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  • UPDATE: Charles Daniel Koss, Purported Missouri ‘Sovereign Citizen,’ Convicted In ‘Redemption’ Swindle Against Social Security

    recommendedreading1Charles Daniel Koss, a 63-year-old purported “sovereign citizen” from Independence, Mo., faces up to 61 years in federal prison after being convicted in a “redemption” scam targeted at Social Security.

    Koss was convicted of two counts of theft of government money, one count of Social Security disability fraud, one count of mail fraud and one count of transmitting a false negotiable instrument with the intent to defraud the government, prosecutors said. The false negotiable instrument was a purported “Registered Private Money Order” mailed to the Social Security Administration purportedly to repay $212,768 Koss owed the agency after it was determined he’d defrauded Social Security and had received disability payments to which he was not entitled between September 1994 and January 2010.

    From the office of U.S. Attorney Tammy Dickinson of the Western District of Missouri (italics added):

    Koss told federal agents in interviews during the investigation that he has studied redemption theory. Redemption theory involves bogus claims that when the United States government abandoned the gold standard in 1933, it pledged its citizens as collateral so it could borrow money. The movement also asserts that common citizens can gain access to funds in secret accounts using obscure procedures and regulations. According to the theory, the government created a fictitious person (or “straw man”) corresponding to each newborn citizen and each citizen has an alleged secret trust account with the United States Treasury. The theory also claims that through obscure procedures under the Uniform Commercial Code, a citizen can “reclaim” the “straw man” and write negotiable instruments against its accounts. Its adherents sometimes call themselves “sovereign citizens.” The “sovereign citizen” movement is a loosely organized collection of groups and individuals who have adopted anarchist ideology. Its adherents believe that virtually all existing government in the United States is illegitimate and they seek to “restore” an idealized, minimalist government that never actually existed.

    And, Dickinson’s office added, “Redemption theory and sovereign citizen beliefs are totally without merit and they have no basis in law or fact. Individuals often use these ideas to further various fraudulent schemes.”

    Even as he was receiving disability payments, prosecutors said, Koss worked full time at a business known as Embassy Mortgage. He also led an active life-style, including “bowling, golfing, horseshoes, boating, activities at his lake house and frequent visits to Ameristar Casino, where he gambled a total of $260,000 during this time.”

    Koss “failed to report any change in his health condition or any income from Embassy Mortgage to the Social Security Administration,” prosecutors said.

  • Alleged Missouri ‘Sovereign Citizen’ Indicted In $212,000 Social Security Rip-Off, Feds Say; Charles Daniel Koss Allegedly Sent Agency ‘False Negotiable Instrument’ To Pay Off Debt

    Charles Daniel Koss, 62, of Independence, Mo., allegedly owed the Social Security Administration $212,000 because he collected disability benefits to which he was not entitled between September 1994 and January 2010.

    Koss allegedly was working with his wife at Embassy Mortgage in Blue Springs, Mo.,  and “willfully failed” to let Social Security know about “the income derived from his work activity,” federal prosecutors in the Western District of Missouri said.

    A purported “sovereign citizen,” Koss now has been charged with two counts of theft of government money, one count of Social Security disability fraud, one count of passing a fictitious instrument with the intent to defraud and one count of mail fraud, federal prosecutors said.

    When Koss learned he had to repay the money, he allegedly mailed the Social Security Administration a false financial instrument dubbed a “Registered Private Money Order” in purported payment of the debt.

    The bogus instrument allegedly was part of a “redemption” theory favored by “sovereign citizens.” Under the theory, prosecutors said, the government is purported to have created “secret accounts” from which debtors can draw to satisfy their obligations.

    In a news release, the office of Acting U.S. Attorney David M. Ketchmark said:

    Koss subscribed to what is known as the redemption theory, the indictment says, which claims that a “Birthright Trust” is created with the U.S. Treasury when parents of a newborn child pledge the child’s birth certificate to the government. Redemption theory involves bogus claims that when the United States government abandoned the gold standard in 1933, it pledged its citizens as collateral so it could borrow money. The movement also asserts that common citizens can gain access to funds in secret accounts using obscure procedures and regulations.

    According to the indictment, adherents of the redemption theory sometimes call themselves “sovereign citizens.”  The sovereign citizen movement is a loosely organized collection of groups and individuals who have adopted anarchist ideology. Its adherents claim that virtually all existing government in the United States is illegitimate and they seek to “restore” an idealized, minimalist government that never actually existed. Redemption theory and sovereign citizen beliefs are totally without merit and they have no basis in law or fact.  Individuals often use these ideas to further various fraudulent schemes.