'Redemption' Internet Conspiracy Theory Backfires for 81-Year-Old Fred Neal

by Mark Friedman  on Monday, Sep. 30, 2013 12:00 am  

On June 18, Fred Neal Jr., 81, pleaded guilty in U.S. District Court in Little Rock.

Fred Neal Jr. thought he found a loophole in the law so that he and his wife wouldn’t have to pay their $1.3 million tax bill.

But his misunderstanding of the law and his faith in an Internet conspiracy theory set off a chain of events that ended in June when he pleaded guilty in federal court in Little Rock to interfering with Internal Revenue Service laws and filing false claims.

By taking the plea deal, the 81-year-old Neal — who had homes in Marshall, Texas, and Harrison — became one of the oldest first-time felons in Arkansas.

The conspiracy theory that Neal subscribed to also prompted him to file fraudulent liens against IRS and government officials that totaled more than $1 billion, according to various records in U.S. District Court and U.S. Bankruptcy Court.

The plea deal came at the end of three years of strife for Neal. Since 2010, the IRS had seized hundreds of acres of Neal’s property in Texas and Arkansas and received $825,000 from the sale of the properties. And on March 28, his wife, Doris, died at age 84.

Neal is awaiting sentencing from U.S. District Judge Billy Roy Wilson.

“I’m not going to give you a story because I’m not supposed to be talking about it,” Neal said last week when Arkansas Business reached him at his Texas home. “I don’t want to jeopardize anything.”

Neal’s criminal cases and related lawsuits and bankruptcy filings provided a peek into the strange world known as the “redemption movement.” Movement subscribers believe that in 1933 the U.S. government left the gold standard and used its citizens for collateral. The theory claims that citizens can tap a hidden account.

Neal’s attorney, Blake Hendrix of Little Rock, declined to comment on the case.

Early Days

Born in Oklahoma on Aug. 31, 1932, Neal received a mechanical engineering degree from Texas A&M University, according to a person close to Neal who asked not to be named. Texas A&M couldn’t immediately verify his degree.

He reportedly started a plastics recycling business in 1973 that grew to nine plants across the country. Court documents don’t name the company, and searches of filings at the Arkansas Secretary of State’s Office and in Texas didn’t show a company connected to Neal.



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