If the Federal reserve bank is a privately owned bank, in which state was it first incorporated?
Answers:
I have my doubts that the Federal Reserve Association has anything to do with the Federal Reserve System. While it is true that the FRA was incorporated in Delaware and anyone can see that on the Delaware Corporate website, a person has to pay $10 to see the current status of the entity. I did. Currently, the status for the FRA is listed as VOID as of 03/01/2001. The definition of the void status from the Delaware Corporate website is "V - Void - A corporation that failed to pay it's annual franchise tax for a period of 1 year or a Foreign Corporation that has not filed their annual reports within a 2 year period." Since the Federal Reserve System has been operating continuously, I seriously doubt the FRA or their status has anything to do with the Federal Reserve System.
According to the Federal Reserve Act (USC Title 12, Chapter 3), there can be no more than 12 federal reserve districts in the continental U.S. In each district, there can be no more than ONE federal reserve city. The federal reserve city will be the location of the federal reserve bank of that district. Also, the title of a federal reserve bank will include the city name. For example, Federal Reserve Bank of Chicago. National banks are required by law to become a member bank of the Federal Reserve System by subscribing and paying for stock in the Federal Reserve bank of its district. (USC, Title 12, Chapter 3, Subchapter I, § 222). Also, no individual, copartnership, or corporation other than a member bank of its district shall be permitted to subscribe for or to hold at any time more than $25,000 par value of stock in any Federal reserve bank. (USC, Title 12, Chapter 3, Subchapter 6, § 283).
JimK: I have to give you a great big GONG on this one.
"As for being "chartered" and equivelent to the USPS I would certainly have to disagree - as the USPS makes a profit and that profit goes to the federal government - you are saying such profits from the federal reserve go to the government as well - they don't - they line the pockets of the owners of the federal reserve."
In reality, the federal reserve pays a 6% per year dividend on the stock of the federal reserve. As I mentioned earlier, other than a small amount, all of the stock in the Federal Reserve is held by national member banks. The dividend is cumulative, so if the Federal Reserve doesn't make enough one year to pay the dividend, it has to pay the amount that is short in following years where it does have enough. The reason for this is to give the member banks incentive to become members and to provide interest on the amount the member banks are required to hold in reserve on their deposits. The Federal Reserve also rebates interest earned on U.S. Government debt to the Treasury. Any excess earnings are required to be placed in a surplus fund to support the system in short years. Periodically, Congress will instruct the Federal Reserve to transfer a portion of the surplus fund to the Treasury.
(USC, Title 12, Chapter 3, Subchapter 6, § 289)
BTW, the non-profit or religious entity type for the Federal Reserve Association simply means this description type refers to a corporation that sets forth in it's certificate of incorporation or subsequent documents that it is a non-profit corporation. The "Religious" literal does not infer that, in every case, the corporation is for Religious purposes only. The intent is to define the corporation as Non-Profit, charitable corporation which maybe formed for Religious purposes.
not sure, but i know that the only presidents ever tried taking over control of reserve from the private banks were assassinated. makes you wonder who's in control of our country.
Its an excellent question, Joe.
The exact legal status of parts of the Federal Reserve is often hotly debated. The emotional part of the debate stems from claims that some or all of the Federal Reserve is privately owned. Such claims are not wholly true or untrue.
Let's review the basic structure. First, the "Federal Reserve" is not a single bank but a system of related entities. It is organized with the Board of Governors at the top, and branches beneath them. (http://www.federalreserveeducation.org/f... )
The Board of Governors is, by law, a government agency with absolutely no structure or mechanism for private ownerhip. The governors are all appointed for 14-year terms by the president and confirmed by congress. it is overseen by congress and must make regular reports to congress. Board members are forbidden by law to have any economic self-interest in any financial institution. (Ref: Title 12 chapter 3 of the U.S. Legal Code)
The controversy over 'private ownership' and 'incorporation' is with the 12 branches. National banks must, and other banks may, buy shares in their local fed branch which entitles them to some power and participation. They can vote for 6 of their 9 board members. The shares get a standard 6% dividend. These shares cannot be sold on the open market.
Beyond the 6% dividend, all remaining 'profit' from the Federal Reserve branches are turned over to the Treasury at the end of the year. That changes from year-to-year but has been around 95% returned since 1913.
So are Fed branches privately owned?
- The Board of Governors says 'No' (ref http://www.federalreserve.gov/generalinf... ).
- Wikipedia calls them "nominally owned' (ref: http://en.wikipedia.org/wiki/federal_res... )
- A 9th circuit court ruling says 'Yes' for the purposes of tort law (ref: http://nesara.org/court_summaries/lewis_... ) If you read the ruling, the tipping point is that since most of a branches directors are elected by private banks, that makes them 'sue-able' as any private corportation.
But to me, your question gets right to the heart of the matter. If they are indeed private corportations, then there had to be articles-of-incorporation filed at the state level.
I personally searched for articles of incorporation where 5 branches are located and could not find any for Federal Branches.
Our friend JimK (below) was kind enough to reference a filing from Deleware for the "Federal Reserve Association". It's intriguing but I conclude it is not relevant. It appears to be a dead-end. it is no longer active and the address listed does not appear to be connected to the Federal Reserve.
UPDATE: NGK - Thanks for the additional insight on the FRA - and paying the $10 to find out.
So I contacted a Federal Reserve branch and ask your question. A research librarian from one of the branches explained it this way:
"(the question regarding incorporation of Federal Reserve Branches) is difficult to answer because of the complex nature of the relationship of the Federal government and the FRB. (Our Branch) is not incorporated, nor are any of the others."
But what about the court case "Lewis v. United States, 680 F.2d 1239 (1982)" which concluded the "Fed branches are "independent, privately owned and locally controlled corporations".
The Fed branch research librarian says:
"I think the court was saying that the Fed banks are set up like private corporations only in the sense that the Federal government does not oversee their activities on a day to day basis and that they are run independently. They are seen as federal instrumentalities under many circumstances ...".
So what is their legal status? I was directed to a publication that indicated the branches were government charters similar to agencies like the USPS.
So getting back to your question. My conclusion is that Federal Reserve banks are not incorporated in the sense there are not any "articles of incorporation" filed with any state.
If someone finds those filings, please share.
The Federal Reserve Association, which controls the federal reserve banks and has all the usual powers and responsibilities of the european central banks, was incorporated in Delaware on 9/3/1914
It is registered as a domestic non-profit or religous corporation - LOL - go figure. File number 0042817
The use of Delaware was a smart move as its close to DC and it does not require the company to reveal the names of its proprietors - they could have done it in nevada as well but that is just too far from DC
EDIT:
Gray Shadow (1) - it doesnt say its not in good standing - it says its not a statement of good standing - I believe this site will say that for ALL businesses - it is only a registry site indicating who is currently registered - I tried to get a statement of standing from the registering agent but they want much more money then I was willing to shell out for curiosty's sake so I forego getting that statement
Gray Shadow (2): I am sure one could always google Federal reserve Association if they wanted to. Although I am not sure if the definitive proof you are looking for will be there. Some time ago I found the site barefootsworld that had abunch of stuff on the reserve. Let me find that link - here it is - try this and see if it helps any - http://www.barefootsworld.net/fs_m_ch_02...
GrayShadow(3): I will have to try to track something down. It doesnt surprise me that you couldnt find anything on the seperate branches. I doubt each branch of a bank incorporates itself - they simply do business as the main corporation. So ONLY the main corporation would need to be registered.
As for being "chartered" and equivelent to the USPS I would certainly have to disagree - as the USPS makes a profit and that profit goes to th efederal government - you are saying such profits from the federal reserve go to the government as well - they dont - they line the pockets of th eowners of the federal reserve
The "charter" is simply to allow federal oversight of the system once congress figured out the implicatons of how this could effect the econoomy of the nation - they didnt want the banks ruling the country so they put laws in place to allow congress to "oversee" things. Needless to say, a little "payment" to the congress and the feds are left alone so the banks run the country anyway.
Hmmm.I wonder if FOIA requests might get us an answer somehow. I would think at the very least it might produce documents for us.that might be worth a try although a little time consuming. Will have to look into that as well.
NGC, Gray Shadow,
I am sure there is always more then one way to skin a cat eh? We could right our questions directly to the Fed and askthem straight out
The Federal Reserve Bank Inc.
20th and Constitution Ave., NW
Washington, D.C.
Postal Code 20551
It must be owned by credit card companys they can get away with anything they want to and nobody seems to care.
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