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Palmdale Woman Faces More Charges

May 30, 1996|NICHOLAS RICCARDI | SPECIAL TO THE TIMES

Adding new charges against Montana "freemen" associate M. Elizabeth Broderick, federal prosecutors Wednesday accused the Palmdale woman of creating phony nonprofit foundations to launder money brought in by an anti-government fraud scheme.

Broderick, 53, charged thousands of people up to $200 apiece admission to seminars promoting the use of homemade checks, which she claimed were backed by liens against the government. Federal officials, who say the checks are worthless, arrested Broderick on fraud charges last month. She remains in custody.

Assistant U.S. Atty. Aaron Dyer said Broderick and an accomplice stashed some of the $1.5 million in proceeds in several bogus nonprofits, using the funds to buy laptop computers, tape recorders and new cars.

"Other money launderers could learn something from Broderick's operation," Dyer said.

Also on Wednesday, authorities increased their estimate of the number and the value of allegedly bogus checks written by Broderick--checks of the same type that led to the arrest of two Montana "freemen" tax resisters in March, sparking a continuing standoff with federal agents at their ranch.

Authorities now say Broderick wrote 8,000 checks for $800 million, most of them distributed to those who attended the seminars. Most checks were rejected by banks, but about $200,000 worth were erroneously accepted by financial institutions and even the IRS, federal officials say.

Dyer said Broderick was the most prolific producer of the checks, so-called "Comptroller's Warrants," which authorities say are becoming a staple of certain branches of the anti-government movement.

Broderick says she has renounced her U.S. citizenship and is beyond the jurisdiction of the federal courts. She said she joined the burgeoning "patriot movement," which holds that the government has declared war on its citizens, after a 1993 raid by state authorities on her previous enterprise, the California Gold Company. State authorities earlier this month charged Broderick with fraud in connection with that business.

Broderick has also been convicted of running a pyramid scheme in Colorado, authorities there say.

In the current alleged scheme, Broderick--who accepted only cash, money orders and cashier's checks for admission to her classes--squirreled away her gains in nonprofit organizations with such names as Brigadoon Foundation and Common Sense Plus, the indictment alleges. Also charged with helping launder the money is Broderick's business manager, Adolph Hoch of Moreno Valley.

Dyer said Broderick and Hoch used the proceeds to buy eight laptop computers, a laser-jet printer and photo scanner, a new Dodge Van, a Buick Riviera and an Oldsmobile.

Authorities are seeking to seize those items and others Broderick might have purchased with the money from the seminars.

In interviews with The Times, Broderick has boasted that she hid money where no one could find it. Dyer said Broderick advised her students to secrete their funds in phony corporations, nonprofits and off-shore companies.

"She practices what she preaches," he said.

Three other Broderick associates are also accused of aiding in the fraud scheme, but not of money laundering. They have pleaded not guilty, and trial in U.S. District Court in Los Angeles is scheduled to begin in June.

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