Financing a breakaway civilization: A series of scandals involving allegedly counterfeit "bearer bonds" make up the biggest and most under-reported financial story of the 21st century.

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by axolotl_peyotl
To being with, here’s a brief overview of three essential methodological assumptions of any counterfeiting scheme:

  1. One does not counterfeit something that does not currently exist as a medium of exchange, or that is not convertible into it. One only counterfeits, or mimics, something real.
  2. Similarly, one does not counterfeit 500, 1,000 or 10,000 dollar bills. One only counterfeits what one can reasonably expect to tender to a target group, and thus must tailor its counterfeit function to the target’s scale of affluence, and do so without raising suspicion.
  3. One must produce a product of sufficient quality to pass the scrutiny of the target group. One does not go to the expense and effort of producing a fraudulent product that cannot be used because it does not exist, is too large a denomination to be traded with the target group, or is too poor in quality to be traded. Quality must be sufficiently high to ensure first sight acceptance of its authenticity.

Things change a bit when the target group is very wealthy, as securities (stocks, bonds, etc.) become the preferred method. Also, a wealthy target group is likely to be privy to the existence of instruments most don’t know exist, and can call upon private intelligence resources to verify information.
But the point remains, one does not counterfeit what does not exist. And an addendum: One does not counterfeit something that the very wealthy do not suspect exists, or know to exist.
Before delving into the various bearer bonds scandals, it’s important to mentioned a very relevant historical antecedent to these recent events, namely an extraordinary undertaking carried out by Nazi Germany.
Operation Bernhard was the largest counterfeiting operation in history. Its goal was to replicate the paper of English notes, copy the printing plates to reproduce the tiniest detail, and employ mathematicians to work out the Bank of England’s numbering system.
Nazi Germany was trying to erect a hidden system of finance aimed at wrecking the British war economy…they were at war with the British financial elite. It’s important to note the connection between financial fraud and intelligence bureaucracies. The SS had essentially created a counterfeiting bureaucracy.
All in all, and these are generally considered to be the most conservative numbers, Operation Bernhard produced a total of 7 million facsimile British pound notes during the war, totally a staggering 135 million pounds. Other estimates range well over 300 million pounds.
Here are some important points about the implications of Operation Bernhard that are relevant to the rest of the discussion:

  1. State-sponsored counterfeiting of undetectable facsimile banknotes had been successfully undertaken on an industrial scale, becoming a significant part of the money supply and were only removed with great difficulty.
  2. Although conceived as economic warfare, it morphed into a virtually inexhaustible means of financing covert activities. Industrial scale counterfeiting became the link between covert operations and research projects.
  3. Access to this type of funding could allow any intelligence bureaucracy and/or secret research entity to become independent of its controlling state and its financial institutions, whether public or private.
  4. In the distribution of the facsimiles, it’s necessary to have “neutral points of entry” into the circulation scheme. In the case of Operation Bernhard, Switzerland and the Vatican were used (remember those two places).

According to the research of Farrell, Richard Dolan and many others, industrial scale counterfeiting survived WWII to become the favored method of the independent financing of covert research and operations of what has become often referred to as a “breakaway civilization”. Operation Bernhard survived WWII, at least conceptually, as well as the accompanying Fascist ideology.
According to Farrell, the major factional structure of this breakaway civilization, as far as finances are concerned, are composed of the following:

  1. A “rogue” element within the American military-industrial-intelligence-finance complex with ties to similar oligarchical interests in Great Britain, Japan, Germany, France, etc.
  2. The international criminal underground (Cosa Nostra/the Mafia).
  3. The international Fascist element, or what Farrell refers to as the “Nazi International”.

To introduce the next section, here’s an excerpt from an article called Parallel World of Finances that continues to discuss the various incidents concerning bearer bonds:

The invisible financial world is something the majority of people have no idea of. The major part of it is the shadow sector of world financial system, financial institutes and financial operations conducted under the cover of off-shores and falling out of the sight of financial regulators (central banks, ministries of finances, and security and exchange commissions). One can only guess how large it is, there is no way to have a clear picture of what it is like because all the activities are conducted beyond any supervision. No books are kept, and no accounting before state structures exists.
The world dwellers are criminal gangs related to drug trafficking, arms trade, slave trade and so on. It’s not even grey sector activities, but rather “black” economy breaching all norms of penal law. According to experts, the turnover is a few trillion dollars a year…Besides, the shadow sector encompasses various structures that do not hide underground. Many of them openly offer various services to individuals and corporations.

And now, the bearer bonds. Here’s a definition from the Wikipedia page on bearer bonds:

A bearer bond is a debt security issued by a business entity, such as a corporation, or by a government. It differs from the more common types of investment securities in that it is unregistered–no records are kept of the owner, or the transactions involving ownership. Whoever physically holds the paper on which the bond is issued owns the instrument. This is useful for investors who wish to retain anonymity. Recovery of the value of a bearer bond in the event of its loss, theft, or destruction is usually impossible.

The first reported case of strangeness concerning the so-called “Morgenthau bonds” became public in 2003. Henry Morgenthau was the US Secretary of the Treasury during the 1930’s, when many of these bonds supposedly originated.
From a BBC article: Two men have been found guilty of conspiracy to defraud in a case related to fake US government bonds worth $2.5 trillion.
The individuals who were caught said the bonds were related to the “black gold” received from Chiang Kai-shek of China. The story hardly attracted any attention on the part of world media. The bonds were supposedly issued in 1934, a year that will continue to pop up. The word “dollar” was printed on the bonds instead of “dollars”. Glaring typos on these various bonds will become a common theme as we explore further.
The following article summarizes the implications of all these weird bond incidents: Secret “Occult Economy” Coming Out of the Shadows?

Yet, although the bonds/notes in the Halksworth case were demonstrably false, they did reveal some rather startling information, that fake bonds were often included amongst large quantities of real bonds so as to preclude the holder from ever being able to cash them.
Indeed, when questioned by the police as to his role in the fake bond scandal, Halksworth responded by telling police that “Deliberate mistakes were often made in such bonds as a security device; ask the CIA.” When the police pointed out that the mistakes were so obvious it looked like a child had made them, Halksworth responded, “Exactly.”

Farrell continues with an analysis on this story here.

So, ye olde plotte thickens, for now we have the involvement of someone with expertise precisely in such bonds and their authentication, alleging that mistakes were deliberately made as “security devices” and that the CIA was involved in this, clearly implying a hidden economy connection.

Further reading: 2.5 trillion in lost 1930’s US Treasury Notes? Naïve scam or secret CIA counterfeits?
Who wants to be a trillionare?
The Japanese Bearer Bond Scandal: Mystery surrounding 134.5 “fake” billion US dollars seized in Ponte Chiasso remains
This story is significant enough to be mentioned on the Wikipedia page for bearer bonds:

In June 2009, Italian financial police and custom guards seized documents purporting to be U.S. bearer bonds, totaling $134.5 billion. The bonds were in $500 million and $1 billion denominations, although the highest denomination ever issued by the US Treasury was $1,000,000. It was unclear what the purpose of the fake bonds was; the two men carrying them were not detained after the bonds were seized.

Now if that doesn’t raise some questions…here are some more articles on the subject:
Strange Inconsistencies in the $134.5 Billion Bearer Bond Mystery
The following are from Farrell: The strange case of the Japanese Bearer Bonds
More information on the Japanese Bearer Bonds
Update on the Japanese Bearer Bond story, with pictures of the bonds and “certificate of authenticity”
From the first of Farrell’s articles:

There were 249 bearer bonds were in denominations of $500,000,000, with ten so-called “Kennedy bonds” each denominated at a value of $1,000,000,000. Some of the $500,000,000 bonds were dated as far back as 1934.
This is where the plot begins to thicken. For one thing, bonds of $500,000,000 denominations did not exist (so we’re told) in 1934, and thus they were deduced to be counterfeits, though, strangely, the Italian authorities at the time of the arrest were waiting for the US Securities and Exchange Commission to make a declaration as to their authenticity.
Moreover, we are informed by a number of internet articles and posts, Bloomberg for example, on this bizarre episode that the bonds were all so well-executed that they were “indistinguishable from the real ones.”
J.S. Kim, in his post on the subject “Strange Inconsistencies in the $134.5 Billion Bearer Bond Mystery,” asks a pertinent question: How can this quality be so good, and “yet the people involved in the alleged forgery be so ill-informed as not to date the bearer bonds with a more recent year that would not immediately identify them as fraudulent?”
The second problem, noted by Kim in his article, is that the $1,000,000,000 denominated “Kennedy bonds” were never known to exist at all. “This discovery defies any logical explanation. Why would expert counterfeiters make 249 bearer bonds with denominations of $500 million apiece, each indistinguishable from the real thing, and then instead of just making 20 more such bonds, decide to make 10 bonds in denominations of $1 billion apiece in a bearer bond design that never has existed? Were the alleged counterfeiters just too lazy to confirm if Kennedy bearer bonds were ever a legitimately issued security? Again, this story makes no sense.”

The number 134.5 billion should be eerily familiar as well: On March 30, 2009, the US Treasury Department stated that the Troubled Asset Relief Program had $134.5 billion remaining, the exact amount of the “stash” seized in Italy.

This fact led some to speculate that, in fact, the bonds, including the so-called Kennedy bearer bonds, were real, but that they had been secretly issued by elements in the American government to keep the economy afloat. Others continued to maintain the counterfeit story. Some began to advance the argument that the Treasury’s announcement in March of 2009 would have allowed two months for forgers to counterfeit the exact amount of bonds and then allow them to be caught, in a murky economic warfare operation.

Are the Kennedy bonds real? Are all these bonds really counterfeit? If they are, the fact they are such excellent copies suggests that whoever was behind it ultimately had to be a nation-state or someone in possession of the genuine article. If they are based on secret “exemplars” then a clear message is being sent to whoever is secretly issuing these bonds: We know the game.
It took US officials two weeks to make a public statement that they were counterfeit. It definitely rattled some people in high up places. Even if they were fakes, they were based on something real that the financial powers did not wish to be known.
The Kennedy bonds offer some more food for thought, as Farrell continues:

I submit that there is a message being sent by this bond, and it is a message that works regardless if one views this strange securities instrument as legitimate or faked, for note the reverse of the bond: we have a clear image of the Moon, a clear image of the space shuttle lifting off.
Consider then the imagery and the message being sent here. A red seal of the US treasury only appears on American currency notes, United States Notes, issued directly and debt-free by the US Government. Kennedy was the last president to order the issuance of such money.
There is another message being sent in the bearer bonds episode…it has something to do with space. Why would a bond-smuggling operation, whether or not the bonds were real or counterfeit, be smuggling such instruments?
We may be looking at a part of the funding mechanism for a vast covert space program, with the “collateral” clearly imaged on the reverse of the bond header itself: space, and whatever might be found out there. Hence, the use of a red seal, connoting a debt-free money, might be significant.
We might be looking at a hidden funding mechanism for Mr. Richard Dolan’s idea of a “breakaway civilization.” If so, that would account for the virtually total absence of news coverage of the story in American media and its virtual disappearance as a story in the rest of the world’s media.

As Farrell concludes in his recent book Covert Wars and Breakaway Civilizations: The Secret Space Program, Celestial Psyops and Hidden Conflicts:

A more basic message is present: a hidden tier of finance exists, represented by bearer bonds denominated in extraordinary amounts of money, amounts that imply that the owners of such bonds are in an elite circle of wealth, power, and knowledge.

The Spanish Bearer Bonds Scandal: $1.64 Trillion of Federal Reserve Note Series 1934 Bonds in Spain Seizure
This story originated in Barcelona in 2009, and was scarcely reported on by the MSM or independent media in the US. Here are a few important points:
The financial institutions involved were in Terrassa and Barcelona, Spain; the scam was detected in Catalonia; they believe the origin of the scam and faked securities was the Philippines; two unidentified businessmen were involved; the bearer bonds totaled $1.5 trillion; $126.5 billion were in 1934 Federal Reserve bonds with coupons; $20 billion were in international Bills of Exchange; $1 billion was in US gold certificate currency notes, banded with JP Morgan-Chase metals bands of bundles of $10 million each; an unspecified amount gold coins were found. They were accompanied by a bronze strong box, engraved with the letters Dallas Federal Reserve Bank.
It’s important to note that all of these bonds emerged just as the BRICS nations began moving away from the dollar, suggesting that these separate incidents are connected and are evidence of covert economic warfare.
The Philippine connection also brings to mind the gold supposedly hidden by Japanese general Yamashita, gold which in turn represents the looting of China by Japan, a potentially extremely important point in this whole narrative.
Taking both the Japanese and Spanish bearer bonds incidents into consideration, Farrell concludes the following:

Discrete steps were put into place by the American financial elite during the 1930s to establish a covert two-tiered system of finance, with the covert system being based upon bullion-backed currency and securities.
This effort was renewed after WWII with the addition of Japanese gold stocks looted form China during the war, thus enabling a vast, though covert, expansion of the American Federal Reserve’s credit making ability. These hidden securities were employed in the funding of covert operations and projects.
The Japanese and Spanish bond scandals thus imply that someone else, some other faction external to this covert financial structure, was aware of this arrangement, and has begun to obfuscate and interfere with the stability of this structure.

The Italian Bearer Bonds Scandal: $6 Trillion In US Bonds Seized In Zurich, Said To Pose “Severe Threats To International Financial Stability”
From Farrell: More faked bonds seized again!
Madison Rupert reported on the story as well: $6 trillion in allegedly fake US bonds hidden in Federal Reserve Mother Box seized
From zerohedge, quoting from a Bloomberg article:

“Italian anti-mafia prosecutors said they seized a record $6 trillion of allegedly fake U.S. Treasury bonds, an amount that’s almost half of the U.S.’s public debt.” From here the story just gets weirder: “The bonds were found hidden in makeshift compartments of three safety deposit boxes in Zurich. The U.S. embassy in Rome has examined the securities dated 1934, which had a nominal value of $1 billion apiece, they said in the statement.
And weirder: “The individuals involved were planning to buy plutonium from Nigerian sources, according to phone conversations monitored by the police.” And really, really weird: “The fraud posed “severe threats” to international financial stability, the prosecutors said in the statement.” Ok great, however one thing we don’t get is just how can $6 trillion in glaringly fake bombs be a “threat to international financial stability.”

Farrell continues:

The bonds were seized in Zurich, an important clue, for Switzerland would be a likely place to sell or trade large denomination securities on the international market. The bonds were once again dated 1934, and they were stated to be a “threat to international stability”. How could denominations of bonds that never existed pose any sort of threat to international financial stability unless there was a real exemplar? One does not counterfeit a seven dollar bill.
Such bonds can only exist if there is a market for them, and such a market can only exist if indeed there is some kernel of truth to the existence of such bonds, dated from that period. The amount seized in this particular episode of the Bearer Bonds Soap Opera was 6 trillion, and these were in bonds that were backed by gold. Is the amount of gold in existence able to cover such an astronomical amount of money? What is the actual amount of gold in existence?

That implication brings us to the strange allegations of Lord Blackheath, made almost at the same time as the bearer bonds scandals
Can you say “breakaway civilization?”
Mystery of the Filipino Bearer Bonds: No One Knows Truth About $300 Billion Bonds from Alleged Crash
Now it’s Filipino Bearer Bonds
Filipino Bearer Bonds, a closer look: Part I Part II, with pictures Part III Part IV Part V
Here are some important details about this story: the bonds were dated 1934; the notes were signed by Henry Morgenthau; the bonds were found in chests and stamped with the seal of the Atlanta Federal Reserve Bank; the bonds were purportedly redeemable in gold bullion; the bonds were denominated in $100,000,000 amounts; the bonds totaled some $300 billion.
Farrell elaborates on the curious nature of this case:

Of course, the official position is that these instruments are fakes. But it’s interesting that the officials involved in the attempts to authenticate these instruments have pointed that someone is going to great lengths to counterfeit not only the bonds but the Federal Reserve Branch Bank strongboxes that they are “discovered” in: “For a collector, these counterfeit bonds are awesome because somebody spent a lot of time trying to justify their authenticity. It’s a marvelous deception.”

Here are some similarities with the case and the other three:

  1. The bonds were based on circulating US paper currency designs, in the case of the Spanish and Italian versions, on the design of the US $100,000 bill, in the case of the Japanese version, a fictitious “Kennedy” $1,000,000,000 currency-looking bill and also in the case of the Japanese version, $500,000,000 bonds based on actual US securities.
  2. In the Filipino, Spanish, and Italian versions, the bonds were accompanied by branch bank strongboxes: Atlanta for the Filipino version, Chicago for the Italian version, and Dallas for the Spanish version. The bonds were all dated 1934 and signed by then US Secretary of the Treasury Henry Morgenthau.
  3. The bonds were all bullion-backed.

The Japanese version differs in that it actually received major US media attention, it didn’t exclusively involve bearer bonds from 1934, but also bonds dated much later, the so-called “Kennedy” bonds, and it didn’t involve US Federal Reserve Branch Bank strongboxes or chests, and the behavior of the Japanese men was such that it seemed that they wanted to be apprehended (after all, they were released!).
Farrell notes:

Additionally, the Philippines appear to have been the point of embarkation for the Japanese men in that scandal. And as the Bloomberg article implied, these bonds appear in each of the three other instances to have originated from some ring operating there.

(Hm, I wonder if anything big has been happening lately in the Philippines?)

This has, of course, called forth all sorts of speculations on the Internet from various quarters, with some linking the bullion-backed bonds to the Imperial Japanese plundering of Asia that began with the Japanese invasion of Manchuria, an operation known as Golden Lily.
This line of speculation traces the bullion backing to anachronistic connections with General Tomiyuki Yamashita’s role in securing this treasure at burial locations on the island of Luzon in the Philippine archipelago.
One may reasonably make a prediction there will be yet another such scandal, and that may indeed be one where more information is communicated in the process, not only about that possible hidden financial structure, but also about who is really behind the effort to send messages to that structure, for someone indeed is waging a kind of economic warfare against the West in general and America in particular.
An important point raised by the Bloomberg article is that the US Treasury issued bonds in million, ten million, and even one hundred and five hundred million dollar denominations. Well, it seems that either the media, or the US Government spokesmen, cannot get the details straight.
Consider this New York Times article after the Japanese Bearer Bond Scandal broke, which claims that the US Treasury only issued such securities in maximum denominations of a mere $10,000:

Mystery of Fake US Bonds Fuels Web Theories
Farrell points out an interesting mistake made by the New York Times:

Of course, the bearer bonds scandals we have been talking about have been bonds from the US Federal Reserve system, not the US treasury, a nitpicking point, but one perhaps indicative that the story, whether by the media or the government or both, is being deliberately obfuscated.

And speaking of the Philippines and unfortunate “natural” disasters, there’s this whole can of worms:
Billions in bearer bonds could be lost due to Hurricane Sandy
Farrell adds some analysis of this curious story here: They’re baaack: of bearer bonds, hurricanes, and shadow banking: Part I Part II

Were the soggified hurricanized $70,000,000,000 in bearer bonds on Wall Street any portion of the bonds from the Japanese, Spanish, Italian, or Filipino Bearer Bonds scandals? If so, how the heck did they get into the vault of the Depository Trust and Clearing Corporation which is, according to the New York Post article, “working feverishly to restore the paper?
Why did the New York Post put a picture of a Federal Reserve bearer bond in its article? Isn’t the U.S. Treasury supposed to issue these things? Is the Federal Reserve doing so too? And if so, for how long? Is this why they don’t want an audit? Is someone trying to tell us, by putting this picture in the article, that the soggified bonds are connected to the other bearer bonds scandals?

Add this to the mix: Shadow banking doubled during crisis to record 67 trillion dollars
So there’s quadrillions of dollars’ worth of toxic derivatives and trillions in shadow banking, quantitative easing, and so on. As the RT article explains, this is an area where institutions that engage in practices “resembling” banking, but which are not banks, can do so without regulatory oversight, essentially an interface between a totally hidden system of finance with the public world.

Then we have all that gold in the world (how much is it? Anyone got an accurate figure?) which some banks are trying real hard to reassure some governments it’s not really necessary to assay or audit (think Germany here). Looks like there’s not only been rehypothecation of a whole lot of gold but, as Catherine Austin Fitts and many others have pointed out, rehypothecation of all sorts of assets…
Now, what could one do with all that money? I can think of three things: (1) a slush fund for covert operations; (2) an endowment for a leveraged buyout of the world and institution of a global you-know-what…but even that wouldn’t account for all of it…the third thing I leave to your imagination…

Here are some further thoughts from Farrell about rumors of that Indonesian President Sukarno and JFK made secretive agreements to lease Indonesian gold as part of what some consider to be a long-range Kennedy plan to restructure American currency and finance: Banks and the National Security State: JFK, Sukarno’s Gold, and UBS
Farrell mentions Neil Keenan, providing this link
Here’s a link to the The dragon family lawsuit
Note the reference to 249 $500 million 1934 US Federal Reserve Notes, the same amount as the Italian bearer bond scandal.
Further reading:
Unprecedented Lawsuit Reveals Bizarre Worldwide Banking Connections
Massive New Lawsuit Filed Against US Federal Government in Bond Theft Scheme
And check out this rather extraordinary comment on reddit from last year.
David Wilcock and Benjamin Fulford, certainly two very colorful characters, have also weighed in extensively on this subject, particularly Wilcock, but I didn’t use any information from them so as to not muddy the waters. Fulford, for example, gives actual names for the two mysterious Japanese men who were released and never identified. They also go much more into the Dragon Family and Neil Keenan’s lawsuit.
That’s what I have so far. If anyone has anything else they’d like to add or if I’ve made any mistakes in this analysis, please share. This is really important and it’s definitely not going away.
An addendum:
The Paltry Missing $9,000,000,000,000 and Bearer Bonds Scandals (Again!): Spain, Rumsfeld and Problems

When former US Secretary of Defense Donald Rumsfeld announced, the day before 9/11 in fact, that the Pentagon was missing a mere $2,000,000,000,000, the story was buried by subsequent events. We now seem to have the Fed admitting that it cannot find $9,000,000,000,000.
But the oddity of the numbers once again struck me…Why weren’t all these dollars showing up, long ago, somewhere, in the form of inflation?
Then, more reflection on the numbers: the Japanese Bearer Bond scandal involved a mere $134,500,000,000 in spurious bearer bonds, but, oddly, that just happened to be the amount of money in the TARP (Troubled Assets Relief Program) fund.
Then, in Spain, near Barcelona, we had the apprehension of allegedly counterfeit bearer bonds, and US gold certificate banknotes denominated in $100,000 bills, to a sum of $10,000,000, all neatly banded in bands with the stamp of Chase Manhattan Bank, and all in allegedly counterfeit strongboxes of a Federal Reserve Branch bank. A scenario that, to this day, strikes me as odd in the extreme.
Why go to the trouble of counterfeiting something so absurdly huge in denomination like $100,000 bills, and more absurdly, gold-backed bearer bonds denominated in units of $100,000,000 and $500,000,000, even if you’re intending to sell them to a “mark” at a substantial discount? That would be like announcing your presence on the international counterfeit money market with a fanfare and timpani beneath trapeze artists and flashing neon signs. “Here I am! I’m counterfeiting sovereign debt instruments and endangering your national security! Come and get me!”
Add to this that we’re told the “counterfeiters” added to the fanfare and neon lights by counterfeiting Federal Reserve Branch bank strong boxes, which is like adding searchlights to the fanfare, timpani, trapeze artists, and flashing neon lights.
So: total amount involved in the Spanish Bearer Bond episode? Well…lookee here: $2,000,000,000,000, the same amount that secretary Donald Rumsfeld could not account for.
Then there was the Italian Bearer Bonds Scandal…similar flashing neon lights, fanfares, timpani, trapeze artists, searchlights, all proclaiming “Here I am! I’m forging your national sovereign debt instruments and calling into question you whole financial structure…I’m counterfeiting things that don’t exist. Come and get me!”
Total amount allegedly involved in the Italian Bearer Bonds episode? $6,000,000,000,000.
Add the three bearer bonds episodes amounts together, and we’re beginning to approach that missing $9,000,000,000,000…actually, about $8,134,500,000,000 but what’s a few hundred million here and there?
So….Rumsfeld announced the Pentagon was missing two trillion dollars… a few years later, that exact amount turns up in bearer bonds seized near Barcelona, Spain. (And what was it doing there?)
Of course, the Fed’s missing nine trillion did not make the MSM in the USA folks, so that means, this is one to watch.

Well now isn’t this interesting:
Report: $8.5 trillion unaccounted for by Pentagon.
When we add up all of these bearer bonds in these various incidents we get $8.1 trillion…but I’m sure that’s just a coincidence, right?


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