'Liberty Dollar' Promoter Convicted of Making Illegal Coins

There are lots of ways to make money, as long as you don't actually print or mint it yourself. That's a lesson that four co-conspirators in North Carolina and Indiana recently learned the hard way.

Last month, the founder and “monetary architect” of an illegal currency known as the Liberty Dollar was convicted in North Carolina on federal charges of making illegal coins and selling them—at a profit—to compete with legal U.S. currency.

Bernard von NotHaus, of Evansville, Indiana, was found guilty of making coins resembling U.S. coins; issuing, passing, selling, and possessing Liberty Dollar coins; issuing and passing Liberty Dollar coins intended for use as current money; and conspiring against the United States. Three others indicted in the case are awaiting trial.

“People understand that there is only one legal currency in the United States,” said Owen Harris, then-special agent in charge of our office in Charlotte. “When groups try to replace it with coins and bills that don’t hold the same value, it affects the economy. And consumers were using their hard-earned money to buy goods and services, then getting fake goods in return.”

It all began in 2004, whenFBI agents inCharlotte learned that a customer at a North Carolina financial institution had tried to use silver coins that were not legal U.S. currency.

Furtherinvestigation revealed that the coins came from the National Organization for the Repeal of the Federal Reserve and Internal Revenue Codes (or NORFED), headquartered in Evansville, whose mission was to return the country’s monetary system to gold and silver. The president of the organization was von NotHaus, who marketed his currency as inflation-proof, claimed it was backed by silver and gold, and said it could be used to compete with—and limit reliance on—U.S. currency.

An undercover investigation found that NORFED had contracted for the minting of about $7 million worth of Liberty Dollars in Idaho. The organization also took orders and payments from customers for Liberty Dollars and organized “Liberty Dollar University” sessions to help educate people interested in selling, buying, or using the currency. There was even a Liberty Dollar website.