Wednesday, February 01, 2006

"Drake's Fortune; The Fabulous True Story of the World's Greatest Confidence Artist" by Richard Rayner

In 1572, Francis Drake (not yet "Sir") stole a treasure worth 40,000 pounds sterling in Elizabethan money from a Spanish party transporting it across the Isthmus of Panama. Thanks to his success, the Queen soon sanctioned another voyage -- and backed it financially herself, along with the Earl of Leicester and Sir Francis Walsingham.  This second voyage made Drake the first Briton to circumnavigate the globe. On the voyage home, he captured a Spanish treasure ship, which yielded a return for his investors of over 4,500%.
Replica of the Golden Hinde, London

Drake's own share made him a very wealthy man as well as a baronet. Despite having been married twice, Drake died without any children.  While his estate passed to his brother and nephews, it wasn't long before rumors began to circulate about the validity of Drake's will.

The rumors attracted fortune hunters and confidence schemes on both sides of the Atlantic Ocean. "Drake's Fortune" tells the story of the scam that kept on giving.

In 1900, a gang of swindlers wrote to every Drake they could find in the new American telephone directories. Each Drake was personally informed that they were the true heirs of the estate, and that a modest legal fee could secure their claim. Many were taken in.

By 1909, a woman named Sudie Whittaker was the most successful Drake promoter in America. She claimed that her cousin, a Mr. George Drake of Roachport Missouri, was the true heir to the Drake fortune. She had an impressive genealogical document created to support her claim. As George Drake was a man of only modest means, he needed investors to help with the finances of pressing his claim. Sudie hooked up with a lawyer named Milo Lewis. Lewis's genuine law degree gave apparent validity to Sudie's sales performance, and he helped her keep the scam in a legal gray area.

Oscar Hartzell was originally a dupe, then was hired on as an assistant, but he gradually took over the scam to run as his own. At first he believed in the basic proposition of the Drake Estate, and was certain a genuine fortune could be obtained. The premise was plausible: some Americans had found themselves to be the legal heirs of distant relatives in the old country. There were lots of Drakes in the American Midwest -- many of them descended from some obscure branch of Sir Francis's family.
Cons of all kinds flourished in the boom of the 1920ies: scammers sold shares in the League of Nations, or in fictitious gold and platinum mines, land speculation, or fraudulent oil well ventures. People believed in nonsense because there were so many true reports of others getting rich quick and they didn't want to be left behind. In the Midwest, the Drake Estate became a craze.

The 1929 stock-market crash put an end to most of the swindles that had been popular during the decade, but not the Drake scam. Somehow the faith of the Midwesterners in Hartzell was confirmed by the failure of Wall Street. Hartzell turned these details to his advantage: fear of the Drake Estate settlement had paralyzed financial institutions and caused the depression.

Eventually, Hartzell was arrested and sentenced to 10 years in Leavenworth prison plus a $2,000 fine. His imprisonment barely made a dent in the continued progress of the scheme. People chose to believe that his imprisonment was unjust, or that it was a fake and he wasn't really in Leavenworth at all.

Hartzell died in prison of throat cancer in 1943. But the legacy of the Drake Estate scam lives on in descendants such as the well-known internet "Nigerian scam."