Trouble With Collectors

I got a call from my bank today that's put me on edge. It appears I am behind on a loan I took out from said bank about eight months ago. I talked to a kind man who was interested in listening to my excuses for not paying. Here is a partial transcript of out conversation:

Me: I intend to pay you back. I just can't right now.

Him: When do you think you'll be able to make a payment?

Me: How do I know? Who am I? Nostodamus?

Him: Of course. Can you tell me what the money was used for?

Me: Certainly. I used it for several projects. Spread it around if you will.

Him: I see. Can you give me some examples?

Me: Well, I spent some of it to build a park in Stonerville.

Him: There's no such town as Stonerville in North Dakota.

Me: I also spent a lot of money planting trees in Haiku City.

Him: Again, there's no such place.

Me: Oh, and thanks to me there's now a fountain in the town square in Chuff's Bluff.

Him: THERE'S NO SUCH PLACE.

As you can probably tell, the bank wasn't too impressed with my explanation of where the money went. This, even though I presented them with a website on which I detailed every penny. For some reason, I am not allowed to just make up numbers and present them as fact. The bank has begun the collections process on the loan and I may be going to prison.

You may not feel sympathy for me. After all, who takes someone's money, spends it like a Bahrainian teenager (look it up) and can't account for it? In fact, who does that and then makes up bullshit numbers to explain how it was used?

You know who does that.

Three questions:

Why is this okay?

If this is how the government handles accounting, why would you trust it with any more money than absolutely necessary?

Can you float me a loan for bail? I promise to pay you back after I finish paying for that statue of Ayn Rand in Boobsen Butte.