Consumer complaint received 2023-07-25
Company: GFS II, LLC
State: GA
Product: Debt collection
Sub-product: Auto debt
Issue: Attempts to collect debt not owed
Sub-issue: Debt was paid

Complaint:
Around or about XXXX  of XXXX I applied to purchase a XXXXXXXX XXXX XXXX I was financed by a company by the name of GFS II AKA/DBA GATEWAY FINANCIAL to complete this transaction. I paid A cash down Payment of {$1000.00} and despite me being the original creditor and upholding my end of the contract GATEWAY FINANCIAL Repossessed and sold said property belonging rightfully to me. Since said transaction occurred GFS has been reporting to the Credit bureaus that the account is delinquent and has a {$24000.00} balance with original amount being {$10000.00} and charged off. 
Notice, it is a fact, affiant is aware, in accordance with 15 U.S.Code 1662 ( b ) it is illegal to require a downpayment in conjunction with any extension of consumer credit unless the downpayment is in that specific amount for every transaction. I the affiant have reason to believe and do so believe, the down payment amount was unique to my transaction and therefore illegal to require as part of the transaction and thus should be remitted by { COMPANY NAME } if it was paid or not required by { COMPANY NAME } to avoid violation of 15 U.S.Code 1662 ( b ) and be liable to double the finance charge under 15 U.S.Code 1640 ( a ) ( 2 ) ( A ) ( i ).

According to 15 U.S. Code 1602 ( f ) It is a fact, I affiant am aware, the term credit means the right granted by I, the original creditor, to a debtor GSW to defer payment of the debt or to GATEWAY FINANCIAL SOLUTIONS to incur debt or a loan from the US Treasury and defer its payment.

This makes GSF a borrower or solicitor who induced me to the treasury window to receive funds unbeknownst to I, at the time of the transaction. I, the affiant, came to extend credit and not receive a loan from the U.S. treasury. The contract I received, as a result, was an unsolicited advertisement described in 48 U.S.C 227 ( a ) ( 5 ) by GATEWAY FINANCIAL and lack of willful full disclosure was the fraud of execution in conjunction with fraud of inducement brought forth by GFS.

In conjunction pursuant to 15 U.S. Code 1602 ( g ) creditor refers only to a person, meaning not the organization but only a natural person, meaning I, the affiant and the consumer, who regularly extends consumer credit, in connection with loans, sales, property or services payable by agreement which a finance charge may or may not be required or the natural person whom the debt arising from the consumer credit transaction which may be payable on the face of the evidence of indebtedness such as a contract or by agreement.

Pursuant to 15 U.S. Code 1602 ( i ) a consumer in reference to a credit transaction is the party whom credit is extended from is a natural person and the subject of the consumer credit transaction is primarily for personal, family, or household purposes.

Whereas I am fully aware that when I deposited the Promissory note with GFS, the original bookkeeping entry showed an increase in the amount of the asset credited on the asset side of its books and a corresponding increase equal to the value of the asset on the liability side of its books. This would show that GFS received my signed promise to repay as an asset, thus monetizing ( securitizing the note ) my signature and creating on its books a liability in the form of a demand deposit or other demand liability of the bank. 
I am also fully aware Securitization is the process by which promissory notes are turned into securities or bonds and then sold to investors. The purpose is to provide a large supply of money to lenders for originating loans and to provide investments for bond holders. The procedure for selling the notes is to create a situation whereby tax laws are observed, and whereby the issuing entities and the lender are protected from either entity going into bankruptcy. In order to achieve this bankruptcy remoteness, numerous True Sales of the loans occur, in which the loans are sold and transferred to different parties during securitization. 
I am fully aware that a True Sale of the loan would be a circumstance whereby one party owed the note and then sold it to another party. An offer would be made, accepted, and compensation given to the seller in return for the note. The note would be transferred, and the security agreement assigned to the buyers of the Note, with an assignment or transfer made every step of the way, and furthermore, each note would be endorsed to the next party by the previous assignee or transferee of record. 

I am fully aware that Auto loans have been and are being bundled into auto loan asset backed securities and sold to the public as solid, income-producing debt investments similar to corporate bonds. Theyre marketed as secure products offering above-average interest. But while a bond may be backed by an issuing companys income and assets, these auto loan assets backed securities products are backed solely by a pool of auto loans. The loans are bundled, and the rights to receive the payments generated by the loans are sold to investors. The investors receive a monthly payment of principal ( to repay the borrowed money ) and interest, or coupon, which is the interest rate paid on the bonds. 
Since the note has been securitized and given to a trust to provide a stream of income for investors ( me ), it follows that the Note will be voluntarily destroyed by bifurcation and any depositors will be paid. As a matter of law, where the payee and the owner of the promissory note have voluntarily destroyed the same, he can not recover judgment against the maker either upon the note itself or upon the debt, which was the consideration for which the note was given. See, e.g., Booth v. Smith, 3 Woods, 19 XXXX XXXX XXXX XXXX XXXX XXXX. Term XXXX ). Once converted and sold, it is impossible for a promissory note and Security Agreement to ever be whole again existing as a negotiable instrument. That is to say, once converted into a stock/security ( or securitized ), that act of conversion impairs the validity and enforceability of a promissory note. It is destroyed and ceases to be a secure asset or negotiable instrument tied to any collateral or debt obligation. In essence, the note is destroyed and thereby, under multiple rulings, is nullified, and the underlying evidence and legality of the debt obligation secured by the note is voided whether or not the obligation has been paid. See e.g. District of Columbia v. XXXX, 130 U.S. 655 ( 1889 ), State Street Trust Co. V. Muskogee Electric Traction Co. 204 ( 1953 ) The Security is/are not backed by the Security agreement because when the note is bifurcated from the Security Agreement or otherwise voluntarily destroyed at the time of conversion to securities, the security agreement is either satisfied or nullified. There are no other eventualities. 

Notice, it is a fact, affiant is aware, whoever willingly and knowingly gives, false, inaccurate or fails to provide information which is required to disclose, or fails to comply with any requirement under the consumer credit protection title will be held to criminal liability pursuant to 15 U.S. Code 1611 with fines up to {$5000.00}, one year imprisonment or both.

Company response to consumer: Closed with explanation