September 20, 2013
By Katy Stech
A Dallas mint that makes commemorative coins and “alternative” money for people who are wary of the U.S. dollar has run into problems with its own finances.
The 25-worker Mulligan Mint Inc.—which has the power to create a “complementary currency system that can fill in the blanks where the U.S. dollar lets us down,” according to its president—has filed for bankruptcy after officials in June discovered that part of a $1.4 million shipment of silver was missing.Mulligan Mint’s business targets an antiestablishment clientele who feel estranged by traditional banking; its Deluminati coin, for example, “says no to inflation, crony capitalism and all-powerful government and yes to individual liberty, economic independence and opportunity.” A Web-advertised one-ounce copper coin reflects the image of Tea Party hero and former U.S. Rep. Ron Paul, while another one asks in copper, “Who is John Galt?”
Perhaps a better question to ask Mulligan Mint executives: Where did the silver go?
“That’s the big question,” Mulligan Mint President Rob Gray told Bankruptcy Beat. “We don’t really know.”
The mint’s Chapter 11 case was filed last week to keep the silver shipment’s owner, precious metals refinery Republic Metals Corp. in Miami, from taking steps to shut down the 20,000-square-foot plant, Mr. Gray said.
Since Mulligan Mint opened last year, the mint has grown to make between 30,000 and 50,000 coins a month, Mr. Gray said. The company’s equipment, some of which came from a Denver mint that made pennies, can “melt, cast, roll, blank, rim, anneal, burnish, wash and mint” coins, according to its website.
Why Mulligan Mint from Coins for the Cause on Vimeo.
Some of the mint’s coins are used by Native American tribes or associations that want commemorative coins. It has also sold coins for what are called “community currencies”—an alternative money system adopted by small groups of people.
“We were a business that set out to do something important for the world and that was to create a complementary currency system for communities that are overlooked by mainstream banking and finance,” Mr. Gray said.
Mulligan Mint’s customers, for example, have included those who take the view that Texas is its own nation, having never properly turned over its land rights. The group’s coins, which depict the Alamo, were once advertised on Mulligan Mint’s website as “not regulated or manipulated by the U.S. government and retains its true value permanently.”
Mulligan Mint even sells a one-ounce silver “bitcoin,” a virtual currency that some have ironically made actual coins for, which has a Q2 code that can be scanned with a smartphone.
“The coin fits in with the company’s vision of a hybrid digital currency backed by a commodity, using commodity banking,” said Mulligan Mint’s blog.
During a 2012 Congressional hearing, Mr. Gray told lawmakers that he’s helped with more than 150 so-called community currencies and token fund-raising programs. As a speaker at a House subcommittee hearing on “parallel currencies,” Mr. Gray stated that the “current private central bank and the men in government who allow it to exist” are “thieves.”
At another point, Mr. Gray told lawmakers that public apathy towards the government and the U.S. Federal Reserve is gaining momentum and “and once it catches on, you’ll be rendered completely obsolete.”
“You’ve managed somehow for the last 100 years to convince the citizens of this country that you’re relevant,” said Mr. Gray, who spoke as executive director for the American Open Currency Standard, an association that promotes alternative monetary systems.
Mr. Gray told Bankruptcy Beat that, despite the Mulligan Mint’s growth, the small business had a sloppy start and that it fell behind on orders.
Mulligan Mint’s bankruptcy stops Republic Metals, which has sued the mint, from taking any more of the plant’s property. The county’s sheriff already took $200,000 worth of silver and gold amid the dispute, which Mulligan Mint wants back.
“What began as a business dispute and an unpaid debt…now escalated due to the seizures [of the company’s] property into a life and death struggle for what is otherwise a sound and potentially highly profitable business,” Mulligan Mint’s attorneys wrote in papers filed with the U.S. Bankruptcy Court in Dallas.
A lawyer for Republic Metals declined to comment about Mulligan Mint’s bankruptcy.
In court papers filed Aug. 1, Republic Metals said the mint’s “outstanding balance of silver” was 71,473 ounces. Republic Metals said in court papers that it agreed to provide silver to Mulligan Mint on consignment because, even though the company didn’t have the money to buy a lot of the metal outright, “it did have access to smelting facilities and to silver buyers.”
A Dallas bankruptcy judge gets to sort out the dispute now.
-Patrick Fitzgerald contributed to this article.
Write to Katy Stech at katy.stech@wsj.com. Follower her on Twitter at @KatyStech.
SOURCE WSJ
