Bogus Checks And Balances Run Amok Freeman Drafts Drawn On ‘New Federal Reserve’ Are Spreading Nationwide

1996, The Spokesman-Review

The bogus check-writing scheme that led the FBI to the freemen’s remote enclave on Monday is cropping up nationwide.

Hundreds of people have traveled to the Eastern Montana outpost called Justus Township to learn how to pay off tax bills, mortgages and credit cards with checks issued by the freemen.

The checks and warrants supposedly are backed by judgments and common-law liens the freemen have filed against state and local governments and public officials.

The freemen claim they are the new Federal Reserve Bank and reject all government authority.

“They don’t believe in the laws of the state of Montana or the United States of America,” said Garfield County Attorney Nick Murnion, who considers the freemen domestic terrorists.

No one knows how many thousands of dollars of checks have been issued by the freemen and their followers.

Authorities estimate that as many as 600 to 800 people have attended regular classes at Justus over the past several months to promote the check scheme.

Interviews and a “proof packet” distributed by the freemen show the checks are being issued coast to coast. The packet, given to people who attend the classes, contains copies of letters, checks and other documents.

People have used the checks to buy hundreds of dollars of merchandise from L.L. Bean and pay off at least one home mortgage with Fleet Bank, a major East Coast lender, the documents show.

Some check writers are overpaying their debts with the phony checks and getting cash refunds:

A Texas man who attended the freemen’s course paid off three years of delinquent federal income taxes with a $57,073 check, then got a $4,156 IRS refund.

One Kansas farmer attended the classes before paying off his MasterCard for twice the amount owed. He claims the Bible commands freemen to pay their creditors two-fold.

“They (bankers) need to read their own banker’s handbook and see that this is entirely legal under the Uniform Commercial Code,” explained farmer Kenneth Thorne, of York, Kan.

Another Justus Township check accompanied a $1.4 million order for weapons and ammunition to outfit a 200-member militia. Federally licensed firearms dealer Cajun James of Eureka, Mont., said he didn’t ship the order because the check bounced.

In Fridley, Minn., a freeman graduate mailed the state a $13,000 check for delinquent alimony owed his ex-wife. He got back a $5,712 refund.

The freemen have been led by LeRoy Schweitzer, a pilot who ran a crop-dusting business near Colfax south of Spokane until the mid-1980s.

He signed most of the checks - variously called comptroller’s warrants or certified banker’s checks. In Garfield County, they’re commonly called “LeRoy checks.”

“This is where the law starts, right here. Everybody else is below,” Schweitzer said during a training session that was videotaped. A copy of the tape was obtained by The Spokesman-Review.

“This is American self-governing. It’s American national law here. It doesn’t have much to do with the United States,” he said.

“We are the clearinghouse, the new Federal Reserve.”

The freeman movement emerged in 1992, shortly after Schweitzer attended a “We the People” course in Montana taught by Roy Schwasinger, of Fort Collins, Colo.

Schwasinger was offering a $300 class, promoting theories about U.S. currency being worthless. He said citizens could file damage claims to collect their share of $600 trillion in gold that he claimed had been secretly collected in a covert U.S. military operation.

The scheme led to a Colorado state indictment in January 1995 against Schwasinger, who is serving a 15-year prison term for threatening Texas judges. Two other people who were indicted with Schwasinger fled Colorado early this year to avoid trial.

Russell Landers and Dana Dudley moved in with the Montana freemen.

In February, Landers and Dudley filed liens against the Colorado judge who handled the fraud case. The judge issued warrants for their arrests and set their bonds at $1 million apiece.

Counting Landers and Dudley, 11 fugitives have been holed up at the township. Three or four wives of freemen and at least two children also live there.

Justus Township is loosely comprised of a half dozen ranch homes on farmland perched at the edge of the Missouri River breaks, about 40 miles northwest of Jordan.

It’s about 120 miles north of the Little Bighorn Battlefield, where the federal government lost the most famous Indian battle in history.

At the township’s entrance, duct tape holds together a computer-generated warning sign emblazoned with a hangman’s noose.

“All trespassers all subject to seizure of all property and up to one year in jail. That means you,” the sign reads.

Authorities believe the freemen recently built a jail in the basement of one of the houses.

On a recent wintry day, freemen stood watch in a late-model Chevrolet Suburban, parked on a hilltop near the township entrance.

Authorities said they believe the freemen recently bought new vehicles from a dealer in the Southwest with “LeRoy checks.”

Until last fall, the freemen were in several locations in Eastern Montana.

Garfield County Sheriff Chuck Phipps said the situation grew more dangerous last September when Schweitzer and township clerk Rodney Skurdal left their cabin hideout near Roundup, Mont., and moved 100 miles to Jordan.

There, they joined the extended families of Ralph and Emmett Clark and William Stanton, whose war with the government can be traced to farm foreclosures in the 1980s.

Two ranches controlled by the freemen have been sold at foreclosure auctions, and the new owners are eager to take possession.

“We’re going to be seeding wheat, barley and oats on our new land in April,” said Tim Phipps, who bought Stanton’s foreclosed ranch.

Stanton is serving a 10-year state prison term for participating in the 1994 freeman takeover of the Garfield County courthouse. During that incident, about a dozen freemen held their own common-law court session for two hours in Jordan before returning to the township.

Stanton’s wife, Agnes, refused to leave the family home and hasn’t paid the new owner rent. Her son, Ebert Stanton, serves as deputy clerk and deputy marshal for the township.

Authorities said Schweitzer clearly was the ringleader of the freemen.

“I view LeRoy Schweitzer as being the guy who calls the shots out there,” said County Attorney Murnion, who has received death threats from the freemen.

Schweitzer, 57, calls himself “chief justice” of the township and answers the telephone there by saying, “Montana State Supreme Court.”

Other freemen serve as marshal, court clerk, notary and justice of the peace.

Schweitzer had already been named in a 48-count federal indictment for illegally flying an aircraft in Idaho. He avoided arrest on that indictment since 1992.

He and the other freemen haven’t granted interviews, and twice stopped and robbed ABC News and Associated Press journalists at gunpoint on a county road near the township entrance.

But the videotape of Schweitzer’s training session and documents issued by the freemen provide insight into the group. The video shows Schweitzer with a gun strapped to his waist and lecturing a small group of people.

The freemen contend their township includes the new Montana State Supreme Court, the new Federal Reserve Bank and the kind of common-law rights the U.S. Constitution intended.

Much of the township philosophy embraces Christian Identity religious beliefs, centering on the supremacy of the white race.

The term “freeman” means “lawful man,” as compared to a slave or a “freedman,” the group’s literature says.

The ideology centers on the notion that government can’t infringe on the individual and common law rights. It’s similar to ideas promoted by Posse Comitatus groups in the Northwest and Midwest in the 1980s.

One day soon, Schweitzer pledged on the videotape, the freemen may grab a county truck or cop car and sell it at auction to help satisfy the freemen’s $100 million lien against Garfield County.

Any “public hireling” who interferes will get a year in solitary confinement - “no exceptions,” Schweitzer said.

The checks his group issues, he said, are written against default judgments from the township court system and common law liens against government entities.

“It’s as if (U.S. Supreme Court Justice) Sandra Day O’Connor and her crew had signed it,” Schweitzer boasted, waving one of his documents.

The township notary seal on many documents is accompanied by the signer’s fingerprint.

At one point on the video, a student asks Schweitzer whether he isn’t afraid authorities might attack with the National Guard.

Boasted Schweitzer: “We’re not going to get raided.”

, DataTimes ILLUSTRATION: 3 Color Photos 2 Graphic: 1. Freemen arrested 2. How the check scheme works

MEMO: This sidebar appeared with the story: History A history of the Montana freemen: Mid-1980s - Ralph Clark, William Stanton and other Garfield County, Mont., farmers begin falling behind on farm loan payments. Lenders start foreclosing on land the families owned for generations. The disaffected farmers ultimately form the nucleus of the freeman movement. Sept. 8, 1992 - Rodney Skurdal, battling the IRS over $29,000 in back taxes, files his first do-it-yourself court documents at the Musselshell County Courthouse in Roundup, Mont. Two days later he files a “Citizens Declaration of War” - a document affixed with a private court seal and embossed with Skurdal’s fingerprint. He and tax protester LeRoy Schweitzer live in a log home near Roundup and call themselves freemen. Oct. 22, 1992 - Skurdal files a “Declaration of Independence” as a member of “the Tribe of Dan of the lost sheep of the House of Israel.” The document says he has “full, absolute power to contract and establish commerce.” October and November 1992 - A group calling itself “We the People” and its leader, Roy Schwasinger, hold $300 seminars in Billings and Great Falls to teach people how to get their share of $600 trillion in gold they claim is being held by the government. Schweitzer, Stanton and Clark attend. Late 1992 and 1993 - Other people in northeastern Montana start calling themselves freemen and file liens and court documents like Skurdal’s. Jan. 27, 1994 - Skurdal and Stanton are among two-dozen freemen who take over the Garfield County Courthouse in Jordan for two hours. They set up their own common law court and videotape the session. March 16, 1994 - The Garfield County prosecutor obtains felony arrest warrants for freemen involved in the courthouse incident. April 1, 1994 - Two freemen plead guilty to the charges. Stanton is scheduled for trial, but the rest fail to appear and become fugitives. June 1994 - IRS agents seize an airplane owned by Schweitzer for non-payment of taxes. The plane is found hidden on the ranch of Ralph Clark, near Jordan, Mont. Feb. 10, 1995 - Stanton is convicted of terrorism for the courthouse takeover, and of writing a $25,000 bogus check to the Garfield County treasurer. He later is sentenced to 10 years in prison. Feb. 21, 1995 - The mayor of Cascade, Mont., Tom Klock, deposits $20 million worth of bogus money orders, notarized by Skurdal, in a Cascade bank. He later proclaims himself a freeman and declares Cascade is a “common law jurisdiction.” March 3, 1995 - Seven men sympathetic to the Montana freemen are arrested in Roundup and charged with plotting to kidnap a judge or other public officials. The charges are later dropped against the “Montana Seven.” Sept. 28, 1995 - Skurdal and Schweitzer leave their Roundup home and move 120 miles north to the Ralph Clark ranch, where he and other freeman fugitives are staying. The freemen create their own government and call it Justus Township. Oct. 2, 1995 - An ABC-TV crew trying to film near Justus are robbed at gunpoint by freemen of $66,700 worth of television equipment. March 25 - Authorities arrest Schweitzer and freeman Daniel E. Petersen.