5 Charged in Check Scheme Based on ‘Freemen’ Classes

Federal agents arrested Montana “freemen” associate M. Elizabeth Broderick and four alleged accomplices Thursday, capping a six-month multi-agency investigation into the fiery tax resister who authorities say raked in $1.5 million from a phony check scheme.

Federal prosecutors contend that Broderick, 52, has donned the mantle of the burgeoning “patriot movement” to fleece thousands of mostly blue-collar clients by selling allegedly worthless checks, perhaps stashing the money in foreign banks.

Broderick maintains that the checks are “comptroller’s warrants,” backed by liens she has lodged against the government.

By arresting Broderick and four others Thursday, prosecutors said they forestalled a possible plan to sell Broderick’s allegedly worthless “liens” to foreign governments.

At her detention hearing, Broderick--her voice hoarse and trembling--said that the court had no jurisdiction over her and threw the 30-count grand jury indictment to the floor.

After prosecutors said Broderick was planning to flee the country, U.S. District Court Magistrate Judge Virginia Phillips ordered her held without bail.

Broderick, who has renounced her U.S. citizenship, calls herself the “Lien Queen” and claims to be a virtual bank that can write checks. She has been charging people up to $200 each to attend seminars in Lancaster and elsewhere, teaching them to use the “warrants,” inspired by Montana tax resister LeRoy Schweitzer, according to the indictment.

The FBI arrest of Schweitzer on similar federal bank fraud charges sparked an ongoing standoff with his armed “freemen” followers, who are surrounded by federal agents on a Montana ranch.

The homemade checks are worthless, FBI Special Agent in Charge Charlie Parsons said, but the money Broderick takes in--she accepts only cash, certified checks and money orders--is not.

“She’s painting this beautiful picture: ‘Come to me, I’ll share my wealth, and you’ll be debt-free,’ ” Parsons said at a Thursday morning news conference after Broderick’s arrest. “But there’s nothing noble about the ‘Lien Queen.’ ”

In a series of sweeps beginning before 7 a.m., federal agents arrested Broderick at her Palmdale house, then her alleged assistant Adolph Hoch and Hoch’s 31-year-old daughter, Laura Marie Hooey, at their Riverside County homes.

Also arrested were Barry Switzer, who allegedly paid his rent on a Canyon Country house with Broderick’s checks, and Reseda chiropractor Julian Cheney, who allegedly tried to pay his tax bill with Broderick’s checks. All are scheduled to be arraigned Monday.

A Canadian immigrant, Broderick moved to California after running at least three illegal pyramid schemes in Colorado, authorities say. After the California attorney general’s office, without filing charges, shut down another alleged pyramid scheme in 1993, Broderick fell in with a group of novel legal thinkers in the “patriot movement.”

Federal officials say Schweitzer and his “freemen” followers engaged in a multimillion-dollar scheme to defraud their creditors using homemade checks. Broderick added a new wrinkle, the indictment alleges--charging admission to regular classes where she distributed forms good for one check. She charges $100 extra for additional checks, the indictment alleges.

Switzer, Hoch and Broderick were ordered held at the Metropolitan Detention Center without bail. Bail will be set for Cheney at a hearing today, and Hooey was released pending $25,000 bail.