Researchers such as Eustace Mullins and G. Edward Griffith have long claimed that our Federal Reserve system is not a division of our Federal Government but instead a privately owned corporation. The Federal Reserve system consists of a central bank and twelve regional Federal Reserve Banks. There is no question that the Federal Reserve' Open Market Committee plays a critical role in establishing the United States monetary policy. The Federal Reserve's own website (hosted as a government owned website with the “.gov” suffix explains that the open market committee is:
“the group that makes the key decisions affecting the cost and availability of money and credit in the economy.” A recently reported federal court case sheds light on the nature of the Bank. See Fourth Corner Credit Union v. Federal Reserve Bank of Kansas City, U.S.D.C. Colorado (2016).
Most people are unwilling to even consider that the agency charged with control of the nation's money supply could be privately owned. However, a recent federal court case speaks to the nature of the ownership of the regional federal reserve banks. The case arises from the State of Colorado as a result of that state's legalization of recreational marijuana use. A number of marijuana distributors were unable to secure banking services. The problem arises from a federal law that makes it a crime to transport or transmit funds that are known to have come from marijuana sales.
A group of pro-marijuana activists formed a credit union in order to provide banking services to marijuana dispensaries. The credit union applied for a master account with the Federal Reserve Bank of Kansas City but their application for that account was denied. The credit union then filed suit against the Kansas City Regional Federal Reserve. Because the law governing suits against federal government agencies differ from the rules for suing private corporations, the nature of the Federal Reserve Bank was in issue. The court was presented with an affidavit from a bank vice president that stated unequivocally that the bank was a private corporation and not a government agency.
The decision makes clear that the Regional banks who largely comprise the Federal Open Market Committee are nothing more than private owned businesses. The larger issue is why we have ceded control over our federal money supply to a group of private bankers.