Undercover 'supply sergeant' helped bring down Alaska militia

In another life, William Fulton was "Drop Zone Bill," a bounty hunter who ran a military surplus store in Anchorage. You need a tactical vest? A bayonet that would clip neatly onto an M-4? Bill Fulton was your man.

"We do bad things to bad people," his company jackets said.

Fulton was also a go-to guy for Republican politicians who occasionally needed to reach out to the far right fringes of the party — those who spent weekends in the woods in camo gear and considered the 2nd Amendment an expression of divine intent.

When then-Alaska Gov. Sarah Palin was plotting a move against the Republican Party chief at the state convention in 2008, Fulton was there strategizing over whiskey and cigars with Palin staffer Frank Bailey and Joe Miller, who later made a well-publicized run for the U.S. Senate as a tea party conservative.

That was the meeting where Fulton was introduced to Schaeffer Cox, an up-and-coming young firebrand of the far right who was running for the state Legislature and had, as it turned out, plans that went well beyond upending the Republican Party in Alaska.

It was a meeting that opened the door to a dangerous cat-and-mouse game that would transform the two men's lives and leave them at opposite ends of one of the federal government's biggest prosecutions of right-wing extremism on the West Coast.

Cox, 28, was sentenced Tuesday to 25 years in prison for heading a militia that plotted to kill judges and other government employees and conspired to accumulate the firepower needed to do it from Fulton. And Fulton, who became one of two key informants the FBI used to gather evidence against Cox and his cohorts, went from being the Alaska Peacemakers Militia's "supply sergeant" to its most celebrated snitch.

Today, Fulton, 37, is nowhere to be found in Alaska.

The very moment that Cox and his associates were being arrested in Fairbanks in 2011, an FBI-paid moving van showed up at Fulton's door in Anchorage — stunning his wife, who until then had known nothing about his double life — and the family relocated to another state. Fulton transferred his surplus store to his partners, sold his house at a loss, changed his appearance and went dark.

"They would have killed me immediately," Fulton said at a cafe in his new hometown, as he sipped cappuccinos between furious smoking breaks outside. "If they found out I was working for the feds? I knew everybody up there in that right-wing militia area.... So there were quite a few people that would have liked to have offed me at some point."

The story of Fulton's foray as a militia arms supplier ended with not just Cox behind bars. Three codefendants were sentenced to prison terms ranging from 15 to 25 years. From his new base, Fulton is continuing to work with the FBI on other gun-related cases and writing a book about the improbable events that transpired in Anchorage over the last two years.

"If you look at it from a sane standpoint?" he said. "Even I sometimes look at the whole story and how it unfolded and I think, this is unbelievable."

Fulton and the other FBI informant, former drug runner J.R. Olson, offered the FBI an inside look at a group that seemed to be moving from right-wing, antigovernment rants — perfectly legal under the 1st Amendment — to something more dangerous. Cox had been boasting that his militia planned to set up common-law courts that would try people under principles they saw as more faithful to the U.S. Constitution. Those found guilty of serious offenses could be hanged or sold into slavery.

Fulton, who had long worked with Army criminal investigators through his surplus shop, had gone to the FBI in 2010 about a potential domestic terrorism case when the FBI learned he knew Cox.

"The wheels started turning: How can we use this to our advantage, to try to get more information? Is Cox really going down that path? Which inevitably, he was," said Sandra Klein, a supervisory special agent who became Fulton's chief handler.

Fulton's first assignment was to attend a gun and military surplus sale intended as a fundraiser for the Interior Alaska Conservative Coalition, which Cox had helped establish in Fairbanks. Cox had been trying to get in touch with Fulton, who had ignored him "because I thought he was an idiot." The night before the event in August 2010, Fulton invited Cox to meet him at his hotel. The militiaman arrived with Les Zerbe, a retired missionary ranked as a captain, and another associate.

Cox had been accused of assaulting his wife, and worried that state authorities were trying to take his son away. He talked about Fulton serving what he called common-law warrants on the officials he thought were out to get him.

"He said these guys need to be arrested and brought to trial," Fulton recalled. "I said, 'What are you going to do with them?' He said, 'We'll either fine them, or we'll hang them.'"

Cox and company discussed how they were going to go to the homes of selected enemies, cut the electricity to the house, and make enough noise to lure their main target onto the front porch, where he could be shot. Then the windows and doors would be boarded up, and the house, with the rest of the family inside, would be set on fire. "Collateral damage" is the way Fulton said they described it.

After Cox left, Fulton phoned Klein. "I'm like, 'Help! What am I supposed to do? Do I need to get my family out of here?' And she's like, 'We'll handle it. Just try to figure out as much as you can.' She was really good at calming me down, but even for her, I could tell it was stressing her out."

The next day was the gun show, and Fulton again met with Cox, along with others from various militias.

"We walk into this meeting, and they're wanding everyone. If you had a gun that was fine. They were looking for electronic listening devices," Fulton recalled.

Fulton said he sensed that he needed to make it apparent to everyone that he was a tough guy who could be counted on, and he went on the offensive with Cox.

"I said, 'Listen, you're a piece of.... You brought all these people in this room. You said you had a plan; you don't have a plan.'"

Zerbe walked up to him. "He says, 'You were never going to help us anyway,'" Fulton recounted. "I saw the doubt start to come up.... If they had for a minute mistrusted what I was saying, I probably would have been dead." He walked toward Zerbe. "I said, 'If you ever question me, I'll slit your throat and bleed you out at my feet.'"

Someone intervened and calmed everyone down. Fulton said he told Cox not to worry — he'd help him get what he needed.

At the next meeting, several months later in Anchorage, Fulton was playing the role of arms dealer. With FBI agents eavesdropping nearby, both Fulton and Olson — neither knew the other one was working as an informant — met with militia members, with Cox joining in by speaker phone.

"We discussed their shopping list. Explosives: C4, Semtex, fragmentation grenades … machine guns, silenced weapons. Pretty much a laundry list of bad things," Fulton said.

Within a month, in March 2011, Fulton flew up to Fairbanks and handed over some of the illegal armament to Olson, who then met up with the defendants in a parking lot. He was about to hand over pistols, silencers and grenades when the parking lot owner walked up to the vehicle and asked what was going on. FBI agents rushed in and made the arrests.

By this time, Fulton was already on his way back to Anchorage.

"I flew home and tried to explain to my wife why there was a moving van at my home," he said. "We knew that once the arrests went down, it was going to be literally days before people figured out who at least one of the informants was. We needed to be gone by the time those questions even started to be asked."

Assistant U.S. Atty. Steven Skrocki, who prosecuted the case, scoffed at the assertions of Cox and others that Fulton scared them into talking about plans to kill federal officials. "The argument that Bill Fulton was a danger to Mr. Cox comes only from Mr. Cox," Skrocki said.

Did Fulton need to go into hiding? Are there people in Alaska who'd like to kill him?

Klein and her co-agent, Derek Espeland, seem dubious. But they say they've been in enough investigations to know what it feels like to operate undercover with bad guys.

"You go somewhere and you try not to be detected. And yeah, you have a little bit of fear," Klein said.

Fulton is trying to finish his book, which he hopes will earn some money. He collected $39,000 from the federal government for his work on the Cox case, but figures he lost a lot more, what with his house, his business and the money he spent playing the big guy in the militia movement.

Still, he's getting monthly disability payments for an old Army injury. His wife has a job. And for the first time in several years, he's spending the winter in some place that isn't Alaska.

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