WeRe Bank

{{Scam}}
{{Economics}}
'''WeRe Bank''' is a scam company that claims to be a bank. Founded by self-proclaimed [[freeman]] Alan Peter Smith (aka Peter of England or PoE),<ref>{{cite web|last=Eder-Kornfeld|first=Rosa|title=Das Geld aus dem Nichts|date=24 February 2016|language=de|publisher=Wiener Zeitung|url=https://web.archive.org/web/20160225093945/http://www.wienerzeitung.at/nachrichten/wirtschaft/oesterreich/802745_Das-Geld-aus-dem-Nichts.html|accessdate=24 May 2017}}</ref> victims pay him [[United Kingdom|British]] pound sterling and enormous promissory notes (£150,000) in exchange for fake, fraudulent cheque books that pay out money in what has been described by an impartial observer as "imaginary energy units".<ref name="tmw">[http://www.ombudsman-decisions.org.uk/viewPDF.aspx?FileID=104875 Financial Ombudsman Service, DRN8341979]</ref> These are then supposed to be used to settle debts.

In case you were wondering, this scheme doesn't work.

==The concept==
WeRe Banks’ website used to be hosted at <code>www.werebank.com</code>, before moving to <code>www.werebank.co.uk</code> for some reason possibly being related to it being nothing more than an elaborate fraud. According to the Financial Ombudsman Service, its explanation for how its service worked was as follows:

{{quotebox|WeRe Bank’s principal trading asset is called the Re. It is a unit of space and time and has Value as it is “exchangeable” or “trade-able.” Units are created through expenditure of effort over time and we hold these units “on account” and pay them out to our customers.

When people join they will receive a cheque book to help them create their own money. They sign a promissory note up to the value of £150,000 which is then transferred into their account. They can then write cheques, drawing on that £150,000, to pay their public liabilities &mdash; HMRC, VAT, Council Tax, Speeding and Motoring Fines, Mortgage repayments, Credit card bills, all court fines and utilities. Private payments can be made between consenting parties.<ref name="tmw"></ref>}}

{{quotebox|WeRe Bank does NOT have cash in it's vaults and neither does it deal with legal tender in the form of "notes and coins". WeRe Bank transfers, to the PAYEES bank, “bank ledger”, “cheque-book money” or “monetary unit of account.” WeRe Bank transfers money [see definition of money] from the account of the WeRe Bank customer to the PAYEES bank/branch via the simple process of “informing them that the ledger, on our side of the “double entry book keeping system” has been debited (-ve) and as energy CANNOT DISAPPEAR [this would violate The Laws of Conservation of Energy as classically defined] then a corresponding positive (+ve) charge must accrue to their side of the ledger.{{sic}}<ref name="tmw"></ref>}}

To translate this into non-bollocks language:

* You sign a note promising to pay WeRe the sum of £150,000 on demand. You also send a monthly subscription in cash to them in pound sterling.
* In exchange, WeRe sends you a cheque book.
* WeRe cheques are legal tender and therefore are as good as cash.
* You send these cheques to people you owe money to and hope that they or their bankers are credulous enough to accept cheques drawn on a bank they've never heard of.
* In the event that they are that credulous, the cheques are "paid" by the process of deducting "Re" &mdash; a form of energy which doesn't actually exist &mdash; from a Re account held in your name at WeRe Bank. The concept is thus that due to conservation of energy, by deducting Re energy from your account then that energy has to go somewhere, and that somewhere is the payee of the cheque; and due to the mechanics of double-entry bookkeeping, any debit they input at their side must be matched with a credit somewhere else.

===The reality===
*  The cheques bear invalid clearing details. In fact, the sort code (bank identifier) on the cheques is the WeRe Bank's founder's date of birth backwards. This means that even if WeRe did have the funds to pay out on the cheques, which they don't, they'd still never be paid.
* Banks and local authorities are aware of the WeRe scam and will intercept the cheques.<ref name="devon">http://www.quatloos.com/Q-Forum/viewtopic.php?p=213613#p213613</ref> The UK's financial regulator has warned against accepting them or signing up for them as the company is not authorised to conduct any banking business (while also noting that the company doesn't actually conduct any authorised banking business, which should ring alarm bells).<ref name="fca">[https://www.fca.org.uk/news/consumer-notice-were-bank Financial Conduct Authority Consumer Notice &mdash; WeRe Bank]</ref>
* Cheques aren't legal tender to begin with,<ref name="devon"/> let alone ones that only pay out in imaginary energy.
* The cheques will bounce because the "Re" energy unit is completely made up and no bank accepts payment for debts in imaginary energy.
* The one kernel of reality however is that not only is your cash actually gone, but that promissory note is apparently '''actually legally binding'''.<ref name="valid">From the TMW decision: "Mr O has signed a contract in the form of a promissory note to pay WeRe Bank £150,000. I don’t know if WeRe Bank will ever call in the promissory note. But I’ve looked at the template on its website and it seems to me to create a legally binding obligation on Mr O to pay the money if WeRe Bank demands it."</ref>

The whole thing is also based on a hilarious twisting of what "double entry accounting" means. The theory is that by "debiting" a ledger on WeRe's side, then spontaneously a "credit" must be input on some other entity's ledgers, or else something will be out of balance that will need to be corrected. Technically this is indeed how it works... but only within a single set of ledgers. You cannot just say "I have debited myself £1,000,000" to make someone else's ledger credit itself with £1,000,000, and you doing so does not compel them to create a matching transaction absent some other sort of legal obligation. There is nothing particularly magical about accounting records that makes them spontaneously affect other peoples' accounting records.

WeRe Bank has apparently opted out of the usual SWIFT money transfer system and instead has devised its own, hilariously called SPIT and SWALLOW. Really.<ref name="blow">"WeRe Bank isn’t a member of the Society for Worldwide Interbank Financial Telecommunication [“SWIFT”] system for inter-bank transfer of electronic funds. This is the system used globally by banks to transfer funds. Instead, WeRe Bank has invented its own systems – SPIT (Secure Protocol Information Transaction) and SWALLOW (Secure Waygate – Allow)"</ref>

As pointed out by numerous people, WeRe are themselves not stupid enough to accept their own cheques as payment for their services. They want good old hard currency posted to them. That should be a warning sign.

== Case study ==
Despite this being transparent bullshit, people have actually fallen for the WeRe Bank scam. The Financial Ombudsman Service's resident freeman woo spotter Jan O'Leary{{efn|As noted on the [[mortgage invalidity]] page.}} wrote a long decision describing WeRe bank and the mechanism by which they purport to work. It's worth reading in full simply to see what it looks like when a serious person has to remain calm and composed when describing the most egregious bullshit they've ever seen; it's positively dripping with contempt for WeRe and anyone who thinks it might work.{{fact}}

Mr and Mrs O sent their mortgage lender a WeRe Bank cheque for £67,500 to settle their mortgage account. Oddly enough, it wasn't accepted, and Mr and Mrs O decided to complain about this. Some choice quotes from the poor person who was stuck investigating this:

{{quotebox|WeRe Bank members are told they can write ‘cheques’ drawn against the promissory note to pay off their ‘public’ debts. But WeRe Bank has no money to pay the ‘cheques’. All it has are the promissory notes signed by members each agreeing to pay WeRe Bank £150,000 in the future. Unless and until those promissory notes are called in and actually paid by the members, WeRe Bank has no assets.}}

{{quotebox|In the circumstances, I’m satisfied TMW is under no obligation to accept a ‘cheque’ from WeRe Bank. My reasons for concluding this are:

* creditors are entitled to be paid in legal tender;
* cheques are not legal tender;
* creditors aren’t obliged to accept cheques in payment of a debt;
* WeRe Bank isn’t a bank, and so has no authority to issue cheques;
* WeRe Bank ‘cheques’ have no value, as there are no funds available to pay them;
* TMW isn’t obliged to accept payment in the form of a unit of energy;
* '''imaginary energy units are not a form of currency and they do not pay debts'''}}

{{quotebox|I’ve noted Mr O’s analogy about paying his gardener with a watch worth £50. I agree with him that if a creditor agreed to accept payment by some other method than cash, such as goods to the value of the debt owed, then retention and use of the goods by the creditor may well constitute acceptance of that method of payment.

But the problem I have with Mr O’s analogy is that TMW has not agreed to accept payment in Re. In fact, Re has no value and the ‘cheque’ is a worthless piece of paper.

A more appropriate analogy is if Mr O was to give his gardener a Post-it Note saying “This is my payment for £50. Phone the number written here and you’ll get paid”. The gardener phones the number and is told “I’ve deducted £50 worth of energy from Mr O’s account, so you’ve been paid”. But the gardener hasn’t been paid at all, he’s not agreed to be paid in energy, he doesn’t have his £50, he just has a Post-it Note that has no value. He is still owed £50 and entitled to be paid in legal tender.<ref name="tmw"></ref>}}

Oddly enough the complaint wasn't upheld.

==See also==
*[[Bitcoin]]
*[[Mortgage invalidity]], a similar pie-in-the-sky scheme to get rid of your debt that doesn't work

==External links==
*[https://web.archive.org/web/20151023181536/https://www.werebank.com/ WeRe bank as it existed before the energy disappeared (Archive.org, October 13, 2015)]
*{{unref|https://www.werebank.co.uk/|WeRe bank in its current form, with the usual Freeman woo||}}

==Notes==
{{reflist|group=note}}

==References==
{{reflist|2|80%}}

[[Category:Economics]]
[[Category:Pseudolaw]]

Categories: Economics, Pseudolaw