April 18, 2016 - "No Greater Tyranny" article about Burt published. Click here to read article.
On July 13, 2015 the unfounded criminal charge of not having a business license was dropped at the request of the prosecution. The civil charges against our seized property were dropped in exchange for an $80,000.00 administrative extortion payment to the Federal Asset Forfeiture Fund. AUSA Korver refused to drop the criminal charge unless Burt agreed to let the government keep $80,000 of the property seized in the civil forfeiture cases.
You can hear Burt speak in person about his experience. Click here for Burt's speaking schedule.
This is my account of and my reflections on what has happened to my family in no particular order. Normally I add new information at the end.
Day of Arrest
On October 14, 2014, I received a phone call from a federal agent telling me that Burt was arrested and that I was not to come to my house. I went to the house anyway to get our family pet.
When I arrived at the house and demanded to know what was going on, Special Agent Arran McWhirter said that my husband was a horrible man and I was probably a horrible person too. He said he didn’t have to tell me why my husband was arrested or why my house was being searched. It was a sealed arrest warrant and a sealed search warrant and he didn’t have to tell me anything.
The agent that went into the house to get a leash for our dog wouldn’t even look me in the eye. She clearly was embarrassed by what they were doing. S.A. McWhirter was clearly angry. He was literally stomping around our yard and yelling.
One of the agents then told me that Burt was arrested for violating 18 U.S.C. 1960. Friends helped me find an attorney that day. Burt spent that night in the Denver County Jail. The next day, the attorney went to the hearing. Magistrate Craig B. Shaffer asked Assistant United States Attorney Michele Korver “what she desired.” She said she wanted to keep Burt the maximum number of nights possible. The defense attorney started to speak (he wanted to point out that Burt has no criminal record and that he is not a flight risk.) The judge refused to hear from the defense attorney. The judge said that AUSA Korver was entitled to hold him the maximum number of nights. Case closed. AUSA Korver argued that if Burt was set free he would be able to hide the Bitcoins from her. (Not true. The feds already had his Bitcoins.)
Burt spent the next two nights in solitary confinement. He would have been there through the weekend if I had not spent our IRA funds on attorneys’ fees to get him out. They had him in shackles most of the time.
AUSA Korver knew they had Burt’s bitcoins. I think she wanted to keep him in jail as long as possible to break him to become a confidential informant.
Day of Arrest
Our house was heart breaking. Friends kept our daughter until I could bring some semblance of order to the rooms she would have to walk through to get to her bedroom.
The feds left Burt’s areas neat and trashed my areas of the house and our daughter’s area of the house. The feds left blue gloves and sticky notes and push pins all over our house for my daughter to see. The feds dumped the drawers in my desk and tidied Burt’s drawers in his desk. The feds dumped our daughter’s photos on the floor and then piled trash on top of them. The feds tore open a wall, broke two desk drawers, removed paneling, broke open our tool shed which has a window through which you can see the lawn mower, destroyed the gun cabinet in the storage closet, and broke the unlocked lock on my husband’s electrical engineering briefcase with all of his tools. The feds took all of our computers, storage media, back-up drives, etc. They even took the memory disc out of my camera. I have two work areas in the house and both our clearly mine and both clearly belong to an attorney. They took my Sudoku book. They tore the first few pages out of my journal which say “Brain Injury Journal” and “Private.” They threw those pages under my bed and took my brain injury journal and my calendar, which someone with a brain injury really needs to function.
In April 2014, our management company called to let us know that someone identifying himself as an agent for Homeland Security asked the postal worker what our company did. I called the Department of Homeland Security three times and identified myself as corporate counsel and wanted to know if DHS had questions about our company. One person called back and said the postal worker was mistaken. Because of that, we put a camera in our office. We have video of the feds entering our satellite office. The fed was very perturbed when he realized he was being filmed. He put a box over the camera. The feds took our business computer and broke our business printer and damaged the office.
The week after Burt was arrested, I called Special Agent Arran McWhirter and chewed him out for taking my computers and files which are protected by attorney client privilege and for taking my daughter’s money and her entire digital life. SA McWhirter forwarded the voicemail to AUSA Korver and said he felt threatened by me. She forwarded the voicemail to Burt’s attorneys. Two days later, Burt received a notice of forfeiture on those items.
The feds have to bring in an independent taint team whenever they raid an attorney’s office or take computers or files belonging to an attorney. I told the Department of Homeland Security in April 2014 that I was an attorney. I told the agents at my house the day of the arrest that I was corporate counsel for our company and my computer and files were protected by attorney client privilege. I reminded Arran McWhirter in the voicemail that I left him and that he forwarded to AUSA Korver that I was an attorney. In November I filed to recover the items taken by the feds and in my filings I again brought up the attorney client privilege regarding my files. In December, AUSA Korver said she never knew I was an attorney and that I had told Agent McWhirter that I no longer practiced law. Clearly not true. I have no reason to say that I am not an attorney. My active attorney license was sitting next to my computer that they took.
Why Arran McWhirter is the world’s worst agent #1 – he followed our family from April 2013 to October 2014 and didn’t know I was an attorney.
Why Arran McWhirter is the world’s worst agent #2 – he still didn’t know what our company did at the time of the arrest.
Why Arran McWhirter is the world’s worst agent 3# -- he feels threatened by me.
I don’t think the feds had search warrants for our client’s office or our satellite office. They definitely did not have probable cause for any search warrant at any of the three sites. No search warrant was left at the client site or at our corporate satellite office. They had to have lied to get a search warrant for our house and to even get a grand jury indictment. Burt has nothing to do with drugs. Burt has never bought or sold drugs with bitcoins. Burt has never sold bitcoins to someone who indicated they planned to use the bitcoins for illegal activity.
Burt said they never showed him a search warrant at the client site. He said the Agent threatened to break down the door to our home if Burt didn’t give him permission to go into Burt’s work area at the client site and get our house keys. He said the agent then called the judge to get permission to seize items at the client site.
Based on the dates in the indictment, it is probable that the feds have been spying on us since April 2013. From April 2013 until October 2014, the only time the feds would have ever seen or been with Burt during a Bitcoin transaction would have been at a coffee shop where Burt would have used his cell phone to trade Bitcoins. At best, the feds might have had probable cause to seize Burt’s cell phone, but they definitely did not have probable cause to raid our home or our client’s site or our satellite office.
Why Arran McWhirter is the world’s worst agent #4 – he spent more than a year following a 52 year old electrical engineer from home to school to work to home, home to church, home to hockey games, home to coffee shops and thought Burt was too smart to get caught, so the agent then lied to get a tracking device on Burt’s car.
Why Arran McWhirter is the world’s worst agent #5 – after getting a tracking device, he still didn’t find any evidence against Burt, so he lied some more and said all Bitcoin traders are by nature drug dealers and stormed our house.
Why Arran McWhirter is the world’s worst agent #6 – he wasted law enforcement time and taxpayers’ dollars chasing after a middle aged engineer instead of fighting terrorists.
Why Arran McWhirter is the world’s worst agent #7 – on the same day that the prosecutor testified in open court that our C corporation had nothing to do with the case, he went to our corporation’s client and demanded access to computers used by Burt to which the client responded by firing our company, all because McWhirter still couldn’t believe he was wrong about Burt being a drug kingpin with loads of money.
One neighbor counted 24 cars. Burt counted 22 cars. The feds brought Burt to our house in handcuffs and made him sit on our elevated deck in handcuffs for all the neighbors to see. One neighbor counted 27 feds. Another neighbor counted 35 feds. It’s not likely the feds travel one per car. If you double 22, you get 44 feds. That seems too high even for going overboard. The 35 number seems most likely. One neighbor said the feds had a battering ram. Another neighbor said SWAT was there, which would be Boulder County Sheriffs. The feds told the neighbors it was a financial matter. The feds went to the neighbor’s house to find out the name of our dog. One of the neighbors tried to take the dog because she was afraid the feds would shoot it. She stood guard over our puppy. Another neighbor heard them call the judge to get permission to break into our shed. All of the neighbors are angry and outraged.
The neighbors and Burt said he was arrested by the Postal Service Police. It turns out the post office has a police force and they cover anything having to do with the internet. The neighbors and Burt saw HSI, ICE, and DEA agents. HSI is apparently Homeland Security Investigations. Burt’s attorney at the time told me that DEA was there not because of drugs but because they were short-handed and needed more agents to search. US Marshals were there with Burt as well.
Grand Jury Indictment
Records are sealed so no one knows what was said at the grand jury. My best guess is that S.A. Whirter and AUSA Korver intentionally provide misleading information. They seem to believe that there is little to no noncriminal reason for someone to have Bitcoins so if someone does have Bitcoins that fact alone is probable cause to search and seize property at their home.
I contacted the following people for help or advice: ACLU, Sen Bennet, Sen Gardner, Congressman Polis, The Boulder Weekly, Mother Jones, The Wall Street Journal, Tim Draper, the Bitcoin Foundation, the Denver Bitcoin Society and Bitcoin Magazine. Only the Bitcoin Foundation was helpful.
It will cost $5,000 to retain an attorney to recover our property. To see the proceeding through the CAFRA claim phase will cost $50,000 in attorney’s fees. The feds are notorious for appealing any victories in order to bankrupt the citizen. Through the appeal phase, the attorney’s fees are $100,000 to recover seized property. If you go the administrative route, there is no time limit for the government to reply to your petition to recover and the person who decides if you get your property back is the person who took it. You have to go the CAFRA route to have any hope of getting your property back. In our daughter’s case, going the administrative route, SA McWhirter who took her $600 and would decide whenever he felt like it if she would get the money back. In CAFRA proceedings, even if the citizen prevails, the citizen usually gets only 20% of his property back and the government almost always keeps 80%. The government charges a storage fee for the items it stole.
Whenever I call Burt and he doesn’t answer right away, she is afraid her daddy has been arrested again. She is scared of law enforcement and gets nervous when she sees police cars. She won’t say the Pledge of Allegiance at school. We had to put her into counseling. She had to see a counselor every other week until recently (Feb 2015). Sometimes she will suddenly cry uncontrollably for no reason. She is afraid the feds will come back and raid our house again.
Burt was clearly targeted because the feds thought they would uncover a stash of bitcoins or money if they pursued him. They were wrong. Forfeiture has been driving this case, not Burt’s actions. AUSA Korver is known as an expert in forfeitures. There’s no drugs. There’s no reason to raid a person’s house, office, and client’s office over paperwork. Make no mistake. This case is solely a paperwork case. The only reason for the show of force is to seize property.
Burt is accused of failing to obtain a money transmittal license and failing to report the names of the people that bought bitcoins. The feds trump up the charges in order to trigger the forfeiture clause and bring in Homeland Security and the Patriot Act secretive searches.
Bitcoins are an investment for Burt. He buys low and sells high. There is no transmission to a third party. There is no business. There is no need for a license. FinCEN guidelines are clear that you don’t need a license if you are trading for yourself.
Letter to Magistrate Shaffer
In February 2015, I called Magistrate Shaffer’s chambers demanding a copy of the search warrant for our corporate office and the grounds for the search. The clerk told me to put it in writing and hung up. When I called back, she refused to answer the phone. I sent a letter to Magistrate Shaffer and I plan to file a complaint with the Judicial Disciplinary board. It is absolutely inexcusable to not allow the defense attorney to speak. Magistrate Shaffer clearly doesn’t perform the duties of his office fairly, impartially, and diligently. Clearly he is not maintaining the independence of the judiciary. There is no excuse for putting a 52 year old electrical engineer, 3rd generation Coloradoan, attends church, teaches Biblical Greek, no flight risk, father of an 8 year old in solitary confinement because he is accused of failing to file the correct paperwork.
Frightening Event at State Judiciary Hearing
Through my research about civil forfeitures I learned that a state senator was trying to pass a bill in the state legislature that would restrict the ability of local law enforcement to bring in the feds for civil forfeitures. Colorado law does not allow civil forfeiture. You have to be convicted of a crime before the state can go after your property. To get around that, the local law enforcement uses the equitable sharing statute to bring in the feds. My daughter and I agreed to testify at the hearing about the effect of civil forfeiture, the lack of due process, the loss of checks and balances, etc. Colorado law enforcement brings in over 4 million a year from civil forfeitures through the equitable sharing statute.
On our way home to Boulder County from Denver, my husband received a phone call from his attorney. I could hear my husband’s side of the conversation and I could hear the attorney. We were at a state hearing over a proposed state law involving state law enforcement. Someone at the hearing called the federal prosecutor AUSA Korver who then called my husband’s attorney to call me a liar.
Both the indictment and the pre-trial release conditions read The United States vs. Burton Thomas. Someone took a pen and crossed out Thomas and wrote Wagner above Thomas. If I were the judge, that would make me wonder if the prosecutor knew what she was doing and had her facts straight.
Cost of being attacked by the U.S. Government
We have lost half of our life savings at this point and are in debt tens of thousands of dollars. I have closed out three savings account and three Roth IRAs to pay the legal fees and to pay the costs of buying new computers because they took every single business and personal computer we had and Burt's cell phone. It is easier to plea to something you are not guilty of than to watch your life’s work drain away to stand up for yourself. Prosecutor’s like Michele Korver bet that people will be willing to plea to anything just to be done. Burt and I have agreed we would rather be broke than have him plea to something he didn’t do just to save money. We have been savers our whole lives. We don’t spend much. We need to raise an additional $150,000.00 to go to trial. This attack has wiped us out financially. We were doing well before the government attacked us. We are not doing well now.
Through its use of civil forfeiture laws to fund itself, the United States Justice Department shows disrespect for the U.S. Constitution and disdain for the Bill of Rights, the very documents which it should adhere to and protect at all times. Civil forfeiture removes the Justice Department from the checks and balances set forth in the Constitution. The Justice Department's focus is to fund itself by taking property from citizens, which is de facto taxation without representation as well as government theft. There is no criminal justice reason for civil forfeiture. It corrupts law enforcement and prosecutors to the point that a prosecutor and judge will put a middle age man with no criminal record in solitary confinement so the government can steal his Bitcoins.
The U.S. Justice Department is the greatest threat to our national security and to our civil liberties embodied in our country's founding documents. This is an insane moment in our country's history. Who would have thought the biggest threat to our country would come from within, from the U.S. Justice Department. Michele Korver and Arran McWhirter abused their positions of power to steal from my family over a paperwork charge, failure to have a business license. Twenty years ago, Burt would have receive a phone call at worst. Now, because of the civil forfeiture laws, charges were trumped up to trigger the forfeiture laws and a para-military assault was led on our house.
Today I learned that the U.S. Postal Police actually prides itself in bypassing Congress and using civil forfeiture to fund itself. The Postal Inspection Service lists asset forfeitures as one of its main purposes on its website. I'm fairly certain Ben Franklin, James Madison, and the other Founding Fathers did not expect the Postal Police to invade homes and steal money from Americans.
Response to a question we received:
Yes, our legal fees and costs have reached $200,000.00. It is an astronomical sum. It represents our retirement fund, our daughter’s education, and the loan we took out against our home to pay the fees. Defending an innocent person bankrupts a family.
Our daughter continues to cry every day. We put her back in counseling. She often has trouble sleeping and has nightmares, so her doctor has us give her a sleep aid as needed.
AUSA Michele Korver's Lack of Professionalism
From November 2014 into February 2015, AUSA Korver promised every week that she would deliver an offer to settle by a certain date and always missed the date. She never produced any written offer until February 27, two days after our daughter and I testified at the State Judiciary Committee hearing regarding civil forfeiture. AUSA Korver and Burt's attorney spent many hours negotiating a settlement (really an extortion agreement). AUSA Korver was supposed to provide a finalized copy on April 10th. She missed that deadline. On April 17th she produced a version that was completely inaccurate and did not summarize the extortion terms. She said "oops!" I sent the wrong version. She could not follow up with the correct version because she had not bothered to draft it. As of April 24th, more than 6 months after Burt's arrest, we are still waiting on a finalized extortion agreement.
May 4, 2015 -- still waiting for agreement that was promised on April 10th.
May 6, 2015 -- I've been told an offer to settle was received by Burt's attorney yesterday.
If AUSA Korver worked in the private sector, her employer would have forced her resignation by now and she would be prosecuted for extortion. Apparently, federal government employees are allowed to operate outside the law. The federal government employees can extort people (AUSA Korver), bribe people (DEA Agent Carl Force), steal from people (Secret Service Agent Shaun Bridges), and commit perjury (S.A. Arran McWhirter). It's interesting that AUSA Korver started out in the Secret Service given all of the recent bad behavior by the Secret Service.
June 15, 2015 -- people have been asking me about the status. Regarding Burt, no news to report. Regarding the seized property, 90 days have passed since I filed two CAFRA claims without action from the govt., which means by law the items should be returned. The Assistant US Attorneys are ignoring my inquiries regarding the return of my daughter's Christmas and birthday money and the return of my corporation's computer and documents.
July 13, 2015 -- The U.S. District Court issued an order dismissing the indictment at the request of the Justice Department.
We are still working on getting our property returned. Our daughter is still traumatized. We've lost most of our savings and are in debt over legal fees, so it's not as big of a victory as you might think.
It will be two years before the case is dismissed with prejudice, which is when double jeopardy attaches.
Burt's attorney Brian did an amazing job of representing Burt and is worth every penny.
I'm not allowed to see the final agreement between the government and my husband. I did see earlier versions. The version I saw from April closely resembled the Non-Prosecution Agreement in the Ripple case. Since I'm not even allowed to know the name of the final agreement, I can only assume it is a non-prosecution agreement since Burt has to forfeit cash and Bitcoins to have the case dismissed.
The attorneys on the case believe they are breaking new legal ground by using this type of an agreement in an individual criminal case. From the online research I've done, Burt appears to be the first individual who was forced to forfeit cash and Bitcoins to the U.S. Justice Department to have a criminal case dismissed. In the past, the U.S. Government would simply dismiss the case and not require a forfeiture.
Eric Holder, former Deputy and former U.S. Attorney General, promoted the practice of having corporations pay the government to not prosecute them several years ago. The number of non-prosecution agreements with corporations has been on the rise ever since.
I believe that using such a non-prosecution agreement on an individual in a criminal matter is unconstitutional and corrupt. Telling an individual that the prosecution will dismiss the charges only if money is forfeited into the Federal Asset Forfeiture Fund (which bypasses Congress and the checks and balances set forth in the Constitution) is extortion. I believe there is no evidence to support the prosecution's case and no legal basis for the case. The case never should have been brought and it should have been dismissed with prejudice. This is not a judicial victory. This is extortion, an attack on the U.S. Constitution, an attack on civil liberties, and the act of a corrupt Justice Department. The U.S. Justice Department threatening to send an individual to prison unless the individual gives the Justice Department money is crooked to the core. No one should have to buy their freedom in this country. This newest development in the U.S. Justice Department should alarm every American citizen.
That said, I want to be clear that I truly appreciate the work done by Burt's attorney and I believe he was able to negotiate the best outcome possible given the corrupt nature of the U.S. Justice Department. We are eternally grateful to Brian.
Reflection on U.S. Congressman Jared Polis
Oh my God! What a worthless U.S. Congressman.
Keep in mind that Polis is a Bitcoin proponent and accepts Bitcoins as campaign contributions.
I contacted Congressman Polis' office October 2014 and was turned away. I walked into his Boulder office with my daughter twice. I have emailed and called his offices numerous times. I wrote a letter that went unacknowledged. My husband and I went to his Boulder office. We were taken into a back room and told that because of the Separation of Powers contained in the U.S. Constitution, there is nothing Polis can do about the corrupt U.S. Justice Department. I guess he doesn't understand the part about Checks and Balances. Or, maybe he doesn't understand that the Patriot Act and forfeiture laws written by Congress have corrupted the Justice Department and that he has the ability and authority to rewrite the law.
An armed assault on the home of American citizens over a free two-page business license, a U.S. Judge refusing to let defense counsel speak, a Homeland Security Agent who uses the Patriot Act to steal from U.S. citizens, a corrupt prosecutor, a Homeland Security Agent who lies on sealed search warrants, a U.S. Postal Inspector who intentionally misleads the court to support sealed search warrants and civil forfeitures of Bitcoins, a U.S. Judge who puts a middle-aged electrical engineer in solitary confinement solely because it's the prosecutor's desire, an administrative process that denies due process, law enforcement taking property from citizens to self-fund the Justice Department, none of this concerns Congressman Polis.
It's no wonder our country is in decline.
What Every Civil Forfeiture Lawyer Should Know
Keep in mind that I am not a litigator and that everything I know about civil forfeiture law I learned since October 2014. I am greatly dismayed that I have had to tell experienced forfeiture attorneys the following information.
You do NOT have to sign Hold Harmless Agreements to get your client's property returned. U.S. Customs can request that your client sign a Hold Harmless Agreement, but U.S. Customs cannot require your client sign one as a condition for the return of property. Megan Fishel, the U.S. Government employee that handles ALL forfeitures by U.S. Customs likes to insist on the Hold Harmless Agreements. What she doesn't tell you is that she was personally sued in 2004 over this very issue. Never have your client sign a Hold Harmless Agreement unless you receive some consideration from the government as part of a settlement. Once the 90 days pass on the CAFRA claim without a complaint from the government, your client is entitled to his/her property. Any requirement to sign a Hold Harmless Agreement at that point is considered an unconstitutional deprivation of property. The Asset Forfeiture Policy Manual is NOT law. It is merely an employee handbook and should always be viewed as such. Don't let Megan Fishel get the better of you. Megan Fishel is in Portland, Oregon and she really should be investigated by an ethics committee.
Property Returned in July
Not all of our property was returned. We were amused by some of the items returned. The chain of custody receipt tells you how often the federal agents checked a piece of property out of evidence. The federal agents checked a post it note out of evidence thirteen (13) times. They were not able to decode it.
The post it note was my 8 year old daughter's. She had copied the Dragon code on the cover of Dragonology, a book that is popular with kids. The federal agents mistook her Dragon language for Bitcoin secret code and were trying to decipher it.
Burt was told that he would NEVER get an audience with Senator Bennet. Senator Gardner's staff wouldn't even take my name or talk to us.
We are grateful to the Usual Suspects and James Hoople for performing at the Fundraiser and Celebration on Oct. 11 and to all those who turned out to support us. We truly appreciate your kindness and generosity.
AUSA Michele Korver and S.A. Arran McWhirter should be prosecuted for wrongfully imprisoning Burt and demanding an extortion payment before dropping the criminal charge. S.A. McWhirter should be prosecuted for falsifying evidence. AUSA Korver should be prosecuted for suborning perjury (McWhirter and U.S. Postal Inspector). AUSA Korver should be sanctioned for her numerous ethical violations. Instead, she will be rewarded for acquiring funds for the Justice Department.
Link to BurtW Fundraier site: www.burtw.com
Thank you to those who have helped us through this difficult time.
Thank you to our daughter's school who provided her financial aid.
Our brave puppy. She held the Homeland Security terrorists at bay.
Site updated 4/14/2016
Homeland Security Terrorizes Family
July 13, 2015 -- Federal Case Dismissed.
Total Legal Fees, Costs and Value of Civil Assets Forfeited = $287,326.00
Amount raised as of today: $38,279.74.