Prepared by Larry
Prepared Statement by Larry Ray
Grand Jury Proceedings – Federal Grand Jury 09-02 - District of Colorado
My name is Larry Ray Hall. I am domiciled at
that Legal Address filed @ Reception # 2001000004659, Adams County Recorder, Colorado. A copy of
the certified recording of my Legal Address has been made available as Exhibit V. I am a
non-resident of the State of Colorado and of the United States, but live on the land of the Republic of
The founding fathers defined a resident as:
"Residents, are distinguished from citizens, are aliens who
are permitted to take a permanent abode in the country. Being bound to the society by reason of their dwelling in
it, they are subject to its laws so long as they remain there, and being protected by, they must defend it,
although they do not enjoy all the rights as citizens. They have only certain privileges which law, or custom,
gives them. Permanent residents are those who have been given the right of perpetual residence. They are sort of
citizen of less privileged character, and are subject to the society without enjoying its
Their children succeed to their status; for the right of perpetual
residence given them by the State passes to their children." [The law of nations. Vattel, Book 1,
Chapter 19, Section 213, P. 87.]
First, please be advised that, I am
appearing here today specially and not generally. I wish to extend my thanks to the Grand Jury for
inviting me here today to present the truth of these matters, as only I can know the truth of my
I am appearing voluntarily and I
welcome the opportunity to answer your questions. I would like to know if I will be free to testify on
my own behalf and that I can be assured that before this hearing is over I will be able to make my own statement
uninterrupted by the prosecutor, as has already been agreed? A copy of my acknowledgment which
contains the terms of agreement for my attendance here today has been provided as Exhibit
For the protection of the Grand Jury
and all other parties to this proceeding, before you commence your questioning of myself, you need to know that the
terms by which I was forced to agree to this appearance were at once made in violation of my rights to due process,
and secured under threat, duress and coercion by officers of the US government, who were not in a position of
authority to make such demands.
I am well aware of the gravity of the
proposed charges that have been alleged against me, and understand fully that without my being present to provide
testimony and written evidence to the truth of the matter and of my innocence, there is little chance that justice
will be done. I am also well aware that the prosecutor will take all necessary measures to secure an
indictment against me, thus I can rely on no other for my defense.
You need to know that in June of 2010,
I mailed by USPS Certified Mail two copies of a letter of notice, dated June 20, 2010, to the Grand Jury Foreman –
one copy in care of Gregory C. Langham, Clerk of the United States District Court for the District of Colorado and
another copy in care of David Gaouette, U.S. Attorney with the U.S. Department of Justice. That letter
of notice provided as Exhibit III, included 1) a full explanation of who I am and my legal status, 2) a
sworn Affidavit as to my legal status, 3) a notice of recognized rules as to how grand juries are to be conducted,
and how evidence is to be handled – specifically that the prosecutor may not hold the grand jury records, including
transcripts, logs, and evidence, 4) what the duties, requirements and limitations of the prosecuting attorney are,
5) a detailed list of those matters which the Grand Jury and Prosecutor were required to investigate prior to this
proceeding, 6) a list of questions which were required to be answered by the prosecutor prior to this hearing, and
7) to provide to the Grand Jury and myself all records and evidence in government files, in any agency of the
government, both federal and state, for inspection and review (none of which has been
Failure of the prosecutor to provide
evidence that could lead to dismissal of the case or a not guilty verdict could be construed as an attempt to
obstruct justice by the prosecutor, and possibly the grand jury. Production of such evidence is
required by the Fourth, Fifth, Sixth, and Fourteenth Amendments to the Constitution, and the doctrine proclaimed in
Brady v. Maryland, 373 U.S. 83.
That letter required the Clerk of the
Court and the US Attorney to present it to the Grand Jury Foreman. It also requested that the Grand
Jury Foreman return to me a copy of each of the letters with a blue wet-ink signature, as proof of receipt by the
I received no acknowledgement that the
Foreman received the letter.
Did the Grand Jury Foreman receive a
copy of that letter from the Clerk of the Court? Did the Foreman receive a copy of the letter from the
You need to know that I am here in my
capacity as a federal witness, investigating certain crimes by the United States Department of Justice, United
States Treasury Department and Internal Revenue Service, among others. My Verified Criminal Complaint
of felonies, made pursuant to 18 USC 4 Misprision of felony, has been served on the United States Congress, and a
copy of the Complaint has been provided as Exhibit IV.
Title 18 § 4. Misprision of
Whoever, having knowledge of the actual
commission of a felony cognizable by a court of the
United States, conceals and does not as soon as possible make known the same to some
or other person in civil or military authority
under the United States, shall be fined under this title
or imprisoned not more than three years, or
You need to know that I was only given 3 court days to
prepare for this hearing. During the past 10 calendar days, my oldest daughter’s house burned to the
ground, and my youngest daughter’s husband passed away. In face of the grief and burdens placed
on me and my time by those untimely events, I asked Charlotte Seaton, who I was told to be the Grand Jury
Coordinator to arrange for this hearing to be postponed until after the funeral, which is scheduled for
tomorrow. When she got back to me on Thursday afternoon, Greg Flynn, the CID agent who
investigated this case was on the phone with her, and he told me that this hearing could not be
postponed. Why is he making decisions for the Grand Jury?
Considering that the Grand Jury is supposed to operate
completely independent of the three branches of government, as explained in Attachment C to the notice letter, I
would first like to know why the Grand Jury Coordinator is connected with the US Justice Department, a part of the
executive branch of government, and why those who are attempting to prosecute me are not independent of this Grand
Second, I would like to know why Greg Flynn, an agent of
the US Treasury, is managing the affairs of and making decisions for this independent Grand Jury?
Doubtless the prosecutor has already provided this Grand
Jury with a written statement of proposed charges and evidence that they say supports those proposed charges,
leaving solely to the Grand Jury the job of investigating the proposed charges and questioning me.
I would like to know how I can expect to be treated
fairly and justly in these proceedings if the prosecutor and various factions of the US Government are involved
directly with the business of the Grand Jury and if they are allowed to take part in or even be present at these
proceedings, which means that the prosecutor is both bringing the proposed charges and either leading the Grand
Jury or performing the duties of the Grand Jury by questioning me?
I would like to know why the prosecutor appears to be
hiding evidence from the Grand Jury by not responding to my notice letter, as required by law?
I would like to know why the prosecutor is in such a
hurry to secure an indictment before the evidence has been presented and reviewed by this Grand
In light of all of these circumstances which have already
contributed to my due process rights being seriously violated, I ask this jury to postpone this hearing until a
later date, after prosecution has complied with all requirements and this Grand Jury has had time to complete a
thorough investigation of all evidence.
I have with me evidence which will absolutely beyond a
doubt prove my innocence of the proposed charges, which I can leave with you today for your review. You will
discover that the proposed charges being brought against me are for alleged crimes that require the element of
intent. Only I know my intent, and I can and have stated that I had no intent to commit any crime,
including, but not limited to those crimes specifically alleged. You will discover that these
proposed charges arose only in the minds of my accusers in a vacuum of evidence, and in their rush to assign guilt
where none exists.
In introduction, you need to know who
I am, as a person. I was brought up to always do what is right and never harm another person, no
matter the personal consequences to myself. I have always followed, as closely as is humanly
possible, that mantra for how to live rightly.
I am now 61 years old, and I can
honestly say that I have never committed a crime, I have never intended to commit a crime, and I see no reason this
late in life to change that policy which has served me so well. I can also say unequivocally that I am
absolutely and completely innocent of the crimes alleged against me.
It is utterly beyond my ability to
imagine why anyone would intend to commit the crimes for which I am being charged by the prosecutor.
Yes, I do know that there are those in our society who, for whatever reason (mental incapacity, improper
upbringing, loss of moral compass, etc.) make decisions to commit crimes. It is just that I
personally do not have the mental or moral incapacity to understand such things.
I find it very frightening that a
prosecutor, acting without any evidence, and having no knowledge of my intentions would bring such charges against
me, thereby threatening my very life, and the future of my family. Further, I find it appalling that
our public servants would fabricate blatant lies, as they certainly have in this case, to mislead this Grand Jury
for the purpose of securing an indictment, when their sworn duty is to uphold the law and assure
justice. How can this happen in America?
According to that letter dated
February 7, 2011 from Kenneth M. Harmon, Assistant United States Attorney to Larry Ray Hall, provided as Exhibit
VI, Prosecution is alleging that I have conspired to defraud the United States and has proposed
charges that I (Larry Ray Hall):
1. Obtained payments on false, fictitious
and fraudulent claims, in violation of Title 18, United States Code, Section 286;
2. Made false, fictitious and fraudulent
claims upon or against the United States, in violation of Title 18, United States Code, Section 287; and
3. Engaged in monetary transactions in
property derived from specified unlawful activity, in violation of Title 18, United States Code, Section
In relation to those charges, they
state that I:
A. Was involved in filing income taxes
for myself and others;
B. Sought tax refunds based on the
purported withholding of taxes on income purportedly realized from Original Issue Discount (“OID”) instruments, as
purportedly reflected in forms 1099-OID submitted to the Internal Revenue Service; and further indicates
C. The subject matter of the
investigation, as it pertains to you (i.e., Larry Ray Hall), includes matters that are the subject of an indictment
pending against People 1 and People 2 in the District of Colorado under Case No. expurgated.
Note: In the following discussion of these
matters, I will refer to each of the above stated Issues by the number assigned above (i.e., Issue 1., 2., or 3. or
Issue A., B. , or C.)
As best as I can tell this whole
misunderstanding centers around the issue of filing Original Issue Discount (OID) with the IRS.
Without that issue present, there is really nothing else to discuss.
Over the past few years, many people
around the country became aware of the OID issue. You can read about it in the tax code at 26 USC
1271-1275 and 6049, and in various IRS publications such as Publication 1212-Guide to Original Issue Discount (OID)
Instruments, Instructions for Forms 1099-INT and 1099-OID, Publication 550-Investment Income and Expense (Including
Capital Gains and Losses)- Chapters 1. and 4., etc. You can also read about OID at 33A Am Jur
OID certainly is not anything that is
new. People have claimed it and the IRS has paid it out for years. So, why all the
sudden resistance from the IRS? Is it possible that with so many learning about OID, that the
IRS simply does not want them to know? Or, is the IRS trying to protect certain
Since OID is at the heart of this
controversy, here is a simple explanation of original issue discount which involves an issuance of
credit. The Original Issue Discount is an actual discount from the face value of a security
instrument. Since 1933 there has been no lawful money in this country. Whereas, we have operated
in the past under the belief that our money was backed by something, in fact, the financial system of this country
has been based on the full faith and credit of the American people. Since money was reduced or
converted to a fiat currency, the only value is what we perceive it to have and what we give for
Banks give loans and credit based on
our signature at which point the bank then monetizes the instruments that we have signed. One does not
get a loan based on the value of an object because the value of the object is not what is used in our present
monetary system. It is based on our own labor and abilities. When the bank
issues what they claim as a credit to us, they are actually only monetizing the signed instrument and generating a
computer or ledger entry at some represented value of units after we sign a document that says the units are based
on us and our labor. If this were not true then anyone would be able to go and buy a car
or a house and have the object be the collateral and there would be no need for credit checks or any personal
information to be reviewed. That is not what happens. Research is conducted
into each of us personally and then the credit is extended based on our signature. This issued
credit is based on a document (such as a promissory note) that is an issuance from us. By
signing the documents/instruments presented to us we authorize a negotiable instrument and a bank takes that
instrument and ledgers it onto their books. They use that ledgering to authorize further
fractionalization of ledgered assets per “Modern Money Mechanics – A Workbook on Bank Reserves and Deposit
Expansion” which is published by the Federal Reserve Bank of Chicago and was first written in
1961. Those asset instruments are then batched and sold on the open market as explained in the
“Comptroller of the Currency Securitization Handbook”, under Real Estate Investment Trusts, or Collateralized Debt
Obligations and other such systems. These items are now securities and the banks have just been
paid for these items by either selling them or offering them in groups and submitting them for bonding and income
A business cannot take out a loan on
assets it does not have because the banks will not allow a business credit without assets to back it
up. Banks cannot loan out their own money and or their investors money unless they make a public
offering for a specific purpose and people invest in the bank for that purpose. When a bank
receives a document with a signature, they are starting with a clean even balance sheet, assets =
liabilities. How would they ledger the loan if they cannot pay out something that is not
theirs? They have to increase assets at the same time as liabilities and so in doing this what
can they use as an asset to create the liability that they take when they agree to the loan, other than your
Banks do not report this payment back
to the people who submit the instruments and are not notifying the individuals that the funds that they have
received have settled the debt that the bank claims to be owed. This income is not reported and the
creator of the security is not told that their creation has been used to make income for the bank or the other
agencies that used the security. This is one of the main reasons for the bank scandals and all
the foreclosure issues that are facing this country now.
When the security was converted and
then submitted into the marketplace, there was a discount from the face value of the instrument, and this amount is
100 % of the value of the original security. The security had no value prior to the signature when it
was originated and so the gain was made when the bank offered the security into the marketplace.
This created the issue of the Original Issue Discount as the security was sold for a premium price while the
original issue was submitted without value. This price difference and the gain from the sale was
a profit or income to the original issuer of the debt instrument or security instrument.
The Banks were authorized and had a
duty at this point to inform the issuer of the security of this gain but were negligent in their reporting and
fiduciary duty to inform. This then created a requirement that a tax be paid on the gain but no documents were
submitted by any of the parties to report this gain. The creator of the instrument was not aware of
the gain and the bank did not file the details because they were not the true beneficiary of the gain on the
instrument as it, the instrument, belongs to the original issuer, the only person who’s signature is on the
document. The tax became due but not reportable as no one reported the
income. When any individual finds out that a taxable event has occurred, per title 26 of the US
Code they are required to report such incident and that is what I feel is and was the appropriate thing to
do. I issued the tax reporting forms to have the banks submit the proper taxes and return the
original issue gain back to the true creditor or issuer (me) of the security instrument.
Title 26 § 6049. Returns regarding payments of
(d)(6) Treatment of original issue discount
(A) In general
Original issue discount on any obligation shall be
IRS Publication 1212 – Guide to Original Issue Discount (OID)
Page6: “The issuer of the debt
instrument … should give you a copy of Form 1099-OID…”
33A Am Jur 2d¶ 60114. Reporting original
issue discount (OID) – Form 1099-OID. OID of $10 or more on any obligation must be reported as
an interest payment (¶ 60101) at the time it’s includible in the holder’s gross income (¶ 12400 et
seq.). (26 USC 6049(d)(6)(A)(i))
A Form 1099-OID must be made for each person who is a
holder of record of the obligation if the OID included in the holder’s gross income is at least $10.
As you can see, there is a requirement
to report the OID, and banks have not been reporting it and have not been paying the tax on it. Maybe
that is who the IRS is trying to protect! I know from calling banks and asking for their tax
identification numbers that they were unhappy that I was planning on sending them a 1099-OID. No
surprise, after they have gotten away without paying for it, for so many years.
Understanding that, now that I knew
about the OID issue, I was required to report it, and I, like many others, put in hundreds of hours of study and
research to learn as much as I could about OID. Many accountants, CPAs and Enrolled Agents also
studied the OID statutes and came to the same conclusion as I did. Are all of these people
criminals because they “may” have misunderstood the tax code on this topic, despite all of their efforts to do so?
Were all of these people conspiring to defraud the US Government? Is that a
logical conclusion that anyone could reach? What is going on here?
When I filed my personal tax returns,
which included the filing of 1099-OID forms, I did so convinced that what I was doing was correct and perfectly
legal, not to mention required by the Tax Code. Is it possible that I did not properly fill out all of
the forms, or that maybe another form was required for which I was unaware? Sure it
was. With hundreds of thousands of tax laws, regulations, court cases, etc. filing row
after row of bookshelves, and thousands of tax forms to select from, even the most experienced tax experts
routinely admit that they are often stumped as to what to do.
Making a mistake on a tax form (if
indeed I did make a mistake) is not a criminal act! Being charged criminally for not being able to
figure out the most complicated set of laws in the world, however is a criminal act!
You will notice from a copy of a page
of 1099-OIDs (copy provided as Exhibit VII) that were submitted with my 2006 Amended Tax Return, that the
“Payer” is identified as the name of the bank to whom I (as the source) issued credit, and from whom the amount of
the credit, as shown in Block 1, must be returned. Nowhere do you find any statement by me that the
IRS owed me the OID amount. So, for the prosecutor to allege that I made false, fictitious and
fraudulent claims upon or against the United States, as alleged in Issue 2. can in no way be characterized as
anything other than a bold face lie.
The IRS knows that it did not
personally owe me the amount of the OID, and they know that I did not expect them to dig into the pocket of the US
Treasury and pay me such amount – my 1099-OID clearly states so. So, why have they concocted this
ridiculous story and proposed criminal charges?
So, if the IRS were to pay me out of
US Treasury funds (as they seem to be alleging that they so did in the case of People 2), how is it that the
independent decision, made solely by the IRS to do something which I did not request, and for which they had no
obligation to do, has been translated into proposed criminal charges against me?
How am I responsible for the mistakes
or deliberate mis-actions taken by the IRS behind the curtain, where I have no idea what they are actually
doing? The IRS says that when they paid People 2 for his tax filling that included the OID, that it
was a mistake on their part – the payment just got out by mistake! And there we see a part of
the problem (assuming we can even believe that a mistake was made). A person submits their tax
return, receives a refund, and then is charged criminally for the mistakes of the IRS. Doesn’t
seem like an appropriate manner in which to cover up a mistake!
Since when does someone file a tax
return, receive a refund, and then is required to call the IRS and ask if they really meant to issue the
refund? Has anyone on the Grand Jury called the IRS after receiving a refund to ask if the IRS really
How is the tax filer supposed to know
that the IRS did not do the proper thing - go to the bank to collect the funds owed to the issuer of the credit,
but instead, paid the tax filer out of US Treasury funds? For that matter, how do I know that the IRS
didn’t actually collect the funds from the bank and are hiding that fact, while charging me with something that
they know is not true? Since it is clear that they are lying in making the charges, what is to
keep them from lying about what they actually did, in order to cover up their other lies?
If the IRS does not understand its own
codes and regulations, how am I supposed to be held liable for their mistakes? Neither I nor anyone
else I know of held a gun to the head of the IRS and demanded a refund of the OID. And no one
demanded that the IRS dip into the pocket of the US Treasury to pay such amounts. If the IRS
truly believes that filing for the OID is not correct under their rules, then all they have to do is send back a
response letter telling the person that their filing was made incorrectly, explain the problem and relate what
needs to be done to correct it. I would be glad to make the changes in an
Again, how is a crime to make a
mistake on a tax form? And how did I give anyone the right to judge my intent?
It is clear that Issue 2. is no longer
valid, and has been entirely dispensed with.
As to Issue 1., the record shows that
I did not receive any payments from the filing of my 1099-OIDs, so that proposed charge is no longer valid, and
has been entirely dispensed with.
As to Issue A., I have never in my
life prepared income taxes for anyone other than my immediate family. Of course, I did file income
taxes for myself. Is there a law that requires that I hire someone to prepare my income
taxes? I was not involved in filing income taxes for People 2. So Issue A. is
no longer valid, and has been entirely dispensed with.
Issue B. is a neutral
statement. Since I had the obligation under the tax code to file the 1099-OID, and since I did so
based on my best available information from studying the OID issue, the fact that I sought tax refunds based on
that obligation, using their codes and forms cannot be considered the element of a crime. Thus,
Issue B. evaporates, and has been entirely dispensed with.
Since I did not intend to defraud the
United States, did not obtain payments on false, fictitious and fraudulent claims, did not make false, fictitious
claims upon or against the United States, and was not involved in filing income taxes for others, Issue 3. becomes
a moot issue, as there were no monetary transactions in property derived from specified unlawful activity, there
being no specified unlawful activity.
The IRS will point to the fact that
funds received by People 2 were used to purchase a property, and allege that that is the specified unlawful
activity. On the date that the property was purchased, however, I had not been notified by the IRS
that they considered the OID filing to be a frivolous filing, so any use of funds which belonged to People 2 could
in no way be considered improper. To my knowledge, those funds belonged to People 2 and no one
else. Both People 2 and myself have the absolute right to contract.
Remember, you file a tax return, the IRS pays you a tax return, you can only consider that they have acted
properly. You are not responsible for the mistakes of the IRS. The IRS needs
to “man-up” and admit to their mistakes, rather than charging innocent people in an apparent attempt to cover up
The IRS has absolutely no evidence
that I committed any of the proposed crimes or that I had the intent to commit the same.
Note that the code sections in Title
18 that the prosecutor has proposed that I be charged with, are general and have no meaning unless there is a code
section in Title 26 that both applies to me and that I have violated. Where is the Title 26 section
that I am supposed to have violated? Really, this is the first question that should be
Now that all of the proposed charges
have been sufficiently dispensed with, let’s look at what the IRS has been doing to try to escape being held
accountable for their mistakes or possibly their intentional mis-deeds.
Here is an outline of how the IRS has
indiscriminately dealt with those who have filed 1099-OIDs, as required by the IRS codes:
- After filing a tax return that
includes OID, some filers receive a letter stating that the filing was frivolous. Some never
receive that letter! This initial frivolous filing letter 3176C cites Frivolous Positions
Notice 2007-30, contained in Bulletin No. 2007-14 (copy provided as Exhibit VII), and claims that the
Secretary has already declared that the “position” being taken is a frivolous position.
First of all, I did not take any position – I just followed the tax code to the best of my ability and
understanding using IRS forms. The IRS never explains what the position is that I supposedly
took! When you go to Bulletin No. 2007-14, you will find that the issue of the OID being
considered by the Secretary as a “frivolous position” is not to be found.
- Additionally, the 3176C frivolous
filing letter cites 26 USC 6702(c), which does not list any frivolous filing positions, but just says:
shall prescribe (and periodically revise) a list of positions which the Secretary has identified as being
frivolous for purposes of this subsection.” Unfortunately, the Secretary has not prescribed filing
the OID (as required by the tax codes) as a frivolous, for the obvious reason that it is not a frivolous
- There being no information
provided by the IRS as to what the problem is, and the references they give to a frivolous position having
turned out to be an obvious lie, the only thing one can do is to write to the IRS and ask for an
explanation. So, you write to the IRS asking what the problem is and what you need to do to
- Before I continue with this
process, lets first look at the IRS Mission:
The IRS Mission:
"Provide America’s taxpayers top
quality service by helping them understand and meet their tax responsibilities and by applying the tax law with
integrity and fairness to all." http://www.irs.gov/pub/irs-irbs/irb07-14.pdf
"The purpose of the IRS is to collect
the proper amount of tax revenues at the least cost to the public, and in a manner that warrants the highest degree
of public confidence in our integrity, efficiency and fairness. To achieve that purpose, we will encourage and
achieve the highest possible degree of voluntary compliance in accordance with the tax laws and
regulations...". -Internal Revenue Manual, Chapter 1100, section 1111.1
- Once you request an explanation
from the IRS (and no matter how many times you ask) you get no answer to your question. The IRS
response is to tell you that if you do not change your filing, you will be charged a frivolous filing
- By the time you figure out that
there is nothing you can do or say that will solicit an answer to your question – What is wrong with my tax
filing? – the IRS has usually (as they did in my case) assessed a frivolous filing penalty of $5,000 for each
year that the OID was filed, and if you filed jointly, each spouse is assessed $5,000 for each
year. Notice that the IRS does not assess everyone the $5,000, but for some people, it not only
assesses the $5,000 per year, per spouse, but it also adds $5,000 per year, per spouse every
month. There certainly is nothing in the tax code that allows that assessment, so why are
they doing it? And, why isn’t everyone that filed the same thing treated the same?
- Then after the IRS has already
assessed you the $5,000 frivolous filing penalty, and you continue to ask the IRS for documentation or
explanations to support their accusations of a frivolous filing, you may receive about every 40 days a letter
that states in part:
extensive research is required" and
to heavy workload, we have not yet completed our research to resolve your inquiry"
- Why does the IRS have to do any
research and what is it that they have to research after they have already issued a decision and assessed me a
$5,000 frivolous penalty? What part of due process allows the IRS to assess a penalty before doing
the research to first determine if something improper has been done?
- I would submit that the only
reason the IRS continues to ignore our questions, with the lame excuse that they need more and more time to
research, is because they are trying to figure out a way to justify their entirely incorrect decisions to label
the filing of the OID as frivolous and to assess a frivolous filing penalty! Since an untold
number of people filed the 1099-OIDs, and the answer is the same for all of them, why has it taken the IRS
almost 3 years to complete this mystery research on one single topic? Makes no sense, does
- Then the IRS recommends that the
Department of “Justice”, take steps to get an indictment for criminal activity against some of those who filed
the 1099-OIDs, as required by IRS tax codes, and not against others who did the exact same thing.
Excuse me, but the law must operate equally for all – right?
- This might be a good time to
review some maxims of law, which are simply common sense statements relative to the antics of the IRS in this
a. All Americans have the right to access
the law and to know of its proper application and operation, even tax law.
b. The law must be complied with, all of
it – even by the IRS.
c. The law must be applied openly and
d. Only Congress writes law.
Administrative (IRS) regulations cannot deviate from law because regulations are not written by Congress.
e. IRS publications are not law.
- And to help put things into
perspective, here are a couple of quotes that remind us of what we are dealing with here:
"Fear is the key element for the IRS
in achieving its mission. Without fear, the IRS would have a difficult time maintaining our so-called system of
voluntary compliance ...". "Given the opportunity, the IRS will take the easy way out and grab whatever it can...
the IRS does not really care about you and what your future....... may be". -Santo Presti, former IRS
Criminal Investigation Agent and author of "IRS In Action"
"The IRS is an extraordinary example
of the end justifying the means. The means of this agency is growth. It is interesting that the revenue officers
within the IRS refer to taxpayers as 'inventory'. The IRS embodies the political realities of the selfish human
desire to dominate others. Thus the end of this gigantic pretense of officialdom is power, pure and simple. The
meek may inherit the earth, but they will never receive a promotion in an agency where efficiency is measured by
the number of seizures of taxpayers' property and by the number of citizens and businesses driven into
bankruptcy". - George Hansen, Congressman and author of "To Harass Our People"
- Can IRS or DOJ show the law and
explain the operation of that law that provides for the following disparity in treatment for the same type
filing? Is the infraction which is not defined on the Secretary’s List of Frivolous Positions
simply “conjured up in somebody’s mind”?
a. One filer has his tax return denied,
and no other action taken.
b. Another filer has tax return denied,
and deemed frivolous per Secretary’s List (nothing on that list), and no other action taken.
c. Another filer has tax return denied,
and deemed frivolous per Secretary’s List (nothing on that list), and is assessed a $5,000 frivolous filing
penalty, per year , per spouse.
d. Another filer has tax return denied,
and deemed frivolous per Secretary’s List (nothing on that list), and is assessed a $5,000 frivolous filing
penalty, per year , per spouse, and $5,000 is added each month, per year, per spouse.
e. Another filer has tax return denied,
and deemed frivolous per Secretary’s List (nothing on that list), and is assessed a $5,000 frivolous filing
penalty, per year , per spouse, and is charged with criminal activity.
f. Another filer has tax return deemed
valid, receives refund, and no other action is taken.
g. Another filer has tax return deemed
valid, receives refund, and is then charged with criminal activity.
Does the IRS have the authority to
indiscriminately treat filers any way they wish?
Does the IRS have any responsibility
as Tax Professionals with their super computers to determine that each and every refund check issued is valid and
Now, go back and read the IRS’s
Mission Statement. How can a mission statement and the practice be any further apart?
Since the IRS code requires me to file
the 1099-OIDs, how can the IRS then come back and tell me that they are a frivolous filing, and that I am being
assessed a penalty and criminal charges for following the law? It becomes a matter of you are damned
if you do, and damned if you don’t!
Take special notice:
The IRS, by its unlawful
actions, has created an impossibility. The law does not allow an
impossibility. The law may not, and the IRS cannot require an action that will result in a
penalty and criminal charges. They can’t have it both ways.
Does any of the above constitute an
unlawful act on part of the IRS or its agents?:
Title 26 § 7214. Offenses by officers and
employees of the United States
(a) Unlawful acts of revenue officers or agents:
(5) who knowingly makes opportunity for any person to defraud the United States; or
(6) who does or omits to do any act
with intent to enable any other person to defraud the United States;
It is clear that the prosecutor is
falsifying information, both by commission and by omission. He has knowingly lied in his
representations to this Grand Jury (commission) by making statements that he either does not know to be true or
does know to be true, and he has not provided all of the evidence to this Grand Jury as required (omission).
I want to know who on this Grand Jury,
who in the IRS or US Treasury and who in the Department of “Justice” has been told or has any information about my
intent? Who has conducted a brain scan that reveals what I intend or have ever intended to do anything
of a criminal intent?
You have seen how the IRS has not
dealt in good faith throughout the process of administering the OID situation. Since this whole
situation arose, I have had occasion to do further research and find out more about the operations of the IRS.
Here is what I have found:
I. 4 USC § 72, which
is positive law, mandates that all offices of government are restricted to “the District of
Columbia, and not elsewhere” unless Congress “expressly” extends their granted authority to other geographical
areas by United States law.
It is a fact, that
the IRS does not have a delegation of authority to operate in the 50 compact states, which means that they have no
jurisdiction or authority to operate in Colorado, making anything they have done to create this case out of thin
air, void and leaving this Grand Jury with nothing to investigate. Just ask any IRS agent for a
copy of their Delegation of Authority to be in Colorado. They will not be able to provide it,
because it does not exist! A copy of a “Brief Regarding 4 USC § 72 and The Secretary’s Authority
in the Several States is provided as Exhibit IX.
II. The requirement to
file income tax does not apply to the people domiciled in the 50 compact states, like Colorado.
The tax code does not name those folks as being liable for the tax. Statutory Definition of
citizen of the United States is attached as Exhibit X. This issue is explored in depth in Exhibit IV, my
Complaint which has been filed with Congress. The IRS has never rebutted the issues presented in
Exhibit IV and X, because they cannot do so. After all, facts are facts!
III. 26 USC§
29.22(b)-1 Exemptions; exclusions from gross income.
Certain items of income specified in
section 22(b) are exempt from tax and may be excluded from gross income. No other items are exempt
from gross income except (a) those items of income which are, under the Constitution, not taxable by the Federal
The reference to the Constitution is
to Article 1, Section 9, Clause 5:
No tax or duty shall be laid on articles exported from any state.
Since export into commerce from one state to another state
Interstate Commerce, and the revenues earned from that
export upon its sale
would constitute an “income;” that would mean that a tax on
from interstate commerce, being export, and export, from an
standpoint, being the income side of interstate commerce, a
tax on an
income derived from any form of Interstate Commerce would
be a tax on the
export of the product or products represented in commerce,
and would be
mandatorily prohibited in being taxed
under Article I, Section 9, Clause 5.
When the IRS realized that the effect
of that section was that Americans were not liable for the income tax, they got busy. You will not
find this section in print today, but it was in the code in 1949. It was never officially
removed from the code by Congress, for the obvious reason that that would have been a violation of the
Constitution. However, between the years 1949 and 1961 the IRS committed massive fraud in order
to make the code section disappear. First they just failed to print title 26 for a few
years. Then 29.22(b)-1 was moved to 39.22(b)-1 (a section which did not exist prior
to1953). Finally, the section just magically disappeared altogether. During
those years, the code was printed at the end of the year instead of the beginning. One year
wasn’t even printed until several years later, and then it was represented that it was printed in the earlier
The bottom line is that 26 USC §
29.22(b)-1 still exists, you and I still have access to it, and the IRS has never been able to rebut this issue
for obvious reasons.
For a complete discussion of this
issue see Exhibit XI, The Title 26, 1949 CFR, 29.22(b)-1(a)/Article 1, § 9, Clause 5 Frauds, and watch
Exhibit XII, for a Power Point Presentation of the topic.
I, Larry Ray Hall, do hereby confirm
and affirm that the statements made herein are true, correct, and complete to the best of my knowledge, not meant
to be misleading, admissible as evidence, and are signed under the penalty of perjury.
By:_________________________ Date: February 14, 2011
Larry Ray Hall
The 2011 posterity of the 1787 we the people of
to the Constitution for the united States of America, a joint
Tenant in the sovereignty of both the united States of America
and Colorado. Standing upon the land on the county of Adams,
COUNTY OF ADAMS
Affirmed to and subscribed before me
______________________ a Notary Public, this 14th day of February, 2011, by Larry Ray Hall at Brighton
My commission Expires: _____________