Suspect in Check Scam Linked to ‘Freemen’ Pleads Guilty to Charges

A man pleaded guilty Friday to 13 federal felony charges stemming from his involvement in a multimillion-dollar phony check scam allegedly run by Palmdale tax resister and Montana “freemen” disciple M. Elizabeth Broderick.

Adolf Hoch, 52, described by prosecutors as the “managing partner” of Broderick’s alleged bogus-check operation, faces a maximum prison sentence of 165 years on the charges of money laundering, mail fraud and conspiracy. His sentencing is scheduled Nov. 12.

Federal prosecutor Aaron Dyer said Hoch agreed to withdraw an earlier plea of not guilty after negotiations between his defense attorney and the U.S. Attorney’s office.

But attorneys refused to reveal details of a plea agreement--including whether Hoch will testify against Broderick, who is awaiting trial on charges of running a scam which collected $1.2 million in profits by issuing phony checks.

Dyer said Broderick, who has refused a defense attorney, had not been informed of Hoch’s decision to change his plea. Neither, he said, had two other accused co-conspirators, Barry Switzer of Canyon Country and Julian Cheney, a Reseda chiropractor.

Prosecutors contend that Broderick operated under cover of the burgeoning “patriot” movement to fleece thousands of mostly blue-collar clients by selling worthless checks in an operation allegedly inspired by the “freemen” who surrendered to the FBI after a long impasse in Montana. Since her arrest in April, she has insisted she is not a U.S. citizen and is therefore not subject to prosecution.

Between November 1995 and April of this year, Broderick taught a series of check-writing seminars in Los Angeles, Orange and San Bernardino counties. After paying admission fees of $125 to $200, attendees were trained in “debt-reduction techniques” and received one check made out to a creditor of their choice, purportedly drawn on the U.S. Treasury and bearing Broderick’s signature, prosecutors say.

Broderick claimed the checks were backed by over $1 billion in liens she had lodged against the government, and that the checks would be honored by the office of the Comptroller of the Currency, investigators said. She encouraged clients to use the checks to pay off mortgages, credit cards or other debts, and to make the checks out for more than the amount owed so that a refund would be issued, prosecutors said. In return, she demanded half the refund, they said.

Prosecutors said Hoch joined Broderick’s operation in December and helped manage about a half-dozen business fronts that Broderick was using to juggle earnings from the seminars. Hoch was responsible for hiring employees, issuing phony checks, arranging seminars and speaking at them--duties he maintained even after realizing the check operation was a hoax, the prosecutor said.

“Mr. Hoch continued to run the seminars, despite his knowledge that this was a front,” Dyer said in court. “He continued to promote the scheme, and to conceal proceeds from the scheme.”

Hoch had been uncooperative in previous court appearances. Like Broderick, he said he had renounced his U.S. citizenship and was not subject to U.S. laws. But on Friday, the gray-haired man, clad in a green jailhouse jacket, politely responded “Yes, sir” and “No, sir” to questions from U.S. District Judge Dickran Tervizian as he entered his pleas.

In a separate hearing, Broderick also appeared briefly in court Friday to make final preparations for the start of her trial Tuesday. Judge Tervizian noted that Broderick recently was hospitalized at White Memorial Hospital in Los Angeles for observation and asked her if she would be ready to go to trial.

“It depends how I feel,” Broderick told the judge.

Tervizian refused Broderick’s request to bring a Bible into the courtroom during the trial, saying it would be placed in view of the jury to elicit sympathy. Broderick disagreed.

“It’s my law,” she said.