[1] The metal was warehoused at Sunshine Minting in Coeur d'Alene, Idaho prior to a November 2007 raid by the Federal Bureau of Investigation (FBI) and the U.S. Secret Service (USSS).

It was created by Bernard von NotHaus, the founder of the Cannabis Spiritual Center in Malibu, California, and the co-founder of the Royal Hawaiian Mint Company.

Liberty Services' original name was "National Organization for the Repeal of the Federal Reserve and the Internal Revenue Code" (NORFED).

Paper and digital Liberty Dollars were legally defined as warehouse receipts and were backed by a physical commodity: a weight in precious metal.

The Liberty Dollar organization asserted one Secret Service agent claimed "It's not counterfeit money"[16] while remaining "skeptical" of NORFED.

§ 486:Whoever, except as authorized by law, makes or utters or passes, or attempts to utter or pass, any coins of gold or silver or other metal, or alloys of metals, intended for use as current money, whether in the resemblance of coins of the United States or of foreign countries, or of original design, shall be fined under this title or imprisoned not more than five years, or both.The promoter of the Liberty Dollar asserts that Claudia Dickens, spokeswoman for the U.S. Treasury Department's Bureau of Engraving and Printing, had previously said American Liberty Currency is legitimate.

"[17] In 2006 the U.S. Mint issued a press release stating that prosecutors at the Justice Department had determined that using Liberty Dollars as circulating money is a federal crime.

[18] The Justice Department also stated that the Liberty Dollar was confusingly similar to actual U.S. currency, and the language used on NORFED's website was deceptive.

Defendants include Henry M. Paulson, Secretary of the Treasury; Alberto R. Gonzales, former Attorney General of the United States; and Edmund C. Moy, Director of the Mint.

[21] The suit sought a declaratory judgment that circulating Liberty Dollars as a voluntary barter currency is not a federal crime and an injunction barring the Defendants from publicly or privately declaring the Liberty Dollar an illegal currency and to remove any such declarations from the U.S. Mint's website.

[22] The Liberty Dollar offices were raided by agents of the Federal Bureau of Investigation (FBI) and the U.S. Secret Service (USSS) on November 14, 2007.

Bernard von NotHaus, the owner of Liberty Services, sent an email to customers and supporters saying that the agents took all the gold, silver, and platinum, and almost two tons of Ron Paul Dollars.

[23] Von NotHaus's email linked to a signup page for a class action lawsuit so that the victims might recover their assets.

Bernard von NotHaus, the group's monetary architect and the author of the email, did not immediately respond to a message seeking comment.

[30] On March 18, 2011, von NotHaus was convicted of "making, possessing and selling his own coins", after a jury in Statesville, North Carolina deliberated for less than two hours.

[32] He faces up to 15 years in prison, a $250,000 fine, and may be forced to give $7 million worth of minted coins and precious metals to the government, weighing 16,000 pounds.

[31] Attorney for the Western District of North Carolina, Anne M. Tompkins, described the Liberty Dollar as "a unique form of domestic terrorism" that is trying "to undermine the legitimate currency of this country".

[33] The Justice Department press release quotes her as saying: "While these forms of anti-government activities do not involve violence, they are every bit as insidious and represent a clear and present danger to the economic stability of this country.

"[33] According to the Associated Press, "Federal prosecutors successfully argued that von NotHaus was, in fact, trying to pass off the silver coins as U.S. currency.

[34] Since his trial, The New York Times has said that his followers describe von NotHaus as "the Rosa Parks of the constitutional currency movement."

[36] As part of his reasoning for delivering a greatly reduced sentence from what Federal Prosecutors demanded, Judge Richard L. Voorhees considered von NotHaus's appeal, which stated: The conviction, which was seen as a victory for the government, has now defined 18 U.S.C.

[39] Federal prosecutors were seeking to take roughly $7 million worth or five tons in Liberty Dollars minted in gold and silver seized in 2007 from a warehouse by the FBI and USSS.