Last Wednesday, a three-judge panel of the First Circuit Court of Appeals in Boston, Massachusetts, held oral arguments in the case of Ian Freeman, the libertarian Bitcoin seller who the feds targeted back in 2019. In December 2022, Freeman was convicted by a jury in a U.S. District Court in New Hampshire of four types of offenses: (1) failing to register with the federal government as a Bitcoin seller and conspiring to not register with the feds as a Bitcoin seller; (2) income-tax evasion; (3) money-laundering; and (4) conspiracy to launder money.
After a verdict of guilty on all the charges, the U.S. District Judge entered what is called a judgment of acquittal notwithstanding the verdict on the money-laundering count. He entered that ruling based on the fact that there was no evidence whatsoever to justify the jury’s finding of guilt on that issue. Thus, that left the other convictions relating to registration, tax evasion, and conspiracy to launder money.
On October 2, 2023, Freeman was sentenced to 8 years in prison on the most important count — the conspiracy-to-launder-money count — and five years each on the registration counts and the tax-evasion counts. All the sentences were ordered to run concurrently — i.e., at the same time. The District Judge denied bail pending the outcome of an appeal and ordered Freeman to be taken into custody. He has been imprisoned ever since. However, he appealed his convictions to the First Circuit Court of Appeals. That’s what the oral arguments were about last Wednesday.
Last July, I wrote a series of articles analyzing these convictions:
The Unjust Conviction of an Innocent Man: The Ian Freeman Case, Part 1
The Unjust Conviction of an Innocent Man: The Ian Freeman Case, Part 2
The Unjust Conviction of an Innocent Man: The Ian Freeman Case, Part 3
How I Came to Investigate the Ian Freeman Case
In those articles, I stated my conviction that the 44-year-old Freeman is an innocent man — yes, a totally innocent man, a man who today is unjustly serving an 8-year sentence in a federal prison camp.
The oral arguments
I attended the oral arguments in the First Circuit Court of Appeals last week in Boston. Also in attendance were around 15 friends and supporters of Freeman as well as his wife Bonnie.
Each side was allowed 15 minutes to present its arguments. Freeman’s attorney went first. The government’s lawyer then presented his reply. Then Freeman’s attorney got some time for rebuttal. If you would like to listen to the oral arguments, you can do so via Youtube here.
Nothing that occurred during those oral arguments dissuaded me from my conviction that the feds have targeted, indicted, prosecuted, convicted, sentenced, imprisoned, fined, and punished an innocent man, as well as permanently deprived him of a large amount of his savings.
In fact, based on the oral arguments presented by the government lawyers in the case, it was clear to me that the concept of statism is alive and well in the U.S. Justice Department and that the feds continue to inflict their statist wrath on Ian Freeman simply because of his fierce anti-statist views.
The conspiracy-to-launder-money count
In an appeal from a criminal conviction, the lawyer for the accused writes and files what is called an appellate brief, which sets forth the facts of the case and the points and arguments and case law as to why the conviction should be reversed. The government lawyer then files a reply brief stating why the conviction should be upheld. The defendant then has the right to file a rebuttal brief responding to the government’s reply brief.
Freeman’s appellate brief challenged his convictions relating to registration and tax evasion. However, his brief did not challenge the conspiracy conviction. In my opinion, that might well prove to be a grave mistake because it had the effect of leaving the most important conviction — the conviction with the highest prison sentence — intact.
In other words, even if Freeman succeeds on appeal in knocking out the registration convictions and the income-tax convictions, he is still saddled with the conspiracy conviction and its 8-year prison sentence because his lawyer did not challenge that conviction in Freeman’s appellate brief. Thus, even if Freeman wins on the registration and tax convictions, it’s my opinion that from a practical standpoint he has gained nothing if the conspiracy conviction and its 8-year sentence are still left standing.
From what I have been informed, the reason for not challenging the conspiracy conviction was that Freeman’s lawyer was up against a word-count limit that the Court of Appeals imposes on appellate briefs. Given such, however, it seems to me that there were other options: (1) edit and compress the arguments so that all (not just some) of the convictions are challenged within the allowable word count; (2) make sure the most important conviction — i.e., the one with the highest sentence — is challenged within the allowable word count; or (3) file a motion asking the Court of Appeals to grant permission to file an appellate brief that has more words than the rule permits.
There is still one possibility, however, of knocking out the conspiracy conviction. In his appellate brief, Freeman’s lawyer made what is called a “spillover” argument. It holds as follows: Since the jury heard all the evidence relating to the money-laundering charge that the District Judge later threw out, that evidence necessarily “spilled over” and affected the jury’s deliberations and verdict on the conspiracy charge (and the other charges). Therefore, in the interests of justice, the Court of Appeals should reverse and remand the case for a new trial, one in which the jury will not hear the evidence relating to the conviction that was thrown out — that is, the money-laundering conviction.
Moreover, the same spillover argument would apply if the Court of Appeals were to throw out the registration convictions or the income-tax convictions or both. Listening to all that “invalid” evidence that has been thrown out could easily have affected the jury’s verdict on the conspiracy count. Therefore, the case should be remanded to the District Court for an entirely new trial.
I find this argument very persuasive. In my opinion, Ian Freeman is entitled to a jury that considers only the evidence that relates to the charge or charges he is facing. This is especially true given the nature of the evidence supporting the money-laundering charge that the District Judge threw out. As I detailed in “The Unjust Conviction of an Innocent Man: The Ian Freeman Case, Part 1,” that was the evidence relating to the fraud, deceit, deception, and entrapment by the IRS agent Pavel Prilotsky against Freeman. As I pointed out in my articles cited above, there is one big reason why the feds would resort to that type of dark-side misconduct as a way to get Freeman — they knew that they had nothing else on him. After all, if they truly believed that their failing to register, income-tax, and conspiracy accusations had any merit, why would they have felt the need to resort to fraud, deceit, deception, and entrapment as a way to get him?
So, where is the fairness and justice of having the jury hear all that dark-side evidence to support a charge that the judge later rightly threw out, given its clear tendency to prejudice the jury on the other charges? Why shouldn’t Freeman (and everyone else accused of a crime) have the right to have a jury determine his guilt on a particular charge based solely on competent evidence relating to that charge rather than on invalid evidence relating to a bogus crime, especially evidence involving fraud, deceit, deception, and entrapment on the part of some IRS agent who is searching desperately for some crime to pin on Freeman?
It’s usually difficult to ascertain how the thinking of an panel of appellate judges is tending based solely on the questions the judges ask. But at one point in the hearing, one of the judges asked the government’s lawyer if he felt it would be proper to send the case back for resentencing if the Court did end up knocking out one or both charges — those relating to failure to register or the income-tax charges.
What is concerning about the judge’s question is that it refers to sending the case back for resentencing, not for a new trial. That implies that that judge isn’t accepting the spillover argument because the spillover concept holds that a new trial, not a resentencing, is in order. What the judge was getting at with his question was the following: If the Court of Appeals knocks out the either the registration convictions or the tax convictions or both, should the case be remanded to the District Judge to see if he would like to reduce the 8-year sentence on the conspiracy-to-launder conviction in light of the fact that one or both of the other convictions have been set aside? But if the case were to remanded for resentencing, it’s important to note that the District Judge can, if he wants to, mete out the same 8-year sentence on the conspiracy-to-launder conviction that he originally gave Freeman.
The conspiracy count
This returns us to the conspiracy-to-launder charge, which, again, is still intact given that Freeman’s appellate brief did not challenge it. Was there a basis on which to challenge that conviction? Absolutely! The basis for challenging the conspiracy-to-launder conviction was the same basis on which the District Judge threw out the money-laundering conviction after the jury found Freeman guilty on that count — that there is no evidence to support the jury’s verdict.
Keep in mind that a judge cannot second-guess a jury’s verdict. The jury’s verdict is always final. But there is one exception: If there is no evidence whatsoever to support the jury’s verdict, the judge has the right — and the duty — to disregard the jury’s verdict and throw it out.
Thus, when the District Judge was faced with Freeman’s challenge of the money-laundering charge — the charge where the feds engaged in fraud, deceit, deception, and entrapment — he found that there was no evidence whatsoever that Freeman had engaged in money-laundering. Therefore, the judge had the right — and the legal duty — to disregard the jury’s verdict on that count and throw it out. In other words, since there was no evidence to support the conviction, the District Judge essentially found Freeman innocent as a matter of law on the money-laundering charge.
I contend that the exact same principle applies to the conspiracy-to-launder count. I have read the entire trial transcript. There is no evidence whatsoever in the record that Freeman conspired with anyone to launder money, just as there was no evidence whatsoever in the record that Freeman laundered any money. Therefore, I contend that Freeman’s attorney should have challenged his conviction on appeal on that count on that basis — the same basis that the District Court used to throw out the money-laundering charge.
In fact, I contend that the Court of Appeals should throw out the conspiracy conviction on its own accord, even though Freeman’s appellate brief failed to challenge it. When there is clearly no evidence to support a conviction, it is the duty of a court of law to set aside the conviction, even when it is not challenged by the defendant. Justice requires it. Justice demands it.
Keep in mind that a conspiracy count requires proof of an agreement to commit an illegal act (i.e., money-laundering). Where is the evidence that Freeman entered into such an agreement? It is nowhere to be found.
For one thing, the government admitted in a pretrial motion that it was not accusing Freeman of conspiring with the online lovers who were scamming old people out of their money. (See my series of article cited above for a detailed explanation of this aspect of the case.) It also would have been impossible as a matter of law and logic for Freeman to have conspired with the victims of the scam.
That then leaves only one possibility: that the government is claiming that Freeman conspired with his fellow Bitcoin associates to launder money. But the government did not introduce one iota of evidence that Freeman and his associates ever entered into an agreement to launder money or that they even discussed such a thing. There is a simple reason why the government failed to introduce such evidence — it never happened. Freeman and his associates never even thought about laundering money, much less agree to do it or even talk about it.
Sure, they all were in agreement to sell Bitcoins. Selling Bitcoins was their line of work. But an agreement to sell Bitcoins to people does not equal an agreement to launder money, except in statist-land, where statists are bending over backwards to convict and punish a fierce anti-statist libertarian who opposes everything about statist-land.
Moreover, laundering money means taking dirty money and turning it into clean money. Freeman never handled dirty money. More important insofar as the conspiracy count is concerned, he and his Bitcoin associates never agreed to handle dirty money. When the victims of the scams purchased Bitcoins from Freeman, their money was clean. When Freeman followed the victims’ instructions to deliver title to the Bitcoins to their online lovers, the money was still clean. It didn’t become dirty until the moment that the Bitcoins became owned by the online lover-scammers. Again, keep in mind something extremely important: The District Judge found Freeman innocent of the money-laundering charge as a matter of law–that is, because there was no evidence whatsoever that he had laundered any money.
As with the laundering-money conviction that the District Judge threw out, the record is devoid of any evidence that Freeman conspired with anyone to launder money. Again, keep in mind that the District Judge knocked out the substantive charge of laundering money based on no evidence to support it. I contend that the same holds true for the conspiracy-to-launder-money count, which is why I contend that the Court of Appeals has a solemn duty to review, consider, and sustain this point, even though it wasn’t made in Freeman’s appellate brief.
The online lover scams
There is an important point that needs to be made about the government’s appellate brief and its oral argument. The government continues to emphasize the little old ladies who had online lovers who scammed them out of money. That’s what the government also did during the trial. What’s the important point? Simply that Freeman wasn’t part of those scams, which is why the government chose not to charge him with fraud or conspiracy to defraud. If the government had even one iota of evidence that Freeman had conspired with the online scammers to defraud their victims, you can bet your bottom dollar that they would have indicted him for fraud or conspiracy to commit fraud against those scam victims. They charged him with neither. Thus, contrary to what the U.S. Attorney’s Office in New Hampshire suggested in a post-sentencing press release, Freeman was never convicted of defrauding anyone. For that matter, that same press release falsely stated in its opening sentence that Freeman had been sentenced for money laundering. That was a flat-out, unmitigated, knowing, deliberate, and intentional lie because the U.S. Attorney’s office knew full well that the District Judge had thrown out the money-laundering conviction before sentencing based on the fact that there was no evidence whatsoever to support it.
What do those online scams have to do with failing to register his Bitcoin business, income-tax evasion, and whether there was a conspiracy to launder money? Absolutely nothing! They were simply a way to suggest that Freeman was involved in scamming those little old ladies without having to charge or prove it and get a conviction on it. It is also a way to induce a jury to convict, as well as induce judges to uphold convictions, based on irrelevant and misleading evidence and baseless accusations.
“Money,” “Funds,” and Bitcoin
Let’s now examine the failure-to register charge and the conspiracy-to-fail-to-register charge, which Freeman fervently opposed in his appellate brief. The following is what the charges are based on:
Congress enacted laws that require people who engage in the “transmission” of “money” or “funds” to register their business with the government. Such laws were enacted many years before Bitcoin was invented. After Bitcoin was invented, Freeman went into the business of selling Bitcoins. Freeman reasoned in good faith that he didn’t have to register his business with the federal government because there is no reasonable possibility that Congress intended to encompass Bitcoin in its definition of “money” and “funds” for the simple reason that Bitcoin had not yet been invented and turned out to be a totally unique invention. Therefore, there was no way that Congress could have envisioned it when it enacted its money/fund transmission laws.
The government’s position, however, was that at some point in Bitcoin’s evolution, Webster’s Dictionary defined “money” and/or “funds” as encompassing Bitcoin. Moreover, the government pointed out in its appellate brief and at the oral arguments that various other appellate courts have held that “money” and/or “funds” encompass Bitcoin.
Let’s accept the government’s position. My question is: So what? What relevance do Webster’s Dictionary and various holdings of appellate courts have to the issue of congressional intent in a law that was enacted long before Bitcoin was invented and long before Webster’s issued that particular dictionary and long before those appellate rulings?
Let’s take the day Bitcoin was invented, which took place several years after Congress enacted its money/fund-transmitting registration laws. Was Bitcoin “money” or “funds” on that day — on the day it was invented? I think even the most dyed-in-the-wool statist would say no. Well then, how about the week after it was invented, when people were first discovering it and talking about it? Again, I think most everyone would say, “No way!”
So, when did Bitcoin officially become “money” or “funds”? When Webster’s Dictionary published the edition that first defined it that way? How about the weeks before the dictionary came out, when the book was being printed? Or is the magical date when the first appellate court made its decision that “money” and “funds” encompass Bitcoin? As I pointed out in my series of articles cited above, there are plenty of financial experts and economists who contend that Bitcoin does not meet the requisite requirements to be considered “money.” For example, the June 2021 issues of Forbes magazine, which is a very well-known financial magazine, published an article in which the author stated, “Cryptocurrencies have been designed to serve as currencies, but they don’t yet fulfill the central functions of money.” But of course, the government’s lawyers would say that dictionary publishers and lawyers know a lot more about finance, money, and economics than financial experts and economists.
I asked Chatgbt whether Bitcoin is “money.” After analyzing the issue, this was its conclusion: “In summary, while Bitcoin exhibits some characteristics of money, it is not universally accepted as such in the same way as traditional currencies.” Well, if that’s the case, how can anyone be certain that the Congress that originally enacted the money-transmission statutes before Bitcoin was invented would not have been one of those who did not accept Bitcoin as “money” or as “funds”?
Thus, while we can be sure that modern-day dictionary publishers and some appellate judges define “money” and “funds” to encompass Bitcoin, what we can’t be certain of is what Congress would have done originally if it had known about Bitcoin. This is especially true given that even dyed-in-the-wool statists would not say that Bitcoin constituted “money” and “funds” from its inception and until it reached the magic date on which Webster’s Dictionary and some federal court of appeals decreed it to be “money” or “funds.”
Given that it is impossible to be certain what Congress would have done had it known about Bitcoin, I contend that we should not be putting people into prison for what we think Congress might have done if it had heard of Bitcoin. That’s not the way our criminal-justice system is supposed to operate. We are supposed to bend over backwards to protect the innocent, not convict them. As the noted 18th-century English legal commentator William Blackstone put it, “It is better that ten guilty people escape than that one innocent suffer.”
There is something else to consider: When a person sells Bitcoins, does he actually engage in the “transmission” of money or funds? I’m certainly no expert when it comes to Bitcoin and I might be wrong about this, but it is my understanding that Bitcoins are never sent or transmitted to anyone. That’s because by their very nature, they remain in the same location on the Internet always and forever. They don’t move. They remain stationary. Given such, there is no way for anyone to “transmit” them. So, why should we assume that Congress would have included them in its statute that criminalized the “transmission” of money or funds?
So, if it’s not transmitted, how does ownership of a Bitcoin change? Through a change in title. The Bitcoin remains where it is. It’s never transmitted. The title to that Bitcoin simply changes with a new ID number when it is sold. Unlike paper dollars, Silver Eagles, or Krugerrands, Bitcoins are not sent to new buyers. The Bitcoin simply ends up with a new identification number of the new buyer.
Imagine that Freeman was in the business of selling real estate. He advertises a lot for sale. A little old lady who has fallen in love with an online lover telephones Freeman and says she wants to buy the lot and that she wants the title of the lot transferred to someone else. Freeman agrees. As Freeman is preparing the deed, she says to him, “Put the deed in the name of John Doe (her secret online lover) and send it to his address.”
Are we to consider that the lot is “money” and “funds” and convict Freeman for not registering his “lot-transmission” business with the federal government? Why not? After all, in certain circumstances at some point in the future, couldn’t real-estate lots be considered to be “money” and “funds”? Haven’t cigarettes been considered “money” in certain situations? Shells? Wampum? And after all, just because the lot isn’t physically transmitted or sent to the buyer, the title to the real estate does change hands, just like it does with Bitcoin.
But here’s the kicker — actually, the super kicker: Many years after the enactment of the statutes under which Freeman was targeted, Congress enacted a law that defined “money” and “funds” to, yes, encompass Bitcoin! Why is that important? Well, if it is so clear that the original money/funds transmission laws encompassed Bitcoin, as the government claims, there would have been no reason for a new law that “clarified” that point. The very fact that Congress enacted the new law is proof positive beyond a reasonable doubt that it wasn’t clear at all that the original law encompassed Bitcoin. And when congressional intent is in serious doubt, we have no business punishing people for failing to comply with the law.
Body snatchers and bee hives
Moreover, consider the harshness of the sentence that was meted out to Freeman on the fail-to-register convictions — five years in prison. Five years! For what amounts to a violation of a ridiculous economic regulation in statist-land. Whoop dee doo! Isn’t that a serious “offense”? Why, I’d say it might even be a threat to the much-ballyhooed concept of “national security,” the most important term in the statist political lexicon. Of course, never mind that the Constitution fails to delegate any power to the federal government to be in the business-registration business. And never mind that Americans were not required to register their businesses with the feds for the first 100 years of our nation’s existence.
If the accused had been a public (i.e., government) high-school principal instead of Ian Freeman, there is no question but that he would have received probation for such a ridiculous regulatory-type offense. That’s because he would have been considered to be part of the collective statism to which most everyone belongs. The feds would have said that he just made a good-faith honest mistake in misinterpreting the statute. They would have slapped him on the wrist, patted him on the back, and sent him home to be with his family.
Not Ian Freeman though. You see, Freeman is different. As a fierce anti-statist libertarian, he doesn’t buy into their little beloved statist system. He stands apart from it. He criticizes, condemns, mocks, and ridicules it. Like other libertarians, Freeman has broken free of the statist indoctrination he received in the public (i.e., government) schools to which his parents were forced to send him. And the statists hate him for it. Their deep hatred of Freeman was perfectly manifested by the fact that they decided to sic an undercover IRS agent on him to defraud, deceive, and entrap him into committing a fake crime.
Recall the movie The Invasion of the Body Snatchers. Statists are the pod people in that movie who are fiercely searching for anyone and everyone whose mind has not been absorbed into the overall statist collectivist mindset. Statists won’t rest until everyone becomes part of the collective and is happy and at peace about it.
Or consider a bee hive. Every drone knows his place and knows what is expected of him to make the hive a joyful and wonderful place. But then along comes Ian Freeman who says, “No, I’m no longer interested in being a part of your hive.” The hive authorities go ballistic. Freeman has become a threat to the hive. He could conceivably cause other drones to question their role in the collective. He has to be dealt with. He has to be targeted, even with fraud, deceit, deception, and entrapment into committing a fake crime. He must be made an example. He must be removed from society for many years so that he is unable to influence any other drones in the hive.
The drug-war racket
Moreover, let’s not forget what all this money-laundering, money/funds transmission, bank-secrecy, suspicious bank activity reports, cash-reporting requirements, and “know your customer” nonsense is all about — the big statist drug-war racket. It’s a racket that has been going on for many decades and has been — and continues to be — a big source of moolah in the form of generous salaries and pensions for federal prosecutors, federal judges, federal clerks, DEA agents, prison personnel, private contractors, and a host of other beneficiaries of the drug-war racket, including officials who receive bribes, payoffs, and proceeds from asset forfeitures as a result of the drug war.
Just ask any of these statist officials: How is your drug war going after some 80-90 years? They’ll look at you blankly for even having the audacity to ask the question. You’re not supposed to ask that type of question in statist-land. You see, each tyrannical measure they have taken to “win” their war on drugs has done nothing more than destroy the freedom and privacy of the American people, including financial privacy. That was precisely why Bitcoin was invented — to restore a bit of financial privacy to the American people after having had this fundamental, God-given right destroyed for decades as part of the failed, deadly, violent, corrupting, and destructive statist war on drugs. That too is why the statists hate Ian Freeman so much — not only because he was selling Bitcoins but also because he was teaching people about the virtues of Bitcoin in protecting people’s financial privacy from the prying eyes of government officials.
The income-tax charges
One of the bright spots for me in the oral arguments was when one of the judges asked the government’s lawyer about the IRS agent who admitted under oath at Freeman’s trial that they didn’t really know whether Freeman owed any back taxes at all. The judge rightly seemed troubled over convicting a person for tax evasion based on the government’s own admission that it wasn’t really certain whether Freeman owed any taxes at all. I found it to be a bright spot because it’s a point I brought up in my series of articles cited above.
The government’s response was that Freeman should have come forward and shown his deductions to establish that he didn’t owe any money. But the IRS agent at trial admitted that they never made an appointment to meet with Freeman to discuss his deductions, as they customarily do with people like public (i.e., government) high-school principals and other “regular” people who are part of the hive. Since he’s not part of the hive and, in fact, opposes the hive, Freeman was not accorded that courtesy.
Nonetheless, it is rather strange to me that the government’s position is that Freeman should have shown his deductions at trial. The reason that sounds strange to me is that I have always believed that in the United States, it’s the government’s job to prove a person’s guilt beyond a reasonable doubt and not the responsibility of the accused to prove his innocence. Once the government’s IRS witness stated under oath that they didn’t know whether Freeman owed any taxes at all, that should have been the end of the matter. The District Judge should have knocked out the income-tax charges, just as he knocked out the money-laundering charge.
In its appellate brief, the government made a big deal out of Freeman’s opposition to paying income taxes and his sharing that belief with others. Sure, to a modern-day statist, that’s a strange and dangerous position, especially since the income tax, along with the Federal Reserve’s paper-money printing racket, fund the statist hive that keeps federal prosecutors and other federal officials in high cotton.
But what the statists don’t realize is that for the first century of America’s existence, Freeman’s views were the norm. It was the statist views that were considered weird. Don’t forget, after all, that our American ancestors in, say, the late 1800s lived without income taxation, the IRS, the Federal Reserve, paper money, drug laws, bank-secrecy laws, money/funds transmission laws, asset-forfeiture laws, money-laundering laws, and, yes, without even business-registration laws. That’s because those Americans chose to live in a genuinely free society, not a statist one that statists have convinced themselves is freedom.
