Ahab is confused as to why Liberty Dollars are illegal. At first I thought this was another case of the federal government acting outside its authority, but after more research I’m not sure. While I will still say that they should find better use of resources than picking on Liberty Dollars, the Liberty Dollar does appear to be in violation of federal law. The article mentions:
The U.S. Mint recently issued a statement saying “prosecutors with the Department of Justice have determined that the use of these gold and silver NORFED ‘Liberty Dollar’ medallions as circulating money is a federal crime.”
“Consumers who are considering the purchase or use of these items should be aware that they are not genuine United States Mint bullion coins and they are not legal tender.”
That would imply they are being charged under Title 18, Chapter 25 of the United States Code, titled “Counterfeiting and Forgery”. They certainly aren’t guilty of counterfeiting, but my guess is that they are probably being charged under this:
Section 486. Uttering coins of gold, silver or other metal
Whoever, except as authorized by law, makes or utters or passes, or attempts to utter or pass, any coins of gold or silver or other metal, or alloys of metals, intended for use as current money, whether in the resemblance of coins of the United States or of foreign countries, or of original design, shall be fined under this title or imprisoned not more than five years, or both.
It says the coins were of gold and silver, so I’m guessing these guys are nailed. The power to mint currency is one reserved to Congress, so you can’t really argue that it’s outside the federal government’s purview.
UPDATE: Just noticed there’s more about this over at Reason. It seems to me that the argument that because you had to use federal reserve notes to pay for your liberty dollars, that they were fraudulent, seems off base to me. I have to use federal reserve notes to buy video game tokens, poker chips, or various other substitutes for currencies. Are these fraud as well? I will read through the affidavit. But it seems to me the only thing they could be guilty of, based on the limited information I have, is utterance of silver or gold coin.
UPDATE: After reading through the affidavit, I agree there is evidence of fraud.Â It seems they were allegedly making claims that their currencies were backed 100% by silver, when that was not, in fact, the case.Â There is also accusations of fraudulent marketing practices and such.