LXIV.
DIAMOND AND OTHER SWINDLES.
THE GREAT DIAMOND SWINDLE OF 1872.—HOW IT WAS ORGANIZED.—MAGNIFICENT PLANS OF THE SWINDLERS.—PLANTING A DIAMOND FIELD.—HOW THE FRAUD WAS EXPOSED.—A NEAT SWINDLE ATTEMPTED IN SAPPHIRES.—HOW IT WAS DISCOVERED.—A MYTHICAL COPPER MINE.—FATE OF THE SWINDLER.
The great diamond swindle of California will probably go down in history as one of the most magnificent frauds of this or any other age. There are some facts about the matter which have not yet been given to the public. When the operators first started their “plant,” they went to New York, and endeavored to enlist capitalists in that city. A friend of mine was thrown into contact with them, and from him I learned the points. They wanted half a million dollars for their claim. He looked at the diamonds, which appeared to be genuine, and he was allowed to apply the usual test of rubbing with steel files and with emery. They stood the test, and he offered to put ten thousand dollars into the scheme. Another friend (a friend of my friend) came forward, and as he had some money to spare, he was allowed to investigate the business; the twain were prepared with more files and emery, and they rubbed more of the diamonds.
The test was going on satisfactorily, when my friend, whom I will call Sharpley, happened to lay hold of a stone that yielded to the hard substances against which it was brought. Sharpley tried another side of it, and again it yielded. He was handling a piece of common crystal, and not a diamond, and his eyes were beginning to open. He became inquisitive enough for a son of Paul Pry, and the result of his questioningwas, that he didn’t put his money into the speculation. Straightway he sought his friend, and actually found him arranging to draw the check that would have made him a twenty thousand dollar stockholder in the great diamond mine of Arizona.
DISCOVERING A FRAUD.
Sharpley talked to him like a Dutch uncle, and with some difficulty induced him to withhold the money for the present. I say with difficulty, for Sharpley’s friend had become as enthusiastic over the diamonds as a damsel of sixteen over her first beau, and was determined to go in anyhow. He half suspected that Sharpley wanted to keep others out so that he could get more stock for himself, and subsequently, when the stock was all taken, he upbraided Sharpley for keeping him out. He does not upbraid much now, but, on the contrary, quite the reverse. When the exposure came out, he thought how his twenty thousand dollars had been saved, and remembered that Sharpley had been the cause of its salvation. He sent a basket of the best champagne to Sharpley’s office, and it was while drinking a glass of the beverage that its recipient told me of his diamond experience.
“It was one of the best laid plants I ever saw,” said Sharpley, “and if it had not been for stumbling on that piece of crystal, I might have been taken in. They tried to explain to me that the crystal got in there by accident; but as they had previously told me that every stone in the collection had been examined by an expert, I knew there was a lie somewhere. They had a few rubies, which they claimed were found in the same locality, or near them. I looked at them, and was allowed to take one of them to a jeweller, who pronounced it genuine. That night I overhauled my encyclopædia, and studied up the character of diamonds and rubies.
“I found that the diamond consists of crystallized carbon, while the ruby, sapphire, and all that class of gems, are crystallized alumina. Next morning I went to one of the best geologists in New York, whom I happened to know well, and asked him if crystals of carbon and alumina could be found in the same locality.
SCENE OF THE PLANT.
“‘Most certainly not,’ was his reply. ‘Such a thing may be possible, but I doubt it very much.’
“‘What would you say,’ I asked, ‘if a man showed you a diamond and a ruby, and told you they were found side by side?’
“‘I should ask him if he knew the man that put them there; and if he insisted that they were natural deposits, I should change the topic of conversation for fear of saying something to wound his feelings.’
“I left the professor,” continued Sharpley, “and made up my mind to have nothing to do with the speculation, although I confess I was greatly puzzled. Apart from the statement of the geologist, and the discovery of the crystal which first caused my suspicions, everything appeared right enough. The parties were respectable, polite, intelligent, and wanted a good price for their property, or rather for half of it, as they only desired to obtain money to work their claim. They would not reveal the locality of the discovery, as it was upon unsurveyed ground, and they desired the passage of a bill by Congress to confirm their title to it. Themesa, or diamond-bearing ground, was minutely described, and was very much like the diamond-bearing localities of Brazil and India. Professor Janin, a scientist of repute, had been there, and staked his reputation on the genuineness of the discovery. He was sworn to secrecy, in order that there should be no jumping of the claim by the adventurous fellows who abound on the frontier, and to keep off everybody, in fact, until the proper title was secured, and the company was ready to go to work. Several persons who had investigated the matter as extensively as they could, were convinced of its correctness, and were ready to invest.
“Furthermore, the operators were anxious to get the claim to their land, and spent money to get it. General McClellan, Samuel Barlow, and others went into the operation, and you may be sure they don’t risk their money unless things appear pretty certain. McClellan, Barlow, and the rest, whom I will call the New York party for the sake of convenience, offeredfour hundred thousand dollars for the half interest, and had the money ready to put up. I surely expected the ‘planters’ would take this and clear out, as they would then make a handsome profit on the speculation. But they refused it, and, as they could get no more, they took up their bags of diamonds and went away. This again made the thing look genuine, and I was more puzzled than ever. I began to wish I had put in my money, and it was then that my friend, whose champagne I am drinking, blew me up for dissuading him from investing. I soothed him, and we determined to keep our mouths shut, and wait for what would turn up.
HOW THE NEW YORKERS WERE CAUGHT.
“Well, to shorten up the story, the planters went to San Francisco and got Ralston, and the rest of them to go in. When the company was organized, the New York party began to regret not having taken the thing at half a million, and they felt so bad about it that they asked the Ralston crowd to let them in on the bed rock organization. They urged the time, money, and influence they had used to get the grant from the government, and begged so hard that Ralston’s party finally gave them a chance. They won’t tell how much they lost, but I think there were five of them stuck for about twenty thousand apiece. There were other small fry, but they were not of much account.
“Now, there is another thing that hasn’t come out yet, but I am sure it will one of these days. There is a rich deposit of diamonds on this continent of North America, and some of the stones which have been exhibited came from it. Some of the diamonds used in getting up this plant were bought in London, and came from Brazil and South Africa, but there were others that certainly came from no diamond fields yet known. At least that is what some of the experts say, and if all the parties interested in the purchase of the Arizona mines,—I do not mean those who sold, but those who bought the half interest from the swindlers,—if all these parties were catechized searchingly, I have reason to believe that some of them would or could tell something that would be quite as startling as the original story of diamonds in Arizona.They had already taken steps to secure this new locality before the Arizona swindle was exposed, and had it not been for the sudden death of a gentleman connected with the negotiations, the business would have been completed ere this. The negotiations were hindered by his death, and it may be months before they are completed; but you can certainly look for a revelation some time in 1873 of great interest concerning diamond fields of wonderful wealth.”
DREAM OF A DIAMOND SWINDLER.
DREAM OF A DIAMOND SWINDLER.
“Why,” I asked, “did not the Arizona swindlers get up their speculation on the real diamond fields of which you speak? They could have made more money, and avoided the stigma of dishonesty which they must bear as long as they live.”
A RICH MESA SOMEWHERE.
“Simply because the swindle was much the easier thing. The real fields are practically inaccessible, except to a large and well-armed party, and under the sanction of another government than our own. A concession to hold and work them must be obtained, and this would take a long time. I will say this and no more—that they are north of the Isthmus of Darien, and are not in the United States. You may guess about their locality as much as you like, but for the present I can say nothing more. You see it was much easier to get up an excitement about Arizona or Colorado, and turn it into money, than to wait and work on the genuine enterprise. Men are not generally inclined to dishonesty unless they can make something by it.”
So endeth what I have to say about the diamond swindle.
Some other transactions of a kindred sort have come to my knowledge, and they may properly be told in this connection. A few years ago I was interested in the study of crystallizations, and made some experiments in the laboratory of a chemical friend. We tried a long time to get up rubies and sapphires, and followed the processes of Ebelman and Gaudin as closely as possible. Artificial crystals of alumina have been produced, but they have always been so small as to require a microscope for their discovery, and any attempt to color them has failed. In the course of our experiment wecame in contact with a scientific gentleman of considerable repute. He assisted us in some of our efforts, but we never succeeded in them, not even producing the smallest crystal. Finally, we gave up the enterprise, and turned our attention to something else.
Three or four months later I met this scientist, Professor Blank, in the corridor of the Astor House. He was delighted to see me, and said he had called two or three times on business of importance, which he could only explain at his rooms.
We made an appointment for that evening, and he went away.
I was on hand at the appointed hour, and, after carefully locking the door, the professor became confidential.
COUNTERFEIT SAPPHIRES.
“You remember your experiments to produce sapphires,” he said, “and you also remember that I took great interest in them. When you were disheartened and gave up, I did not abandon hope, and at last I have been rewarded. I have produced a perfect sapphire by following another process from yours. You used alumina and boracic acid; I have been using the same things, but have added another acid, and an oxide that gives the color to the stone at the same time that it facilitates the crystallization. Here is the result.”
As he spoke he opened a table drawer, and from a small box produced three beautiful stones. Apparently they were sapphires of correct shape, color, and density, and worth a great deal of money. They reflected the gas light, and for a short time I saw a fortune before me. When I had examined them thoroughly and placed them on the table, the professor continued: “Now, these are sapphires made in my laboratory—just as Nature has made them in hers. They are of the same material as the natural sapphire, and a man can sell them for genuine stones and not be guilty of any fraud.”
I assented to his proposition.
“Here is a fortune in my secret; but to make the secret available, it is necessary to proceed with great caution. The instant it is known or suspected that the stones are made by an artificial process, the market will be ruined. I havethought the whole thing over, and determined upon a plan. We will form a small company, the fewer men in it the better, and fit up a laboratory in connection with a tin shop, or something of the sort. The shop will be a blind to prevent suspicion, and the laboratory can be in the rear, where we will pretend to have a new process for soldering tin. When the stones are made, we can put them on the market slowly, and sell them just fast enough to prevent getting up a panic.”
A MAGNIFICENT SCHEME.
He went on with the details of his scheme, which was plausible enough, only it was a trifle too large. Had he been an adventurer, I should have suspected him at once; but here was a scientific gentleman, whose name was on the title page of a book that had been received as an authority, and, so far as I knew, his reputation was without blemish. I was captivated by the brilliancy of the enterprise, and readily consented to join him and bring the matter to the attention of some of my friends. He wanted about twenty thousand dollars for a share in the secret, and as capital wherewith to set up and stock his proposed laboratory. To wind up the evening and leave me fully convinced, he opened a crucible, which, he averred, he had that afternoon taken from the furnace and laid away to cool. From the black mass of slag at the bottom he extracted a couple of sapphires, smaller than the ones he had previously shown me, but as perfect in every way as the others. My mind was nearly but not quite made up. I asked the privilege of taking one of these latest sapphires, and also one of the others, to show to a friend whom I wished to join me in the speculation.
The professor consented, with the injunction that I must not reveal the secret of their manufacture, and that I should be very cautious about exciting the suspicion of any outsider as to their artificial character. “We must be very careful,” said he, “not to let the dealers know that the stones are not dug from the ground, like all others in the market. They are in every respect the same, but the question of demand and supply tells more readily on precious stones than on anything else that men deal in.”
FINDING A CLUE.
Next morning I jumped into an omnibus and rode down town. I went to a lapidary on John Street, with whom I had a slight acquaintance, and at once showed him my sapphires. He looked at them just an instant, and asked what I wanted to know about them. I asked what he called those stones.
“Well,” he replied, with a smile, “they are very good imitations of sapphires.”
“Imitations!”
“Yes, imitations; I ought to know, for I made them myself.”
A gigantic flea at that instant—a flea as large as an elephant—entered my right ear, and jumped about like a schoolboy exercising across a gutter. The lapidary continued, that he made the stones to order, and three others at the same time, about a month before, but declined to tell me for whom they were made. They were made of strass, a fine article of glass, consisting mainly of potash, oxide of lead, borax, and silex. Nearly all artificial gems are made of strass, and the colors are obtained by adding certain oxides while the substance is in a state of fusion. Diamonds, sapphires, rubies, and amethysts, made of strass, may deceive a novice, and even be made so skilfully as to require a careful test before deciding on their character; but you can no more sell them for genuine to a regular dealer than you can make a butcher buy a poodle under the belief that it is a bull-dog.
I returned the gems to the professor that evening, with the brief explanation that my friend was averse to a speculation on account of a lack of funds, and that an unexpected development had rendered it impossible for me to invest. He did not press for an explanation, and we separated with mutual regrets.
Another time a man who had been for several years on the Pacific coast came to New York, and lived a month or two at my hotel, without any appearance of business. I formed an acquaintance with him one day at the table, and found that he was a good talker, and well informed on mining matters. Our acquaintance ran on a week or so, and one day he invitedme to his room, and showed me some specimens of copper ore. They were of wonderful richness, and while I was looking at them he explained that he knew where there was a vein six feet wide and a half a mile long of just such ore. He said it in the most careless way imaginable, and remarked that he thought he had about as good a thing as there was going.
A BOGUS COPPER MINE.
I thought so, too; and after a few minutes’ conversation we separated. Nothing more was said for several days, when finally he asked if I knew anybody who would like to join him in working the mine and sharing the profits. There was more than he wanted for himself, and he would like to be relieved of the trouble of looking after it. The mine was on the Colorado River, in Lower California, and was a very easy one to work. I took some of his samples of ore, and showed them to a speculating friend, who said, “This is a wonderfully rich ore, and there is no end of money in it, if he is talking the truth. It is worth looking into, but we must be cautious.”
Ten of us formed a company, and agreed to pay him a hundred thousand dollars for a half interest in the mine, if it turned out as he represented. He described it minutely, over and over again, and his story appeared perfectly plausible. He was ready to go there with any of us, show us the property, and satisfy us that he had told the truth. We sent one of our number to California with him, and at San Francisco a couple of gentlemen, to whom we had written, joined the twain, and made a party of four to go to the copper mine. All the way he talked about the mine—from New York to San Francisco, and from the latter city to the Colorado River. Several copper mines had been opened in that region, and he spent a day escorting the party among the reduction works of these companies. Up the banks of the river he led them about twenty miles from the last of these mines, and then acknowledged that the whole thing was a deception, and that he had no mine to sell.
The two Californians proposed shooting him on the spot; but the New Yorker had a prejudice against shedding blood, and persuaded his friends to let the scoundrel escape. Hedid not return with them, and he never reappeared in New York; but he did turn up in San Francisco, where he sold for ten thousand dollars (and obtained the money for it), a quarter interest in a mine to which he had no more title than I have to a township in the moon. He was a plausible wretch, and could look you straight in the eye while telling a lie as big and as plump as the swelled head of an Irishman the morning after a wake.
SHOT BY MISTAKE.
I believe he was subsequently mistaken for a coyote, and shot by a miner whose claim he had been endeavoring to steal and sell. The miner regretted the mistake, or, at all events, said that he was sorry that somebody else had not made the mistake, and made it earlier.