DOJ Lawsuit Against Bill Benson Backfires
USDC To Hear 16th Amendment Fraud Issue
Twenty-five years ago Bill Benson, a former Illinois Department of Revenue investigator, began a cross-country trip across the forty-eight states that comprised the Union in 1913 seeking documentary evidence regarding the ratification of the 16th Amendment. This was a most important undertaking, because the government uses the 16th Amendment as its sole authority to tax an individual’s wages and salaries.
During his two-year trip, Benson collected thousands of certified legal documents from both state and federal archives documenting exactly how the 16th Amendment was acted on by each state legislature and handled by the office of the Secretary of State for the United States.
In the end, Benson had assembled an irrefutable mountain of evidence showing that during the final days of the William Howard Taft administration in 1913, the 16th Amendment was fraudulently declared by the U.S. Secretary of State, Philander Knox, to have been properly ratified by the requisite number of state legislatures. Bill Benson, and his co-researcher Red Beckman, documented the results of their work in a two volume research report entitled, The Law That Never Was.
Until now, no federal court has agreed to examine the vast body of legal evidence compiled by Benson. Indeed, the federal courts, both District and Appellate, have consistently refused to tackle the troubling issue, claiming the matter of the fraudulent ratification of the Amendment to be a “political question” for Congress to decide, and beyond the jurisdiction of the courts.
For more than 20 years, this judge-made “political question” doctrine has blocked a resolution of the issue.
Today, as the result of a dramatic court battle now being waged in Chicago, Bill Benson and Red Beckman may be on their way to vindication and the federal government may soon find itself scrambling for a new principal source of revenue.
In November 2004, the Department of Justice filed a lawsuit against Benson in the USDC in Chicago, accusing him of operating a “fraudulent tax shelter” and violating Section 6700 of the Internal Revenue Code.
At the heart of Benson’s alleged fraudulent tax shelter “scheme” is the two-volume research book, The Law That Never Was. The hard bound publication is an exhaustive, detailed review of each state’s legislative process regarding its adoption, or rejection, of the 16th Amendment.
The government claims Benson fraudulently induced large numbers of Americans to stop paying income taxes because they relied upon fraudulent statements contained in Benson’s “Reliance Defense Package”.
Shortly after being charged, Benson’s lawyer, Jeff Dickstein, filed a Motion to Dismiss the suit, claiming that Benson, as a matter of law, could not present a defense as to the factual truth of his claims regarding the ratification fraud because the federal courts have repeatedly ruled that the issue is outside their legal domain , and hence, the courts are without subject matter jurisdiction.
Specifically, Benson’s attorney argued that because the fact of making “false or fraudulent statements” is a central element of the alleged unlawful act, Due Process requires that Benson must be given an opportunity to directly defend the factual question of whether Benson’s claims are true or false – despite the fact that the federal courts apparently lack any jurisdiction to consider or adjudicate such a question. This legal “Catch-22”, Dickstein argued, required the dismissal of the case.
Ignoring this constitutional quagmire, the District Court in Chicago rejected Benson’s Motion to Dismiss for lack of subject matter jurisdiction, thereby indirectly admitting it did, in fact, have subject matter jurisdiction regarding the ratification of the amendment.
Most importantly, the Court must now address the exercise of Benson’s Due Process Rights which include challenging the factual substance of the government's allegations, i.e., that Benson is willfully and falsely telling people that because the 16th amendment wasn't ratified, people do not have to file a federal income tax return.
During a status conference, the Court specifically stated it would study The Law That Never Was and also ordered Benson to submit a legal brief arguing the details of the fraud for the Court. On August 1, Benson’s attorney filed the legal brief detailing aspects of the ratification fraud.
As Benson’s documentation overwhelmingly establishes, the fraud was deliberate and pervasive throughout the four-year long amending process. As a single example, consider Kentucky’s resolution on the 16 th Amendment which was recorded by the Secretary of State as having passed the amendment on a vote of 22 to 9. In fact, the source historical record shows that Kentucky ’s resolution was rejected on a vote of 22 to 9, thereby voiding the 16th Amendment, which Philander Know alleged had been passed with only a two-state margin.
Will Benson Enjoy Due Process Or
Will His Claims Be Judicially Presumed False?
On its face, Benson’s legal proceedings can be considered the worst possible scenario for the government. Despite all efforts to avoid such, the government is slowly being forced by a District Court into directly confronting the legal evidence put forth by Benson.
That is, to successfully sustain its legal claim against Benson for allegedly violating Section 6700 of the Internal Revenue Code, (i.e., running a “fraudulent tax shelter”), the government must establish for the record that Benson had an “illicit state of mind” by proving that Benson could have had NO rationale or reasonable basis to believe that his claims regarding the 16th Amendment are, as a matter of law, true.
Unfortunately for the government, standing in its way are thousands of certified, legislative documents and a court-ordered hearing to examine Benson’s rationale in advancing his allegedly fraudulent claims.
According to Benson, at an earlier status conference, DOJ officials openly offered to settle out of court and that they only wanted to bar him from distributing his 16 th Amendment “reliance package”. However, as part of the settlement, DOJ also wanted a list of Benson's customers. In response, Benson asserted his right to remain silent because an IRS CID special agent asked about Benson in connection with an on-going grand jury investigation in another state. Benson did not settle out of court.
On August 4, presumably to avoid any further public hearings on the matter, the government filed a Motion for Summary Judgment . Benson's attorney is currently working on a response to this motion and is preparing a cross-motion for summary judgment. Oral arguments regarding Benson’s research have not yet been held.
Benson, who for years failed in his attempts to force the government to honestly respond to his legal research has, through a strange turn of events involving these Section 6700 civil charges, been drawn into a legal conflict where he may yet have his questions answered.
Ironically, in its insatiable desire to suppress the distribution of an ever-growing body of research exposing the legal fraud of our tax system, and to quash those that act in good faith upon that research to secure their Rights, the government, in its lawsuit against Bill Benson, has inadvertently put itself in the position of having to confront the very thing it dreads – a public, judicial hearing where it must rebut the existence of thousands of certified legal documents that irrefutably establish that our income tax statutes have no constitutional authority.
Some might conclude the government’s lawsuit against Bill Benson has backfired.
September 30, 2005
For the original posting of this column with embedded hyper-links, please go to http://www.givemeliberty.org/RTPLawsuit/Update2005-09-30.htm
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