Honouring Bank of England Promise to Pay Bearer on Bank Notes

The request was partially successful.

Dear Sirs,

Please would you be so kind as to answer several pertinent questions laid out as follows, under authority of the Freedom of Information Act 2000 ('FoI Act').

1) Can BoE provide a record of the number of individuals who have returned bank notes (or demanded) for payment on their 'promissory bank notes' with tangible assets attached to the nominal values of £5, £10, £20 or £50 and what procedure is followed to demand given sums for the nominal value on bank notes.

2) What denominations of tangible assets of value allocated to the aforementioned BoE Promissory Bank Notes are paid to the bearer on demand by the Bank of England or HM Treasury?

3) HM Treasury backs these bank notes with Securities (BoE ref. V 76202). Please provide information BoE has on classification of Securities such as Gilts as 'tangible' assets of value? and what denominations of securities backing each note are paid 'on demand' to the bearer of a bank note.

4) Finally, pursuant to the BoE Act 1882 s.3(1)(2)(3)(4) a promissory note is legally compliant when "signed by the maker, engaging to pay, on demand or at a fixed or determinable future time, a sum certain in money" therefore please state what is paid by the Bank of England on demand by the bearer as per request no. 1 above. Where money appears to be the promissory note itself strictly speaking.

A timely response in compliance with the Freedom of Information Act 2000 ('FoI Act') will be greatly appreciated.

Yours faithfully,

Mr Tapi

Enquiries, Bank of England

Dear Mr Tapi

We acknowledge receipt of your email dated 20 November (our ref V 79248). We will reply in due course.

If you have any queries please contact the Bank’s Public Information and Enquiries Group on 020 7601 4878.

Yours sincerely

Public Information & Enquiries Group
Bank of England |Threadneedle Street|London|EC2R 8AH|+44 20 7601 4878
[Bank of England request email]

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Enquiries, Bank of England

1 Attachment

Dear Mr Tapi

Please find attached a response to your e-mail of 20 November below.

Yours sincerely

Public Information & Enquiries Group
Bank of England |Threadneedle Street|London|EC2R 8AH|+44 20 7601 4878
[Bank of England request email]

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Dear Sandra Collins,

Thank you kindly for your response to my request of 20 November 2013, I also noted a previous FoI request of 3 April 2013 with reference V 52183, where you made remark on this subject. Having reviewed links to information provided at Legislation.gov and Bankofengland.co.uk websites in your reply to my request ref V 79248, there are a couple of quoted articles with added remarks in there, from which I would greatly welcome further clarification and resolve from the Bank of England (BoE);

1. "We are unclear as to what you mean when you refer to 'tangible assets' in the context of 'promissory banknotes'"

Notwithstanding the Currency and Bank Note Act 1954, and in addition to your comment on Gold backing the banknote historically, many will agree anything which can be touched is a tangible asset (perceptible by touch), so too, although arguably, would this include cash. Money per se or legal tender as its otherwise known cannot be classified as a tangible asset when digitized in bank and or ledger accounts for that matter?

Ref V 52183, Commodity FoI request of 3 April 2013, you stated;

“The link with gold was finally broken in 1931, and since that time the issuance of Bank of England banknotes has been backed by securities. Bank of England banknotes can, however, only be physically exchanged for other Bank of England notes.”

Does the Bank of England yield securities as tangible assets, given the commonly understood definition, as prescribed above, even within the accounting profession?

2. "under section 1(4) of the Currency and Bank Notes Act 1954 the holder of a Bank of England banknote is in summary entitled on demand on presentation of his / her banknote at the Bank of England to receive in exchange legal tender banknotes of a lower denomination, as he / she may specify, of an equivalent value."

As I trust BoE will appreciate, ‘value’ or money rather, is something in which people place ‘faith’ in and commonly agree on as a means of exchange, typically physical objects and hence why Bank of England works hard to maintain faith in its currency system of issuing banknotes also known as ‘cash’, being that is the physical object. Herein lies the issue, it is a promissory note and not a ‘tangible asset’ as identifiable by the BoE Act 1882.

So, in the context of a Bank of England promissory banknote issued by the Bank of England, a useful or ‘valuable’ thing is a tangible asset; such that to place value in the money system. You stated;

“Nowadays public faith in the pound is maintained through the Bank of England's operation of monetary policy, the object of which, by statute, is price stability”

The underlying questions, withstanding;
On demand on presentation of my banknote promising to pay £20 in value at the Bank of England, I will receive in exchange ‘legal tender banknotes’ (which is yet more Bank of England promissory banknotes) of a lower denomination (£5 or £10), as I specify, of an equivalent value that is £20.

Can you see the predicament? I still have promises of payment (or so called legal tender) which are to be fulfilled upon demand. But where is the asset exchange (based on definition herein) promised, considering gold is no longer and securities are not tangible as far as one can reasonably determine?

What has happened, if anything is a like for like swap of currency ‘value’ not money, right? If this is the case a local trader is able to perform the same function of providing ‘change’ as it is commonly known.

In light of this, why is the Bank of England still issuing “promise to pay the bearer...” , when it is difficult to pay anything of substance without an asset of real value backing the Bank of England promissory notes, as was the case historically? And some would argue should still be the case today.

I await your response in due course.

Sincerely,

Mr Tapi

Enquiries, Bank of England

Dear Mr Tapi

We acknowledge receipt of your email dated 18 December (our ref V 81602). We will reply in due course.

If you have any queries please contact the Bank’s Public Information and Enquiries Group on 020 7601 4878.

Yours sincerely

Public Information & Enquiries Group
Bank of England |Threadneedle Street|London|EC2R 8AH|+44 20 7601 4878
[Bank of England request email]

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Enquiries, Bank of England

1 Attachment

Dear Mr Tapi

Please find attached a response to your e-mail dated 18 December below.

Yours sincerely

Public Information & Enquiries Group
Bank of England |Threadneedle Street|London|EC2R 8AH|+44 20 7601 4878
[Bank of England request email]

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daniel left an annotation ()

I think you are missing a vital point when corresponding with the bank of england, with regard to the promise on their notes. If you took £1000 pound down to the bank all your gonna get in return is money back, no gold and no securities,as they quite clearly told you in the response. However its all depending on what you say when your handing over the money. Now if you walked in the bank of england with that £1000 and told them you want to allocate the money to the national debt, what have you just done! You have just paid the debt of another, and you immediately step into creditor shoes, and subrograte the rights and defences of the original creditor. The law provides you with remedies in that situation, such as reimbursement, exoneration etc. You would definatley could ask for the securities that backed that portion of the debt or go to the original debtor for reimbursement. You have to allocate the money to the national debt. Its not your debt per se but as a citizen you are required to do your bit.

Arten 60 left an annotation ()

This is to Daniel, what are you on about we are not citizens in England we are a Constitutional Monarchy ergo we are subjects,

This country was hijacked long ago and our Laws and Customs subverted.

Those who own the Bank of England have and continue to commit High Treason if you care to look at our Treason Laws,

Mr Tapi left an annotation ()

Thank you daniel and Arten 60 for your comments and learned discussion.

Since this request was made, Arten 60, you may wish to note that people in England are experiencing the first English interregnum since Queen Victoria.

http://courtofrecord.org.uk/Treason-QBD

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