Independent currency producer and opponent of the Federal Reserve Board’s inflationary monetary policy Liberty Dollar raided as the constitutionality of non-governmental currency circulation comes to the forefront.
Federal Agents have raided the corporate headquarters of Indiana based currency producer Liberty Dollar, seizing company records, equipment and inventory following authorization from an United States District Court Judge.
It is yet unclear if charges have been filed in the case, however a statement posted on the US Mint’s website indicates that officials there view Liberty Dollar’s issuance of 100% gold and silver backed currencies to be in violation of the US Constitution, specifically Article 1, Section 8, Clause 5, which reads “The Congress shall have the power to coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures.”
As the wording of the clause does not address currencies distributed by private individuals or establishments, the Mint also cited federal statue 18 U.S.C. § 486, which reads “Whoever, except as authorized by law, makes… any coins of gold or silver…intended for use as current money… shall be fined under this title or imprisoned not more than five years, or both.”
The constitutionality of that law will likely be addressed should the Liberty Dollar case be brought to trial, as the Constitution does not clearly indicate who by law is permitted to produce currency outside of the expressly authorized Congress.
According to the monetary architect of Liberty Dollar, Bernard von NotHaus, the inflationary policies of the United States Federal Reserve Board have caused the value of the US Dollar to lose 96% of its purchasing power since the creation of the FED in 1913, generating a need for an alternative, commodities backed currency.
Liberty Dollar’s website reports that currently as much as $20 million of the independent currency is in circulation with as many as 100,000 users. Interestingly, variations of the coinage include $1, $20 and $1,000 coins baring the likeness of Republican Presidential Candidate Ron Paul, a current member of the US House of Representatives Financial Services Committee.
Paul’s Presidential platform includes a condemnation of the FED’s inflationary policies similar to NotHaus’s, however in a statement made to the Associated Press the campaign’s spokesman Jesse Benton indicated that Paul is not affiliated with the company nor was his permission requested for the use of his likeness on the coins.
Liberty Dollar encourages that If you are owed an order and want to get your money back, or have paper certificates or digital Liberty Dollars, that you demand redemption or the return of your money by joining a Class Action Lawsuit favoring the company’s activities. More information on the lawsuit can be obtained from their website.
Derek is a college student majoring in Business Management and History. You can visit his blog here or email him at dgetbnn@gmail.com.
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3 users commented in " Liberty Dollar Raid Calls to Question Constitutionality of Independent Currency "
Follow-up comment rss or Leave a Trackbacke constitution was written and itended to outline and restreict the powers of government, not people. Any private individual is free to create his own currency and trade it with someone else. Can I not trade an ounce of silver with you for something you own of value?
“There is no law that says goods and services must be paid for with Federal Reserve Notes. Parties entering into a transaction can establish any medium of exchange that is agreed upon.”
- Andrew Williams, Spokesman for the Federal Reserve in Washinton, DC
As far as the USC Title 18 is concerned, visit http://www.NoCriminalCode.US/ . Not saying it is true, but you would think this is something that can be easily proved in court. It will be interesting to see what happens.
Logically, why would anyone prefer the constantly devaluing dollar over a commodoties backed currency? Surely this raid was just an attempt to eradicate a strong competitor to the Federal Reserve note.
I’ve heard that there are several countries in the world whose currencies are backed by commodoties. Does anyone know if this is true and if so, what are those currencies?
I think the raid was timed to both eliminate a competitor which had a chance of at least providing a little bit of relief from the currency devaluation the FRN’s are currently in and also to discourage other would-be currency competitors from entering the business. It doesn’t matter whether the Feds eventually have to give everything back to Liberty Services. What matters is that they have dealt a blow to an instrument that potentially posed a real danger to the dollar, at this very precarious time in which the dollar is to be destroyed. The Feds want no monetary saviors popping up. The ALC was a good idea, but they they made some mistakes, such as keeping everything too centralized, using too-similar wording on the coins and certificates to the dollar, etc. I wrote to Bernard when he asked for offers on the CEO position (which was eventually filled and then open again) both times that position was available and asked him to incorporate Zcoins ideas into the ALC, but I was never considered for the position. In hind sight, I’m glad I wasn’t. Still, though, it’s too bad for those who lost money and hope on this company. The Feds will surely drag their feet as much as possible on this. 100,000 Liberty Dollar Associates just standing around doing nothing is a waste. Hopefully, some other organization will step in to fill the void left by Liberty Services, so that the monetary reform heat on the Feds is not let up.
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