'Liberty Dollars' Can Buy Users A Prison Term, U.S. Mint Warns
He put a beautiful Lady Liberty and a majestic flaming torch on the silver and gold coins, and he named them "Liberty Dollars." On his Web site, www.libertydollar.org, he said: "It is fun to use REAL money. Liberty Dollars are a proven and profitable currency that protects and grows the purchasing power of your money!"</br></br>True story, phony money. So says the U.S. Mint, which would like to remind Liberty Dollar users that since the United States already has its own currency, the only thing Liberty Dollars buy in these parts is a jail term.</br></br>Liberty Dollars were coined by von NotHaus and an Evansville, Ind.-based group called Norfed, which stands for (sort of) the National Organization for the Repeal of the Federal Reserve Act and the Internal Revenue Code. In the late 1990s, the group began hawking its money as a hedge against inflation, and as a way to compete with the Fed. Von NotHaus makes the pitch online, using a raft of statistics and graphs that he says show the greenback is well nigh worthless.</br></br>Norfed Executive Director Michael Johnson says the group isn't aiming to overthrow the American monetary system. "We're not locking horns with the Fed. I mean, that's crazy," he said. Norfed simply wants "to offer a solution to the Federal Reserve Note," a.k.a. U.S. dollars.</br></br>Norfed struck the first gold- and silver-backed coins -- which, to avoid charges of making its own money it calls "rounds" -- in 1998 at its private mint in Idaho. Today the group claims to have more than $20 million in Liberty coins and notes in circulation, and about 2,500 merchants who accept Liberty Dollars for goods and services from doughnuts to tattoos.