Feds go after $7m-worth of silver 'Liberty Dollars' after maker is convicted on counterfeit charges

By Daily Mail Reporter      

Last updated at 12:12 AM on 5th April 2011

Federal prosecutors are planning to take ownership of $7million worth of silver “Liberty Dollars” that they say was invented by an Indiana man to compete with U.S. currency.

Bernard von NotHaus, 67, from Indiana, was last month convicted of conspiracy and counterfeiting charges for making and selling the currency, which he touted as inflation-proof competition for the U.S. dollar.

More than five tons of Liberty Dollars and precious metals was seized from a warehouse and the Feds now want to take them by forfeiture.

Von NotHaus’s lawyer Aaron Michel is appealing against the conviction, saying von NotHaus did nothing wrong because he didn’t try to pass the Liberty Dollars off as U.S. currency.

Von NotHaus began issuing Liberty Dollars in 1998. Nine years later the headquarters of his group, the National Organization for the Repeal of the Federal Reserve and Internal Revenue Code, were raided, along with the Sunshine Mint in Coeur D’Alene, Idaho, where the coins were made.

Federal prosecutors successfully argued that von NotHaus was trying to pass off the silver coins as U.S. currency.

Liberty Dollars come in denominations of 5, 10, 20, and 50. The money features a dollar sign, the word “dollar” and the motto “Trust in God,” similar to the “In God We Trust” that appears on U.S. coins.

After von NotHaus was convicted, U.S. Attorney Anne Tompkins said: ‘Attempts to undermine the legitimate currency of this country are simply a unique form of domestic terrorism.’

Von NotHaus argued that it’s not illegal to create currency to privately trade goods and services.

He also has said his organization took pains to say the Liberty Dollars shouldn’t be called “coins” and shouldn’t be presented as government-minted cash.

The Liberty Dollars were a means to help keep currency in local communities by creating networks of merchants and consumers who used the money, he said.

Several regions all over the U.S. have experimented with local currency, but laws restrict them from looking like U.S. bills or from being passed off as money printed by the government.

The concerns raised by von NotHaus and his group resonate among some state lawmakers. About a dozen states have legislation that would allow them to produce their own currency backed by gold or silver in the event of hyperinflation striking the U.S. dollar.

Von NotHaus’s organisation has been followed for years by the Southern Poverty Law Centre, a group that tracks political extremism.

Before the government began its investigation into von NotHaus, Southern Poverty Law Centre was raising concerns about the popularity of Liberty Dollars among fringe groups on the Far Right.

Mark Potok, a spokesman for the group, said: ‘He’s playing on a core idea of the radical right, that evil bankers in the Federal Reserve are ripping you off by controlling the money supply.

‘He very much exists in the world of the anti-government patriot movement, whatever he may say. That’s who his customers are.’

Von NotHaus is free on bond. If the conviction against him is upheld, he faces up to 25 years in prison and a fine of $750,000. No date has been set yet for his sentencing