A number of our clients have contacted us recently to ask how to handle the applications of individuals who claim to be “sovereign citizens,” and state that the government has no right to verify their eligibility for affordable housing, such as Section 8 or LIHTC. I have seen this often enough lately that an article on sovereign citizens and how to handle them for affordable housing eligibility purposes is warranted.
Sovereign Citizens believe that they – not judges, juries, law enforcement, or elected officials – should decide which laws to obey and which to ignore. Most sovereign citizens also don’t believe they should have to pay taxes.
The contemporary sovereign belief system is based on a decades-old conspiracy theory. Sovereigns believe that the American government set up by the founding fathers, under a common-law legal system, was secretly replaced. They think the replacement government swapped common law for admiralty law, which is the law of the sea and international commerce.
They follow the basic precept that U.S. judges and lawyers are foreign agents who deny the court challenges of sovereigns out of treasonous loyalty to hidden and illegitimate government forces.
It is impossible to know how many sovereigns there are in the U.S. today, in part because there is no central leadership. There are a variety of local leaders with individualized views on sovereign citizen ideology and techniques. Their recommendations often include tax evasion, adverse possession (squatting on a property that does not belong to them), or ignoring laws regarding driver’s licenses, vehicle registration, or license plate possession. They base these activities on their belief that free men and women, as they call themselves, are not bound by the laws in question. It is estimated that there may be as many as 500,000 sovereign citizens, with a hardcore group of about 100,000.
When sovereigns are angry with government officials (or others who deny their rights as sovereigns), their revenge most often takes the form of “paper terrorism.” Sovereigns file retaliatory, bogus property liens that may not be discovered by the victim until they attempt to sell or mortgage their property or take out a loan. These liens can be for millions of dollars. For this reason, it is recommended that property owners who reject the application of a sovereign due to their refusal to verify eligibility check for possible liens against the property for a period of one to two years after the rejection.
Sovereigns have also signed up for Section 8 as landlords for properties they do not own. Over the course of four years, the Department of Housing & Urban Development (HUD) has recovered $17 million from sovereigns for housing-related fraud.
Despite what they may believe, so-called Sovereign Citizens are not exempt from federal, state, or local law. If such a person applies for occupancy at an affordable housing property of any type, including HUD, Rural Development, or LIHTC, they are subject to the same rules as any other person. They must be able to demonstrate eligibility based on verified information and must submit to the same screening and occupancy criteria as any other applicant. Due to the nature of their beliefs, when dealing with such individuals, managers should contact their corporate office and involve their attorney in the process.