Jeffrey Scott Green, age 53, and Lisa Flaugher-Green, age 52, both of Easley, pled guilty recently in federal court in Greenville, to a conspiracy to defraud, a violation of Title 18, United States Code, Section 1349. Senior United States District Judge Henry M. Herlong, Jr., of Greenville accepted the pleas and will impose sentence after he has reviewed the presentence report which will be prepared by the U.S. Probation Office.
Evidence presented at the change of plea hearing established that this was an Electronic Funds Transfer (“EFT”) debt elimination case. Various branches of the Sovereign Citizen movement, which denies the jurisdiction and authority of the federal government, teach that they can discharge debts by presenting a check written off a closed account.
The debtor writes on the check “EFT Only for discharge of debt.” On the back he writes “authorized representative without recourse.” Sovereign-Citizen groups falsely teach that if the creditor accepts the instrument then the debt is discharged even though no money ever changes hands. The Defendants were part of a group that endorsed the use of EFT instruments.
It was a part of the scheme and artifice to defraud that Jeffrey Scott Green and Lisa Flaugher-Green wrote checks on closed accounts and noted on the checks “EFT only for discharge of debt.” They then would mail these bogus “EFT instruments” and accompanying documents to creditors in an effort to trick the creditors into issuing documents noting that the debt was paid in full. Once the creditor discovered the scam, Defendants would refuse further payment on the grounds of a discharge procured by “EFT instruments.” Agents estimate that the Defendants attempted to eliminate over half a million dollars in debt using the scheme.
Mr. Nettles stated the maximum penalty the Defendants can receive is a fine of $250,000 and/or imprisonment for 20 years, plus a special assessment of $100.
The case was investigated by agents of the Federal Bureau of Investigation, the Spartanburg County Sheriff’s Office, and the Greenville County Sheriff’s Office. Assistant United States Attorney Bill Watkins of the Greenville office handled the case.