and legally binding] Accounting Principles/Practices, and IFRS is International Financial Reporting Standards (also in fact regardless of formal designation as such).
  23. Note the cognitive similarity here to the structure of the well-known joke: Boss: “Where are you going? It is only 3 o’clock?” Employee: “Well this morning I arrived an hour late, and so this afternoon I am making up for it by leaving an hour early!”
  24. R. v. Olan, (1978), 41 C.C.C. (2d) 145, 86 D.L.R. (3d) 212, [1978] 2 S.C.R. 1175
  25. Strictly-speaking, however, in this case we are dealing with two separate and substantive criminal offences and not a compounding, per se. The first crime would be complete with the requirement for the pure falsification of the security to claim a greater amount at a lower rate than in fact. The decision to then further stipulate for the kick-back is a different crime, plus an additional money-laundering offence, and not a mere escalation of the first crime – or at least on a most-dominant basis regardless of much unavoidable duplication.
  26. The word another is because your undertaking / underwriting of the liability is an advance of $800,000 of credit / money to VERSATILE. One year later you have to pay VERSATILE another $800,000, at which point VERSATILE will nominally discharge your initial assumption or underwriting of the liability – but VERSATILE will then still have your second payment (re-payment) of $800,000 after having arrived with nothing and having contributed nothing. You also have to give them legal title to the property in exchange for an embedded repurchase option by paying all of the money due under all of the securities (funding instruments). VERSATILE then charges-off your second payment (re-payment) to the repurchase option and walks away with a free $860,820 from you, balanced by from $718,000 to $800,000 of kited-liabilities to third parties. Plus whatever additional gains it makes from the domestic and international financial markets using / employing the mortgage and the Assignment of Rents.
  27. And directly on-point and illegal under R. v. Olan [1978]. There the accused were directors of a company who had exchanged what the Court described as “Blue Chip Securities” belonging to the company for an unsecured promissory note from a third party. The Supreme Court held that the difference in risk established the offence of fraud by the directors as and when the exchange was made, and did not depend on any subsequent default by the third party. Here in your case you were required to give away everything to VERSATILE and UPTON not merely in exchange for an unsecured liability of VERSATILE / UPTON (just as in Olan), but for the bare chance of obtaining it under a constructive wager / game-of-chance.
  28. Most every nominal loan transaction (under the false-receipt technique) is a combination of two quick-succession-irrational acts. The first is the issuer of the security swearing under oath and giving / delivering a receipt for money already received, when none has been paid or received in fact, and the second is the bank later making an actual advance when it is already in possession of a sworn, signed, and notarized and / or registered security evidencing that it had already done so.
  29. Note that under Canadian/English convention 4-11-1980 means the 4th of November 1980 and not April 11th.
  30. This provision also criminalizes the primary modus operandi of banking globally because the banks obtain possession and apparent legal ownership of the security (e.g., mortgage) as a constructive or actual loan fee (stand-by fee) for the banks’ bare agreement to loan it back to them at interest. But I won’t complicate the issue with that at this point. Sufficient to say at this point that the members of the banking committee recognized the technical criminality of loan fees converted in advance and chose to deal with it by reviving Crown dispensation and purportedly extending it into the criminal-law realm. Actually, to remain accurate and precise, the conveyance of the mortgage itself is at an infinite rate of conversion, while that on any nominal-loan-fee / kick-back from it should be based on a period of one-day. The rate remains virtually always criminal but making the distinction aids in the comprehension of what is really happening and why it is criminal. Sometimes with things like nominal “application fees” also, they will be paid in advance from the potential borrower’s own pre-existing funds, and that does involve an infinite rate of conversion because of divide-by-zero, but where the subsequent credit reinsurance is the source in fact of the loan fee to the bank, then the period is, in law, one day. The witness(es) also asserted that the technical violation might occur as a function of the party paying the fee later voluntarily choosing not to obtain the credit – but that is equally absurd because the criminal act is the receipt of the payment (under subsection (1)(b)) and so must occur or not at the moment of receipt and regardless of any subsequent act by the party from whom the offending bank receives it. It was made clear in the other sessions that the substance of the new law is under (1)(b) addressing the actual receipt of payments or partial payments of interest, and that (1)(a) regarding the agreement or arrangement was added essentially as an afterthought in case the creditor were caught before receiving any payments – it only appears first because of the chronology factor – they only put it first because the agreement to receive virtually always precedes the receipt. The fact of it is a microcosm of the larger financial system. The crime per se is the receipt of a payment of interest at a criminal rate – but virtually all of the finance people immediately default to the agreement subsection as if the fact of the offence can be avoided by how the lender describes it on a piece of paper. In the present case various employees and associates of VERSATILE and UPTON divvied up about $20,000 of what is clearly interest and taken as a rake-off from the proceeds on the day of the deal.
  31. National Banking Law Review, Vol. 9, No. 3, p. 43 (Part I), No. 4 (Part II)), PARTICIPATORY LOANS: THE CRIMINAL PROBLEM, by Alison Manzer and Rose Marie Ip of Robins, Appleby & Taub. Although, strictly speaking this particular article (including and especially its title) appears to incorporate a number of aspects designed to beg the questions nominally posed. All of the (other) articles in similar publications that directly admit the technical criminality studiously avoid the issue of automatic (strict liability) solicitor criminalization. But the corresponding front-loaded credit fees are and remain criminal regardless of any additional profit-sharing arrangements. The discussion before the Senate banking committee exhibited the same phenomenon where the example of a relatively obscure and complicated “standby fee” is presented as opposed to a “bonus” or an “application fee”, for example, where it is clear that the only purpose is in fraud against GAAP. Overall, if the authors of this article were to later lose their minds, then I shouldn’t be the least bit surprised, as they have demonstrated an amazing capacity for organized self-deception.
  32. This of itself is a very fraudulent statement. Contrast: “Of greater concern to the lender is the illegality of the transaction where the transaction offends the Criminal Code…”, with: “Of greater concern to the lender is the apparent illegality of the transaction where the transaction offends the Criminal Code…”. The addition of the word “apparent” is a form of code used among the financial law community. One of the most salient aspects of financial law commentary is the excessive presence of condition-based words and terms such as would be, may be, etc., but without the presence of any antecedent conditions to account for them.
  33. Just to point out the fact of it, and not necessarily to concede any absolute jurisdiction to the United Nations.
  34. Although here again, it is not technically necessary to go that far because the proposal was illegal and criminal from the outset under s. 206(1)(a) as a scheme or proposal to loan or to advance credit by any mode of chance whatever (“The lender does not have to advance the principal amount…unless the lender wants to.” is a mode of chance. Caprice is the most basic form of chance – Give me something of value and maybe I will give you something in return, and maybe I won’t.)
  35. Assume for example, and as the most simple case, VERSATILE were to be a direct member of Payments Canada, and that you wanted to use your $800,000 nominal loan to buy another property from some third-party seller. In order to access your (max) $800,000 of proceeds, you have to issue and sign another cheque for $800,000, payable to the Seller / Vendor, and who must then co-sign or endorse the cheque and deliver it to VERSATILE. That is why VERSATILE’s $800,000 gain is capitalized as and when the false-document / nominal-security is registered.
  36. The judge’s dissenting opinion was not applied in the case for other reasons – but his reasoning and conclusion still stand as good law.
  37. $1 billion per day is actually a reasonable estimate based on the total compounded balance forward from the illegal capitalization of interest in advance, divided by the total number of days in the period. By total amount, the phenomenon now accounts for all debt in Canada and by several times over, while requiring an aggregate of $16.4 trillion to average out to $1 billion per day for 40 years (16,400 days).
  38. In R. v. Foley, [1994] 30 C.R. (4th) 238 two men had exchanged bills of sale for $1,000 to document the swap / exchange of their vehicles (each worth in fact at least $3,800) on the belief that they would have to pay provincial sales tax on the exchange price when they went to re-register their new vehicles. It turned out that there was no sales tax payable on such an exchange, but the Newfoundland Court of Appeal explained that had they been properly charged with forgery, then they would have been found guilty because the offence was complete when they created the bills of sale with the lower price to avoid the question of the sales taxes (a fraudulent purpose) irrespective of the actual tax law. Likewise here, the registered mortgage fails to disclose the fact of the interest payments being deducted in advance, at a minimum to avoid the question of illegality under multiple accounting, civil and criminal laws (and in fact makes an objective false statement as to the fact of it).
  39. Note also the material difference between taking existing money from a different source and paying it into a nominal interest-reserve-account, versus using the nominal security itself to create the credit / funds for the nominal interest-reserve-account. In practice, virtually all such pretended funds are created by and under the securities themselves.
  40. The required payment frequency or interval is an important parameter in the financial markets where the nominal securities are ultimately directly and indirectly bought and sold by investors and the public generally. It also defines a kind of default-detection-pulse-frequency. One conventional problem with an annual-pay mortgage is that if the nominal debtor’s circumstances were to materially change, it may take up to a year and the first and only missed / late payment to find out about it. A registered payment frequency of “Monthly” makes any portfolio of such mortgages more valuable than if they were to disclose either or both of the true annual payment frequency, and the interest deducted in advance.
  41. About half of all pretended-lenders, as here, employ the fictitious or illusory consideration technique, while the other half employ the direct false-receipt technique. See again the Mortgage Payment Abatement Advisory for a detailed exposition of both.
  42. The Oxford Companion To Law. David M. Walker, M.A., Ph.D., LL.D., F.B.A., Clarendon Press, Oxford, 1980, pp. 489.
  43. After the first one-year term, the renewal appears to have been for required monthly payments actually to be made.
  44. Some institutions use an explicit / literal “Error Correction” Code while for others it is constructive (i.e., the subsequent off-setting credit is just as fictitious as the corresponding original falsification under the debit column – and so it becomes a second and criminal act of account falsification – unless it is taken as an error correction).
  45. The $45,000 was capitalized in advance under the master agreement / debenture to which Mr. Carpenter’s guarantee applied, and notwithstanding that bank management later declined to advance / reinsure the entire $250,000 “principal amount” to Thomson but only the $205,000 net. If Mr. Thomson wanted his $45,000 of interest in advance then he was going to have to wait until he actually received it (converted it again) at the end of the 3-month term. Effectively bank management fully understood the wrongful nature of what was being done and took steps to ensure that Mr. Thomson did not commit the same fraud against the bank as against the nominal borrower. But either way the offence against s. 347(1)(b) was complete when the $45,000 was capitalized to the debt on the day of the advance. Otherwise had Mr. Thomson received it as planned on the day of the deal, then that would have constituted an additional act of money-laundering under s. 462.31(1).
  46. Under the technique of stringing together statements that are not categorically false, the judge(s) cannot state or conclude: “Therefore the agreement is not illegal”. The purpose of the adverbs or adjectives like “fundamentally” is to convert the (false) statement of fact into an opinion so as to support the desired fraudulent conclusion.
  47. Thomson, (William E.) Associates Inc. v. Carpenter [1989] 34 O.A.C. 365. Note also how quickly (in the same decision) the Court / judges commit the constructive Freudian slip of constructively referring to the criminal law as a “prohibition” notwithstanding the substance of their core ruling in the same case that there is technically no such prohibition. It is criminally insane either way of course, but that’s policy.
  48. Strictly speaking, the nominal contracts never had any legal existence and so were incapable of being rendered void. Here again, the judges play fast and loose with these legal technicalities because they are committing a fraud against jurisdiction and at least one of their multiple personalities knows it.
  49. Except in high-profile class-action cases like Garland v. Consumers Gas (S.C.C. (2004)) where the judges aided and abetted the gas company and the lawyers to steal a minimum $2 billion trust owned by the illegally / criminally-over-charged customers. With up to 500,000 interested parties watching, the judges could not risk official reliance on “not fundamentally illegal”.
  50. Gaysek is important because the S.C.C. used it to do a comprehensive analysis of the offence(s) of constructive and actual forgery under the Criminal Code of Canada, and to caution the legal profession to be extremely careful because of the relative ease with which the offence is committed, owing to its two-part nature under what is now s. 321 and s. 366. Under s. 321 a false document is defined as one that is false in a material particular, which, once established, constitutes forgery under s. 366 on proof of the accused’s intent to act upon the document containing the false material particular as if it were genuine, and not necessarily on the false particular that makes it false.
  51. Note that a typical banker will maintain that the bank does not owe a fiduciary duty to an ordinary deposit account holder, but (1) the bank still owes the account holder an honest accounting regardless, and (2) after at least the first few instances of account falsification the bank lost all claim to any right of property in any subsequent deposit made by the business owner, which automatically creates a trust, which makes the bank a fiduciary.
  52. This section appears to have been deliberately sabotaged by Parliament but may still apply by strict liability. The section is very unusual (and utterly irrational) and only applies if the giver of a false receipt has a fraudulent intent irrespective of the intent of a party who solicits it from them. It is directly analogous to a criminal law that makes it an offence to receive counterfeit money, but not to pass it. Very odd.
  53. The so-called nominal interest rate is in fact a logarithmic-derivative of the interest rate and not the interest rate, per se. See Appendix 5 for a detailed discussion of the nominal-method / calculating.
  54. Strictly speaking this is a finding of law and not fact. In fact there was no bonus because the parties had not even gone through the motions. The nominal creditor only ever had $3,000 to invest and not $5,000 and so the nominal bonus was pure fiction. But here again, either way it remains a fool’s errand because it was first and foremost a false document and forgery-in-law. (Or like trying to interpret the legal meaning of a title-deed from a Monopoly game.)
  55. The Editor’s Note is laced with assertions that are literally impossible. The words “in fact of adding the bonus to the amount advanced and so making up the principal on the face of the mortgage” directly contradict and cannot be logically reconciled with the definition of “principal” – e.g., “1. The amount of debt not including interest; the capital sum of a debt or obligation, as distinguished from interest or other additions to it.” The actual meaning is “in fact of adding the bonus to the amount advanced and fraudulently misrepresenting it as investment of principal…”.
  56. Read: Pay close attention because we are about to tell you how to (presumably but directly contrary to what the Court said) avoid the consequences of this judgment while still concealing your illegally-capitalized bonuses and fees from the registrar, from your investors, from the financial markets, from the taxman, from your regulators, and from the public generally.
  57. Here again, if the practice itself were not illegal and wrongful then all interest would always be designated as “bonus” for making the loan because it is vastly more profitable.
  58. The editors mean an unregistered separate document but use the word “clause” to obfuscate prima facie criminal intent. Note that same is confirmed in the final sentence where “a separate clause” has morphed into “a separate assignment”.
  59. Note the direct contradiction – it can either be advanced and immediately paid back, or it can be deducted, but it must be one or the other and cannot be both. What the Editor is apparently trying to avoid is expressly stating that the fact of the kick-back is to be omitted from the face of the security.
  60. The Editor employs the word principal as an oscillating contradiction that oscillates between a noun / fact and an adjective / opinion to arrive at his desired result. If and when fixed throughout as either one or the other, then the piece / article simply becomes gibberish.
  61. Meaning the bank’s liability to the account owner – there is technically no such thing as funds on deposit because anything deposited becomes the property of the bank the instant it is deposited.
  62. R. v. Lemire, [1965] S.C.R. 174, R. v. Theroux [1993] 2 S.C.R. 5.
  63. Note also the practical non sequitur here too. If London Loan were to attempt to cash the kick-back cheque as soon as it mailed it (“forwarded to”) the nominal borrower, then the kick-back cheque would bounce. But the officer for London Loan appears to know that he should not spell-it-out that London Loan will hold the kick-back cheque until after the nominal loan cheque has cleared because that is cheque-kiting by definition.
  64. It is important here not to confuse the fact of an asset with its relative liquidity. Even under the relative worst-case scenario (vis a vis just the bonus) London Loan may have had to have come up with $30,000 in cash to advance to the borrower, but it would receive in exchange a total of $33,000 in assets, being a $30,000 mortgage plus a $3,000 cheque (whether slightly post-dated or current date). Either way the bonus comes in substance from the falsified securities). The actual meaning was: “Look, if we actually have to go through the motions, then it is going to completely screw up our fraudulent system. And the public will also quickly recognise what is really going on and take steps to make us obey the law, and obviously we can’t have that.”
  65. Even if there is a jury the judge will tightly control the kind of information and testimony that can be put before it.