Thread by @egavactip

Today I've been doing research, for my book, on so-called "warehouse banks" used by tax protesters, sovereign citizens & other ne'er-do-wells for nearly 40 years as a way of hiding income from the IRS and other prying eyes.

I thought you might be interested in this phenomenon.

I suspect non-ideological warehouse banks of one sort or another may have been in existence longer, but "patriot"-style warehouse banks began to emerge in the 1980s. The most prominent of them was the National Commodity and Barter Association (NCBA), operated by John Grandbouche

and, after JG's death, John Voss. It also had affiliates and spin-offs in other states, like the Mid-States Exchange and the Northwest Community Exchange. The idea behind the NCBA was that it was a "bullion" bank. You would send money to the NCBA and it would convert your $$$

to gold and/or silver bullion, tucked away in a vault. You would be given a secret account number like a Swiss Bank Account. Using that number, you could direct the NCBA to send out money on your behalf--to pay bills or any expense. They would charge a fee. The idea was that

these were not financial transactions--just bartering bullion--and you needn't report any of that to the IRS or anybody else. And the secret nature of the accounts theoretically meant the IRS couldn't find out what you were doing even if it wanted to. Promotional materials

for these entities claimed they were "common law businesses" that were "outside the jurisdiction of government." The IRS disagreed and in 1985 launched a raid on several NCBA-related locations, seizing some 10 tons of silver bullion and around $250,000 in gold bullion. The

main purpose of the raids of the NCBA and various affiliates elsewhere was actually to obtain the account records--to find out who was using these barter banks and audit/prosecute them as needed. A judge later declared the Colorado search warrant invalid, but they never got

It was hard for the IRS to investigate these banks. To investigate one based in Seattle, the Northwest Commodity Exchange, in 1985, they had to send undercover agents and informants to be clients. They posed as an organized crime/illegal gambling operation and said they wanted

to launder money. They sent about $226k through its secret accounts, getting cashier's checks back. None of these transactions were reported to the IRS, as all transactions over $10k must be. For some reason, Oregon seemed to be a popular spot for warehouse banks, and several

such banks were set up there. After many warehouse bank folks were prosecuted in the 80s, you might think the tactic would be abandoned, but you'd be wrong. The 1990s saw more warehouse bank operations investigated, such as the Natural Coin Exchange run by Oregon-based Richard

Flowers, head of the Christian Patriots Association. Warehouse bank operations continued into the 2000s, but by then the "bullion" aspect was dropped as unnecessary. All you really needed was a common bank account. People would send all their money to you and you would

put everybody's money into one single account, commingling it so that nobody but you knew whose money was whose. You kept records with secret account numbers and when one of your clients wanted you to pay a bill, they'd send you instructions and you'd do it.

There have been people convicted at least as recently as 2018 for using bogus warehouse banks. Some of these "banks" were huge. One of them, MYICIS, allegedly had 3,000 clients and about $100 million in deposits over a three-year period. These obviously catered to more people

than just right-wing extremists, but anti-gov't extremists have been regular users, and often operators, of these schemes for years.

Correction: through some glitch one of these tweets ends with "they never got." The phrase should actually read "They never got their bullion back."