'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.

To his disappointment, the IRS rejected his notes. “Why, I don’t know,” Neal said.

Judge Barry tossed the Neals’ bankruptcy case, finding it to be an attempt to delay enforcement of the IRS judgment.

In his May 2010 order, Barry said the Neals failed to establish a reorganization plan because their primary source of funding was through “self-filed ‘maritime liens.’ Debtors filed eleven maritime liens that are fake, fraudulent liens.”

Barry also blasted Neal’s theory. “It’s all based on legal gobbledygook and gibberish,” he said during the February 2010 hearing. “It’s legal fantasy; it’s stuff on the Internet.

“It’s just a bizarre, outlandish set of theories that, unfortunately, a lot of people have come to believe because they want to believe it because they don’t want to pay their taxes.”

Barry added that a maritime lien can only be based on a service provided to a vessel, such as a ship. “A person is not a vessel,” Barry said.

He also gave Neal a warning: “If this continues to be promoted — and it may be too late — there could be criminal prosecution for continuing to take these actions.”

It was already too late.

Criminal Charges

On Feb. 2, 2011, Neal was indicted in U.S. District Court in Little Rock for interference with the IRS laws and filing false liens.

Neal had also filed false IRS 1099 tax forms, misrepresenting that IRS and court officials and others had each received personal incomes ranging from $7 million to $210 million.

Matters worsened for Neal when he appeared for plea and arraignment on March 2, 2011. He asked for a public defender because his only income, he said in filings, was a monthly Social Security check for $1,250.



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