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The Federal Denounce

Puerto Rico Real Estate Limitations & Fraudulent Practices

 

Now, abounding more about the criminal practices that affect the Estate, until the year 1996 all our legal tools were strictly based on the hereditary rights, until one day, by accident, studying the laws, we discovered the most important legal tools never ever known and seen before that we were needing to win the legal battle to recover the inheritance since its discovery.

 

By accident, reading the Constitution of the Commonwealth of Puerto Rico in a book titled “Puerto Rico’s Constitutional Development”, we discovered the biggest financial scandal in the history of Puerto Rico and United States of America secretively hidden by judges, courts and attorneys during the last 100 years.

 

Due to during that time we had doubts about it we proceeded to consult many attorneys in the island, confirming later that we were right.

 

Certainly, on 1997, we discovered the weakest point of the entire local financial system with all its history and development.

 

In simple words, said discovery revealed that during the last 100 years all the assets and the local financial system had been produced by virtue of a very big white collar criminal money laundering operation, orchestrated by hundreds of juridical persons, participating as criminal holders of more than 500 acres of lands, dedicated to the prohibited corporate business of buying and selling real estate, violating the federal and local laws.

 

 

At present, any person may verify said prohibitions, still in effect,

checking the websites of the Puerto Rico’s State Department and Supreme Court.

 

Click here to see an updated list of some of the local illicit urban projects

 

About the particular the Secretary of Justice of Puerto Rico has declared:

 

No corporation, doesn’t matter his nature, will be engaged

on the business of buying and selling real estate in Puerto Rico.

Op. Sec. Just. No. 6 of 1968

 

A corporation can not be dedicated to the business of buying and selling real estate, or,

in any form, hold lands to speculate in the real estate market.

Op. Sec. Just. No. 15 of 1966

 

The corporations not engaged in agriculture are only limited by the first part of the statute of this section,

that prohibit to all corporation effectuate businesses of buying and selling real estate or to hold or

to have such class of assets except such as may be reasonably necessary to

enable it to carry out the purposes for which it was created.

Op. Sec. Just. No. 70 of 1956

 

 

More clearly speaking, on 1997 we discovered that during the past decades hundreds of juridical persons, doing businesses in Puerto Rico, had been criminal holders of lands in excess of 500 acres and/or had been dedicated to the prohibited business of buying and selling real estate, acts, that constitute felonies with a maximum penalty of 10 years in prison, being the local government and the local mortgage banking financial system (members of the Federal Reserve Bank System, regulated by HUD) the main authors, promoters and conspirators; being also involved hundreds of private artificial (juridical) persons (corporations & partnerships), corrupted urban developers, judges, courts (federal & local), attorneys, bankers, public officials, surveyors, appraisers, title insurance companies (insurers), engineers, architects, real estate vendors, construction workers and common people.

 

The first fraudulent assets production stage began on the year 1900 until approximately 1945, when hundreds of juridical persons (corporations) dedicated to the sugar production industry generated billions of dollars having illegally large sugar plantations committing felonies by virtue of controlling and acquiring many very large tracts of lands, holding more than 500 acres each one.

 

The second fraudulent assets production stage began after that, on the year 1946 until present, when hundreds of juridical persons (corporations and partnerships) dedicated to the prohibited business of buying and selling real estate generated billions of dollars by virtue of producing, developing and selling more than 800,000 housing urban units, financing all the operations by virtue of issuing millions of fraudulent mortgage investments instruments sold to the American investors through the following primary and secondary markets mortgage banking financial institutions regulated by HUD, like: the Government National Mortgage Association (GNMA), the Federal National Mortgage Association (FNMA – Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac) and the Federal Home Loan Banks System (FHLB).

 

Without taking in consideration said first stage related with the criminal agricultural sugar operation, at least, if we multiply the average appraisal value of each criminally produced housing urban unit ($112,500) by the produced volume (800,000 housing units), the Puerto Rican criminal urban industry had laundered no less than the huge amount of $90 billion dollar ($90,000,000,000) in only the last 55 years.

 

The background of those prohibitions had its origin in the Section Number 32 of the Foraker Act (31 Stat. 77), enacted by the United States Congress on April 12, 1900, to provide a civil government after two years of military government since the Spanish American War on 1898.

 

More later, said Section 32, was amended by the Article Number 3 of the Joint Resolution Number 23 enacted by the United States Congress on May 1, 1900 (31 Stat. 716); which remained in effect when the Congress enacted the Jones Act on March 2nd, 1917 (39 Stat. 951) to provide a better structured civil government, giving the American citizenship, which repealed said Foraker Act, except the sections 2,3,4 and 11.

 

Later, said Article Number 3, suffered some changes conserving its essence, being codified as the Section Number 752 of the Title Number 48 of the United States Code, still being in effect until present; prohibiting the corporate land holdings in excess of 500 acres, and, the dedicated activities of buying and selling real estate to all kind of corporations doing businesses in Puerto Rico.

 

More later, on August 7, 1935, the local government enacted the Act Number 48, typifying as a misdemeanor the violation of said Article Number 3, imposing maximum penalties of $1,000 dollars and/or a year in prison.

 

Later, on 1940, said Article Number 3 and the Act Number 48 where declared valid, in effect and totally constitutionals by the US Supreme Court in the case People of Puerto Rico v. Rubert Hermanos, Inc., 309 U.S. 543 (1940).

 

More later, on April 12, 1941, the local government enacted the Act Number 26, known as the Land’s Act of Puerto Rico, still in effect, typifying as a felony the corporate holdings in excess of 500 acres to all kind of juridical persons, imposing maximum penalties of 10 years in prison, the dissolution of the entity, the prohibition to continue doing businesses in the country, the nullity of all acts and contracts made by the [juridical] person, the cancellation of every entry or registration in the public registries and fines.

 

Later, on 1942, said Article Number 3 and the Acts Numbers 48 and 26, where declared again totally constitutionals by the US Supreme Court in the case People of Puerto Rico v. Rubert Hermanos, Inc., 315 U.S. 637 (1942).

 

More later, on 1951, the People of Puerto Rico accepted the inclusion of all said prohibitions mentioned in the Article Number 3 when participated in a referendum accepting the congressional proposition to enact a Constitution to Puerto Rico.

 

Later, on 1952, all said prohibitions of the Article Number 3 were included in the Article Number 14th of the 6th Section of the Constitution of the Commonwealth of Puerto Rico when it was enacted and approved by the US Congress that year (66 Stat. 327). The inclusion of such prohibitions was a requisite for its approval.

 

More later, on 1953, the acceptation of all said prohibitions and penalties, were ratified by the new Government of Puerto Rico when codified all the laws on the Annotated Laws.

 

Finally, on 1956, 1966 and 1968 all the Puerto Rico’s Secretaries of Justice ratified again the validity of all said prohibitions and penalties.

 

After understanding such background we may concluded that:

NUMBER ONE

Pursuant to various federal and local laws, since the date of May 1, 1900, in the Commonwealth of Puerto Rico is prohibited to all the artificial (juridical) persons (like domestic or foreign private or public corporations & partnerships), doing businesses in the island, the act of to have, posses, acquire and/or control more that 500 acres of lands and the dedicated business of buying and selling real estate.

 

Those prohibitions are established in the Section Number 752 of the Title Number 48 of United States Code (48 USC § 752) [which is included in the Article Number 14 of Section VI of the Constitution of the Commonwealth of Puerto Rico].

 

Pursuant to the sections numbers 401 to 407, 421 and 431 to 435 of the Title Number 28 of the Puerto Rico Annotated Laws (28 PRAL secs. 401 to 407, 421 and 431 to 435), the violation of those prohibitions is typified locally as a felony punishable by imprisonment in jail for a term not exceeding ten (10) years or by a fine not exceeding one thousand dollars ($1,000) or by both penalties, at the discretion of the court.

NUMBER TWO

Pursuant those statutes, the sections numbers 3391 and 3432 of the Title Number 31 of Puerto Rico Annotated Laws (Puerto Rico Civil Code - 31 PRAL secs. 3391 and 3432) and the local jurisprudence, the criminal violation of those prohibitions has the effect to invalidate any legal contract product of it.

 

Pursuant to the Laws of Puerto Rico a contract has no existence when is product of a crime and the cause (the consideration) is illicit.

NUMBER THREE

Pursuant to 18 USC §§ 1001, 1002, 1003, 1004, 1005, 1006, 1007, 1010, 1011, 1012, 1033, 1034, 2314 and 2315 the intentional production of those criminal, illicit, unconstitutional, illegal and non existence contracts in order to produce and sell interstitially multiple illicit produced immovable or movables domestic properties configures (constitutes) the felony of FRAUD, which is an indictable criminal activity under the federal laws.

NUMBER FOUR

Pursuant to 18 USC §§ 471, 472, 473, 494, 495 and 657 the intentional production of those criminal, illicit, unconstitutional, illegal and non existence contracts in order to produce and sell interstitially multiple illicit produced immovable or movables domestic properties configures (constitutes) the felony of FORGERY, which is an indictable criminal activity under the federal laws.

NUMBER FIVE

Pursuant to 18 USC §§ 1956 and 1957, the intentional interstate transference of any unlawful (illicit) immovable or movables domestically produced properties, product of those criminal, illicit, unconstitutional, illegal and non existence contracts, product of those criminal violations, with the intention to conceal and clean its fraudulent origin, configures (constitutes) the felony of MONEY LAUNDERING, which is an indictable criminal activity under the federal laws.

NUMBER SIX

Pursuant to 18 USC §§ 1952, 1961 to 1964 and 1968 that intentional interstate money laundering activity practiced by corrupted organizations configures (constitutes) the felony of RACKETEERING, which is an indictable criminal activity under the federal laws (RICO ACT).

NUMBER SEVEN

However the aforesaid, ignoring intentionally those prohibitions, the Government of the Commonwealth of Puerto Rico in conspiracy with the aforesaid parts, continues authorizing to hundreds of artificial (juridical) persons (like domestic or foreign private or public corporations & partnerships) the financing, development and selling of thousands of new and old illegal and fraudulent housing units urban projects (promoting the prohibited corporate business of buying and selling real estate in PR), making thousands of false, non existence and fraudulent public documents (purchase and sale and mortgage deeds contracts) with the intention to sell these false and non existent mortgages backed credits through the aforesaid mortgages secondary market institutions (GNMA, FNMA / Fannie Mae, Freddie Mac and FHLB), generating billions of dollars of illegal and criminal profits using a fraudulent scheme of MONEY LAUNDERING, defrauding the Treasury of the United States of America and all states financial markets of our American Nation.

 

As we can see, here, all the federal indictable felonies are: Fraud, Conspiracy, Racketeering, Concealment, Money Laundering and Forgery.

 

Again, don’t forget, the aforesaid new and old housing units projects are illegal because were developed and sold by juridical (artificial) persons (corporations and partnerships) in violation of the section number 752 of the Title Number 48 of United States Code (48 USC § 752) [which is included in the Article Number 14 of Section VI of the Constitution of the Commonwealth of Puerto Rico], that prohibit to all domestic or foreign juridical persons doing businesses in Puerto Rico the dedicated activities of buying and selling real estate.

 

More clearly speaking in Puerto Rico no domestic or foreign juridical person is authorized to conduct the business of buying and selling real estate.

 

That federal statute applies to all private and public juridical persons; and, its violation is typified as a criminal offense (felony) in Puerto Rico (see 28 PRAL secs. 401 to 407, 421 and 431 to 435).

 

At present, the Puerto Rico's homebuyers are acquiring fraudulently thousands of new and old housing units (more than 800,000) without the properties titles and are paying DURING 30 YEARS thousands of false, fraudulent and non-existent mortgages.

 

As you can see the home buyers are losing their all life savings capitals because they are paying for nothing, and the American investors are losing their all life savings investments because they are paying for a false, fraudulent and non existent monetary investment instrument (the mortgage bonds).

 

Now then, again, in order to understand the scheme, is very important to clarify the following:

 

  • The mortgage bond (mortgage backed security sold to the American investors through the aforesaid mortgage financial institutions) is false and non existent because the mortgage credit that backed the bond was false and non existent;
  • The mortgage credit was false and non existent because the mortgage deed where that credit was attempted to constitute was false and non existent;
  • The mortgage deed was false and non existent because the property title where the mortgage was attempted to constitute was false and non existent;
  • The property title (the purchase and sale deed) was false and non-existent because the contract where it was attempted to constitute as a contract never existed. In other words, the transference of the immovable property (immovable transaction) never occurred legally;
  • The contract never had existence because was a product of various white-collar felonies (like fraud and forgery of public documents). Pursuant to the Puerto Rico Laws a contract has no existence when is product of a crime and the cause (the consideration) is illicit;
  • And those crimes occurred when the housing project developer, as the vendor, developed, constructed and sold the illegal urban housing project been a juridical person, violating knowingly the aforesaid local and federal statutes that prohibit the corporate business of buying and selling real estate in Puerto Rico.

NUMBER EIGHT

Also, ignoring those prohibitions, the Government of Puerto Rico in conspiracy with the aforesaid parties continues authorizing the development, financing and selling hundreds of additional criminal urban projects, developed by others hundreds of artificial persons, holding each one more than 500 acres of lands in Puerto Rico, by virtue of the aforesaid non existent, false and fraudulent public documents scheme.

 

Although the local and federal courts, and their Judges, know VERY CLEAR that those mortgages are false, fraudulent and non existent, they continue authorizing the foreclosure of them GENERATING A BIGGEST JUDICIAL REAL ESTATE MONEY LAUNDERING CRIMINAL ENTERPRISE.

 

The federal authorities in Puerto Rico are allowing those criminal activities because, at present, the United States Attorney's Office for the District of Puerto Rico (USAO) is involved in a conspiracy to conceal the aforesaid scheme.

_______________

 

Now then, continuing with the same line of thinking in chronological order, once we discovered that huge criminal conspiracy, during the period of 1997 to 2002, we proceeded to inform it to the following federal agencies and related entities:

 

John Ashcroft Honorable Attorney General U. S. DEPARTMENT OF JUSTICE 950 Pennsylvania Avenue, NW Washington DC 20530-0001; Helen L. Schumacher Unit Chief / Economic Crimes Unit  Criminal Investigative Division FEDERAL BUREAU OF INVESTIGATION U. S. DEPARTMENT OF JUSTICE J. Edgar Hoover FBI Building 935 Pennsylvania Avenue, NW Washington DC 20535-0001; Michael Chertoff Assistant Attorney General Criminal Division U. S. DEPARTMENT OF JUSTICE 950 Pennsylvania Avenue, NW Washington DC 20530-0001; John Roth Director Asset Forfeiture and Money Laundering Section Criminal Division U. S. DEPARTMENT OF JUSTICE 950 Pennsylvania Avenue, NW Washington DC 20530-0001; Joshua R. Hochberg Chief Fraud Section Criminal Division U. S. DEPARTMENT OF JUSTICE 950 Pennsylvania Avenue, NW Washington DC 20530-0001; Bruce G. Ohr Chief Organized Crime and Racketeering Section Criminal Division U. S. DEPARTMENT OF JUSTICE 950 Pennsylvania Avenue, NW Washington DC 20530-0001; Andrew Lourie Chief Public Integrity Section Criminal Division U. S. DEPARTMENT OF JUSTICE 950 Pennsylvania Avenue, NW Washington DC 20530-0001; Paul H. O’Neill Honorable Secretary of the Treasury Office of Public Correspondence U. S. DEPARTMENT OF THE TREASURY 1500 Pennsylvania Avenue, NW Washington DC 20220; Paul S. Sarbanes Honorable Chairman Committee on Banking, Housing and Urban Affairs U.S. SENATE 534 Dirksen Senate Building Washington DC 20510; Patrick Leahy Honorable Chairman Committee on the Judiciary U.S. SENATE 224 Dirksen Senate Building Washington DC 20510; Carl Levin Honorable Chairman Committee on Armed Services U.S. SENATE 228 Rusell Senate Office Building Washington DC 20510; Michael G. Oxley Honorable Chairman House Committee on Financial Services U.S. HOUSE OF REPRESENTATIVES 2129 Rayburn House Office Building Washington DC 20515; Bob Stump Honorable Chairman House Armed Services Committee U.S. HOUSE OF REPRESENTATIVES 2120 Rayburn House Office Building  Washington DC 20515; F. James Sesenbrenner Jr. Honorable Chairman Committee on the Judiciary U.S. HOUSE OF REPRESENTATIVES 2138 Rayburn House Office Building Washington DC 20515; John Warner Honorable Senator U.S. SENATE 225 Rusell Senate Office Building Washington DC 20515; James M. Inhofe Honorable Senator U.S. SENATE 453 Rusell Senate Office Building Washington DC 20510-3603; Trent Lott Honorable President U.S. SENATE 487 Rusell Senate Office Building Washington DC 20510; Dennis Hastert Honorable Speaker U.S. HOUSE OF REPRESENTATIVES Washington DC 20515; Alan Greenspan Honorable Chairman BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM 20th Street and Constitution Avenue, NW Washington DC 20551; Mel Martínez Honorable Secretary U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT 451 Seventh Street, SW, Room 10000 Washington DC 20410; Jim Chaplin Southeast Area Regional Director Georgia State Office U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT Five Points Plaza 40 Marietta Street, NW, 2nd Floor Atlanta GA 30303-9812; Kenneth M. Donohue Honorable Inspector General Office of Inspector General (OIG) U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT 451 Seventh Street, S.W., Room 8256 Washington DC 20410-4500; District Inspector General for Audit Office of Inspector General (OIG) U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT Richard B. Rusell Federal Building PO Box 330 75 Spring Street, SW, Room 330 Atlanta GA 30303-3388; David M. Walker Comptroller General U.S. GENERAL ACCOUNTING OFFICE 441 G Street NW Washington DC 20548; GAO FraudNET U.S. GENERAL ACCOUNTING OFFICE 441 G Street NW Washington DC 20548; Donald E. Powell Chairman FEDERAL DEPOSIT INSURANCE CORPORATION 550 17th Street NW Washington DC 20429-9990; Richard Pazereckas Regional Director FEDERAL DEPOSIT INSURANCE CORPORATION 20 Exchange Place, Room 6014 New York NY 10005; George W. Bush Honorable President UNITED STATES OF AMERICA The White House 1600 Pennsylvania Avenue NW Washington DC 20500; Donald H. Rumsfeld Honorable Secretary U.S. DEPARTMENT OF DEFENSE 1000 Defense Pentagon Washington DC 20301-1000; Gordon R. England Honorable Secretary U.S. NAVY Washington DC 20350-1000; SEC Complaint Center Division of Enforcement U.S. SECURIETIES AND EXCHANGE COMMISSION  450 Fifth Street NW Washington DC 20549-0213; Ronald A. Rosenfeld President GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) 451 Seventh Street SW Washington DC 20410-9000; Complaints Legal Department FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) 3900 Wisconsin Avenue NW Washington DC 20016-2892; Complaints Legal Department FEDERAL HOME LOAN MORTGAGE CORPORATION (Freddie Mac) 8200 Jones Branch Drive McLean VA 22102-3110; Complaints Legal Department Federal Housing Finance Board FEDERAL HOME LOAN BANK SYSTEM (FHLBS) 1777 F Street NW Washington DC 20006-5210; & Complaints Legal Department Office of Finance FEDERAL HOME LOAN BANK SYSTEM (FHLBS) Two Fountain Square 11921 Freedom Drive, Suite 1000 Reston VA 20190

___________________

 

The original introduction of that Federal Denounce was:

ATTENTION

THIS IS A NATIONAL EMERGENCY WARNING

MORTGAGE BACKED SECURITIES & REAL ESTATE FRAUD ALERT

 

SPECIAL REMARKS: Do not forward this delicate & sensitive information to

the San Juan, Puerto Rico’s FBI and USAO (United States Attorney’s Office) Offices.

Those entities are concealing the following criminal scheme.

 

A very sophisticated multibillionaire DOMESTIC FINANCIAL TERRORISM criminal scheme is been committed in PUERTO RICO in order to affect, influence and defraud many civil, economic, political, social and military sectors like the national defense, the interstate commerce, the financial markets, the American Investors and the U.S. Treasury.

 

The government of the Commonwealth of Puerto Rico in conspiracy with many private artificial (juridical) persons (corporations & partnerships), Commercial Banks (members of the Federal Reserve Bank System), Mortgages Financial Institutions (regulated by HUD), corrupted urban developers, judges, courts (federals & locals), attorneys, bankers, public officials, surveyors, engineers, architects, real estate vendors, construction workers and common people is intimidating, coercing, entrapping and obligating the Puerto Rico’s general civilian population to commit and conceal various biggest financial white collar federal crimes (like: Fraud, Conspiracy, Racketeering, Concealment, Counterfeiting, Money Laundering and Forgery) generating thousands of false public documents in order to produce and sell thousands of non existent mortgages backed securities (mortgage bonds) to the American Investors through the following mortgages financial institutions: the Government National Mortgage Association (GNMA), the Federal National Mortgage Association (FNMA – Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac) and the Federal Home Loan Banks System (FHLB); laundering, by virtue of those criminal activities, more than U.S. $90 Billions dollars, violating many financial anti terrorism and banking federal laws like: the Public Law Number 107-56 (115 Stat. 272) known as Uniting and Strengthening America By Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT Act) Act of 2001; and the following criminal federal codified statutes: 18 USC §§ 471, 473, 494, 495, 657, 1001 to 1007, 1010 to 1012, 1033, 1034, 2314, 2315, 1952, 1956, 1957, 1961 to 1964 and 1968.

 

Also, on the other hand, by virtue of that fraudulent scheme, the Government of Puerto Rico is collecting and generating taxes, producing the necessary economic resources to finance its politic, judicial and public campaign in order to achieve the outgoing of U.S. Navy and Army forces from Vieques affecting our American National Defense System.

 

Unfortunately, although on December 30, 1997 we sent a letter of 778 pages (in Spanish language) to the United States Attorney General, Mrs. Janet Reno, explaining the complete "Modus Operandi" of the aforesaid criminal operation, it continues practicing year after year as if it its authors were untouchables and immune to the U.S. banking and securities laws. The same situation occurred with the Offices of the Inspector General (OIG) of the Department of Housing and Urban Development (HUD) in Atlanta GA and the FBI’s Economic Crimes Unit of the Criminal Investigative Division (in FBI Headquarters - FBIHQ) in Washington D.C., which respectively, although since the dates of May 1, 1998 and September 3, 1999 assumed jurisdiction to investigate those matters under the complaint number FH00-9467, until today, nothing had happen.

 

At present, the Puerto Rico’s judicial and justice system is intimidating, coercing and threatening the life, security and liberty of all citizens who denounce that DOMESTIC FINANCIAL TERRORISM criminal scheme. The Government of Puerto Rico and it accomplices are putting obstacles and do not wish that the Federal Government in Washington D.C. know all the aforesaid clandestine enterprise. We have various documents in order to prove that the San Juan, Puerto Rico’s FBI and USAO (United States Attorney’s Office) Offices are involved, concealing the aforesaid criminal scheme. Those Offices DO NOT WANT TO INVESTIGATE IT PROTECTING THE LOCAL GOVERNMENT AND ITS CORRUPTED BANKING FINANCIAL SYSTEM THAT OPERATES LIKE A MAFIA.

 

For that reason, as declarants and witnesses,

WE NEED YOUR PROTECTION URGENTLY RIGHT NOW

 

We understand that the life of our families and us are in jeopardy if your Office does not provide us very soon that federal protection pursuant to 12 USC §§ 4201 to 4247 and 18 USC § 3521. According to various documents and occurrences, we have many reasons to believe that the Government of Puerto Rico and its criminal organization want to hurt us, including KILL US very soon, using different methods, techniques and tricks that could have the appearance to be mere accidents. For example, since the aforesaid date of December 30, 1997, when we made the aforesaid denounce, we have been receiving multiples intimidating not speaking people phone calls. Recently, two of those calls were from the Puerto Rico’s Department of Justice. At present, as reprisal, that entity wants to fabricate a case against one of us in order to intimidate us and affect our efforts and credibility.

___________________

 

The conclusion of that Federal Denounce was:

 

Our PRIMARY INTEREST into denouncing the aforesaid criminal scheme was born as result from our civic duty to defend our American nation; and our SECOND INTEREST from our civic duty to defend and recover our private properties, assets and civil rights abusively usurped by the local government and its corrupted judicial and justice system.

 

For your information, at present, Andres and I are members of the Estate of Basilio Lopez Martin who is practically the owner of the entire island of Puerto Rico since the year 1750 (century XVIII). Although that Estate has a very large tract of land of 2,179,674 acres in Puerto Rico, it has not the control of the illegal activities of the people who reside illegally in its lands. That situation impedes us from having the control of our lands. The aforesaid corruption of the Puerto Rico’s judicial and justice system has had the effect to impede us to get a genuine and real justice from the local and federal judges and attorneys, who reside illegally in our lands, representing that fact, a clear conflict of interests that impede the application of an impartial justice. For that reason the Puerto Rico’s judiciary system and its members are against us.

___________________

 

During that same period of time the Federal Government assumed jurisdiction when the U.S. Department of Justice, the FBI, the U.S. Securities and Exchange Commission (SEC) and the Office of the Inspector General of the Department of Housing and Urban Development (OIG-HUD) agreed to investigate all those concerns (see received letters).

 

Also, to prove the criminal intentions of the financial system of Puerto Rico we filed a $100 Billion dollars lawsuit against the main bank in the island, Popular Bank of Puerto Rico, putting in one document of 1,000 pages the complete Federal Denounce (the letter to the ex U.S. Secretary of Justice, Mrs. Janet Reno) and the Estate’s story.

 

At present, the FBI has a copy of that document (Civil Case Number DCD1997-1074 (506), Banco Popular de Puerto Rico v. Wilfredo Medina Rosado et als, before the Court of First Instance of Bayamon Puerto Rico).

 

On 2002, as consequence of said proceedings, our main administrator had to leave the island to protect his life when was discovered a plan from the local government to kill him.

 

In that year he visited personally the U.S. Senate and the FBI Headquarters seeking protection.

 

Finally, on 2005, we continued denouncing those practices as follow:

 

Enron, World Com and Martha Stewart were prosecuted … However … Why not the local Government, the developers and the fraudulent mortgage banking system in the territory of the island of Puerto Rico ? Yearly, all of them are producing billions of dollars of false, non existent and fraudulent mortgage backed securities, participating FREDDIE MAC & FANNIE MAE as conspirators …

 

YEAR 2005

 

 

Attention: USDOJ, CONGRESS, OFHEO & FBI

MORTGAGE BACKED SECURITIES FRAUD WEEKLY ALERT

 

This week … again                  

FREDDIE MAC,

FANNIE MAE and the main

Title Insurance Companies in America:

 

knowingly and intentionally issued, insured, bought, sold and promoted billions of dollars of false and fraudulent Mortgage Backed Securities, collateralized by non existent and false property titles, mortgage notes and deeds, originated by tens of powerful and corrupted artificial persons, acting as urban developers (corporations, partnerships & trusts), dedicated to the prohibited corporate business of buying and selling real estate in the territory of the island of Puerto Rico USA.

 

The corporations in Puerto Rico are ARE NOT AUTHORIZED to conduct the business of buying and selling real estate; and neither, to hold each one more than 500 acres of land.

 

The violation of those prohibitions

It’s a FELONY

 

However …. FREDDIE MAC, FANNIE MAE and the main Title  Insurance Companies in America continue buying and insuring in Puerto Rico billions of dollars of false, fraudulent and non existent mortgages originated by hundreds of white collar criminal urban corporations there dedicated to the prohibited corporate business of buying and selling real estate, putting in risk the financial health of said publicly traded institutions in detriment of the U.S. Treasury, Wall Street and the American investors

 

Is THE MAFIA in Puerto Rico immune to the justice ?

 

According to the federal and local laws (48 U.S.C. 752; the Article Number 14 of Section VI of the Constitution of the Commonwealth of Puerto Rico; and the Title 28 of Puerto Rico’s Annotated Laws secs. 401 to 407, 421 and 431 to 435), in Puerto Rico USA the artificial persons (like corporations, partnerships & trusts) ARE NOT AUTHORIZED to conduct the business of buying and selling real estate; and neither, to hold each one more than 500 acres of land.

 

Fraud, Conspiracy, Racketeering,

Concealment, Money Laundering and Forgery

See more info on the next page …

Urgent Notice

Dear Sirs:

 

Again, during the past week, the following federal regulated financial institutions, among other parties, continued defrauding the U.S. Treasury and the American investors by virtue of issuing, insuring, buying, selling and promoting billions of dollars of false and fraudulent Mortgage Backed Securities, collateralized by non existent and false property titles, mortgage notes and deeds, originated by tens of powerful and corrupted artificial persons, acting as urban developers (corporations, partnerships & trusts), dedicated to the prohibited business of buying and selling real estate in the territory of the island of Puerto Rico USA:

 

 

THE FOLLOWING FINANCIAL MORTGAGE & COMMERCIAL BANKING INSTITUTIONS:

 

Citibank

 

Eurobank

 

First Bank

 

Scotiabank

 

Westernbank

 

Levitt Mortgage

 

Banco Bilbao Vizcaya

 

Banco Santander Puerto Rico, Inc. and its subsidiary

Santander Mortgage Corporation

 

Doral Financial Corporation and its subsidiaries

HF Mortgage Bankers, Doral Mortgage Corporation,

Doral Savings Bank, Doral Securities,

Sana Mortgage and Centro Hipotecario

 

New York Mortgage

 

Oriental Financial Group and its subsidiaries

Oriental Financial Services and Oriental Mortgage

 

Popular Inc. and its subsidiaries

Banco Popular de Puerto Rico, Inc., Popular International Bank, Inc. and Popular North America, Inc.

 

R & G Financial Corporation and its subsidiaries R & G Premier Bank and R & G Mortgage Corporation

 

THE FOLLOWING SURETY INSTITUTIONS:

 

Chicago Title Insurance Company

 

First American Title Insurance Company

 

Stewart Title Guaranty Insurance Company

 

AND THE FOLLOWING PRIMARY AND SECONDARY MARKET MORTGAGE INSTITUTIONS:

 

Federal Home Loan Banks System (FHLB)

 

Government National Mortgage Association (GNMA)

 

Federal Home Loan Mortgage Corporation (Freddie Mac)

 

Federal National Mortgage Association (FNMA, Fannie Mae)

 

 

NOW it’s time to prosecute them to protect America

 

Fraud, Conspiracy, Racketeering,

Concealment, Money Laundering and Forgery

See more info on the next page …

ATTENTION

 

EXTREME URGENT

DOMESTIC FINANCIAL

TERRORISM CRIMINAL

SCHEME ALERT

 

Our American nation needs you!

Take action NOW !

 

THIS IS A NATIONAL EMERGENCY WARNING

 

MORTGAGE BACKED SECURITIES & REAL ESTATE FRAUD ALERT

 

A very sophisticated multibillionaire DOMESTIC FINANCIAL TERRORISM criminal scheme is being committed in PUERTO RICO in order to affect, influence and defraud many civil and economic sectors; like the interstate commerce, the financial markets, the American Investors and the U.S. Treasury.

The Government of the Commonwealth of Puerto Rico in conspiracy with many private artificial (juridical) persons (corporations, partnerships & trusts), Commercial Banks (members of the Federal Reserve Bank System), Mortgages Financial Institutions (regulated by HUD), title insurance companies, appraisers, notaries public, corrupted urban developers, judges, courts (federals & locals), attorneys, bankers, public officials, surveyors, engineers, architects, real estate vendors, construction workers and common people is intimidating, coercing, entrapping and obligating the general civilian population to commit and conceal various financial white collar federal crimes (like: Fraud, Conspiracy, Racketeering, Concealment, Counterfeiting, Money Laundering and Forgery), generating thousands of false public documents, by virtue of producing and selling thousands of non existent mortgage backed securities (mortgage bonds) to the American investors through the following mortgage financial institutions: the Government National Mortgage Association (GNMA), the Federal National Mortgage Association (FNMA – Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac) and the Federal Home Loan Banks System (FHLB); laundering, by virtue of those criminal activities, more than $90 Billion dollars, violating many financial anti terrorism and banking federal laws like: the Public Law Number 107-56 (115 Stat. 272) known as Uniting and Strengthening America By Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT Act) Act of 2001; and the following criminal federal statutes: 18 USC §§ 471, 473, 494, 495, 657, 1001 to 1007, 1010 to 1012, 1033, 1034, 2314, 2315, 1952, 1956, 1957, 1961 to 1964 and 1968.

Currently, the Puerto Rico’s judicial and justice system is intimidating, coercing and threatening the life, security and liberty of all citizens who denounce that DOMESTIC FINANCIAL TERRORISM criminal scheme.

 

The Government of Puerto Rico and its accomplices are putting obstacles, and does not wish the Federal Government at Washington D.C. knows all the aforesaid clandestine enterprise.

 

Now then, once understood the general aspects, to understand more about the aforesaid DOMESTIC FINANCIAL TERRORISM criminal scheme, its basics facts and grounds are:

 

NUMBER ONE

 

Pursuant to various federal and local laws, since the date of May 1st, 1900, in the Commonwealth of Puerto Rico is prohibited to all the artificial (juridical) persons (like domestic or foreign private or public corporations, partnerships & trusts), that make businesses in the island, the act of to have, posses, acquire and/or control more than 500 acres of lands, and to dedicate to the business of buying and selling real estate in the island.

 

Those prohibitions are established in the Section Number 752 of the Title Number 48 of United States Code (48 USC § 752) [which is included in the Article Number 14 of Section VI of the Constitution of the Commonwealth of Puerto Rico].

 

Pursuant to the sections numbers 401 to 407, 421 and 431 to 435 of the Title Number 28 of the Puerto Rico Annotated Laws (28 PRAL secs. 401 to 407, 421 and 431 to 435), the violation of those prohibitions is typified locally as a felony punishable by imprisonment in jail for a term not exceeding ten (10) years or by a fine not exceeding one thousand dollars ($1,000) or by both penalties, at the court discretion (see the Appendix A).

 

NUMBER TWO

 

Pursuant those statutes, the sections numbers 3391 and 3432 of the Title Number 31 of Puerto Rico Annotated Laws (Puerto Rico Civil Code - 31 PRAL secs. 3391 and 3432) and the local jurisprudence, the criminal violation of those prohibitions has the effect to invalidate any legal contract product of it.

 

Pursuant to the Laws of Puerto Rico a contract has no existence when it is product of a crime and the cause (the consideration) is illicit (see the Appendix B).

NUMBER THREE

 

Pursuant to 18 USC §§ 1001, 1002, 1003, 1004, 1005, 1006, 1007, 1010, 1011, 1012, 1033, 1034, 2314 and 2315 the production of those criminal, illicit, unconstitutional, illegal and non existence contracts in order to produce and sell interstitially multiple illicit produced immovable or movables domestic properties configures (constitutes) the felony of FRAUD, which is an indictable criminal activity under the federal laws.

NUMBER FOUR

 

Pursuant to 18 USC §§ 471, 472, 473, 494, 495 and 657 the production of those criminal, illicit, unconstitutional, illegal and non existence contracts in order to produce and sell interstitially multiple illicit produced immovable or movables domestic properties configures (constitutes) the felony of FORGERY, which is an indictable criminal activity under the federal laws.

NUMBER FIVE

 

Pursuant to 18 USC §§ 1956 and 1957, the interstate transference of any unlawful (illicit) immovable or movables produced domestic properties, product of those criminal, illicit, unconstitutional, illegal and non existence contracts, product of those criminal violations, with the intention to conceal and clean its fraudulent origin, configures (constitutes) the felony of MONEY LAUNDERING, which is an indictable criminal activity under the federal laws.

NUMBER SIX

 

Pursuant to 18 USC §§ 1952, 1961 to 1964 and 1968 that interstate money laundering activity, practiced by corrupted organizations, configures (constitutes) the felony of RACKETEERING, which is an indictable criminal activity under the federal laws (RICO ACT).

NUMBER SEVEN

 

However the aforesaid, ignoring and violating intentionally, willfully and knowingly those prohibitions, the Government of the Commonwealth of Puerto Rico in conspiracy with the aforesaid parties, continues authorizing to hundreds of artificial (juridical) persons (like domestic or foreign private or public corporations, partnerships & trusts) the financing, development and selling of thousands of new and old illegal and fraudulent housing units urban projects (endorsing the prohibited businesses of buying and selling real estate in PR), making thousands of false, non existence and fraudulent public documents (purchase and sale and mortgage deeds contracts) with the intention to sell those false and non existent mortgage backed securities credits through the aforesaid mortgages secondary market institutions (GNMA, FNMA / Fannie Mae, Freddie Mac and FHLB), generating billions of dollars of illegal and criminal profits, using a fraudulent scheme of MONEY LAUNDERING, defrauding the U.S. Treasury and all states financial markets of our American Nation.

 

In other words, at present, various Puerto Rico financial institutions

are financing a $90 Billion dollar URBAN CRIMINAL OPERATION.

 

Again, don’t forget, the aforesaid new and old housing units projects are illegal because were developed and sold by juridical (artificial) persons (like domestic or foreign private or public corporations, partnerships & trusts) in violation of the section number 752 of the Title Number 48 of United States Code (48 USC § 752) [which is included in the Article Number 14 of Section VI of the Constitution of the Commonwealth of Puerto Rico], that prohibit to all domestic or foreign juridical persons making businesses in Puerto Rico the business of buying and selling real estate in Puerto Rico.

 

More clearly speaking, in Puerto Rico no domestic or foreign juridical person is authorized to conduct the business of buying and selling real estate.

 

Those prohibitions apply to all private and public juridical persons; and, its violation is typified as a criminal offense (felony) in Puerto Rico (see 28 PRAL secs. 401 to 407, 421 and 431 to 435).

 

We are talking about of the biggest real estate and mortgage

backed securities fraud in the history of the United States of America.

 

At present, the Puerto Rico's homebuyers are acquiring fraudulently thousands of new and old housing units (more than 800,000) without the properties titles, and, are paying DURING 30 YEARS thousands of false, fraudulent and non-existent mortgages.

 

As you can see, the home buyers are losing their all life savings capitals, because they are paying for nothing, and the American investors are losing their all life savings investments, because they are paying for a false, fraudulent and non existent monetary investment instrument (the mortgage bonds).

 

Again, in order to understand the scheme, is very important to clarify the following:

 

1.      The mortgage bond (mortgage backed security sold to the American investors through the aforesaid mortgage financial institutions) is false and non existent because the mortgage credit that backed the bond is false and non existent;

2.      The mortgage credit is false and non existent because the mortgage note and the deed where that credit was attempted to constitute was false and non existent;

3.      The mortgage deed is false and non existent because the property title where the mortgage was attempted to constitute was false and non existent;

4.      The property title (the purchase and sale deed) was false and non-existent because the contract where it was attempted to constitute as a contract never had existence. In other words, the transference of the immovable property (immovable transaction) never occurred legally;

5.      The contract never had existence because was a product of various white-collar felonies (like fraud and forgery of public documents). Pursuant the local laws a contract has no existence when is product of a crime and the cause (the consideration) is illicit;

6.      And those crimes occurred when the housing project developer, as the vendor, developed, constructed and sold the illegal urban housing project being a juridical person, violating the aforesaid local and federal statutes that prohibit the corporate business of buying and selling real estate in Puerto Rico.

NUMBER EIGHT

 

Also, ignoring and violating intentionally those prohibitions, the Government of Puerto Rico in conspiracy with the aforesaid parties, continues authorizing the development, financing and selling of others hundreds additional criminal urban projects developed by others hundreds artificial persons, holders of more than 500 acres of lands, violating such statutes by virtue of the aforesaid non existent, false and fraudulent public documents scheme, violating also the U.S. Supreme Court resolutions on: People of Puerto Rico v. Rubert Hermanos, Inc., 309 U.S. 543 (1940) and 315 U.S. 637 (1942).

 

Additional Remarks

 

Although the local and federal courts, and their Judges, know VERY CLEAR the illicit origin of the mortgages, they continue authorizing the foreclosure of them GENERATING A BIGGEST JUDICIAL REAL ESTATE MONEY LAUNDERING CRIMINAL ENTERPRISE. For those reasons, WE CAN SAY WITHOUT DOUBT that both public institutions: 1) are operating like a MAFIA using the judges and attorneys as GANGSTERS (Mobsters); 2) are RACKETEERS, MONEY LAUNDERERS and WHITE COLLAR CRIMINAL ENTERPRISES; and 3) INTENTIONALLY, ARE CONCEALING THE AFORESAID REAL ESTATE AND BANKING FRAUDULENT SCHEME to the Federal Government.

 

If the FDIC does not stop this fraudulent scheme, the U.S. Treasury will be affected. The FDIC should not assume the risks of their criminal clients and its illegal banking activities. As we know, the FDIC charges banks premiums for the insurance and can borrow funds from the U.S. Treasury when necessary to finance payouts. At this time, the FDIC is assuming the financial risks of various WHITE COLLAR CRIMINAL CLIENTS. Pursuant to 12 USC §§ 1811 to 1833e the FDIC has the powers to suspend or remove any financial institution’s affiliated party charged with felony. The section 1818(g) of the aforesaid legal code explains this procedure very clear. The FDIC also has the responsibility for liquidating banks who getting income (profits) from ILLEGAL and CRIMINAL OPERATIONS.

 

On the other hand, as we know, pursuant to the Inspector General Act of 1978, Public Law 95-452 (5 USC Appendix) and 42 USC §§ 3532 ~ 3535, the Office of the Inspector General (OIG) of the Department of Housing and Urban Development (HUD) has jurisdiction to investigate the aforesaid banking and white collar crimes, because the aforesaid secondary mortgages market institutions (GNMA, FNMA / Fannie Mae, Freddie Mac and FHLB) are regulated by them, specially GNMA. The HUD-OIG is obligated by LAW to inform these criminal practices to the U.S. Attorney General, Congress and the U.S. Department of the Treasury.

 

Due to the aforesaid, we can say without doubt,

that pursuant to the federal laws,

the GOVERNMENT OF THE COMMONWEALTH OF PUERTO RICO

and the local mortgage banking system

should be placed under a judicial receivership,

or simply, be eliminated (closed).

 
Appendix A

 

United States Congress Joint Resolution No. 23 of May 1, 1900, Sec. 3 / 31 Stat. 716

 

Sec. 3. That all franchises, privileges or concessions granted under section thirty-two of said Act shall provide that the same shall be subject to amendment, alteration, or repeal; shall forbid the issue of stock or bonds, except in exchange for actual cash, or property at a fair valuation, equal in amount to the par value of the stock or bonds issued; shall forbid the declaring of stock or bonds dividends; and, in the case of public-service corporations, shall provide for the effective regulation of the charges thereof and for the purchase or taking by the public authorities of their property at a fair and reasonable valuation. No corporation shall be authorized to conduct the business of buying and selling real estate or be permitted to hold or own real estate except such as may be reasonably necessary to enable it to carry out the purposes for which it was created, and every corporation hereafter authorized to engage in agriculture shall by its charter be restricted to the ownership and control of not to exceed five hundred acres of land; and this provision shall be held to prevent any member of a corporation engaged in agriculture from being in any wise interested in any other corporation engaged in agriculture. Corporations, however, may loan funds upon real estate security, and purchase real estate when necessary for the collection of loans, but they shall dispose of real estate so obtained within five years after receiving the title. Corporations not organized in Porto Rico, and doing business therein, shall be bound by the provisions of this section so far as they are applicable. Approved, May 1, 1900.

48 USC § 752

§ 752. Corporate real estate holdings

No corporation shall be authorized to conduct the business of buying and selling real estate or be permitted to hold or own real estate except such as may be reasonably necessary to enable it to carry out the purposes for which it was created, and every corporation authorized after May 1, 1900, to engage in agriculture shall by its charter be restricted to the ownership and control of not to exceed five hundred acres of land; and this provision shall be held to prevent any member of a corporation engaged in agriculture from being in any wise interested in any other corporation engaged in agriculture. Corporations, however, may loan funds upon real estate security, and purchase real estate when necessary for the collection of loans, but they shall dispose of real estate so obtained within five years after receiving the title. Corporations not organized in Puerto Rico, and doing business therein, shall be bound by the provisions of this section so far as they are applicable.

(May 1, 1900, No. 23, § 3, 31 Stat. 716; Mar. 2, 1917, c. 145, § 39, 39 Stat. 964; May 17, 1932, c. 190, 47 Stat. 158; July 3, 1950, c. 446, § 5(2), 64 Stat. 320.)

 

Article Number 14 of Section VI of the Constitution of the Commonwealth of PR

 

§ 14. Land holdings by corporations

 

No corporation shall be authorized to conduct the business of buying and selling real estate or be permitted to hold or own real estate except such as may be reasonably necessary to enable it to carry out the purposes for which it was created, and every corporation authorized to engage in agriculture shall by its charter be restricted to the ownership and control of not to exceed five hundred acres of land; and this provision shall be held to prevent any member of a corporation engaged in agriculture from being in any wise interested in any other corporation engaged in agriculture. 

 

Corporations, however, may loan funds upon real estate security, and purchase real estate when necessary for the collection of loans, but they shall dispose of real estate so obtained within five years after receiving the title. 

 

Corporations not organized in Puerto Rico, but doing business in Puerto Rico, shall be bound by the provisions of this section so far as they are applicable. 

 

These provisions shall not prevent the ownership, possession or management of lands in excess of five hundreds acres by the Commonwealth, its agencies or instrumentalities.

 

28 PRAL sections numbers 401 to 407, 421 and 431 to 435

 

§  401. Juridical person, corporation, and association, defined.

 

For the purposes of this Act, the term "[juridical] person" shall refer to private corporations, limited companies, societies, partnerships, joint-stock companies, voluntary associations (including community partnerships), business trusts, Massachusetts trusts, common law trusts, and any other form of corporate organization, or any other organization, partnership or entity created for the purpose of carrying out transactions or attaining specific objectives, which continue to exist regardless of the changes made among its members or among the persons participating in them, and whose affairs are managed either by one person only, or by a committee, a board, or any other group of individuals acting in a representative capacity, and any other association which is an [juridical] person. The term "corporation" or "association" shall include any association or organization, or corporative association or organization already incorporated, organized or constituted in any State of the United States, a foreign nation or Puerto Rico. The term "[juridical] person" shall include all associations, regardless of the form, kind, denomination, character or nature, and all cooperatives, except proportional-profit farms as described, established and authorized by this Act.

(Apr. 12, 1941, No. 26, p. 388, § 57; May 11, 1942, No. 197, p. 996, § 14, eff. 90 days after May 11, 1942.)

 

§  402. Holding of over 500 acres by juridical person prohibited; penalties; confiscation and sale; preference of Land Authority.

 

The acquisition, holding, or any other form of direct or indirect control of land in excess of five hundred (500) acres by any [juridical] person, as said term is defined in this Act, is hereby declared unlawful. This provision shall be applicable to any extension of land, which, jointly with such land as the acquirer may hold, possess, control or exploit at the time of the acquisition, aggregates over five hundred (500) acres. [Juridical] persons may, however, loan funds upon land security, and acquire land when necessary to collect loans, but they shall, within five (5) years after receiving the title thereto alienate such land as they may hold in excess of five hundred (500) acres. 

 

Actions filed for violation of this section shall be governed by the general provisions of the Code of Civil Procedure, and by the special provisions of the Quo Warranto Act, §§ 3391-3397 of Title 32, relative to corporations engaged in agriculture and holding land in excess of five hundred (500) acres; Provided, therefore, That when it should be established that an [juridical] person, as said term is defined in this Act, has performed acts in violation of the provisions of this section, the judgment shall, in case the defendant is a domestic corporation, decree the dissolution thereof, and in the case of a foreign corporation, the prohibition to continue doing business in the country; and the nullity of all acts done and contracts made by the [juridical] person; the cancellation of every entry or registration originated by same in the public registries of Puerto Rico; and a fine may be levied. 

 

The Commonwealth of Puerto Rico may, at its option, demand, in the proceeding itself, the confiscation in its favor of the real property of the defendant entity, or the alienation of said property at public auction within a period of not more than six (6) months reckoned from the date on which final judgment is entered. 

 

The confiscation or alienation shall in every case be made upon proper compensation in the manner established by the Condemnation Proceedings Law, §§ 2901-2913 of Title 32. The Supreme Court is hereby empowered to appoint receivers who, in behalf and with the approval of said Supreme Court, shall be exclusively in charge of the liquidation and sale of the property of the [juridical] person or persons affected. The receivers shall give preference in the purchase of land to the Land Authority of Puerto Rico, which shall hold preferential option for the fair value of the property fixed in the final judgment. The receivers shall have the duty of beginning the sale of the land within a period of not more than six (6) months after the receivership is established. The Land Authority shall have a preferential right to purchase said lands for their fair value within a period of not to exceed five (5) years, during which no sale may be made to any other person or entity. This period of five (5) years may be extended for another year on authority of the court on petition of the Authority. Upon the expiration of such period or periods, the land shall be sold at public auction. The Authority shall have priority or preference for the purchase of land at public auction in those cases where it bids a price equal to that bid by the highest bidder. And the edicts published shall so state. 

 

The violation, after a final judgment is entered, of an order prohibiting the doing of business, shall be punished by a maximum fine of five hundred (500) dollars for each day that the entity continues to exercise its functions, recoverable from the property of the entity; and the persons representing such entities shall be held in contempt of court punishable by a minimum penalty of imprisonment in jail for a term of from one (1) to six (6) months. 

 

For the purpose of fixing the value of the property, the Commonwealth of Puerto Rico is authorized to enter the property or holding the object of controversy. 

 

(Apr. 12, 1941, No. 26, p. 388, § 58; May 14, 1943, No. 160, p. 520; May 5, 1945, No. 57, p. 208.)

 

§  403. Institution of proceedings; evidence.

 

It shall be the duty of the Secretary of Justice of Puerto Rico to institute proper actions or proceedings against any [juridical] person engaged in agriculture in Puerto Rico which holds, controls or possesses, whether directly or through the instrumentality of any natural or [juridical] person, land in excess of five hundred (500) acres, or when there is reason to believe that such instrumentalities have been created and are utilized in a simulated or covert manner to violate and evade the above-mentioned land restriction; and the courts, upon substantiating such actions, shall have full discretion to receive evidence and to look beyond the form into the actual merits and essence of the case, taking into account the fundamental purpose of this Act and the public emergency which exists of preventing that the said restriction of land tenure be directly or indirectly infringed or violated. 

 

(Apr. 12, 1941, No. 26, p. 388, § 59, eff. 90 days after Apr. 12, 1941.)

 

§  404. Juridical persons considered engaged in agriculture.

 

There shall be considered as engaged in agriculture in Puerto Rico any [juridical] person which, directly or indirectly, plants, cultivates or harvests, or permits the planting, cultivating or harvesting of, agricultural products on lands belonging thereto, or held, owned or controlled thereby, as well as those which hold, possess or control, or are the owners of, lands devoted or that may be devoted to the planting, cultivating or harvesting of, agricultural products, or to any operation, activity or process relating to agriculture. 

 

(Apr. 12, 1941, No. 26, p. 388, § 60, eff. 90 days after Apr. 12, 1941.)

 

§  405. Penalties for concealing ownership, etc.

 

Any natural person making itself [sic] to appear as partner, shareholder, or owner, or holder of lands so as to conceal or serve as an instrument to an [juridical] person in violating the provisions restricting land tenure to five hundred (500) acres, or in violating this Act, shall be guilty of a felony and shall, upon conviction, be punished by imprisonment in the penitentiary for a term of from two (2) to ten (10) years, [at] the discretion of the court; and the lands of such [juridical] person actually possessing the title which it has been attempted to hide or conceal shall revert to the Commonwealth of Puerto Rico, and it shall be so pronounced in the judgment. Any individual forming part of an [juridical] person, or acting as agent or in representation of an [juridical] person, whenever such [juridical] person has been created for the express or implicit purpose of concealing the acquisition, alienation, holding, possession or exploitation of land in excess of five hundred (500) acres, or any [juridical] person directly or indirectly barred from so holding, or any person forming part of an [juridical] person actually concealing the acquisition, alienation, holding, possession or exploitation of land in excess of five hundred (500) acres, or who in any wise shall deliberately lend himself as an instrument to violate the agrarian policy set forth in this Act, shall be guilty of a felony and shall upon conviction, be punished by imprisonment in the penitentiary for a term of from two (2) to ten (10) years, [at] the discretion of the court; and the lands of such [juridical] persons which he may have thus attempted to conceal, shall revert to the Commonwealth of Puerto Rico, and it shall be so pronounced in the judgment. 

 

(Apr. 12, 1941, No. 26, p. 388, § 61, eff. 90 days after Apr. 12, 1941.)

 

§  406. Void contracts; agricultural partnerships.

 

Any conveyance of land by an artificial person as this term is defined in this Act, executed after this Act takes effect, for the purpose of evading the provisions and purposes hereof, and all contracts for extension of time executed by agricultural partnerships holding over five hundred (500) acres of land after this Act takes effect, shall be null and void, without need of judicial declaration to that effect; Provided, however, That in the case of agricultural partnerships holding over five hundred (500) acres of land, against which judgment by consent has been entered by the Supreme Court of Puerto Rico in proceedings instituted by the Commonwealth of Puerto Rico for their dissolution, and which, by reason of such judgment by consent, may have entered into negotiations with the Land Authority of Puerto Rico for the sale of their properties to said governmental agency, such partnerships may, with the consent of the Land Authority of Puerto Rico, extend their partnership contract for a term which in no case shall exceed two (2) years. The constitution, subsequent to the effective date of this Act, of new agricultural partnerships holding land in excess of five hundred (500) acres shall be null without intervention of judicial declaration therefore. 

 

(Apr. 12, 1941, No. 26, p. 388, § 62; May 11, 1942, No. 197, p. 996, § 15; May 15, 1947, No. 482, p. 1090.)

 

§  407. Self-incrimination of witnesses.

 

No person may refuse to appear as witness for the Commonwealth of Puerto Rico in any civil or criminal action instituted in compliance with the provisions of this Act under the pretext that his deposition might incriminate him, but the deposition thus made shall not be used against him in any proceeding or action, except such civil actions as may arise from the provisions of this Act or of any statute regulating land tenure. 

 

(Apr. 12, 1941, No. 26, p. 388, § 63, eff. 90 days after Apr. 12, 1941.)

 

§  421. Quo warranto and other pertinent proceedings.

 

There is hereby conferred upon the Supreme Court of Puerto Rico exclusive original jurisdiction to take cognizance of all quo warranto proceedings or any other pertinent proceedings that the Government of Puerto Rico may hereafter institute for violation of the provisions of § 752, Title 48, United States Code, and of the Land Law of Puerto Rico of 1941 in the matter of the holding of lands, and for that purpose it is provided that the violation of said provisions by any [juridical] person, as the term [juridical] person was defined by § 401 of this title, shall constitute sufficient cause to institute a proceeding of the nature of quo warranto or any other pertinent proceeding. 

 

(July 22, 1935, No. 33, p. 418, § 1; May 9, 1942, No. 172, p. 892, § 2, eff. 90 days after May 9, 1942.)

 

§  431. Illegal acts or contracts.

 

Every act or contract which in any form impairs, affects, or violates the provisions contained in § 3 of the Joint Resolution of the Congress of the United States, approved May 1, 1900, regarding the purchase, sale, or possession of real property, shall be illegal. 

 

(Aug. 7, 1935, No. 48, p. 536, § 1.)

 

§  432. Penalty against corporation.

 

Every corporation which openly, fraudulently, or by misrepresentation, or in any way acquires lands in violation of the provisions of § 3 of the Joint Resolution of the Congress of the United States, approved May 1, 1900, regarding the purchase, sale, or possession of real property, shall be guilty of a misdemeanor, and upon conviction, shall be punished by a minimum fine of five hundred (500) dollars and a maximum fine of one thousand (1,000) dollars. 

 

(Aug. 7, 1935, No. 48, p. 536, § 2.)

 

§  433. Penalty against persons.

 

Every person who, in any character, as official, notary, agent, intermediary, or otherwise, knowingly and with the deliberate purpose of violating the provisions of § 3 of the Joint Resolution of the Congress of the United States, approved May 1, 1900, regarding the purchase, sale, or possession of lands, directly or indirectly participates in any act or contract which in any way impairs, affects, or violates said provisions of the aforesaid Joint Resolution, shall be guilty of a misdemeanor and, upon conviction, shall be punished by a maximum fine of one thousand (1,000) dollars or by imprisonment in jail for a maximum term of one (1) year, or by both penalties, [at] the discretion of the court. 

 

(Aug. 7, 1935, No. 48, p. 536, § 3.)

 

§  434. Penalty for acquiring land for benefit of corporation; confiscation.

 

Every person who, by misrepresentation, acquires lands in his own name, for the use and benefit of any corporation, in violation of the provisions of § 3 of the Joint Resolution of the Congress of the United States, of May 1, 1900, shall be guilty of a misdemeanor punishable by a fine of not more than five hundred (500) dollars nor less than one hundred (100) dollars, or by imprisonment in jail for a term of not less than three (3) months nor more than one (1) year. The conviction of such person shall entail the confiscation of the property so acquired or held for the benefit of the Commonwealth of Puerto Rico, upon payment by the latter of a reasonable compensation. 

 

(Aug. 7, 1935, No. 48, p. 536, § 4.)

 

§  435. Cognizance of cases.

 

The Court of First Instance of Puerto Rico is hereby vested with exclusive original jurisdiction to hear, try, and decide all cases of violation of § 431-435 of this title, without right to a trial by jury. 

 

(Aug. 7, 1935, No. 48, p. 536, § 5.)

Puerto Rico’s Secretary of Justice Opinions

 

No corporation, doesn’t matter his nature, will be able to dedicate to the business of buying and selling real estate in Puerto Rico.

Op. Sec. Just. No. 6 of 1968

 

A corporation can not be dedicated to the business of buying and selling real estate, or, in any form, hold lands to speculate in the real estate market.

Op. Sec. Just. No. 15 of 1966

 

The corporations not engaged in agriculture are only limited by the first part of the statute of this section, that prohibit to all corporation effectuate businesses of buying and selling real estate or to hold or to have such class of assets except such as may be reasonably necessary to enable it to carry out the purposes for which it was created.

Op. Sec. Just. No. 70 of 1956

 

Appendix B

 

31 PRAL sections 3391 and 3432

 

§  3391. Requisites of contracts.

 

There is no contract unless the following requisites exist: 

 

(1) The consent of the contracting parties. 

(2) A definite object which may be the subject of the contract. 

(3) The cause for the obligation which may be established. 

 

(Civil Code, 1930, § 1213.)

 

§  3432. Contracts without consideration; illicit consideration.

 

Contracts without consideration or with an illicit one have no effect whatsoever. A consideration is illicit when it is contrary to law and good morals.

(Civil Code, 1930, § 1227.) 

PR’s Supreme Court Opinions regarding the validity and existence of contracts

 

Once consideration has been determined to be illicit the contract is void or non-existent. Sanchez Rodriguez v. Lopez Jimenez, 116 P.R.R. 172 (1985). 

 

Contract law in this jurisdiction is based on the premise that no contract exists where consideration is illicit or no consideration exists. Sanchez Rodriguez v. Lopez Jimenez, 116 D.P.R. 172 (1985). 

 

Where two contracting parties have engaged in illegal activities they are barred from filing claims against each other but this impediment does not apply to innocent third persons who did not participate in illegality. Sanchez Rodriguez v. Lopez Jimenez, 116 D.P.R. 172 (1985). 

 

Statute of limitations does not run against nonexistent situations. Sanchez Rodriguez v. Lopez Jimenez, 116 P.R.R. 172 (1985). 

 

There is no contract where there is no consideration or where consideration is illicit. Sanchez Rodriguez v. Lopez Jimenez, 116 D.P.R. 172 (1985); In re Las Colinas, Inc., 294 F. Supp. 582 (1968), reversed and remanded, In re Las Colinas, Inc., 426 F.2d 1005 (1970), affirmed, 453 F.2d 911 (1971), certiorari denied, Banco Popular de Puerto Rico v. Las Colinas, Inc., 405 U.S. 1067 (1972); Soto v. Feliciano, 80 P.R.R. 595 (1958); Monserrate v. Lopez, 80 P.R.R. 476 (1958); Guzman v. Guzman; Rodriguez, Int., 78 P.R.R. 673 (1955); Quintana v. Lejeune, 37 P.R.R. 682 (1928); Booth Packing Co. v. Sobrino & Bro., 34 P.R.R. 14 (1925); Aponte v. Garzot, 28 P.R.R. 586 (1920); Gonzalez v. Vilella, 24 P.R.R. 262 (1916); Rosado v. Rosado, 17 P.R.R. 447 (1911); Montilla v. Van Syckel, 8 P.R.R. 153 (1905); Cordova v. Santisteban Chavarri & Co., 7 P.R.R. 303 (1904). 

 

Illegal consideration in contracts results in nonexistence and nullity, not in grounds for rescission. La Sagrada Familia Cooperative v. Castillo, 107 P.R.R. 405 (1978). 

 

Substance of contractual object is particularly decisive quality thereof, which, if nonexistent or knowingly erroneous, would have resulted in parties not entering contract. La Sagrada Familia Cooperative v. Castillo, 107 P.R.R. 405 (1978). 

 

There are no prescriptive terms to challenge simulated non-existent actions having no juridical effect whatsoever. Garcia Lopez v. Mendez Garcia, 102 P.R.R. 383 (1974). 

 

When the consideration of a simulated contract is illicit, the latter is void and has no juridical effects. Hernandez v. Secretary of the Treasury, 86 P.R.R. 12 (1962). 

 

A simulated contract is wholly void and creates no right whatsoever. Hernandez v. Ayala, 68 P.R.R. 883 (1948).

 

 

These concerns need to be resolved before Puerto Rico become state of the union.

 

 

STATEMENT OF

LUIS G. FORTUŃO

GOVERNOR OF PUERTO RICO

BEFORE THE COMMITTEE ON ENERGY AND NATURAL RESOURCES

UNITED STATES SENATE

MAY 19, 2010

Thank you, Mr. Chairman…and Ranking Member Murkowski…for the opportunity to appear this morning before you and fellow members of this Committee to express my support of H.R. 2499, the Puerto Rico Democracy Act of 2009. I especially appreciate the opportunity to follow Puerto Rico’s sole elected representative in Congress, Resident Commissioner Pedro Pierluisi, who was my running mate in 2008.

Today, I appear before you as Governor of Puerto Rico and as President of Puerto Rico’s statehood party, which includes national Republicans like myself as well as Democrats like Resident Commissioner Pierluisi.

In the elections of 2008, voters gave candidates of our party the biggest margin of any electoral victory in 44 years. We obtained over two-thirds of the seats in each house of the legislature and three-fifths of the mayorships. The candidates in the “Commonwealth” party, by contrast, received the lowest percentage of votes for their party in history.

This is particularly relevant because the process proposed by H.R. 2499 was an issue in the elections. Our party campaigned on a pledge to seek congressional sponsorship of a status choice process…in order to provide a choice among real status options to be made…directly by voters…in plebiscites.

Why does Congress need to act? Because there is a patently obvious need for the territory’s real options to be clarified. Under the present status…given Congress’ constitutional jurisdiction under the Territory Clause…Congress can provide the necessary clarification. Specifically, previous political status plebiscites without federal legislation…in the first two instances, at the end of the 1960s and the beginning of the 1990s…were inconclusive because of proposals for an unconstitutional and impossible governing arrangement. The most recent plebiscite…12 years ago…was similarly confused by such a proposal.

For decades, the leaders of the “Commonwealth” party– including those of that party’s delegation here today – have refused to recognize the reality that the only possible “Commonwealth” option that exists is the one that is the island’s current territory status.

H.R. 2499 simply clarifies what the possible status options for Puerto Rico are: continuation of the current territory status that goes by the name of “Commonwealth”, independence, nationhood in free association with the United States and statehood.

What is not included in the legislation…and what is the real reason for the “Commonwealth” party’s persistent objections to the bill… is this impossible “Commonwealth” status proposal that is not the current status [holding up copy].

Under this proposal of theirs, Puerto Rico would be permanently empowered to nullify federal laws and court jurisdiction. The island would also be empowered to enter into international agreements and organizations requiring national sovereignty. The proposal also includes a new subsidy for the government of the island, and incentives for companies in the States to locate plants in Puerto Rico. But wait, there’s more. The proposal also further includes all current federal program assistance to individuals, and U.S. citizenship would be perpetually guaranteed.

A wise member of this Committee once called this proposal “the free beer and barbeque option.” Members of the Senate should…once again… join their counterparts in the House in clarifying that such proposals are not a possible status option.

In doing so, Mr. Chairman, you and your colleagues would do well to join Congresswoman Virginia Foxx…who in a letter to myself and Resident Commissioner Pierluisi last week did just that. Congresswoman Foxx clarified that the “Commonwealth” option contained in her amendment to H.R. 2499…which was approved by the full House…is…and I quote…”the status quo, under which Puerto Rico is subject to federal Territory Clause authority.”

As Congresswoman Foxx further made clear, her amendment’s intention was not to endorse the legal viability or practical possibility of…and I quote once again…”’a new Commonwealth status’ which would grant Puerto Rico greater autonomy from federal authority with greater federal benefits.” With your permission, Mr. Chairman, I would like to submit Congresswoman Foxx’s letter for the record, along with my entire written testimony.

Mr. Chairman, what H.R. 2499 essentially does is authorize a process…at the discretion of Puerto Rico’s elected representatives…that would begin with threshold votes on whether to consider status options. This responds to the “Commonwealth” Party argument that the status question should not be addressed. Only if a majority of voters no longer favors the current status…and Puerto Rico’s elected representatives agree… would there be a second-stage vote on the full range of possible options. If a majority of voters in a threshold plebiscite do not want to consider Puerto Rico’s status options, the issue would be put aside for eight years.

If a second-stage vote does take place, the current status would stand equally alongside the other possible status alternatives that have support in Puerto Rico: free association – which is advocated by an increasing number of members of the “Commonwealth” Party, although not the current leadership; independence; and statehood. In terms of measuring support for Puerto Rico’s possible status choices, H.R. 2499 could not be any fairer.

In sum, H.R. 2499 would enable the preferences of Puerto Ricans…among the real status alternatives…to finally be ascertained. The legislation would not mandate any action in response by the federal government. If there ever is a majority of the vote for a status different than the present one, it is then that Federal officials could determine what response is appropriate. An accurate expression of status preferences by the people is the necessary first step.

Last month, members of the House took the right step. I urge you to do the same. By so doing, you will be effectively responding to the people of Puerto Rico’s clear mandate for a federally sanctioned status choice process. You will also fulfill Congress’ responsibility to enable a territory that lacks democracy at the national government level to determine if it wants one of the options for national government democracy.

Mr. Chairman, over the course of more than a century, millions of your fellow American citizens in the territory of Puerto Rico have made countless contributions to the Nation, both in peace and wartime. Thousands of our sons and daughters have laid down their lives…thousands more proudly serve today…in defense of American democratic values. Yet, we have never been given the chance to express our views about our political relationship with the Nation in the context of an accurate, fair and democratic process sponsored by Congress. This bill will, at long last, give us that chance. What could be more right?

Thank you very much.