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Dear Friend of GATA and Gold:
The federal raid on the Liberty Dollar organization
was the product of an elaborate undercover operation and was based on a claim
that Liberty Dollar's products were "intended for use as current
money" in violation of Title 18, Section 486, of the United States Code.
The government's complaint is outlined in the raid's
seizure warrant affidavit, which was temporarily disclosed by accident in
U.S. District Court in Charlotte,
North Carolina, and then posted
on the Internet by vigilant libertarians. The affidavit can be found here:
http://www.johnlocke.org/site-docs/meckdeck/pdfs/USAVLibdoll.pdf
The government's complaint also alleges that Liberty
Dollar's marketing practices justify charges of mail fraud and money
laundering.
But the government's main objection seems to be what
it considers excessive similarity between government-issued coins and what
Liberty Dollar calls its medallions, which, the government contends, causes
the medallions to be mistaken for government currency.
This case will be important for its bearing on
constitutional law and individual rights to possess and trade in gold,
silver, and copper, even as it may turn on the issue of likeness. Liberty
Dollar might be in a stronger position if it did not use the word
"dollar" or the dollar sign on its medallions and instead
denominated its medallions only by weight in metal. Still, it is hard to see
how people could be deceived into thinking that the Liberty Dollar products
are issued by the government and are legal tender "for all debts, public
and private," rather than devices for barter.
In any event Bill King, editor of The King Report,
may have had the most telling observation on the controversy: that the
government would have had no problem with the Liberty Dollar organization if,
like the wildly unregulated gangsters in the Wall Street financial houses, it
had been pushing collateralized debt obligations instead of honest money.
A Washington Post Weblog
story that disclosed the libertarians' posting of the Liberty Dollar raid
affidavit is appended.
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
* * *
In Ron Paul Coins,
Federal Agents Don't Trust
By Alec MacGillis
Washington
Post
Friday, November 16, 2007
http://blog.washingtonpost.com/the-trail/2007/11/16/post_203.html?hpid=t...
As if Ron Paul's supporters needed any more
motivation to storm the battlements and wreak havoc on the Republican
presidential primary, now comes this: The feds are trying to take away their
money.
Federal agents on Wednesday raided the Evansville,
Indiana, headquarters of the National Organization for the Repeal of the Federal
Reserve and Internal Revenue Codes (NORFED), an organization of "sound
money" advocates that for the past decade has been selling what it calls
Liberty Dollars, a private currency it says is backed by silver and gold
stored in Idaho, with a total of more than $20 million in circulation,
according to the group.
NORFED officials said yesterday that the raid
occurred just as they were preparing to mail out the first batch of about
60,000 "Ron Paul Dollars," copper coins sold for $1 and decorated
with the craggy visage of Paul, the libertarian Texas congressman, Iraq war
opponent and sound-money advocate who has sparked a surprisingly vigorous
insurgent campaign for the GOP nomination. The group says that it in recent
months it already shipped out about 10,000 in silver Ron Paul dollars that
sold for $20.
Bernard von NotHaus, NORFED's founder and executive director, said in an
interview from his home in Miami Friday night
that his employees in Evansville
had received the copper dollars late last week and managed to mail out only
about 3,500 of them so far. After a six-hour raid, he said, the agents left
with the rest of the coins, which weighed about two tons total, as well as
smaller amounts of silver Ron Paul dollars, gold Ron Paul dollars that sell
for $1,000 and platinum Ron Paul dollars that sell for $2,000. There was a
separate raid, NotHaus said, of Sunshine Mint in Coer D'Alene,
Idaho, a company that prints
the organization's coins, where von NotHaus said
agents seized the huge pallets of silver and gold worth more than $1 million
that the organization says back the paper certificates issued to its
customers.
"They took everything, all of the computers,
everything but the desks and chairs," said von NotHaus,
who says he served 25 years as the mintmaster for
the Royal Hawaiian Mint. "The federal government really is afraid."
The Indianapolis
branch of the FBI declined to comment on the raid and referred calls to the
U.S. Attorney's office for Western North Carolina in Charlotte. That office's spokeswoman, Suellen Pierce, also declined to comment. But bloggers at the libertarian Reason Foundation posted
on-line a 35-page copy affidavit for a search warrant filed last week with
the Western District in Asheville
laying out the government's case against NORFED. Pierce said that the search
warrant in the case had been accidentally made public by a court clerk and
has since been sealed, under court rules.
In the affidavit, an FBI special agent states that
he is investigating NORFED for federal violations including "uttering
coins of gold, silver, or other metal," "making or possessing
likeness of coins," mail fraud, wire fraud, money laundering and
conspiracy. "The goal of NORFED is to undermine the United States
government's financial systems by the issuance of a non-governmental
competing currency for the purpose of repealing the Federal Reserve and
Internal Revenue Code," he states.
The agent states that the investigation started two
years ago. And the U.S. Mint a year ago issued a warning against using the
Liberty Dollar, prompting a lawsuit by NORFED. But that has not kept Liberty
Dollar fans from speculating on-line that the raid was prompted by Paul's
strong campaign -- which recently raised more than $4 million in a single day
-- or by the precipitous recent decline in the value of the dollar.
A Paul campaign spokeswoman, Kerri Price, said
yesterday that while Paul also supports abolishing the Federal Reserve, the
campaign "does not have any affiliation with Liberty Dollars at
all." von NotHaus confirmed this, saying that
he knows Paul because they "move in the same circles" but that he
had expressly not talked with Paul about his plans for the special coins so
as not to violate federal election rules.
But the coins have been another rallying point for
Paul's supporters, who have asked Paul to pose for photographs with the coins
on the campaign trail. Jim Forsythe, a Paul organizer in New
Hampshire who ordered 150 of the copper Ron Paul dollars, said
yesterday that the seizure of the coins would likely fuel more support for
Paul, who scores close to double-digits in some New Hampshire polls. "People are
pretty upset about this," he said. "The dollar is going down the
tubes and this is something that can protect the value of their money and the
Federal Reserve is threatened by that. It'll definitely fire people up."
Von NotHaus, meanwhile, is
urging Liberty Dollar supporters to express their outrage by donating to
Paul, saying on the group's Web site that "in light of this assault on
our financial freedom, it is clear that we need Ron Paul to lead this country
more than ever." He said that all of his bank accounts have been frozen
and that he expects that a federal indictment will soon be in the offing,
saying that "once the federal government starts an investigation like
this and takes it to a grand jury, they can indict a ham sandwich." Should
he be charged, he said, "I'll turn it into my golden opportunity to
validate the Liberty Dollar as a legal lawful currency and save the country
from a monetary collapse."
What he's most concerned about for now, though, is
the thought of all his customers waiting for their Ron Paul dollars. "People
aren't going to get their orders, and they aren't going to get them for a while,"
he said.
That is good news, of course, for those already
holding the coins. On eBay, the silver Ron Paul dollars that were purchased
for $20 were selling for more than $170 last night.
Chris Powell
Secretary / Treasurer
Gold Anti-Trust Action Committee
www.GATA.org
Join GATA here:
Vancouver Resource
Investment Conference
Sunday-Monday, January 20-21,2008
Vancouver, British Columbia,
Canada
http://www.cambridgeconferences.com/
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