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‘Sovereign Citizens’ Indicted in Tucson

By Evelyn Schlatter on September 15, 2011 - 2:02 pm, Posted in Sovereign Citizens

Marshall Home, a one-time Tucson mayoral candidate, and Margaret Elizabeth Broderick, a disciple of the 1990s Montana Freemen money scams, have been indicted by a federal grand jury on multiple counts of fraud for running a financial scam straight out of the antigovernment “sovereign citizens” playbook.

Home and Broderick allegedly posed as representatives of Fannie Mae and Freddie Mac in a property acquisition scheme. They operated “The Individual Rights Party: Mortgage Rescue Service” in south Tucson. They advertised that, for $500 per case, they could help people whose mortgages were in foreclosure. The indictment alleges that Home and Broderick would fight foreclosure by filing paperwork that made ludicrous arguments to courts that did nothing to help the individuals who hired them. 

They are also alleged to have registered the names “Federal Home Loan Mortgage Corporation” and “Federal National Mortgage Association” with the Arizona secretary of state. Those are the same names of Freddie Mac and Fannie Mae, respectively. Home and Broderick then allegedly filed deeds with county officials for real estate that Freddie Mac and Fanny Mae had acquired, and then they would “conduct a transfer” to their Individual Rights Party. Once they did that, they would rent out the properties.

Home, 81, is a self-described multibillionaire with a history of dispensing questionable financial advice. He served, for example, as an adviser to John Apostolou, a Greek immigrant and owner of the Giordano’s Pizza restaurant in Chicago. When he ran into financial trouble, Apostolou turned to Home and ended up filing documents with the court to terminate his bankruptcy case because of “bank fraud, securities fraud and tax fraud by the United States.” For his part, Home filed papers with the court, too, claiming a $150 million lien against Giordano’s, part of an apparent scheme to get the restaurant chain back.  It didn’t work. The business is soon to be sold.

Broderick, 68, was born in Canada but has a long history with American sovereign citizen scams. The former teacher and self-proclaimed “lien queen” pleaded guilty to  running a pyramid scheme in Colorado in 1987 and settled a civil suit the following year. Her husband, an aerospace engineer, was transferred to Long Beach, Calif., after that and she continued her questionable practices. She opened the California Gold Co. in 1990, but Orange County deputies raided her office and home, seizing computers, gold, diamond rings and other property, in 1993 during a probe of her business dealings. That event seems to have drawn her to the teachings of Montana Freeman LeRoy Schweitzer and other fringe political ideologies.

She was convicted in 1996 in California on 26 charges of conspiracy, fraud and money laundering for a scheme in which she told hundreds of followers they could wipe out their debts with checks supposedly drawn against the government. She represented herself during the trial and repeatedly said that she was a political prisoner. She was accused of issuing more than 8,000 phony checks, totaling $800 million, at seminars in California. At the seminars, she charged people $200 to attend – and for an additional fee, she would write a check for any amount. The checks were supposedly backed by $1 billion in liens against the federal government.  She made over $1 million in the scam, but was  sentenced to 16 years in federal prison.

In typical sovereign citizen fashion, she told a federal judge that he had no jurisdiction over her because she was “an ambassador of the Kingdom of Hawaii.”

Ambassador or not, she and Home now face federal prison if convicted. The three counts of bankruptcy fraud each carry a maximum penalty of five years, a $250,000 fine, or both. The seven counts of mail and wire fraud each carry a maximum penalty of 20 years, a $250,000 fine, or both.