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제목: PJ#010, PRIVACY IN A FISHBOWL

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    PJ 10
    CHAPTER 15

    REC #1 HATONN

    FRI., DEC. 1, 1989 8:00 A.M. YEAR 3, DAY 107

    FRI., DEC. 1, 1989

    Hatonn present in the light of radiance. I come this morning to calm my scribe prior to moving forward with the privacy journal. You ones may include it in the journal if you choose to leave it as is, or subtract. I believe, however, this message should go forth to all ones who will ever read a journal from this source.

    In responding to Dharma's queries I must refer, but not by name, to written material just having come into her consciousness which all but shuts down our work.

    I do not discourage this information for it gives me a most opportune opening to remind you ones of things said long prior to this and further, to allow him/her to keep moving ahead. You ones get this scribe shut off and you are going to be in most grave circumstances for THIS IS THE ROUTE OF YOUR MOST USEFUL INFORMATION NO MATTER WHAT YOU WISH TO BELIEVE. This is not the only source and do not misunderstand my statement! It is our desire that most of you NEVER EVEN KNOW WHO THIS PERSON IS--NEVER! UNDERSTAND ME WELL--HIS/HER VERY LIFE IS IN THE BALANCE.

    In the Phoenix Journals truth is being brought forth on about every subject which impacts you to the greatest extent. You will find yourselves clutching unto your favorite subject and dissecting it with a microscope. I have no objec­tion whatsoever to your doing that. However, you will keep some things clearly in mind as you do so. I CARE NOT IF ONES DISAGREE WITH THESE JOURNALS--BUT REMEMBER, WE KNOW MORE THAN DO YOU! WE ARE CURSED IF WE BRING YOU NOTHING "NEW" AND ALSO DISCOUNTED IF WE BRING YOU SOMETHING YOU HAVEN'T ALREADY "HEARD". I CARE NOT WHICH OR WHAT ANY ONE OF YOU BELIEVES. MY INTENT IS TO GET THE WORD OF TRUTH TO YOU ONES THAT IN THE ENDING YOU CAN HAVE AMPLE INFOR­MATION UPON WHICH TO BASE YOUR DIVINE DECISIONS. WE HAVE A MASSIVE JOB TO ACCOMPLISH, BEYOND THAT WHICH ANY OF YOU CAN POSSIBLY IMAGINE. TAKE THE INFORMATION OR LEAVE IT!!

    I will clarify some things which are being again misunderstood from our writ­ings for ones are getting the information in bits and pieces with no background. Well, this is not a center for entertainment nor literary genius--this is a resource being made available to those who wish to partake.

    Quote from a letter, a copy of which was received in this place yesterday: "First, I now know who Stephen King's Guides are, those papers could bring terror into almost any soul and they have a grave sense of, if you believe this there is no hope whatsoever so why bother, I do not in any way know this to be true it simply is not the case". This was placed within a letter which has made its way back to this source--it was not directed to anyone at this locale. It was within subject matter pertaining to me, Hatonn, and therefore I will respond for the benefit of my directly connected workers.

    This is the very type of discounting of your work of which I have warned you. Ones, in their attempt to appear so very knowledgeable make statements of which they know nothing and you can see the tinge of gray all over it. If you would lump Hatonn with any guides of anyone you are in error and obviously do not recognize my personage--which also means you might check out your own guides.

    I am going to tell you once more WHO I AM AND YOU DO WITH IT THAT WHICH YOU PLEASE, BUT I DO SUGGEST YOU PAY ATTENTION. IN THE BEGINNING WAS THE WORD AND THE WORD WAS WITH GOD, AND THE WORD WAS GOD. "WORD" IN ITS ORIGINAL SENSE DOES NOT MEAN VOICE, SOUND, OR SPEECH, IT MEANS THE CREATION.

    THE WORD DAWNED . . . THE EIGHTEENTH DYNASTY, EGYPT'S IMPERIAL AGE, HAD BEGUN WITH AHMOSE I, A THEBAN PRINCELING. THUTMOSE III HAD SALVAGED THE GREAT TREA­SURES OF SOLOMON'S TEMPLE IN ISRAEL. NOW THE HEART OF ALL MANKIND WAS READY TO RECEIVE THE WORD AS IT DAWNED IN EGYPT AS THE ATON. ATON'S SERVANT ON EARTH WAS TO BE AMUNHOTEP IV, KNOWN TO THE WORLD AS AKHNATON, HAVING HAD HIS NAME CHANGED TO SERVE THE ONE LIGHT--GOD! ATON! BELOVED AKHNATON CAME YOUR WAY MANY, MANY TIMES IN SERVICE TO GOD AND MAN--SOCRATES, PEIER, THE "BIG FISHER­MAN", ETC. AKHNATON WAS NOT THE FIRST MONOTHEIST BUT HE DID BRING THE LIGHT OF THE ONE GOD BACK TO THE PEOPLE OF THE WORLD WHO HAD STRAYED FROM THE LIGHT AND HAD BASICALLY BECOME FOLLOWERS OF THE SO-CALLED FORCES OF "EVIL". THEY CALLED "SATAN", "AMUN"! AKHNATON CHANGED HIS NAME AND THE NAME AMUN WAS STRUCK OUT OF EVERY TOMB, TEMPLE, AND MONUMENT THROUGHOUT EGYPT. THIS EN­ERGY OF AKHNATON HAS SERVED THE ONE GOD OF LIGHT, ATON, FROM INCEPTION.

    THAT ENERGY IS NOW THIS SCRIBE, DHARMA (BRINGER FORTH OF LIFE TRUTH--THE WORD). THIS DISSERTATION IS FOR HER BENE­FIT--THE REST OF YOU, BE HONORED TO SHARE FOR SHE HAS HAD ENOUGH BATTERING OF STONES CAST AT HER TRUTH. FOR HER TRUTH IS ONLY THAT OF MINE OWN.

    AKHNATON HAD SEVEN LOVELY DAUGHTERS AND THE SEVEN
    MAJOR STARS OF PLEIADES ARE NAMED FOR THEM. I SHALL NOT ENLARGE ON THAT AT THIS TIME, SUFFICE IT TO KNOW YOUR BIRTHRIGHT IS PLEIADES. DO NOT BE QUICK TO THROW AWAY THE MYTHS OF THE CENTURIES FOR WHERE THERE IS MYTH, THERE IS CAUSE FOR MYTH.

    AKHNATON BECAME THE CHOSEN MESSENGER OF ATON. HE WAS POISONED BY A PRIEST OF AMUN (SATAN) AND CAME BACK IN THE TIME OF THE CHRISTOS YOU RECOGNIZE AS IMMANUEL (JESUS) AS JUDAS ISCARIOTH (JUDAS ISCARIOT). THIS IS WHY THIS SCRIBE, HAVING BEEN BELOVED OF SANANDA AND POISONED BY ONE JUDA (IHARIOTH) HAS BEEN ALLOWED TO PEN THE WORKS WHICH HAVE CLEARED THE NAME OF ONE JUDAS ISCARIOTH WHO PENNED THE SCROLLS WHICH RESIDE IN PLEIADES AND TRANS­LATED (IN PORTION) BY ISCARIOTH INTO A JOURNAL CALLED AND THEY CALLED HIS NAME IMMANUEL--
    I AM SANANDA--dharma.

    THIS IS IMPORTANT SO LISTEN UP, PLEASE. IF THE WORLD HAD ACCEPTED THE GREATER LIGHT FROM AKHNATON AND THE MEMBERS OF HIS COMPANY WHICH WERE ALL GOODLY (GOD-LY), EGYPT WOULD HAVE LATER PRODUCED THE GREATEST PHARAOH OF THEM ALL, FOR THE CHRIST-SPIRIT WOULD HAVE INCARNATED AS PHARAOH SANANDA!

    WELL THE WORD HAD BEEN PREPARED--THE WORD HAD DAWNED; AND THEN IT WAS TIME FOR THE REVELATION--IT IS NOW AGAIN TIME FOR THE REVELATION!

    DURING THIS TIME OF TRANSITION OF A PLANET INTO HER HIGHER BIRTHING I HAVE CHOSEN TO EXPERIENCE AS A FOURTH DIMENSIONAL PERSONAGE THAT I MIGHT BETTER RELATE UNTO MINE PEOPLE--

    I AM ATON
    * * *

    I wish to continue in the quote from the letter above referred to: "Frankly we have all the technology (or damn close to it) to correct just about anything on this planet and I know this from first hand experience. I also have a great deal of faith in the human spirit which is much more willing to embrace change than is given credit for in much of the New Age material, just witness Eastern Eu­rope that's not just a financial strategy! Most of what was said in the papers I've heard many times before so it was not new. I also feel that Hatonn needs a good lesson in writing style, public relations and common sense in presentation as the born again Christians will have a field day with this. I do believe it should be read with a critical eye however taking nothing for granted and they were wrong about the Quake (see my quake meditation!)".

    You also have technology--out of your ability to control--to destroy your planet as a whole.

    Man shows no probability of change from his headlong path into destruction just as projected by the ancient prophecies.

    YOU have no notion whatsoever about what is happening in Eastern Europe!

    I have no interest in gaining anything from my writing STYLE.

    I shall be most happy to take lessons from the letter writer on public relations for I perceive that is about all he might truly be dedicated unto...and,

    As for my common sense--so be it! I have rarely been confronted with an accu­sation of lack of common sense!

    Further, you ones DO HAVE AN ANTIDOTE FOR AIDS, CREATED BY THE SAME ONES WHO CREATED THE AIDS VIRUS. THEY ALSO HAVE THE METHOD OF CLEARING UP THE PROBLEM BUT THERE IS NOT ANY INTENT TO DO SO UNTIL A MINIMUM OF A THIRD OF YOU ONES ARE ANNIHILATED--CHECK IT OUT! WE ARE EFFORTING TO GIVE YOU SOME MEANS OF HEALING THINESELVES FOR THE CURE IS INTENDED, BY YOUR CONTROLLERS, FOR ONLY THE ELITE FEW--AFTER THE ELEMENTS OF SOCIETY "THEY" CHOOSE TO ANNIHILATE ARE ANNIHILATED.

    YOU LITTLE CHELAS HAD BEST WAKE UP AND, PROVERBIALLY, SMELL THE COFFEE COOKING!

    We have no popularity contest running herein. This scribe is to remain forever anonymous if at all possible to accomplish a thing of that magnitude on your placement. It is fine, for the ones who know who he/she is should simply enjoy the association and allow safety and security. He/she is weakened physically by all the bombardments and resuscitations. There are times when you have an an­gry God and you approach it now.

    Further quote: "I'm also enclosing some material that was published by Lazaris on UFOs which handled the subject very well indeed! With this is------ ------'s modest catalogue of------ ------'s audio tapes (she has video tapes, books and audio tapes available, this is my favorite channel and I feel a far more constructive resource in presentation of major changes and I suggest you and------carry her material, it would sell very well indeed and provide a balance that is necessary to include".

    I am not interested in "handling" the issue of UFOs--you will meet your brethren in the UFOs soon enough.

    Neither are we in the literary business--our efforts are to get the information for a grave and seriously troubled world in transition out to you ones in the most rapid and responsible manner possible. Those who bear greed within their be­ings and desire to acquire for worldly gain and not for the furtherment of his fellow-man shall be ultimately excluded from participation--YOU ONES ARE RIGHT NOW UNDER THE MICROSCOPE TO ALLOW YOU TO MAKE YOUR CHOICES--YE WHO ARE INVOLVED WITH THE CIRCUM­STANCES COVERED IN THESE JOURNALS.

    FURTHER, AS REFERENCE TO THE BORN AGAIN CHRISTIANS--THERE ARE SO FEW "CHRISTIANS" THAT IT SICKENS ME TO MY CENTRAL BEING WHAT YE HAVE DONE UNTO MINE PERFECTION. PUBLIC RELATIONS INDEED! I AM JUST--NOT IN PUBLIC RELA­TIONS. YE SHALL HEAR AND HEED MINE CALL OR YE SHALL NOT. YE SHALL COME HOME THROUGH THE LIGHTED PATH OR YE SHALL BE PUT INTO PLACEMENT ELSEWHERE THAN THE REALMS OF TOTAL LIGHT. THIS PLANET SHALL BE CLEARED FOR HER EVOLUTION AND BIRTHING IN NEW STATURE--YOU OF THE CRE­ATIONS ARE NOT NECESSARY TO FULFILL HER GLORY!

    IF YE DO NOT BELIEVE IN MINE TRUTH--TRY ME! I BELIEVE YOU HAVE ONE ON YOUR PLACE FAMOUS FOR THE WORDS, "MAKE MY DAY!"

    THE AUTHOR OF THE REFERENCED LETTER, BY THE WAY, HAS A MAGNIFICENT PORTION AWAITING HIS CLAIM THEREOF--SO BE IT AND MY GREATEST APPRECIATION FOR THE LETTER FOR IT HAS GIVEN ME AN OPPORTUNITY TO COMMUNE WITH MINE MESSEN­GER IN A MOST INTIMATE MANNER--HE/SHE HAS WORKED LONG, AGAINST ALL ODDS, ALONG WITH MINE TEAM SENT FORTH FOR THIS PURPOSE--IN BLINDNESS BEYOND THAT OF WHICH ALL OTH­ERS MUST FUNCTION.

    THE WORDS WILL CONTINUE TO COME FORTH IN A SEQUENCE PROPER AND UNTO ONES INTENDED. BLINDNESS GOES WITH THIS TASK FOR ENLIGHTENMENT WOULD BRING TEMPTATIONS, DAN­GER AND A BARRAGE OF COMPOUNDED HARASSMENT. I HONOR MY ONES INFINITELY!

    YOU ONES HAD BETTER STOP TRYING TO DECIDE "WHO" YOU PREFER TO BELIEVE AND WHOSE STORY SITS BEST WITHIN THY GUTS; YOU BETTER GET WITH IT AND PAY ATTENTION FOR THE STROKE OF MIDNIGHT IS AT HAND.

    I SUGGEST MY BELOVED ONE WHO HAS JUST BEEN PENNING MINE BELOVED NOSTRADAMUS' CONVERSATIONS, PAY UTMOST ATTEN­TION FOR THE DARK ENERGIES ARE AT THY DOORSTEP FOR THEY HAVE SEEN THE TRUTH AND THEY ARE AT THE DISCREDITING THEREOF. BE OF UTMOST CAUTION AND G.G., PLEASE SEE THAT THIS INFORMATION REACHES D.C.

    THE REST OF YOU BETTER RUN TO YOUR NEAREST SOURCE AND GET THIS WORK [VOL. I] FOR IT IS VALID AND "LAST-DITCH" EF­FORTS ARE COMING FORTH TO AWAKEN YOU. ALL THE GREAT PROPHETS ARE COME FORTH NOW TO BE BRINGING YOU TRUTH AND CLARIFYING THEIR ORIGINAL INTENT OF COMMUNICATIONS--YOU BE ITER BE PAYING ATTENTION.

    THE SO-CALLED "CHRISTIANS" OF YOUR PLACE SICKEN ME AND DISHONOR THE WONDROUSLY PURE PERFECTION SENT FORTH TO SHOW YOU THE WAY--WELL, HE IS BACK ALSO AND A LOT OF DOORSTEP SWEEPING IS GOING TO TAKE PLACE. TRUTH IS TRUTH AND THERE IS NO PLACE BUILT WITHIN THESE TIMES FOR LIES TO ASSURE A BETTER PUBLIC RELATIONS IMAGE.

    YOU ONES SEEM TO REQUIRE EARTHQUAKES, BURNING BUSHES AND EARTH DEATH AND PHENOMENA FROM THE HEAVENS TO EVEN BLINK THINE EYES--WE SHALL SEE TO THAT WHICH GETS THINE ATTENTION.

    FURTHER, BEHOLD A CHILD HAS BEEN SENT UNTO YOU IN PHYSI­CAL FORM--IT BEARS THE NAME OF MYSELF, ATON. YE SHALL SOON REAP AS YE HAVE SOWN--SO BE IT.

    ONE ADDITIONAL POINT OF IMPORTANCE: IF YOU ONES THINK US TO BE OF DARKNESS AND RELATED TO EVIL GUIDES--THEN YOU HAVE OBVIOUSLY NOT READ SATAN'S DRUMMERS BROUGHT FORTH BY SANANDA. THIS HAS BROUGHT THE GREATEST BOMBARDMENT OF EVIL FORCES UNTO THIS SCRIBE OF ALL TIME--BE YE WARNED THAT SATAN IS ALIVE AND THRIVING IN YOUR WORLD AND YOU HAD BETTER PAY ATTENTION. THERE IS NO DARKNESS IN THIS PLACE AND IF YOU BELIEVE THERE IS NO SUCH THING AS EVIL--YOU ARE TO BE PITIED.

    IT IS SO--THERE WILL BE FEW WHO PREVAIL BECAUSE YOU AS BRETHREN TOUT YOUR "OPINIONS" AND KEEP THE TRUTH BURIED. SO BE IT FOR IT SHALL BE AS WRITTEN. FURTHER, YE ONES WHO COME FORTH AND PLAY GAMES IN MINE NAME HAD BETTER BE­GIN THY CLEANSING FOR THE TIME IS AT HAND THAT THE EN­TERTAINMENT CEASE AND THE WORK BE BROUGHT FORTH.

    I PLACE MINE SEAL UPON THESE WORDS THAT NONE IN THE RECEIVING HEREOF BE IN MISUNDERSTANDING--

    I AM ATON

    Dharma, go chela, that you can allow your head to get re-screwed onto your neck properly. We are fine and we have much work to be done on the current journal. It is a guide to assist our ones to claim some privacy in a physical world of total chaos. We must sustain a group for service. So be it and Selah-- Au Da Pai Da Cum! Ye shall find peace in the garden with me. So shall it come to pass in thine days upon this placement!


    PJ 10
    CHAPTER 16
    REC #2 HATONN
    FRI., DEC. 1, 1989 12:30 P.M. YEAR 3, DAY 107

    FRI., DEC. 1, 1989

    Hatonn present to continue.

    PRIVATE INVESTING

    There is very little of private investing in your current situation. The rights of investors to invest money as they see fit, in any investment that they feel appro­priate, has been gradually restricted in a most insidious way since your World War II. When it really got under way was in 1913 when the U.S. instituted an income tax.

    Much of this erosion in financial privacy has taken place as a result of the government's continuing war against "money laundering" and the underground economy. Other restrictions would prohibit "discriminatory" investments such as a recent proposal in Congress that would ban U.S. citizens from owning shares of South African stock.

    The outstanding invention that destroyed privacy was the withholding program, then the Social Security and Unemployment--all those tid-bits withheld from your income checks.

    Then World War II came and along with it came rationing and strict economic controls, a thriving black market developed in ration coupons, gasoline, tires, etc. The economists actually began to include and speak of black markets and the underground economy as a measurable proportion of the Gross National Product.

    Following World War II the hundreds of billions of dollars of debt of the U.S. intensified efforts to stop tax evasion. One method for wealthy individuals to evade taxes was by establishing bank accounts outside the U.S. Switzerland, with its strict bank secrecy laws, was particularly favored for this purpose.

    A very large thing happened in 1970. The underground economy was booming. Illegal trafficking in narcotics was at an all-time high for that period of time. Organized crime figures, testifying before Congress, repeatedly invoked the "Fifth Amendment" when asked about their income and investments.

    Reports from Switzerland showed record deposits in secret Swiss bank accounts, records of which the U.S. government could not obtain. Repeated Treasury in­quiries to Swiss banks regarding the accounts of suspected tax evaders almost always went unanswered. We will refer to these accounts later.

    The Nixon Administration lobbied Congress to pass a law that would prohibit U.S. citizens from taking cash out of the U.S. and outlaw foreign bank ac­counts. In addition, the administration requested that Congress require that all cash transactions $1,000 or greater be reported directly to the IRS.

    In 1970 Congress responded with the "Financial Recordkeeping, Currency and Foreign Transactions Reporting Act", known today as the Bank Secrecy Act. President Nixon got most but not all, of what he wanted--remember, a lot of your Congressmen utilized these secrecy measures.

    The Act was the first federal effort to both register foreign bank accounts and impose currency exchange controls on individual Americans. As such, it was an enormous step backwards in both personal and financial privacy.

    BANK SECRECY ACT

    Under this Act, U.S. citizens are required to complete an IRS form when they import or export more than $5,000 in cash (Form 4790). Violators risk confis­cation of any funds discovered, plus a fine of up to $500,000 and as much as five years in prison. Is it any wonder that the ingenious people would come up with paper trails instead of cash?

    The Act did not prohibit foreign bank accounts, but those larger than $1,000 had to be reported to the IRS. (This limit has since been raised to $10,000.) Violation of this requirement is considered income tax evasion. However, there are many ways to sidestep this regulation also.

    No industry has been affected more by the Bank Secrecy Act than U.S. banks. The paperwork burden alone has been enormous. Banks are required to main­tain copies of deposit slips and both sides of checks drawn for more than $100. In addition, they must keep a permanent record of any loan over $5,000. And if a depositor makes a deposit or withdrawal of more than $10,000, the bank is required to notify the Treasury Department. Note this carefully: The House of Representatives in 1988 passed legislation that would reduce this $10,000 re­porting threshold to $3,000. Many banks near the Canadian and Mexican bor­ders already require "voluntary" completion of a Currency Transaction Form for withdrawals of more than $1,000!

    The Act also requires banks to record the Social Security number of anyone opening any type of new account. The original legislation provided for the name of anyone refusing to provide their Social Security number to a bank to have their name placed in a special file available for Treasury Department in­spection. An amendment now authorizes banks and other financial institutions to simply deduct a portion of the interest such accounts accrue and send it di­rectly to the IRS.

    ABUSES ABOUND

    You may not agree with actress Jane Fonda's politics, but how about this? Only a few months after the enactment of the Bank Secrecy Act, the Nixon Administration put to work investigating individuals it considered "enemies". One of these was Jane Fonda, an actress active in supporting peace initiatives to end the Vietnam War.

    The FBI found little to incriminate Fonda in her account. But it did find the names of firms whom she patronized and organizations to which she con­tributed. All this information was used to open up new avenues of inquiry.

    Government investigators routinely investigated the bank accounts of "left-wing" and "right-wing" organizations, people who advocated "revolutionary" social or political changes--and just about everyone who opposed Richard Nixon--and you thought the McCarthy era was bad! Where have your "freedoms" gone and did you even notice them being gone?

    Another victim of the Act was one Daniel Ellsberg, who in June 1971 passed a copy of the Pentagon Papers to The New York Times. The Pentagon Papers contained embarrassing details of the Vietnam conflict. After a consultation with the National Security Agency, the Times deleted passages that could have compromised national security and began publishing excerpts.

    President Nixon was furious over the disclosures. He ordered the FBI to inves­tigate Ellsberg's bank accounts. After cancelled checks made payable to a psy­chiatrist were discovered, Nixon authorized a break-in into the psychiatrist's of­fice in search of Ellsberg's records. Then the administration leaked to the press the information that Ellsberg was under the care of a psychiatrist.

    Investigation by the Washington Post in 1972 and '73 led to disclosure of re­peated governmental abuses of the Act. In response to these abuses, Congress in 1974 enacted the "Privacy Act" (after all, now all ones could be caught) which requires the consent of individuals before a government agency collects and uses information on them for a different purpose than the information was intended--of course, with the exception of the IRS.

    There also is a contradiction to the whole procedure--it was the government in the first place that required all records to be kept so meticulously that any in­formation would be of value. Now they were going to "protect"? Smells, does it not?

    The Bank Secrecy Act also authorized the U.S. Customs Service to set up a system to enforce the legislation's foreign exchange control provisions. The Customs Service responded with a computer system known as "TECS"--the Treasury Enforcement Communications System. TECS terminals are now in place at virtually every major port of entry to the U.S. When your name is en­tered into the system, TECS will report: if you are a suspected or a convicted tax evader; whether or not you have arrest records or convictions listed in the FBI's National Crime Information Center data base; if you have been suspected, arrested or convicted for possession or sale of illegal drugs; if you have been suspected, arrested or convicted of smuggling or a similar offense and; if you are currently sought by any law enforcement agency for any criminal or civil offense.

    An "expert system" enhancement of the TECS system in 1988 gave it the ability to construct computerized profiles of individuals suspected of money launder­ing, drug smuggling, etc. By answering a few questions at a computer termi­nal, a customs agent can make an almost instantaneous decision whether or not to detain someone who appears to fit the profile provided by the computer. How safe do you feel visiting Mexico or Canada?

    Well, little argument comes forth against the "Privacy Act" being absurd and no protection at all.

    By the early 1970s, the proliferation of personal data in government data bases had reached an all-time and uncontrolled high. The IRS, FBI, CIA, Department of Defense, National Security Agency and dozens of other federal agencies kept files on U.S. citizens. These agencies had no legal obligation to verify that the data that they maintained was accurate. Nor were they required to disclose to citizens what records were being kept.

    The Privacy Act was intended to bring the proliferation of personal data in government data bases under control. Under its provisions, a government agency gathering data on an individual was required to keep a list of disclosures of personal information to other agencies. Citizens were given the authority to examine their files and challenge information they felt to be inaccurate.

    Opposed by virtually all government agencies, the Act was at the last minute gutted by a "minor" loophole: "Routine use" of such information or transfers of information would require no notification or consent. Moreover, a huge amount of information with potential "national security" uses was made totally exempt from the Act's provisions.

    In the 15 years since the Privacy Act was enacted, it has had little effect in gov­ernment efforts to gather information on individual citizens. In practice, just about any use of personal data by a government agency is considered routine. Test yourself: When was the last time you received a letter from a government agency informing you that information about you had been distributed to an­other agency? I thought not!

    The Privacy Act also requires the government to publish an annual census of files containing personal information. However, many files are excluded be­cause they contain information relating to national security. Other files simply aren't counted because of sloppy bookkeeping.

    Further, as with Seismic data from the Nevada testing grounds--they will simply tell you they are two years behind in data "printing" and cannot give out the in­formation.

    Still, the 1977 census showed a staggering total of 4,015,500,000 files on U.S. citizens--more than 16 files for every American man, woman and child. Later census figures showed lower numbers of files kept, and progressively longer list of agencies claiming "exemptions" under the Act.

    Another loophole is that the Act applies only to agencies maintaining a "system of records" indexed by a "personal identifier". In practice this means that handwritten or informal records kept by bureaucrats are totally exempt from any control under the Act. Only computerized data counts. Many agencies have thus encouraged bureaucrats to keep sensitive information out of computer data banks. As a result, "informal" recordkeeping has proliferated since the Act was inacted.

    Nor were restrictions placed on government agencies sharing data with state and local jurisdictions. Criminal records, tax records and other sensitive informa­tion have continued to freely change hands without the knowledge or consent of the individuals the records concern.

    Finally, no agency was put in charge of enforcing the Privacy Act. As a result, government agencies have been loosely policed in acting on its provisions.

    A LITTLE QUIZ!

    How many of you remember a man by the name of Lyndon H. LaRouche?

    Alright, Mr. LaRouche ran for president against Mr. Bush. Obviously he did not win!

    Did any of you see any of his political programs on TV? THEY WERE TO­TALLY ACCURATE, YOU KNOW--OR DIDN'T YOU KNOW THAT? DID YOU VOTE FOR HIM? WHY NOT?

    What has happened to Mr. LaRouche since the election? Oh, shame on you for not knowing! HE IS IN PRISON ON TOTALLY FABRICATED CHARGES AND HAS BEEN DENIED ALL SEMBLANCE OF DUE PROCESS OR A FAIR HEARING. OTHERS OF HIS SUPPORTERS ARE ALSO IN PRISON WITH SENTENCES THAT WOULD WITHER COLD BLOODED MASS KILLERS--FOR "MINOR" CAMPAIGN "VIOLATIONS" AS DECIDED BY PUBLIC CRITICS.

    YOU ONES MUST OPEN YOUR EYES! IT IS MOST SERIOUS, DEAR ONES.

    THEY DO NOT WANT YOU TO CROSS THE PLANNED LINES--YOU ARE PEOPLE OF THE LIE WITH LITTLE ESCAPE ROUTE AND YOU ARE DOWN TO THE LAST FLAG!

    HOW ABOUT NICE MR. REAGAN'S
    WAR ON PRIVACY?

    When former President Reagan was elected to office in 1980, he promised to "get the government off the back of Americans". You got exactly that--they switched from your back to all over you. He got exactly the opposite.

    I would like to quote a wondrous scientist who came up with what he called "The Law of the Bureaucracy: Whatever the bureaucrats set out to do they will accomplish exactly the opposite"! Look carefully, it works that way every time without any noted exceptions.

    One of Reagan's first initiatives was to hire 5,000 new IRS agents, and to accel­erate the IRS' program of "cross matching" tax returns against other data bases which might indicate a taxpayer was "living beyond his means".

    Next, the administration began pressuring Congress to adopt legislation giving the government vast new powers to gather, cross-reference and distribute per­sonal data. The first major victory for the administration in this regard was the Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA).

    TEFRA was an expansion of the Bank Secrecy Act, greatly expanding the power of the IRS and imposing additional reporting requirements on financial institutions. Among other things, TEFRA requires brokerage firms to report most types of investor income to the IRS, including interest, dividends and the gross proceeds from sales, redemptions and exchanges.

    The law also requires banks and other financial institutions to withhold 20 per­cent of taxable interest, dividends and other payments if the taxpayer does not provide such institutions with a Social Security number for the purposes of re­porting this income.

    From the administration's viewpoint, TEFRA had the desired effect. IRS seizures jumped from 8,848 in 1981 to 22,450 in 1986. The number of IRS levies jumped from 740,103 to more than 1.6 million in the same period. And the IRS budget grew 91 percent in just five years--faster than even the soaring defense budget.

    The Reagan Administration also began an unprecedented effort to cross-connect federal data bases to weed out "welfare fraud" and cheating by beneficiaries of federal programs. These efforts culminated in the Deficit Reduction Act of 1984.

    This Act authorized the first full-scale effort to link data in various federal gov­ernment and private data bases. Not surprisingly, the key to the system was the Social Security number. In effect, the Act authorized the SSN to serve as a national identification number that could cross-match seemingly unrelated in­formation in dozens of data bases.

    Cross-matching was first used by the Department of Health and Human Services to identify individuals involved in welfare fraud and similar offenses. The So­cial Security Administration used the technique to insure that individuals who received disability benefits were actually disabled.

    But the uses of the Deficit Reduction Act were hardly limited to efforts to stamp out governmental waste and fraud.

    The U.S. Customs Service upgraded its TECS system. And the Secret Service wrote an expert system program that constructs "computer profiles" to identify individuals who might be likely assassins.

    But the biggest beneficiary of the Deficit Reduction Act was the Internal Rev­enue Service. Shortly after the Act was enacted, the IRS began creating a "Debtor Master File", compiled by the bloc modeling techniques already de­scribed.

    Data were gathered from governmental files, credit bureaus, banks, hospitals, insurance companies and direct marketing companies that construct computer­ized profiles of consumer spending. By 1986, the project was complete.

    The Debtor Master File was designed to crack down on individuals who had failed to repay money they had borrowed from the federal government. From an IRS standpoint the project was enormously successful; the file today lists nearly 1,000,000 people who owe money to various government agencies. One of its first uses in 1987 was to deny refunds to individuals who have defaulted on loans from the federal government.

    The Deficit Reduction Act also provided funding to assist the states in their own efforts to "compare notes" and identify individuals who fail to pay state taxes. In exchange for IRS access to state computer records, state tax authorities were given direct access to IRS computers.

    Oh, dear ones, how many of you realize the barrage of threats and insinuations that bombard you around your tax time? Do you notice the announcements about TAX CHEATERS? They effort at making one who takes his rightful de­ductions into "cheaters" for all the world to accuse. Further, they have their little hot-line where you can call and tattle--worse, if convicted the tattler gets a reward--NOW YOU TELL ME WHAT IS DIFFERENT ABOUT THE WAY THE NAZIS HANDLED IT UNDER HITLER? YOU NOW REWARD AND EXTOL CHILDREN WHO TATTLE ON THEIR PARENTS FOR ACTIONS WITHIN THEIR OWN PERSONAL HOUSEHOLDS. I MAKE NO JUDG­MENT ON THE ACTIVITIES--IT SIMPLY POINTS OUT THAT YOU HAVE DESTROYED YOUR CIVILIZATION! YOU HAVE A GENERA­TION OF ABUSERS AND A GENERATION OF LOST CHILDREN BE­CAUSE THE PARENTS HAVE BECOME TERRIFIED OF THEIR OWN CHILDREN! YOU CONDEMN THE PARENT FOR NOT KEEPING THE LITTLE BRATTY ONES UNDER CONTROL AND THEN YOU PRONOUNCE THEM TO BE ABUSERS IF THEY PUNISH THE CHILD.

    OH MY. THE DRUG SCENE!

    Could you be thrown in jail for selling bread to an individual with a "reputation" as a drug dealer? Well, you have Congressmen who think you should be, and the intent of the legislation successfully sponsored by Congress­man Bill McCollum (D-FI)--the Anti-Drug Abuse Act of 1986--could net you 20 years in jail and a $500,000 fine for "engaging in monetary transactions in property derived from specific unlawful activity".

    Quoting Congressman Bill McCollum: "The corner grocer in a community is aware of the reputation of the local drug trafficker. That person comes to the store and buys five pounds of hamburger. The grocer has to know what he is coming in to buy groceries with what is indeed the money derived from a particular designated crime. I don't have any problem whatsoever holding the gro­cer accountable for money laundering".

    Of course, the hamburger/bread buyer would not have to only be a drug dealer for you to land in jail. A few other "specified unlawful activities" under the Act include: theft or bribery of funds provided by any federal program; hostage-taking and violations of the Arms Export Control Act, the Emergency Economic Powers Act or the Trading With the Enemy Act; counterfeiting; embezzlement; smuggling or bank robbery! NOW, I KNOW THAT ALL YOU NICE PEO­PLE READING THIS ARE TOTALLY FAMILIAR WITH ALL THESE RULES AND REGULATIONS AND CAN EVEN QUOTE THEM AT WILL--TO THE CRIMINAL SUSPECT!

    OH, BY THE WAY, "IGNORANCE OF THE HAMBURGER BUYER'S CRIMINAL ACTIVITY IS NO EXCUSE." Section 1957 reads in part:

    "The government is not required to prove the defendant knew that the offense from which the criminally derived property was derived was specified unlawful activity".

    The only thing that could potentially save you would be that transactions under $10,000 are exempt from provisions of the Act. I knew that you knew that! However, any pattern of transactions totaling $10,000 or more would be en­forceable. So, if over a period of months or years, the drug dealer were to buy groceries totaling $10,000 or more, you would still be found guilty. More­over, proposed revision in the Act would reduce this threshold from $10,000 to $3,000--how many groceries will $3,000 buy at today's exchange rate? Gets more frightening doesn't it?

    The Anti-Drug Abuse Act of 1986 will, if strictly enforced, break down any semblance of trust--and privacy--that might exist between a businessman and his customer.

    Should you as a businessman ask each and every one of your customers to sign a statement certifying that the funds he is paying for your product or service have not been gained through "specified unlawful activities" as defined by Sec­tion 1957 of the Anti-Drug Abuse Act of 1986?

    Court challenges to this law have so far been rejected. It is most probable that it will be held "in reserve" for use in particularly difficult tax evasion cases--and for IRS enemies.

    Where, indeed, would the Reagan Administration's war on privacy end?

    AGAINST MONEY LAUNDERING

    Boy, doesn't just the term "money laundering" conjure up dirty, dirty illegal activity? Money laundering invokes images of jewel-bedecked foreign nationals carrying courier cases full of cash onto private airplanes bound for secret Caribbean tax havens, shadowy businessmen opening crates full of automatic weapons for distribution in your central cities and numbered bank accounts tucked away in foreign countries.

    In truth however, money laundering is a much more mundane and insidious ac­tivity. In fact the definition of "money laundering" is any action an individual takes in order to avoid filling out a U.S. government currency reporting form. This might seem a fairly trivial offense, but under the Money Laundering Con­trol Act, violators can be punished by a maximum of 20 years in prison and fines up to $25,000,000. Boy, no wonder there isn't any room left in prisons for criminals who murder, etc.

    Money laundering, according to U.S. Customs Service Director William Von Raab, is a "$50 billion industry". The most common money laundering offense is making a series of deposits or withdrawals under $10,000 from a U.S. bank account in order to avoid this threshold for reporting a "currency transaction" under the Bank Secrecy Act of 1970. Other individuals have been prosecuted for failing to declare more than $5,000 in cash when they cross U.S. borders.

    By far the largest money laundering case in history involves the Bank of Credit and Commerce, a Luxembourg-based institution that allegedly laundered hun­dreds of millions of dollars on behalf of Colombian drug kingpins. Now isn't that a funny coincidence with the happenings of your news reports these days? Nearly 100 individuals were indicted in late 1988 in the case, and more indict­ments are expected. And Mr. Noriega? Oh, isn't he a thorn in the sides of this administration--HE HAS SIGNED CONTRACTS FOR HIS DRUG ACTIVI­TIES--WITH YOUR GOVERNMENT!

    What does money laundering have to do with individual privacy? Surely you are beginning to understand this treachery as it oozes down to you in the private sector of "law-abiding" citizens. That, further, is why I take no responsibility for your actions as we go along here--you must check into it all and consider the alternatives. Naught that I see is against the Laws of Creation and there is no way to keep up with all the laws of Caesar. Virtually any action you take to avoid filing a currency transaction form--how about $9,999 instead of $10,000? Well, how about $8,900 instead of $10,000? Use your heads! Intentional avoidance is now a federal felony and punishable by truly enormous fines and long prison sentences.

    Anti-money laundering legislation is anti-privacy legislation. Seeking privacy from the government in your financial affairs, for what ever reason, is now in many cases a crime.

    THE OMNIBUS ANTI-DRUG BILL OF 1988

    As intrusive as the current crop of federal legislation dealing with financial pri­vacy is already, the government continues to tighten the noose. The most recent legislation, the Omnibus Anti-Drug Bill of 1988, contains the following provi­sions: requires that agencies of the federal government co-operate with the Customs Service to feed data into customs computers on at least a monthly ba­sis; requires the Customs Service to establish machine readable passports; au­thorizes the Secretary of the Treasury to negotiate with finance ministers of foreign countries to establish an "international currency control agency"; authorizes the Secretary of the Treasury to encourage foreign countries to adopt uniform cash reporting transaction forms and anti-money-laundering statutes and; autho­rizes the Secretary of the Treasury to lower the cash transaction reporting re­quirements set forth in the Bank Secrecy Act at any time.

    Given the power of the computer to piece together seemingly unrelated data, the Omnibus Anti-Drug Bill of 1988 could have some unexpected--and potentially devastating--effects.

    What would happen for instance, if the IRS were to wire a Customs Service computer that you were about to be audited? Would the Customs Service, upon scanning your machine-readable passport, permit you to leave the U.S.?

    Already an "international currency control agency" suggested by the bill is tak­ing shape. A new international treaty, the "Draft Multilateral Convention on Mutual Administrative Assistance in Tax Matters", would establish a system to exchange tax information between nations "automatically" and "simultaneously". It would also establish globally-standardized tax forms and tax laws. And it would permit suspected tax evasion in one nation to be inves­tigated in any other nation and allow assets to be seized across international borders. Finally, to enforce these provisions, a global IRS would be estab­lished: "InterFipol", the International Financial Police. DO YOU BEGIN TO SEE THE WORLD GOVERNMENT AND POLICE STATE AROUND YOUR NECK WITH A TIGHTENING NOOSE?

    DO YOU ONES OF MINE BEGIN TO SEE WHY THE DREAM OF "HATONN, JUST GET US THE MONEY AND THE WORLD WILL LIVE HAPPILY EVER-AFTER", IS NOT POSSIBLE? SO BE IT! YES THE SPACE BROTHERS KNOW YOU NEED FINANCES--BUT WE ALSO WOULD LIKE TO BE ABLE TO DO OUR WORK. I'M SORRY, BROTH­ERS, BUT WE DID NOT MAKE THE LAWS--YOU SLEPT AND AL­LOWED THEM TO COME ABOUT! NOW, WE MUST WORK WITHIN THEM TO THE BEST OF OUR ABILITY AND YOU MUST BEAR WITH US. SO BE IT.

    Dharma, it has been a long time without a break. Let us close this portion that the chapters not be too long and create boredom.

    In appreciation for service and always in your service, chelas, I move to stand­by.

    SALU, SALU, SALU,
    I AM HATONN CLEARING CIRCUIT FREQUENCY AND
    MOVING TO OUT.
    GOOD AFTERNOON

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    PJ 10
    CHAPTER 17

    REC #1 HATONN

    SAT., DEC. 2, 1989 7:30 A.M. YEAR 3, DAY 108

    SAT., DEC. 2, 1989

    Hatonn present to resume on the journal. We shall move right to the subject with only one comment on daily notice boards.

    Something I desire you consider: What is this mission, through your holidays, of your shuttle craft all about? Consider what you now know of your Star Wars "space" system--that well over 60% of all action and satellite system is for international bankers' use to have the world banking network in place and ready to utilize for a world banking system with YOU IN IT! Well, take note--these "secret" government/military trips are setting the final computer links in place. One reason the new money exchange could not begin on time as planned was that there were bugs in the international "spy on you" system and the final links were not in proper placement. The intent is to have it all working by the time your Christmas shuttle returns to terra-firma.

    BANKING COMMUNITY SINKING FAST

    At this point I am simply going to have Dharma quote from a publication of Dr. Gary North. If you don't recognize this name, please recall that he was one of the authors of FIGHTING CHANCE, a book most referred to in our journal, SURVIVAL IS ONLY TEN FEET FROM HELL. I believe that he now offers an information newsletter which is called REMNANT REVIEW. I disagree with some of his conclusions and recommendations but for the most part they can be most beneficial and his current analyses of the changing situation of the finan­cial community is quite excellent--you can do some of your own thinking. Ranos, please add the address to the appendix. I will make sure that Dharma has it in hand by the time you are ready for compiling the appendix. Further, while we are in this thought mode I also desire that we place
    Dr. King's FUTURE TRENDS on the list of available information for he is one of the only economists that has any idea of what is currently coming down. Most of the rest of the children playing in economics are touting "inflation" instead of "deflation" in the recession/depression and I value his input.

    Quote:

    "Step right up, folks. The Great American Banking Shakedown is about to begin.

    "But don't blink. You may miss it. It'll hit that quick.

    "We're now seeing 70 to 80 bank failures a year--more than at the height of the Great Depression. And the rate is accelerating.

    "The FDIC listed 642 banks on its Problem List in 1983. By 1986 that number had leaped off the charts to over 2,600--more than 18% of all U.S. banks!

    "By June 30, 1989, the number had dropped to 1,271. But according to Warren Heller of Veribanc, this drop was due to the improving condition of agricultural banks; it masked the deteriorating condition of other banks whose holding in depreciating real estate was actually worsening their condition.

    "According to the FINDLEY REPORT, a noted authority in the banking field, half of today's banks will be gone by in the next five years. Swallowed up, bought out, knocked down, or buried quietly. Gone.

    "And yet, as bad as these numbers are, they contain a tiny glitch. Nowhere in the FDIC Problem List will you find mention of the largest eleven banks in this country--even though nine of them have loaned out 227% of their total combined equity to Third World and Soviet bloc deadbeats!

    "In 1984, Comptroller of the Currency, Todd Conover, told the House Banking Committee that these eleven banks are considered 'too big to fail' by the government. This, in spite of the fact that if only half of their foreign loans defaulted, their funerals would begin at dusk.

    "Who are these lucky eleven?

    * CITIBANK
    * BANK OF AMERICA
    * CHASE MANHATTAN
    * MANUFACTURERS HANOVER TRUST
    * MORGAN GUARANTY TRUST
    * CHEMICAL BANK
    * CONTINENTAL
    * BANKERS TRUST
    * SECURITY PACIFIC
    * FIRST NATIONAL OF CHICAGO
    * WELLS FARGO"

    (Hatonn: Now surely you remember who controls these particular banks--if not, return to SPIRAL TO ECONOMIC DISASTER to "Grey Men" and start over without passing graduation or collecting $200 at "GO"!)

    "So no matter how much water these behemoths take on, no matter how much they list or threaten to capsize, the government will not let them sink. Every other bank in the country will have to swim for it, but not the big guys.

    "Did you know that the Federal Reserve Bank was created mainly to prevent the bankruptcy of any major bank"? In turn, the majors own all the shares of the Fed AND they choose the majority of its directors. No matter how big the emergency, the Fed--armed with truckloads of fresh T-bills and funny money--will ride to the rescue of any major bank. (Hatonn: this is, however, one reason short-term T-bills is one of the very best places to have that cash you withdrew from those pathetic banks.)

    "And, believe me, the emergencies they'll need rescuing from could be awesome. And devastating to anyone who's unprepared.

    1. A Latin debtors' cartel could form tonight and revolt tomorrow. Adios to hundreds of billions of our dollars.

    2. The 15 largest U.S. banks have promised (and received fees for) loans totaling almost a trillion bucks, and they don't have that much in total as­sets!

    3. When foreign depositors finally admit the declining dollar is souring their investments, they'll pull the plug on their $150 billion. That will put a nasty little dent in the FDIC's $17 billion reserve fund, won't it? (So much for that one lonely cent covering each dollar of deposits). Especially since the en­tire fund is in T-bills, which will have to be cashed in to raise the money! (Hatonn: I surely do hope my people are reading this most carefully!)

    4. The total U.S. farm debt now exceeds the external debts of Mexico and Brazil combined. Nearly a third of the debt, $73 billion, is owed by the shakiest farmers.

    5. Big oil companies borrowed over $150 billion back in 1980-81, when it was over $30 a barrel. Now it's the banks who are over the barrel.

    6. The Mortgage Banker's Associations of America have announced that 5.8% of all home loans are more than 30 days overdue, a post-World War II record.

    "This conveniently leads to another imposing question: exactly how healthy are our savings and loan institutions? Glad you asked.

    "According to Veribanc, the #1 monitoring firm in the nation, 20 of the largest 50 S&Ls are in serious trouble. (Bottom line: your S&L may be in jeopardy.) The best estimates put the bail-out tab for saving all the ailing S&Ls at (GASP) $100 (plus) billion. And that's money the FSLIC simply doesn't have.

    "For every dollar deposited and insured, the FSLIC has exactly 7/10ths of the cent put aside. On paper. On bad paper. Most of their reserve fund is nothing more than acquired "junk bonds" from failed businesses! The fund is already dead broke even without making any bail-outs.

    "Most important is how all this affects you now. If you are borrowing from a troubled bank or S&L, your loan may get called overnight if the Fed or FDIC puts the screws on your banker to clean up his portfolio.

    "Even worse, your deposits can be locked up and withheld from you. When Home State Savings Bank in Cincinnati needed rescuing in 1985, depositors were put on a withdrawal allowance of no more than $750 a month. No matter what sad story they had.

    "Life is tough, and then your bank dies. Without warning, the govern­ment can:

    *Close your bank (Monetary Control Act of 1980)

    *Freeze your deposits (Emergency Banking Regulation #1, 1961)

    *Keep you out of your safety deposit box. (If you can't get into your bank, you can't reach your box, can you?)

    "Oh, you'll get paid eventually, no matter how suddenly or brutally your bank drops dead. The government has "guaranteed" it. As long as there are printing presses and buckets of green ink (or whatever color), you will get paid, all right.

    "Of course, don't expect those crisp new bills to be worth too much".

    * * *

    AND YOU ARE "THERE", BELOVED ONES--YOU ARE "THERE". IT HAS BEEN A MASTERFULLY EXECUTED PLAN BY THE "BIG BOYS" AND IT IS WORKING TO PERFECTION. THE MASSES WILL PLEAD TO HAVE THE GOVERNMENT NOW COME IN AND SOMEHOW SAVE YOU FROM THE DRAGON WITH THE NEW DEBIT SYSTEM AND YOUR MOVEMENT INTO SLAVERY WILL BE COMPLETE. SO BE IT!

    FAMOUS LAST WORDS: "THEY WON'T FIND ME"

    Another scenario here, complements of THE GARY ALLEN REPORT, which was made possible by the Deficit Reduction Act of 1984 and its attendant link­ing of computerized government data bases.

    "George was attracted to her the moment he saw her while he was driv­ing to work. She was in her mid-thirties, elegantly dressed, with long blonde hair that fluttered in the breeze as she drove her red Porsche convertible in the adjacent lane of a crowded California freeway. Letting her get a little ahead of him, George was able to read her vanity license plate: MINE.

    "When he arrived at his office in the local government building that housed the Department of Health and Human Services, where he worked in the social welfare division, George quickly brought up his file of codes on his com­puter terminal; tracking down that beauty would be a snap, he mused to him­self. After all, he had access to numerous government records and private data banks. Checking people out was part of his job to distinguish valid welfare ap­plicants from chiselers and illegal aliens. It was all part of the administration's drive to reduce wastes, fraud and abuse in federal welfare programs.

    "At the computer prompt, George entered his authorization code on the keyboard, hit the "execute" button and accessed the Department of Motor Vehi­cles data base. He typed in the license plate letters "MINE" and ordered a search of the DMV files. After less than a minute's wait, the monitor screen displayed the information he wanted: Licence tag: MINE. Vehicle: 1983 Porsche 944. Owner: Julie Jameson, 1509 Appleton Drive, Laguna Heights, CA Driver's licence: U0834725. Date of Birth: 5/14/52. Sex: Female. Height: 5'6". Weight: 105 lbs. Social security number: 552-58-2436.

    "Entering another data bank, George used the SSN as the key data ele­ment to search wage records that employers are required to file with state un­employment compensation and tax offices. Julie's record came up with more information: SSN #552-58-2436. JULIE JAMESON. Employer: Toltech Manufacturing, Inc., 921 Wilshire Blvd., Los Angeles, CA. Employed from 1110/77--current. Position: National Director of Sales and Marketing. Gross pay for 1986: $63,124. Earnings for First Quarter, 1987: $16,542.

    "'Not bad,' thought George. Next, he typed Julie's address into the computer and told it to search the records of the Laguna Heights deed registra­tion office. Soon the screen filled with new data record: 1509 Appleton Drive. Block 351, Lot 3. Land Assessment: $35,685. Total Assessment: $114,006. Built: 1978. Use: Residential. Deed of trust recorded: October 11, 1978. Loan Instrument: 23997. Amount: $75,000, between Joseph James and Julie Jameson Nelson and First National Savings & Loan. Other personal assets listed as collateral: 25-foot sailboat, assessed at $16,000.

    "Julie Jameson had once been Julie Nelson. George decided to check county divorce records to see what was on file. He found the record: Divorce awarded 7/18/85. Julie Jameson Nelson vs. Joseph James Nelson. Married: 6/12/76. Children: Anthony Michael, born 4/3/78; Carolyn Marie, born 12/24/80. Grounds for divorce: Infidelity. Divorce sought by: wife. Race: husband, Caucasian; wife, Caucasian. Number of previous marriages: husband, none: wife, one. Date first marriage was terminated: 9/24/74 in Reno, Nevada.

    "Being a curious fellow, George then decided to check local school en­rollment records. He found that "Tony" went to Ben Franklin Elementary School. Carolyn Marie was enrolled at Montgomery Special Education Insti­tute, a school for children with learning disabilities.

    "Next, George decided to look into IRS files. But, such records are confidential, so George's office computer terminal could not access the IRS data in Washington by an on-line connection. Instead, he put Julie's name and SSN on a request list that was mailed by his welfare office to the IRS the next day. In less than a week, George received a magnetic storage tape from the IRS that contained tax information on Julie Jameson's other sources of income.

    "Data from Form 1090 (Unearned Income) revealed that her interest in­come included $2,100 from a $23,000 Certificate of Deposit from First National Bank, $4,200 from a $48,000 CD at the same bank and another $1,600 from a $28,000 passbook savings account. Dividend income was also listed--including $9,754 from 4,000 shares of Toltech Manufacturing stock. Capital gains income of $5,600 came in from the sale of IBM stock. Even $3,235 winnings from betting on the horses at Los Alamitos Race Track was listed.

    "Chuckling to himself, George mentally reviewed what he had learned about his mark. Julie Jameson was recently-divorced after a nine-year mar­riage; it had been her second marriage and she had ended it with a divorce by charging her husband with adultery--and had apparently wound up with a hefty settlement as well as custody of the kids; she lived in an expensive home in a nice neighborhood (George had driven by to check it out); she worked at a se­cure high-paying job; she had additional income from interest and dividends: she enjoyed sailing and betting on the ponies; her six-year-old daughter had a learning disability; and she owned a status-symbol car. He decided he had enough information to make a phone call and strike up an acquaintance"!

    SO BE IT. FURTHER, HE COULD HAVE FOUND OUT A WHOLE VOL­UME OF ADDITIONAL INFORMATION FROM HER MEDICAL RECORDS TO EXACTLY WHAT WAS THE LEARNING DISABILITY OF THE CHILD!!!! WE JUST DON'T HAVE TIME OR SPACE TO GO ON WITH THE STORY.

    A FEW PRIVATE INVESTMENT REFUGES

    I will only briefly cover these because laws change quickly and negation of a suggestion can come spontaneously. However, even after the enactment of the Bank Secrecy Act and other legislation making financial privacy difficult to achieve there are still a few private refuges.

    1.Money-market accounts. These accounts may extend check-writing privileges to depositors yet, unlike banks, the brokerage firms offering them are not required to photocopy both sides of the checks you write. A money-market account manager however, must report interest you earn in such an account to the IRS. Many foreign banks also offer interest-paying money market accounts which are not reported to the IRS. You must of course, report any interest earned on your tax return from such a foreign account, along with the presence of the account itself if it is larger than $10,000.

    2. Non-dividend paying stocks. While most stocks pay dividends, not all do. And if you do not earn dividends on a stock, neither you or your broker is required to report the purchase of that stock to the IRS. However, any profits you generate when you sell must be reported by both you and your U.S. broker. Non-dividend-paying stocks are particularly popular outside the U.S. However, the Tax Reform Act of 1986 has imposed complex requirements for translating deferred dividend payments into theoretical capital gains for such investments. Tax must be paid on these paper profits.

    3. Stock certificates you hold yourself. Most brokers will maintain your stocks in a "book entry"--computerized--form. For greater privacy, and to guard against the possibility of some future catastrophic computer failure, have your stock certificates sent to you and keep them in a safe place.

    4. Bearer stocks. "Bearer" stock certificates are widely available out­side the U.S. Such certificates are not registered in any form and provide a completely anonymous form of stock ownership. Stock certificates issued be­fore 1982 in the U.S. may be available in bearer form. (I expect my co-work­ers to pay attention to this one. Please).

    5. Bearer bonds. Like bearer shares, bearer bonds are one of the most private of investments. They are widely used in many foreign countries and in particular, Switzerland and other tax havens. Bonds issued before 1982 in the U.S. may be available in bearer form.

    6. Municipal bonds. Municipal bonds are exempt from federal taxation. However, the Tax Reform Act of 1986 requires you to list all municipal bond holdings on your tax return. Bonds issued before 1982 in the U.S. may be available in bearer form.

    7. Treasury Securities. Direct obligations of the U.S. Treasury, backed by the "full faith and guarantee of the U.S. government" are among the world's safest investments. And until recent years, they were also relatively private. You would purchase them at a bank and would be mailed the actual bond cer­tificate. When the bill or bond matured you would present it at the bank and instantly obtain your money, with no questions asked. Some Treasury securities were also issued in bearer form without your name appearing anywhere on the certificate.

    In order to "safeguard certificates against accidental loss" (and, al­legedly, to save money), the U.S. Treasury in 1986 introduced "Treasury Di­rect", a program converting all government securities to an electronic form. In this new program, you no longer receive a Treasury security, only an acknowledgment that you own it. And when the security matures, your funds are wired to a bank. Both safety--and privacy--are removed, unfortunately.

    U.S. savings bonds however are still relatively private. While your name is imprinted on each bond, they are the only type of Treasury security that you can still hold in your personal possession (other than older T-bond and T-note issues). You can purchase savings bonds at any bank.

    8. Precious metals. Gold, silver and platinum are still relatively private investments. The purchase of precious metals need not be reported to the IRS. However, under IRS regulations proposed in 1982 (but never finalized), sales of precious metals by an "unincorporated entity" require completion of a govern­ment reporting form, (a 1099-B). Some precious metals dealers enforce this provision and others don't--yet! (DO YOU NOTE THIS, YOU ONES WHO DO NOT THINK A CORPORATION IS A USEFUL ITEM)?

    A loophole in the proposed regulation permits a reporting exemption if the items are sold for a premium of 15 percent or more above their bullion value.

    Many foreign banks offer precious metals accumulation and safekeeping accounts. While you can legally avoid reporting precious metals sales in this manner you are of course, required to declare any profits you make.

    9. Collectibles. Art, diamonds, antiques, stamps, rare coins, etc., are among the most private of all investments. No government reporting applies to either purchases or sales of collectibles. While such investments may be rela­tively difficult to sell and are often subject to high dealer buy/sell spreads, they are usually not purchased purely as an investment.

    Among collectibles, rare coins are probably the most liquid and subject to the smallest dealer mark-ups. An excellent guide to the rare coin market is the monthly newsletter Investment Coin Review. (See appendix.)

    Another excellent resource is through the services of David Schectman of Investment Rarities Incorporated. (See appendix.)

    Dharma, prior to going into the subject of private investing outside of your country (U.S.), let us have a break. We will also need to cover mundane things like, where to put the stuff into a safe place at home. Do not expect perfection, dear ones, there is risk in EVERYTHING. You must be discerning and wise--we can do no more than make the information available to you--it is up to you as to what action if any, you will take. So be it.

    HATONN TO STAND-BY. I WILL BE AVAILABLE WHEN YOU ARE READY TO RESUME.

    SALU


    PJ 10
    CHAPTER 18
    REC #2 HATONN
    SAT., DEC. 2, 1989 11:29 A.M. YEAR 3, DAY 108

    SAT., DEC. 2, 1989

    Hatonn present to continue. Thank you.

    LOOK OUTSIDE

    Among the most important reasons to invest outside the U.S. are currency diversification against the declining international value of the dollar and the opportunity to participate in markets not ordinarily accessible to U.S. citizens. These concerns are beyond the immediate intent of this journal. The best reason for consideration of this mode of business is financial privacy.

    HAVENS

    A handful of nations have policies or explicit legislation embracing banking se­crecy for non-resident (but for some very good reasons, not resident) investors.

    The oldest of this type of banking secrecy laws goes back to the time of the 1930s. The government of Switzerland became alarmed when agents of the German Gestapo began visiting Swiss banks and asking questions about Jewish depositors. It responded to these visits with a law prohibiting Swiss banks from releasing information on depositors. Many other nations enacted similar legis­lation after World War II. Today, 20 or 30 "tax havens" exist worldwide that cater to private investors. It gets more and more difficult to sort them out and less and less privacy can be maintained in international situations, such as Marcos, but there are still good ones around if you look.

    Some of these havens have less than savory reputations and some are most un­stable politically and relatively "new" and unfortunately are targets because of drug trafficking. These would include places like Panama and Vanuatu (the former Dutch New Hebrides).

    Switzerland is still unquestionably the largest tax haven in terms of foreign money invested. Other significant havens include Liechtenstein, Austria, Luxembourg, the Cayman Islands, the Channel Islands, Barbados, Bermuda and the Bahamas and lately there are some places emerging in the Orient such as Singapore.

    HOW TO CHOOSE

    First, be cautious. Few havens have unambiguous secrecy laws! Some coun­tries only have a non-legal "tradition" of secrecy; others have "confidentiality" laws where the local government has access to records but is itself sworn to se­crecy--a promise that may or may not be enforced. Some have laws that are not always respected with loopholes abounding. Not a few are tax havens with only "pretense" to secrecy.

    You would always need to check into the length of time the tradition of secrecy has been maintained. A country with several centuries experience, like Switzerland, or even several decades, like Luxembourg, won't be in as much of a hurry to change as havens like Vanuatu in the Pacific, which only recently proclaimed itself a tax haven.

    Check the haven status for local support. See if the haven's citizens also use the facilities. There is a world of difference in this regard between the Bahamas, where locals seem resentful of the haven provisions, and Austria, where average citizens regularly use the completely anonymous "password account", and thus have a vested interest in its continued existence. (By the way, watch Austria most carefully for when they become a member of the Common Market you have a MAJOR clue to timing of upcoming events).

    Always check into the stability of the haven itself. Any financial haven must also be a haven in nonfinancial ways. It must have a high degree of personal freedom. Of course, even free-market havens are not always stable. For ex­ample, Margaret Thatcher gave in to Red China's demands on Hong Kong, abandoning it to the 1997 deadline!

    Is the haven important to Washington, D.C.? Costa Rica, because it is a "friendly" nation in an unstable region, enjoys the favor of the U.S. govern­ment. Haven income is important to it and Washington won't want to lean too hard on it over a "non-strategic" issue. And since the CIA uses Liechtenstein for its financial transactions, the U.S. won't seek to wipe out its haven status. The Cayman Islands on the other hand, have no strategic value to Washington.

    Check carefully into whether or not it waves a "red flag". Public dealings with high-profile havens can raise a "red flag" in tax collector's offices around the world. The Caymans, Panama and Liechtenstein are examples. Switzerland is in the second tier, and Austria and Luxembourg are another step below that level. Bermuda is lower still, though it doesn't offer the secrecy the others do.

    Does it protect its sovereignty? Has the haven caved in to the demands of the great powers, even in non-financial matters? The Dominican Republic has bank secrecy laws, but when ex-CIA agent Edwin Wilson traveled there incognito in 1983, U.S. agents were waiting for him, ready to hustle him back to the U.S. There were no legal extradition formalities. U.S. agents operated in the Dominican Republic as they would in Kansas City. More recently, with the Marcos, Duvalier and Dennis Leving insider trading cases, Switzerland has shown that it is not quite as safe as it has previously been. This will increase, depend on it.

    You will also need to look into the convenience of the services. Are competent staffs available to serve the customer? How well do they speak English? Fi­nally, how convenient is the haven to deal with? It's best to visit one's money periodically, and so much the better if it is in a place that one enjoys visiting.

    The first requirement of a haven is that it offer capital preservation. Nonethe­less, to include a haven country which scores heavily in capital preservation but which also has high withholding, corporate, estate or other taxes is to ignore an important consideration.

    OH YES, YOU CAN FORM OFFSHORE CORPORATIONS AND I SUGGEST YOU LOOK INTO DOING SO. YOU MIGHT EVEN FIND SOME ALREADY IN SERVICE INTO WHICH YOU CAN INVEST.

    LET US CONSIDER SWITZERLAND

    French philosopher Voltaire in 1794 made the following observation: "If you see a Swiss banker jump out a window, be sure to follow him, for there is money to be made". Further, give appreciation to Voltaire for another most remarkable contribution to you ones. He, through his Countess mistress, trans­lated Newton's PRINCIPEA. Give honor unto the great Newton who--by the way--celebrates his true birthday on December 25th. The only valid thing about your December 25th birthday celebrations.

    Back to the Swiss. This mountainous nation in the heart of Europe is synony­mous with banking privacy and investment savvy. Switzerland has not only the oldest banking secrecy laws in the world, but a centuries-long tradition of financial privacy. As such, it is well-suited to an introductory discussion of offshore financial havens.

    Swiss bank secrecy laws date from 1934 and cover every conceivable person--bank employee or not--who might have access to personal information about a bank customer. Bank employees, auditors, regulators and anyone else with ac­cess to bank data are required to maintain silence regarding bank accounts. Not only are such individuals prohibited from disclosing account balances, but they may not even acknowledge that an account exists.

    Penalties are strict for those violating bank secrecy laws. Each breach of se­crecy is punishable by a fine of SFr 50000 (about $30,000) or six months im­prisonment--or both.

    Secrecy may be waived only at the client's request, or if the Swiss government has evidence that a crime has been committed. Should the crime have been committed outside of Switzerland, the bank secrecy laws requires that the of­fense also be considered a criminal offense in Switzerland for banking secrecy to be relinquished.

    Tax evasion, for instance, is a civil, not a criminal offence in Switzerland. Nor are violations of other nations' foreign exchange laws, money laundering laws or laws regarding the reporting of certain investments criminal offenses in Switzerland.

    If evidence exists that a depositor in a Swiss bank has committed a crime in an­other country that is a criminal offense under Swiss law, the government can try to get a court order forcing the bank to release information relevant to the crime under investigation.

    Unlike an IRS "investigative summons", a Swiss court order requiring breach of bank secrecy is rarely granted. And when it is, it can be appealed; the case of Ferdinand Marcos and his alleged secret Swiss bank accounts is a case in point. After nearly three years and several million dollars in legal expenditures by the Philippine government, that government has yet to receive any information from Swiss banks in relation to accounts allegedly held by Marcos, the former Philip­pine president.

    When a court order is granted, the Swiss government is permitted to examine bank records only in relation to the crime under investigation. "Fishing expedi­tions" are expressly prohibited.

    Swiss banking secrecy has been breached, however, in several investigations in recent years. Most notably in regard to inside trader Dennis Levine. But the average American with a Swiss bank account, even an American who is deliber­ately evading U.S. taxes, is in no danger of being exposed by Swiss authorities. Even if he is exposed, a bank account in Switzerland is nearly impossible for the IRS or any other governmental agency to impound.

    Banking secrecy also enjoys strong local support in Switzerland. A 1984 refer­endum endorsed the continuation of bank secrecy laws by a 2:1 margin.

    Switzerland also maintains a uniquely stable fiscal and military status. The total Swiss national debt today stands at less than SFr 20 billion (U.S. $12 billion), a smaller figure than the outstanding debts of many private companies. In spite of its meager debt, the Swiss government has the largest per-capita gold reserves in the world: 83,275,000 ounces. At the present price of gold, Swiss gold re­serves are worth more than $31.6 billion.

    As a result, the Swiss franc is one of the world's strongest currencies. Since 1970, the value of SFr vs. the U.S. dollar has increased by nearly a factor of three; from 23.2 cents per franc in 1970 to more than 60 cents per franc today.

    Switzerland actively protects its neutrality with its army and local defense forces. In both World Wars I and II, Switzerland demonstrated to Germany and the Soviet Union that it could not be easily conquered. Today, Swiss army strength stands at 625,000. Every soldier is obliged to keep a loaded automatic rifle in his home, ready for instant use if the nation is invaded.

    Further, as we pointed out in SURVIVAL IS ONLY TEN FEET FROM HELL, the Swiss are well prepared for any event with massive tunnel shelter systems. Virtually every citizen would be protected in the event of a nuclear war. Most homes have bomb shelters and new homes cannot be constructed without them.

    The Swiss government goes to enormous lengths to protect the integrity of its banking system, its currency and its territory. The Swiss have taken privacy (used in its widest sense) to a much higher level than almost any other nation in the world.

    It would go beyond the scope of this journal to describe all the types of Swiss bank accounts available, or to recommend specific Swiss banks. There are re­sources for that information. One such source is the CONFIDENTIAL: RE­PORT FROM ZURICH newsletter, which covers developments in Swiss banking and other offshore havens (see appendix) and OFFSHORE BANKING NEWS. (See appendix.)

    OTHER TAX HAVENS AROUND YOUR WORLD

    Austria. A relatively "low-profile" haven located in central Europe, Austria has stricter bank secrecy laws than Switzerland, although they have been in effect only since 1979. The Austrian "numbered account" system provides total anonymity for the depositor, and unlike the numbered accounts from Swiss banks, the average U.S. investor can obtain one relatively easily.

    Liechtenstein Principality. This is a tiny central European haven. It offers per­haps the most adaptable company law in the world--along with almost impene­trable bank secrecy. There are several types of Liechtenstein companies; per­haps the most flexible is the anstalt (trust) which one banking authority claims, "can be adapted to be all things to all people". Setting up a Liechtenstein com­pany is not an inexpensive undertaking but the flexibility of Liechtenstein com­pany law along with the privacy of its corporate structures, attracts wealthy in­vestors from all over the world.

    Luxembourg. Located at the confluence of France, Belgium and West Ger­many, Luxembourg is a convenient offshore banking center with most financial transactions by foreigners going untaxed. While bank secrecy laws date only from the early 1980s, Luxembourg has a tradition of banking confidentiality dating back to the years following World War I.

    The Channel Islands. Located in the English Channel a few miles off the coast of France, the Channel Islands are one of the fastest-growing havens in the world. The most important of these islands are Jersey and Guernsey (does sound a bit like a dairy cow herd.) The islands are close historically and geo­graphically to Great Britain, but are not subject to high British taxes.

    Barbados. A Caribbean haven, Barbados is the easternmost island in the West Indies. The island is notable for the large number of U.S. and multinational corporations that have set up offshore subsidiaries to take advantage of its low tax rates. Company law in the Barbados is adaptable to many enterprises, and most companies owned by non-residents need not pay income tax or capital gains tax.

    Bahamas. The closest haven geographically to the U.S., the Bahamas' western­most islands are located only 50 miles due east of Miami, FL. Strict bank se­crecy laws and numbered accounts are available in Bahamian banks, but this haven has developed a relatively high profile in recent years as a result of well-publicized tie-ins with narcotics smuggling.

    Bermuda. While having no formal bank secrecy legislation, Bermuda enjoys a tradition of confidentiality in financial affairs, political stability and much lower profile than most Caribbean havens. Taxes on non-residents are low or non­existent and several Swiss banks have opened branches on the island.

    OFFSHORE REPORTABLES AND NON-REPORTABLES

    If you take part of your wealth outside the U.S., Uncle Sam wants to know about it. The original version of the Bank Secrecy Act required U.S. citizens holding more than $1,000 in any "financial accounts" outside the U.S. to report them on their federal income tax return. This reporting threshold has now been raised to $10,000. If you think any of these maneuvers seem strange, re­member that you have a lot of lawmakers trying to gain privacy also and these are the loopholes you continually seek out.

    The IRS does not make it easy to report foreign bank accounts. No questions relating to this subject appear on Form 1040. Instead, these questions appear on Schedule B.

    The 1988 instructions for Schedule B state that anyone who at any time during the year had an interest in or signature or other authority over a financial ac­count in a foreign country (such as a bank account, securities account or other financial account) should report same. Exceptions are made if the combined value of the accounts is less than $10,000 or if the accounts were with a U.S. military banking facility operated by a U.S. financial institution.

    "If you admit to having an interest in a 'foreign financial account', you must also complete a separate Treasury Form 90-22 listing each foreign account and send the form directly to the Treasury Department in Washington, D.C.--not your regional IRS office." (You can be certain that once it reaches Washington it receives "special attention").

    There are several methods you can use to avoid reporting the presence of your offshore account. Since a tax return isn't the same as a "currency transaction report", using these techniques probably don't constitute "money laundering". By now I expect all of you to be reading between, over and under the lines of print.

    1. Keep reportable foreign accounts at less than the reportable minimum. The key word here is "reportable"; many types of offshore investments need not be reported. A few examples: insurance policies, safety deposit boxes, real estate holdings that do not generate income, non-dividend-paying stocks, precious metals ownership certificates, etc.

    Of course, most U.S. investors investing offshore for the first time will stick with a foreign bank account, the presence of which is reportable if the total of such accounts is $10,000 or more. You are on your own as to the use of multi­ple bank accounts of under $10,000 each.

    2. Minimize your interest income from all sources to avoid filing Schedule B. If your interest income is less than $400/year, you need not complete Schedule B--the form that asks you if you have an offshore account. Nowhere on Form 1040 itself are you asked to make such a disclosure.

    In practice, keeping interest income at this level or lower may require consider­able effort even for middle-class investors. But if your portfolio consists mainly of assets you purchase for capital gains, such as precious metals, collectibles, real estate, etc., you can keep interest income to a minimum.

    MOVING YOUR MONEY

    To keep your offshore accounts confidential, you may wish to take action to disguise the funds you transfer to an overseas bank. However, if you do so in a deliberate attempt to avoid currency reporting regulations imposed by the Bank Secrecy Act, your actions could be interpreted as "money laundering", and you could be subject to the heavy fines and even imprisonment as I have already dis­cussed.

    This section should show you how preposterous the whole U.S. system of anti-"laundering" really is. Any criminal can use these techniques. It takes little skill to defeat the system. It is obvious that these laws are not aimed at crimi­nals. It is obvious that these laws are aimed at honest citizens who think they deserve some privacy. The following description of techniques for privately taking funds out of the United States, and bringing them back, are taken from the May, 1988 issue of Confidential: Report from Zurich.

    Further, this Journal is copyrighted for the sole purpose of being able to prove what was in our original document as released to the public. We refuse to be set-up as a target for them to aim at. I have no wish to have anyone break laws, for Caesar can be most difficult. I merely report that which comes into my at­tention. None of it has come into Dharma's attention so we maintain quite a bit of security in that manner.

    1. Don't use personal checks from a U.S. bank account to send money overseas, since they are photocopied by your bank.

    2. Small money orders less than U.S. $1,000 may be used to transfer funds to your offshore account. Pay for the money order in cash. Don't put either your name or the name of the intended recipient on the money order until after you have purchased it. Nor should you make the money order payable to "cash" if you are sending more than $5,000 overseas at one time. Doing so makes it a bearer instrument and subject to U.S. currency reporting require­ments.

    The best place to purchase a small money order is at a convenience store. You may also purchase money orders, with varying degrees of privacy, at banks, securities firms and post offices.

    3. If you do business overseas, consider asking a trusted firm to overbill you for the goods or services they provide. Simply have the company divert the excess funds to your foreign bank.

    4. Many individuals use the mail to transfer cash overseas. While rela­tively reliable, you have no recourse if the money is lost. In addition, if you mail more than $5,000 in cash, you are required to notify U.S. Customs.

    5. Rare, or numismatic coins may be used to sidestep filing an international currency exchange transaction form. Rare coins may be declared at their face value to U.S. Customs. For instance, you could buy U.S. Liberty and Saint Gaudens $20 gold pieces, which contain nearly an ounce of gold, and declare their value as $20 at the border. Similarly, you may be able to declare the U.S. 1-ounce gold eagle for $50, since this is its stated legal tender value. (However, you may run into problems since this is a bullion, rather than nu­mismatic coin). Check with your overseas bank to determine what type of rare coins can be most easily sold in that area to assure maximum liquidity when the coins arrive.

    6. Bank checks drawn for less than $10,000 are another private method of transferring funds overseas. Have the check signed by the bank manager and made payable to your foreign bank--not cash. Pay for the check in cash. There should be no need to leave your name or provide any identification for this ser­vice.

    7. You can wire up to $10,000 overseas in complete privacy with a Western Union money wire. Pay for the wire in cash and do not complete the claim form that asks for your name and address. This will insure anonymity, but if the wire is lost, you will not be able to obtain a refund.

    Consider in advance the private repatriation of funds you hold in an overseas account. Strict foreign exchange controls, however, could complicate your efforts immensely. Therefore, I do not recommend that you maintain a large portion of your wealth overseas. Laws are very, very quick to change while piggy-backed with other seemingly inoffensive legislation.

    8. One of the best ways to repatriate assets overseas in a totally private manner is to use a Visa, MasterCard or American Express card drawn on a foreign bank account. Transactions on the card are cleared in the name of the foreign bank, not your own name. Many foreign banks offer such cards. Ob­tain the credit card when you set up your overseas bank account. Make sure that the card can be used in an automatic teller machine. If you plan to use the card to purchase goods or services, ask the bank if it can be printed in English so that its origin is not as obvious. British banks are an excellent choice for low-profile foreign credit cards.

    9. Consider requesting the bank to send you your proceeds in the form of municipal bonds issued prior to 1982. Since these are bearer bonds, instruct the bank to send them in increments of $5,000 or less. (Hatonn: This could be considered as a deliberate effort to avoid completing a currency transaction form, and therefore might be considered illegal under the U.S. anti-money­laundering statutes.)

    Interest on municipal bonds must be reported on your income tax return, even if it is currently exempt from federal taxes. To legally avoid reporting the interest, you could simply cash them in immediately after receiving them before an interest payment comes due.

    10. Many overseas banks have correspondent banks in the U.S. You may be able to request your offshore bank to transfer your funds to a U.S. cor­respondent bank with the transfer recorded in the bank's name, rather than your own.

    The easiest way of all is simply to put cash in a paper bag and go on a Caribbean cruise. When you get off the boat at a tax haven, wear a really ugly tourist-type shirt, a funny hat, and have an old Japanese camera around your neck. Carry the money in the paper bag or inside your camera bag, get a taxi, and go to your bank. No customs inspectors ever greet Caribbean cruise ships--it is sort of a silent "understanding". If you think a Mafia member hasn't fig­ured this out, think again. ANTI-LAUNDERING LAWS ARE AIMED AT YOU. NOT THE MAFIA.

    Let me sort of summarize this portion because it can be so useful indeed.

    Many countries outside the U.S. better appreciate the basic right of confiden­tiality. They have a long-standing tradition of bank privacy. Holding cash is not a crime; most stocks and bonds are issued in bearer form in Europe; anonymous safe deposit boxes are available in London. Americans can buy real estate in most of these countries. European-based credit cards are also avail­able.

    Foreign insurance products allow you to earn tax-free income in certain circum­stances. One of the most interesting products is Unilife's International Whole Life Plan, based in Luxembourg. Unilife is a 20-year old insurance company with over 700,000 clients worldwide. This whole life plan is unique because the cash value is invested in no-load mutual funds and international funds, man­aged by Charlesworth & Rugg, Inc., a distinguished investment management group led by Donald Rugg. The fund is available in either Swiss francs or U.S. dollars. Minimum investment is $10,000. For a free brochure, Robert Edgar, International Insurance Agent. (See appendix.) I will point out however, that Insurance companies are in severe trouble during these times, as well as banks and S&Ls, so use intelligence.

    Before we pass these investment sections, let me give you a bit more. Of course, the best privacy strategy is to have a corporation and allow it to handle all these things. Neither do I recommend most of the investments as will be re­ported here, but I feel it only fair to give them to you as possibilities for you who can't yet see the handwriting on the wall clearly enough.

    Most stocks, bonds and other traditional investments bought through brokerage firms are no longer private, but some investments can still be bought with cash. For example, you can walk into almost any coin dealer and buy a gold coin with cash, no questions asked. You can't do that at Merrill Lynch, for instance.

    In addition to coins, there are other investments that can be bought quietly. Real estate can be purchased in a low-profile manner through "land trusts" in most states. Land trusts will keep your name off the county records. You might also consider buying real estate out-of-state or in foreign countries, preferably in areas where you like to travel. It is still better to simply incorporate, buy the real estate and when you choose to sell, sell it in its entirety as a corporation. (Sell the corporation). There are a lot more advantages than I have time to list for you herein.

    You can store coins, collectibles and stock certificates in safe deposit boxes in a private manner--but not in your local bank. Guardian Safe Deposit Co.'s Long-Distance Storage Account Program, located in Arlington, Va. offers top-secu­rity protection for your valuables away from your banking facility. (See ap­pendix: Guardian Safe Deposit Co.)

    LET'S RETURN BRIEFLY TO THE SSN

    Another reminder about privacy and guarding your Social Security number and then we will move on to the system itself.

    Remember, most computer files are accessed by a number, specifically your So­cial Security number. One of the keys to maintaining your privacy is to keep your SSN as private as possible. Unfortunately, your SSN is constantly being demanded by businesses and organizations, far beyond the original purpose of the SSN. Prior to 1960, the SSN was used only in dealing with the Social Security Administration. The card itself warned, "Not to be used for identifi­cation purposes". But in 1960, the IRS and other government agencies started using it. Then in the '70s, states began using it for driver's licenses, and soon universities, banks, insurance companies and employers demanded it for identification as well. Even utility companies demand it before they will send water or electricity to your home! New Social Security cards no longer carry the warning about unauthorized use.

    However, you do not always have to disclose your SSN unless required to do so by law--and make them show you the law. Refuse to give your number to uni­versities, insurance agents, doctors, and others who simply demand it. Most organizations are set up to assign people an independent number if they don't have a SSN, or if they refuse to disclose it. You can put any number in that slot if it is not required by law.

    There are many ways in which your SSN can be abused. If a criminal latches onto your SSN, he may gain access to credit files and a list of credit card num­bers, which would allow him to buy airline tickets and other products with your money and without signature. Or he may use your SSN to create a new iden­tity. When crimes are committed, your SSN may be incorrectly linked to a criminal record. Recently, THE WALL STREET JOURNAL reported the story of a man whose life has been practically destroyed because a criminal stole his SSN and used it to create a new identity and to commit crimes. The innocent man has been falsely arrested several times and lives in constant fear. The last time he crossed the border into Mexico, he was seized by U.S. police at gun­point. Beware if your name and SSN appear on the National Crime Information Center computer.

    ALSO THE TAX RETURNS

    Another thing you should guard against is turning over tax records to financial institutions. More and more banks and credit card companies are demanding tax returns for customers applying for a mortgage, personal loan or credit card. But you should refuse to disclose this information if at all possible. Tax records are a grave distortion of your financial well-being. Moreover, when you turn them over to a bank, you lose control of this vital data. Once you give your tax returns to a bank, the bank owns the information and can disclose it to others. A tax return contains all kinds of personal and financial data, including your as­sets. If you are sued, a tax return may be extremely helpful in locating hidden assets.

    There are many ways to avoid submitting tax records. Often you can verify in­come by other means--a statement from your accountant, W-2s or 1099s, for example. Or in the case of a mortgage application, you can request a "no dis­closure" form. Many banks and mortgage institutions will allow you to get a mortgage without disclosing your tax returns if you are willing to make a down-payment of 25-30% and can demonstrate a good credit history.

    LAST GASP!

    The Social Security system has been a part of U.S. life for more than 50 years. To be sure, Social Security has been an enormous success for the first two gen­erations of retirees. And the aging architects of the system assure you that "the system is fundamentally sound".

    Such statements are wonderful for public consumption. But you should not be­lieve them. Not when bankrolling Social Security into the 21st century will re­quire greater and greater intrusions into your private affairs--not to mention much higher payroll contributions.

    To finance the centerpiece of the "Old Age Insurance Plan"--also known as the "Old Age Pension", Congress in 1935 imposed a tax on the wages of employ­ees, to be matched by employers. That tax, just like the income tax of 1913, now seems incredibly low: 1 percent of wages, to be paid on the first $3,000 of income. The maximum annual contribution from an employee was only $30, to be matched by a $30 contribution from his employer. Are any of you falling on the floor yet?

    As you all know, Social Security taxes are much higher today. Employees pay 7.65 percent of the first $45,000 in income into the program. Employers make an identical contribution. The maximum annual employee contribution is $3,442.50--115 times higher than the 1935 maximum. Social Security taxes have increased by 11,375 percent since they were first imposed 50 years ago.

    Unfortunately, the upward momentum in Social Security taxes is unlikely to let up anytime soon. The population distribution of the U.S. makes it impossible. The number of workers making contributions to the Social Security system is increasing at a much slower rate than the number of beneficiaries.

    This is a direct consequence of the "baby boom" of the '50s and '60s and the "baby bust" of the '70s and '80s. By the time "boomers" are set to retire in the early 21st century, the "dependency ratio"--the number of workers available to support one retiree--will have shrunk from 3.2:1 in 1980 to 2:1 in 2020. (SS began with a ratio of 140:1).

    To finance benefits to aging boomers, the Social Security Administration's "most pessimistic" (but read this as the most "realistic") assumptions project payroll tax rates of an incredible 37.5 percent by the year 2020.

    It doesn't require a great deal of imagination to consider how workers of the 21st century will react to SS tax rates of 37.5 percent. Workers will "opt out" of the system any way they can to avoid being trapped by rising tax rates. Evading SS taxes is tax evasion. But with SS tax rates of 37.5 percent com­bined with federal taxes of a minimum of 30 percent or probably grossly higher, many workers won't let that stand in their way.

    Well, thus the infant numbering system, etc., but the invasion of privacy to come from SS will be far greater than the assignment of a mere number. For instance, to keep tax rates from going higher than even 37.5 percent, you can count on more "means-tests" before you obtain SS benefits. The "means-test" concept is simple: If you aren't poor, you don't get the benefits.

    Naturally, the IRS and the SS system will want "proof" that you are "poor enough" to deserve benefits. In the future you can count on intrusive applica­tions, unannounced visits by caseworkers and SS "audits" not dissimilar to the IRS audits of today.

    SS will thus evolve from its present status as primarily a pension-welfare system into a pure welfare system. The "wealthy" (read middle class) will pay in­creasing taxes on SS benefits, while their children struggle with the burdens of higher and higher tax rates.

    Another trend will be the elimination of the wage ceiling on which SS tax must be paid. A bill to this effect was narrowly defeated in the 1988 Congress. In 1989 or in some future year, we may not be so lucky.

    If you are concerned by these trends, the solution is simple: opt out of the SS system legally. Work toward shifting your income from wages to royalties, in­terest, dividends, rents, etc. that are at least not currently subject to SS tax.

    Dharma, let us take a break at this point. I wish to speak of the Cashless Soci­ety next and it will be a bit wordy.

    Thank you for your kind attention.

    Salu ,

    Hatonnn to quit frequency. Good afternoon.

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