The Bizzare Saga Of Denny Ray Hardin: 10-Year Prison Sentence Of Purported ‘Sovereign Citizen’ Whom Prosecutors Said Tried To ‘Extinguish Over $100 Million Worth Of Debt’ Upheld By Appeals Court

EDITOR’S NOTE: In August 2011, the FBI warned of debt-elimination schemes advanced by purported “sovereign citizens.” The story below outlines a “bonded promissory notes” scheme advanced in Missouri by Denny Ray Hardin. It is worth noting that AdSurfDaily figure Kenneth Wayne Leaming is jailed near Seattle awaiting trial in a case that alleges he issued a “bonded promissory note” and filed false liens against public officials.

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The 10-year prison sentence of a purported “sovereign citizen” who hatched a scheme in which bogus financial products were sold to customers in a bid to eliminate their debts has been upheld by the U.S. Court of Appeals for the 8th Circuit.

Denny Ray Hardin, 53, of Kansas City, Mo., was convicted in September 2011 of 11 counts of creating fictitious obligations and 10 counts of mail fraud.

The circumstances that led to Hardin’s arrest and trial were just plain bizarre. Hardin, according to prosecutors, divined a a construction by which he was a private banker authorized to issue “bonded promissory notes” (BPNs) backed by the government.

Customers were told they could use Hardin’s manufactured notes to wipe out their debts, and Hardin charged $100 or more for the notes, prosecutors said.

Hardin called his purported bank “The Private Bank of Denny Ray Hardin,” and he operated it from his residence, prosecutors said. The scheme in part operated online, but also through the mails.

“Hardin defrauded customers by selling them BPNs with the false promise that these fictitious instruments can discharge debts,” prosecutors said. “Hardin defrauded creditors by presenting them with worthless BPNs.”

U.S. District Judge Gary A. Fenner sentenced Hardin to 10 years. An appeal followed.

In upholding the sentence, a three-judge appeals panel from the 8th Circuit noted that Fenner could have sentenced Hardin to nearly 34 years in prison but used his discretion under the circumstances of the case to depart downward, ordering a 10-year-sentence and three years’ supervised probation after Hardin’s release.

Records in the case show that Hardin, in October 2010, was ordered “committed to the custody of the United States Attorney General for hospitalization and treatment” after he raised issues of his own competency to stand trial.

In May 2011, Hardin was ruled competent to stand trial.

At a pretrial conference in August 2011, prosecutors announced they had at least 30 witnesses and 487 trial exhibits.

Hardin, who had decided to represent himself and had been appointed stand-by counsel, “refused to participate in the proceeding and objected to the Court’s jurisdiction, according to a memo by the presiding magistrate judge. (Read memo at Leagle.com).

The conviction followed on Sept. 14, 2011, and the appeals panel last week upheld the 10- year sentence.

Among other things, the panel rejected as “meritless” Hardin’s claims that the district court had no jurisdiction over him.

These are among the findings of the appeals panel (italics/bolding added):

Witness testimony and documentary evidence established that (1) Hardin produced
fictitious financial instruments that he called “bonded promissory notes” and (2) Hardin claimed that these notes had monetary value to discharge debt and were authorized by the United States Department of Treasury. Hardin typically sold the bogus notes for a fee and then mailed them to financial institutions on behalf of the purchaser with the stated purpose of extinguishing that purchaser’s debt, including mortgage debt. Hardin continued this course of action even after he was advised about the illegality of his conduct. See 18 U.S.C. § 514(a) (producing fictitious obligations with intent to defraud), § 1341 (using mail in a scheme to defraud).

At sentencing, the panel recounted, “additional evidence was introduced to show that Hardin sold the fictitious instruments to over 50 customers and attempted to extinguish over $100 million worth of debt . . .”

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3 Responses to “The Bizzare Saga Of Denny Ray Hardin: 10-Year Prison Sentence Of Purported ‘Sovereign Citizen’ Whom Prosecutors Said Tried To ‘Extinguish Over $100 Million Worth Of Debt’ Upheld By Appeals Court”

  1. There more on this here, including a mug shot:
    http://www.pitch.com/gyrobase/denny-hardins-weapon-against-the-us-government-his-own-private-bank/Content?oid=2197865&showFullText=true

    An interesting bit is:

    When it comes to not knowing exactly who owns his mortgage, Suppenbach has a lot of company. In many cases, even the banks aren’t sure. (Last year, researchers at the University of Iowa found that out of 1,733 foreclosures begun in 2006, 40 percent of the foreclosing creditors showed no proof of ownership on the note or security investment in the property.) If a bank has to contest a payment’s legitimacy — for example, if payment is presented in the form of a bonded promissory note from a self-proclaimed banker — then not being able to show proof of ownership could actually help the homeowner, or at least let the homeowner delay getting kicked into the street.

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  2. The really sad thing here is that it doesn’t matter how many sovereigns do jail time for using “bonded promissory notes” it will never dissuade the true believers from insisting that they’re valid.

    One of the charges being faced by RuSA “President” Tim Turner is him attempting to use and instruct other in using “bonded promissory notes.” Yet on the next “Republic Round Table” confrence call Kelby Smith was insisting these things are real and using the fact that President Turner was being charged in relation to them as proof of how corrupt and deceitful the real government is.

    It’s pointless to argue with someone’s deeply held religious beliefs. The Book of Mormon speaks of ancient civilizations in the new world which had horses, iron weapons and functioning axles. It doesn’t matter to Mormons that there is zero archeological evidence for any of those things being here prior to the arrival of Europeans. But Mormons are, by and large very nice people and productive citizens so I don’t care if I find a few of the things they believe to be factually inaccurate.

    I’ve known a few sovereigns (online) who I think are nice people as well and it bugs me that they pay for false teachings. But I don’t think any of the people I’m talking about would ever shoot a traffic cop for “impeding their right to travel” which means driving without a valid license.

    I suppose fanatics of any stripe are potentially dangerous. FLDS Prophet Warren Jeffs was on the FBI’s most wanted list prior to his arrest and conviction. But the FLDS is NOT the main stream Mormon church and Warren Jeffs was not respected and admired by most Mormons. But Schaeffer Cox is admired and respected by large portions of the sovereign citizen/militia movements. Both before his arrest and conviction for amassing an arsenal and conspiring to murder judges, AND after.

    Do prison commissaries accept bonded promissory notes?

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  3. Prison Commissaries don’t. I always wonder why the guys who sell them don’t either.

    Just sayin’

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