In the spirit of full disclosure I have included the FBI post directly from the website. When you read you will see that the fraud they are referring to regards individuals associated with the sovereign citizen movement (?) (I’m not aware that any movement exists so that must be a name they coined). They have successfully prosecuted people who are actually threatening other individuals with physical harm or violence and using the bonding process offensively to acquire property – to purchase travel conveyances or lien judges. My understanding is that this process is used to eliminate debt.
You’ll notice no one has been prosecuted that uses this process defensively.
Redemption / Strawman / Bond Fraud
Proponents of this scheme claim that the U.S. government or the Treasury Department control bank accounts—often referred to as “U.S. Treasury Direct Accounts”—for all U.S. citizens that can be accessed by submitting paperwork with state and federal authorities. Individuals promoting this scam frequently cite various discredited legal theories and may refer to the scheme as “Redemption,” “Strawman,” or “Acceptance for Value.” Trainers and websites will often charge large fees for “kits” that teach individuals how to perpetrate this scheme. They will often imply that others have had great success in discharging debt and purchasing merchandise such as cars and homes. Failures to implement the scheme successfully are attributed to individuals not following instructions in a specific order or not filing paperwork at correct times. This scheme predominately uses fraudulent financial documents that appear to be legitimate. These documents are frequently referred to as “bills of exchange,” “promissory bonds,” “indemnity bonds,” “offset bonds,” “sight drafts,” or “comptrollers warrants.” In addition, other official documents are used outside of their intended purpose, like IRS forms 1099, 1099-OID, and 8300. This scheme frequently intermingles legal and pseudo legal terminology in order to appear lawful. Notaries may be used in an attempt to make the fraud appear legitimate. Often, victims of the scheme are instructed to address their paperwork to the U.S. Secretary of the Treasury. Tips for Avoiding Redemption/Strawman/Bond Fraud:
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Be wary of individuals or groups selling kits that they claim will inform you on to access secret bank accounts.
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Be wary of individuals or groups proclaiming that paying federal and/or state income tax is not necessary.
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Do not believe that the U.S. Treasury controls bank accounts for all citizens.
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Be skeptical of individuals advocating that speeding tickets, summons, bills, tax notifications, or similar documents can be resolved by writing “acceptance for value” on them.
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If you know of anyone advocating the use of property liens to coerce acceptance of this scheme, contact your local FBI office.
Sovereign Citizen Movement
Domestic terrorism—Americans attacking Americans because of U.S.-based extremist ideologies—comes in many forms in our post 9/11 world. To help educate the public, we’ve previously outlined two separate domestic terror threats—eco-terrorists/animal rights extremists and lone offenders. Today, we look at a third threat—the “sovereign citizen” extremist movement. Sovereign citizens are anti-government extremists who believe that even though they physically reside in this country, they are separate or “sovereign” from the United States. As a result, they believe they don’t have to answer to any government authority, including courts, taxing entities, motor vehicle departments, or law enforcement. This causes all kinds of problems—and crimes. For example, many sovereign citizens don’t pay their taxes. They hold illegal courts that issue warrants for judges and police officers. They clog up the court system with frivolous lawsuits and liens against public officials to harass them. And they use fake money orders, personal checks, and the like at government agencies, banks, and businesses. That’s just the beginning. Not every action taken in the name of the sovereign citizen ideology is a crime, but the list of illegal actions committed by these groups, cells, and individuals is extensive (and puts them squarely on our radar). In addition to the above, sovereign citizens:
- Commit murder and physical assault;
- Threaten judges, law enforcement professionals, and government personnel;
- Impersonate police officers and diplomats;
- Use fake currency, passports, license plates, and driver’s licenses; and
- Engineer various white-collar scams, including mortgage fraud and so-called “redemption” schemes.
Sovereign citizens are often confused with extremists from the militia movement. But while sovereign citizens sometimes use or buy illegal weapons, guns are secondary to their anti-government, anti-tax beliefs. On the other hand, guns and paramilitary training are paramount to militia groups. During the past year, we’ve had a number of investigative successes involving sovereign citizens. A few recent cases:
- In Sacramento, two sovereign citizens were convicted of running a fraudulent insurance scheme. Operating outside state insurance regulatory guidelines, the men set up their own company and sold “lifetime memberships” to customers, promising to pay any accident claims against their “members.” The company collected millions of dollars, but paid out very few claims. More
- In Kansas City, three sovereign citizens were convicted of taking part in a conspiracy using phony diplomatic credentials. They charged customers between $450 and $2,000 for a diplomatic identification card, which would bestow upon the holder “sovereign” status—meaning they would enjoy diplomatic immunity from paying taxes and from being stopped or arrested by law enforcement. More
- In Las Vegas, four men affiliated with the sovereign citizen movement were arrested by the Nevada Joint Terrorism Task Force on federal money laundering, tax evasion, and weapons charges. The investigation involved an undercover operation, with two of the suspects allegedly laundering more than a million dollars from what they believed was a bank fraud scheme. More
You can help. First, “be crime smart”—don’t fall for the bogus claims and scams of sovereign citizens. And second, if you have information on any suspicious activities or crimes, please contact us.
Treasury Inspector General for Tax Administration: Fact Sheet on Sovereign Citizen Movement
Filed under: Concepts, Rebuttal, Rebuttal
§ Sovereign Sources 