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Thursday, April 16, 1998

Republic of Texas separatists convicted of fraud

By ROBERT G. WIELAND / Associated Press Writer

DALLAS (AP) -- A founder of the Republic of Texas separatist movement faces life in prison and $25.25 million in fines for issuing more than $1.8 billion in worthless checks he claimed were backed by State of Texas assets.

Richard McLaren is to be sentenced June 23 for his conviction Tuesday on 26 federal counts of conspiracy and fraud.

Jurors were in the fourth day of deliberations after hearing a month's worth of testimony in the complicated case.

Seven followers of McLaren, including his wife, Evelyn, were convicted.

Mark Anthony Hernandez was acquitted on two counts and ordered released.

"I'd rather be in there with them ... because they're innocent too," Hernandez said. "It's not fair."

All of those convicted were immediately taken into custody until their sentencing in June and July.

The Republic of Texas members allegedly ran up their credit card bills on such expenses as a Lear jet lease for McLaren and a $300 Neiman Marcus sweater for his wife. They paid with worthless "warrants" resembling cashiers' checks, prosecutors said.

Prosecutors accused them of issuing $3.4 million in warrants to eight companies, including American Express and Visa.

McLaren told jurors the federal government improperly annexed Texas in 1845 and its $80 billion in assets belong to the independent nation of Texas.

The group's self-proclaimed "ambassador and consul general," McLaren was convicted of organizing and managing the warrant scheme.

"I'm disappointed and I'm sure he's (McLaren) disappointed," said defense attorney Tom Mills. "But I don't think he was surprised."

U.S. Attorney Paul Coggins said the verdict was a warning.

"This verdict sends a strong message that crooks cannot evade the laws through militia doublespeak," he said. "If you rip off your fellow citizens, you will be caught, prosecuted, convicted and punished."

McLaren is already serving a 99-year state prison sentence for his role in a kidnapping last year that triggered a Republic of Texas standoff with state troopers.

Mills said McLaren continues to work on Republic of Texas business while behind bars.

"He's very hopeful the Republic of Texas will be recognized as a legitimate entity," he said.