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Alaska militia infiltrator exposed

Jill Burke
Schaeffer Cox, founder of the Alaska Peacemakers Militia, is accused in an alleged conspiracy to kill a state judge and others. He faces conspiracy and weapons charges in state and federal court.
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Schaeffer Cox in a Fairbanks courtroom on April 5, 2011
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Michael Anderson is accused as a conspirator in an alleged plot to kill a state judge and others. Photographed in Fairbanks on April 5, 2011.
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Lonnie Vernon faces multiple conspiracy and weapons charges in connection with alleged plots to murder state and federal judges and others. Photographed in Fairbanks on April 5, 2011.
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Karen Vernon faces state and federal conspiracy and weapons charges in connection with alleged plots to murder state and federal judges and others. Photographed in Fairbanks on April 5, 2011.
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Coleman Barney, accused in an alleged plot to kill a state judge and others, faces conspiracy and weapons charges in state and federal court. Photographed in Fairbanks on April 5, 2011.
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Rachel Barney, charged in state court with helping hide a fugitive, in a Fairbanks courtroom April 5, 2011
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Judge David Stewart.
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Editor's note: This is the first of a two part series on Gerald Olson, a government informant who has been helping the FBI in its case against the Alaska Peacemakers Militia. Today's story chronicles his past run-ins with the law and what he is getting in return for cooperating. On Wednesday night, Alaska Dispatch looks at Olson's connections to the militia and his role as an informant in the state-federal investigation.

PART I: As the state-federal case against a Fairbanks-based militia accused of plotting to murder government officials unfolds, a back story is emerging of two informants with eclectic backgrounds who played major roles in nabbing the suspects.

Much of what investigators know about Alaska Peacemakers Militia leader Schaeffer Cox’s alleged murder plans came from the two paid informants, who had been feeding authorities tips for at least 10 months prior to the March arrests of Cox and four others.

One of the informants was Bill Fulton, the owner of Drop Zone army surplus shop in Anchorage, an ex-military man who made national headlines when he handcuffed an Alaska Dispatch journalist during tea party candidate Joe Miller's failed run for U.S. Senate last fall.

The other informant, however, had remained a mystery to the public until Friday, when a state judge forced state prosecutors to unveil his role in the Alaska Peacemakers Militia investigation.

RELATED: Read more about the Alaska Peacemakers Militia and the investigation

 

His name is Gerald "J.R." Olson. He has spent time in Palmer, Fairbanks and Delta Junction, and he has a criminal past, including crimes that he may be getting a break on in return for his cooperation in the militia probe.

Like Fulton, Olson had been feeding inside information on the militia to Alaska State Troopers and the FBI since at least last fall. Though Olson and Fulton crossed paths occasionally, they were unaware they had a common bond: pretending to be friendly with Cox and his anti-government cause. In reality, they were actually foes, helping the government infiltrate the young Alaska militia leader and his followers.

Known in court documents as "Confidential Source 1" (Olson) and "Confidential Source 2" (Fulton), those following the militia movement in Alaska took note when the two men seemingly dropped out of sight after the March arrests of five Alaska Peacemaker Militia members allegedly intent on bloodshed. Federal court documents detail an alleged plot by the militia group to kill judges and state troopers in the belief that no laws applied to them and that they had every right to use lethal force to defend their leader, Cox, who had gone missing at the start of his trial on a minor weapons charge.

On Friday, Olson was in Alaska Superior Court in Palmer defending himself against unrelated charges. Based on court filings in the militia case and details revealed during Friday's hearing, Olson's role as a cooperating witness against Cox and his group has been confirmed.

"Currently, CS-1 (Olson) is a convicted felon, and is facing pending Alaska State felony fraud charges and is cooperating with law enforcement with the hope of having his charges reduced or dismissed by the State of Alaska in exchange for his cooperation,” states a summary of the militia investigation filed in federal court.

Criminal acts and cutting confidential deals

As is typical in complex and secret government probes, the investigations often depend on informants, sometimes witnesses who themselves have rap sheets and motives to cooperate. It happened in the Justice Department's oil-political corruption probe, which rested largely on onetime oil tycoon Bill Allen. And in the Alaska Peacemaker Militia investigation, it also seems to be a case resting on the words and actions of two informants -- one whom has a criminal past of his own.

Much has been revealed about one of the informants -- Bill Fulton -- in part because of his high-profile actions during Alaska's 2010 U.S. Senate race. Until he abruptly signed over his business to a colleague and disappeared earlier this year, Fulton ran a military surplus store in Anchorage called Drop Zone ("Drop Zone Bill," he was known in certain circles). At least one person present for meetings between Fulton and militia members has confirmed Drop Zone Bill was working for the government, describing him as somebody who Cox and his associates believed had the ability to obtain grenades and other weapons.

Yet, until last week, not much was known about Olson, the second informant -- a man trusted so well by Cox that he was promoted to the rank of officer within the militia's command structure and tasked with procuring weapons. 

Now that his name is public, a picture emerges of a sketchy contractor who has much to gain by helping the government uproot Alaska militia members. Whether his past will impact the veracity of his allegations remains to be seen.

Thirty-six-year-old Gerald R. Olson, known as "J.R." and as "Jerry," first made headlines in 2005 when he was convicted for illegally installing septic systems in Peters Creek and Wasilla, most of which never worked. By fall 2009 he was again in trouble with the law, accused of stealing a $69,000 construction tractor.

On Friday in state court, prosecutors were forced to explain Olson's involvement to a judge. The hearing was called for Olson to plead guilty to state charges that he stole a construction tractor in 2009. He was now in the midst of cutting a plea deal that would keep him out of jail, an agreement that to some watching the militia case seemed generous, considering his criminal past.  

In defending why they were willing to let a guy with a history of scams get away with what could look like a sweetheart deal, state lawyers publically revealed some details of Olson's cooperation.

Olson assisted state and federal authorities in Fairbanks in the cases against militia members who are currently under indictment for weapons offenses and conspiracy to commit murder and kidnapping, Fairbanks District Attorney J. Michael Grey told state Superior Court Judge Kari Kristiansen.

Olson cooperated at "great personal risk to him and in doing so safeguarded the lives of a number of prosecutors, troopers and judges," Grey told the judge.

"His cooperation was very extensive and included cooperation in a number of other cases not mentioned," added Paul Maslakowski, Olson’s attorney. Olson attended the hearing by phone from an undisclosed location. But he didn't say much, or speak personally about his involvement in the militia case.

A defense attorney for one of the accused militia members who was monitoring Olson's most recent court proceeding also confirmed Olson as an informant who had shared with investigators many troublesome tales about the militia group's actions and intent. 

At Friday's hearing, nobody brought up another felony case against Olson that had also happened in 2009. In those charges, Olson was accused of deceptive business practices for an unspecified incident. The case, however, went nowhere. When Olson was indicted, he had already been picked up for stealing the construction equipment. And soon after, it appears talks were under way on how he might be of use to authorities in Fairbanks.

By June 2010 -- 10 months before Cox and other militia members were arrested largely because of intelligence gathered from Olson, Fulton and other confidential informants -- the business practices case was dismissed before it ever went to trial.

Olson's past is riddled with run-ins with the law -- not over guns and anti-government actions -- but shoddy contract work. Eventually, his narrative arc would cross paths with the militia and the government looking to root out violent anti-government behavior.

Mr. Sewage

In 2002, Gerald Olson's pattern of shoddy septic work caught up with him after a KTUU-Channel 2 TV reporter pursued answers on behalf of his customer-victims. The stories continued, and by 2004 Olson was under indictment for theft and for being an unlicensed contractor who didn't follow the rules and worked under the radar of regulators.

In December 2005, he was sentenced to serve 90 days in jail, five years on probation, and pay nearly $50,000 to his victims. The crimes were of the sort that makes homeowners wary of hiring contractors.

After Olson's sentencing in the case, the Anchorage Daily News reported:

Gerald Olson, formerly of Wasilla but now living in Fairbanks, either failed to deliver the systems or the systems broke soon after installation, leading to long, messy cleanups. In one case, Olson also took $8,400 from an elderly Wasilla couple to remove 17 car hulks from their property as well as to install a septic system. The couple testified that the money represented most of their life savings.

Instead, said chief investigator Jim Bowden of the Alaska Department of Environmental Conservation, Olson crushed the cars and buried them on the couple's property. He then covered the cars up with dirt and ran pipes out of the ground to create the appearance of a septic system below. He piped the couple's sewage straight into the ground. The resulting mess was so severe that the couple had to leave the state for three years, living with relatives until they could save enough money to move back and clean up the property.

Olson's botched installations and bilking of homeowners spanned from Trapper's Creek to Wasilla to Delta Junction, according to authorities at the time.

The jail time and fines were apparently not enough to stop Olson from hustling home owners. Deals gone badly seemed to follow him wherever he went, and in whatever kind of business he chose to pursue, be it a logging mill selling kit cabin frames from an address in Copper Center, or a construction company in Fairbanks.

Court records don't show why Olson in September 2008 rented a tractor from Totem Equipment Rentals near Sutton. But according to prosecutors, Olson never returned the $69,000 Mustang track loader, a decision that within a year would catch up with him.

He would find himself charged with vehicle theft stemming from the incident and in violation of his probation for the septic scams. A few months before the 2009 tractor theft landed him in trouble, Olson was yet again accused of not providing a service he had promised. It happened in August 2009 near Delta Junction, and criminal charges were filed against him. But the court record is vague about what happened. Charging documents show only that Olson was accused of "deceptive business practices."

A look back at Olson's history shows a decade of swindling others as well as a string of civil lawsuits from unhappy clients and businesses. 

In 2001 and 2002 -- around the time he was busy installing bad septic systems -- he was sued in separate cases for not returning a rented log loader, for the late return of an excavator that came back damaged, and for $2,817 for using a bad check to buy 3,000 gallons of fuel.

A decade later, Olson still hasn't paid all of his victims back for the damage he caused, both in the civil cases and his septic scams. At his sentencing in Palmer on Friday, one condition of his sentencing deal is that he cannot be released from probation until he fully compensates those he stole from, including his victims from the 2004 case.

But he's not under any kind of order to pay back people he ripped off whose dealings with him never led to criminal charges, and an Eagle River couple who had a run-in with Olson knows all too well the frustration of trying to get money from him. 

Scott and Donna Fredrickson hired Olson in May 2008 to build a front entryway and decks for their home. Olson asked for $5,000 up front. When it was time to start, he didn't show up, claiming he had a family emergency. When he did finally begin work, he soon wanted more money, first $4,000, then another $2,000. He claimed another customer had paid with bad checks and his cash flow was hurting.

Although Olson did eventually perform work on the Fredricksons' home, the couple claimed it didn't meet code, was made with the wrong materials, and was so poorly constructed that exposed nails were pointed inward on the deck, on which Mr. Fredrickson cut himself. They worried the incomplete work would affect their ability to adopt a child, concerned that they might fail the required home study to show they had a good place for a child to live.

Fredrickson tried to get state attorneys and the state licensing board to take action, but couldn't seem to get anyone to listen, he said in an interview Tuesday. "At the very least I wanted the state to make it where this guy couldn't do it to someone else," he said.

Olson was soon facing other problems, too.

In 2009, Donald and Chrissy Hoover say they ordered a $17,000 log cabin kit from Olson and made an $8,500 down payment, but the kit never showed up at their Chugiak property. At the time, Olson was operating yet another business -- Tolsona Log & Lumber, which Hoover found through an advertisement on Craigslist.

It didn't take long for Hoover to realize he'd signed on to do business with a man with a shady past, and he unsuccessfully tried to use it as leverage to get his money.

"J.R., where is the check? I know you know the consequences of ripping people off and you certainly do not need any more criminal charges brought against you," Hoover wrote to Olson in a May 2009 email. Olson eventually wrote two checks as reimbursement, but they bounced.

The Hoovers sued Olson in state court for failing to return their money.

In filing their court complaint, Donald Hoover expressed frustration at learning, like the Fredricksons, that there was little he could do to either get Olson's contractor license pulled or have criminal charges filed."I just can't believe that a contractor can breach a contract, take someone's money, build substandard construction, and there's nothing the state can do about his license," he wrote to the court.

Hoover had hoped law enforcement would take some action, but in an interview Monday said he couldn't get anyone to help. Alaska State Troopers told him it wasn't there jurisdiction because the potential crimes -- entering into a bad contract and signing over bad checks -- took place at their home. Troopers told him it was a matter for Anchorage police, Hoover recalled. But when he contacted the police, he was told there wasn't much they could do, either. Nobody, including Olson's parole office, seemed able or willing to help, Hoover said, which is why he ended up filing a civil suit against Olson.

"I'm probably chasing after some bad money at this point," he said.

When he learned Olson had cut a deal in the other cases -- the vehicle theft and the probation violation -- Hoover felt let down.

"I'm pretty disappointed he's not back in jail," he said. "He just kind of takes the money and runs. And he's going to do it again and again and again."

Victim compensation takes a backseat to government investigation?

In an unusual twist, it may be the very money Gerald Olson is earning from his work in the militia case (court records disclose that he will continue to be paid until the government no longer needs his services) that allows him to cover his legal costs and reimburse any victims. But what has Olson done for the government to deserve such treatment? And how close was he to Schaeffer Cox, a 27-year-old from Fairbanks who has been dubbed by the Feds as a dangerous threat in the Sovereign Nation Movement sweeping parts of America?

PART II: Coming Wednesday night, Alaska Dispatch looks at Gerald Olson's connections to the militia and his role as an informant in the state-federal investigation.

Contact Jill Burke at jill(at)alaskadispatch.com