A UCC-1 is a “financing statement” that creditors file with the Secretary of State to evidence a lien on against non-real estate, usually goods sold to a merchant at wholesale and put into inventory by the merchant for sale to the merchant’s customers.
An example: I sell tires at retail as the XYZ Tire Store in a small city in NY. You are my wholesale supplier and sell me 2000 tires a month (which, as you can imagine, have a substantial value) on credit. You want to take some step to be sure you are paid so you can, by law, file a UCC-1 with the NY Secretary of State generally indicating that you have sold me $500K in tires and, by virtue of the filing of the UCC-1 you are claiming a security interest in the tires.
The UCC-1 won't interfere with the XYZ Tire Store’s ability to sell the tires to retail customers. However, if the XYZ Tire Store declares bankruptcy, you have a lien against those tires, meaning you can get your tires back and they won’t be sold off in the bankruptcy to pay the XYZ Tire Store’s other creditors.
SOVEREIGN CITIZENS AND THE UCC-1
The Sovereign Citizen (SC) movement has attempted to highjack the legal meaning and purpose of the UCC-1 to somehow create the alter-ego of the “person” of a SC and thus make the person (the living, breathing person who claims to be a SC) somehow immune from his or her responsibilities as a citizen . . . to pay taxes, register cars, and even answer to criminal charges, claiming the state and federal government lack jurisdiction over them (I prosecuted one when I was a federal prosecutor; he was convicted and served 33 months in federal prison). The “beliefs” the SCs tout are bizarre and are designed, in my view, to keep SCs from having to pay their fair share of the tax burden living in our society and reaping the benefits of that society imposes on all of us. Some SCs go the extra step of committing frauds and then using their misguided beliefs to avoid the consequences of committing their frauds (which was what the guy I prosecuted tried to do). A full explanation of the bizarre beliefs of SCs, even if I felt comfortable in trying to outline them (and I don’t), would take pages. And these beliefs change constantly so SCs can use then to try to deal with yet another situation their actions as a SC got them into.
THE FILING OF A UCC-1 BY AN INDIVIDUAL (YOU)
I infer (and if I am wrong, I apologize) that you got the idea for filing a UCC-1 from someone touting SC malarkey. And if that’s the case, read on.
You can “file” a UCC-1 by putting some (probably bogus) information on it and mailing it the Secretary of State of your state along with the filing fee. Probably the Secretary of State will take your money and file it.
An individual who “files” a UCC-1 out of the blue or out of left field in this fashion, as I infer you are thinking about doing, gains no benefit . . . let me repeat that . . . no benefit . . . from filing a UCC-1, and, if anything, you may draw the attention of law enforcement to yourself. You aren’t in the business of selling goods on credit. You haven’t sold any goods on credit, no one owes you money for goods you sold them on credit. In short, you may as well just fill a UCC-1 and paste it to your forehead. It’s effect will be the same as it would be if you filed it with the Secretary of State . . . none, and it will make you look silly.