by Bruce Cherney (part 1)
Where to go to escape the pervasive reach of American justice and one of that nation’s richest men? It was a question plaguing a man who gained notoriety using the name Lord Gordon Gordon.
When he cast his gaze about for a safe haven, the alleged member of the nobility decided upon a sleepy town on the edge of Canada’s western frontier. After the man with a dubious pedigree arrived in Winnipeg, he insisted he was a Scottish “laird,” meaning he was from the moneyed land-owning class in the Old World.
But the so-called Lord’s nefarious past would eventually catch up to him. To thwart answering for his sins, Lord Gordon would suffer an inglorious death, taking his own life with officers of the court waiting for him to emerge from his hideaway in Headingley.
As his life underwent later investigation, it was revealed that Lord Gordon Gordon had used numerous aliases, including Lord Glencairn, Herbert Hamilton, George Hubert Smith and Gordon Harcourt Gordon, as he plied his confidence games in Scotland, England, the United States and Canada.
His greatest claim to infamy was convincing American multi-millionaire Jay Gould to part with nearly $1 million. Among the pantheon of the U.S. business elite, Gould was noted by U.S. newspapers as the chief robber baron among a cast of characters publically-lampooned in newspaper front-page cartoons for their avarice. Next in order to Gould on the greed scale and rating public derision were J.P. Morgan, Cornelius Vanderbilt, John Rockefeller, James Fisk, Daniel Drew and Andrew Carnegie.
The wealthiest of the bunch was Rockefeller, who went on to control 95 per cent of the oil business in the U.S. Being a deeply religious man did not prevent Rockefeller from using unsavoury methods to corner the oil business, forcing others to bow in submission to his all-mighty monopoly of the oil marketplace.
Gould didn’t pretend to be religious, although if he followed any god, it was named “money.”
With the exception of Gould, the robber barons in the later stages of their lives attempted to buy their way back into Heaven by using their wealth for philanthropic purposes. Steel magnate Carnegie donated money to build libraries across North America, including two in Winnipeg. Rockefeller established a multi-millionaire foundation which is still active today.
The pursuit of money at all costs undoubtedly allowed Gould to fall into the trap laid by Gordon; after all, greed is the con man’s best ally when pursuing a victim.
In 1867, Daniel Drew added Gould and Fisk to the board of directors for the Erie Railroad, which was called the “Scarlet Woman of Wall Street,” because its stock was continually manipulated to line the pockets of Drew and company.
Vanderbilt, who started out amassing a fortune in shipping, earning him the title commodore, tried to take over the Erie by buying up its stock. The trio from the Erie countered Vanderbilt’s buying spree by printing thousands of extra shares, effectively watering down the value of the stock.
Incensed by their action, Vanderbilt got a New York judge on his payroll to forbid the issuing of new stock. The judge signed a warrant for the arrest of Fisk, Drew and Gould, but they evaded the law by fleeing across the Hudson River to New Jersey where the judge’s warrant could not be enforced. With $7 million of Vanderbilt’s money in their pockets, the men took up residence in a New Jersey hotel. They then hired policemen armed with cannons to serve as a deterrent to anyone attempting to force them to recross the river.
The hostile takeover made its way through the legislatures of both New York and New Jersey, where money was spread around to bribe legislators. When Gould turned up in Albany, the state capital and site of the New York Legislature, the New York Herald reported he was carrying a trunk “stuffed with thousand-dollar bills which are supposed to be used for some mysterious purpose in connection with the legislation.”
The final outcome was that the stock issued was approved by the New York Legislature, which dealt a deathblow to Vanderbilt’s takeover bid, but the “commodore” did manage to sell his 100,000 shares in the Erie Railway to London investors. Other investors in the Erie lost thousands of dollars due to the watering down of shares by Fisk, Drew and Gould.
Gould’s most famous bid for increasing his wealth came when he, partnered with Fisk and the brother-in-law of U.S. President Ulysses S. Grant, attempted to corner the gold market. Grant’s brother-in-law was enlisted to keep the president in check and prevent him from releasing the $100 million in federal gold from Fort Knox onto the market which would have put an end to their scheme.
Once they had cornered the market, their goal was to sell off their accumulated gold and realize an enormous profit resulting from their ability to manipulate the price of the precious metal. They amassed $7 million in gold, driving the premium up by 160 per cent.
But Grant caught wind of their scheme. He realized their greed would bring economic ruin to the nation and authorized the release of $2 million from the federal reserve. Despite Grant’s attempt to stave off the manipulation of the gold market, it was rumoured that Gould made a profit of $10 million by selling off his gold when the market price for the yellow metal was at its peak.
The result of the gold scheme was the panic of “Black Friday” on September 24, 1869, which threw the country into a deep recession. When people became aware of Gould’s role in the market’s collapse, an angry mob attacked him on the street in New York. After this fright, Gould only travelled in the company of a bodyguard.
Gould then turned his attention to western railways, buying stock in the Union Pacific until he controlled the company. Eventually, Gould would become a director of 17 railways and the president of five. He also owned the New York World newspaper and held major investments in New York City’s elevated railways system, as well as several telegraph companies, including Western Union.
Lord Gordon Gordon made his way to New York in this highly-charged atmosphere of stock speculation and the unbridled accumulation of wealth by a select few. But before he could reap his own ill-gained profit, Gordon took a side trip to Minnesota in the summer of 1871 where he courted the American West’s high and mighty.
Gordon registered in a Minneapolis hotel under the name G. Gordon and deposited $20,000 in English pounds in the National Exchange Bank of Minneapolis, which was known locally as Westfall’s bank.
Gordon related a scheme to settle 100 Scottish families in Minnesota to Col. J. Loomis, the land commissioner of the Northern Pacific. According to Gordon, the generous benefactor of the settlement was his own titled sister in Scotland.
Loomis invited Gordon to accompany him on an excursion with railway surveyors George B. Wright and Nathan Butler.
“The adventurer went to Pelican Falls, Otter county, Minnesota,” wrote Manitoba author George Bryce in his book, The Illustrated History of Winnipeg (1905), “and lived in great state with a large retinue under canvas, in company with the Commissioner of the Northern Pacific Railway. He was represented as of enormous wealth, and was most artful in providing it.”
The Fergus Falls Daily Journal described the excursion as “a caravan of forty horses, twelve men to pitch tents, a French cook and a number of colored waiters wearing white linen aprons and white silk gloves.”
The staff was told to only address Gordon as “My Lord.”
They travelled in style befitting royalty, which was the point of Gordon’s con to pass himself off as being among the British privileged class.
It was reported that Loomis spent $45,000 to fund the two-month long trip to Pelican Rapids, Oak Lake and Detroit Lakes. The colonel justified the expenditure to the railway’s board by saying Gordon was prepared to invest $5 million (Putnam’s Magazine January 1910 article by Dr. William A. Croffut, who had been the editor-in-chief of the Minneapolis Tribune from 1871 to 1875).
By the end of the journey, 50,000 acres in Ottertail County was surveyed. In addition, a town site was laid out to be named “Loomis” after the colonel.
While in Pelican Falls, he convinced a local landowner named Tuttle to invest in the scheme.
“He advanced no money, however,” wrote Bryce, “and Tuttle was ruined.”
Surveyor Butler told Edward H. Mott, the author of the Story of Erie (1901) that he and Gordon left Detroit Lakes around Christmas and proceeded to St. Paul. In 1923, Butler wrote to a Dr. W.J. Folwell that when they arrived at Gordon’s hotel room there were about 20 pieces of solid silver, apparently from the Northern Pacific officials and one from Mrs. Jay Cooke.
Jay Cooke was an American banker, bond seller and railway entrepreneur. In 1860s newspapers, Cooke was referred to as “our modern Midas.” But Cooke’s vaunted Midas touch ended on September 18, 1873, when the stock market collapsed and his company was forced to close its doors.
Gordon left Minneapolis for New York just after the New Year 1872. He had in his possession letters of introduction, including one from Col. Loomis addressed to Horace Greeley, the owner and publisher of the New York Tribune, who coined the phrase, “Go west young man.” Greeley was apparently enthusiastic about Gordon’s plan to bring Scottish settlers to the American West.
Accompanying him on the train to New York was Mrs. William Belden, the first wife of James Fisk. Her acceptance assured Gordon of an early introduction into New York society as her husband was wealthy in his own right. Gordon became a long-term guest at the Belden home in New York.
According to a May 2, 1872, affidavit Belden provided for the later New York Supreme Court trial of Gordon on May 17, he introduced himself as Lord Gordon, the Earl of Aberdeen, “a Scottish nobleman, and one of the peers of Great Britain; he told me that he had taken a seat as a member of the House of Lords of Great Britain when he was only twenty-two years of age, then being the youngest member of that body ...”
He told Belden of his vast wealth, which Gordon alleged included an annual income of $3 million.
Belden said Gordon talked about the Erie, claiming his investments in the railway totalled $30 million in stock, which he owned outright. Another claim was Gordon also represented a group of English stockholders, who possessed another $20 million in Erie Railway shares.
Using this information, Belden obtained a free lifetime pass on the Erie from Gould for Gordon, who met Gould for the first time on March 2, 1872, at the Metropolitan Hotel in New York.
According to Gordon’s affidavit, he informed Gould that he held 60,000 shares of Erie stock and had an interest in more that he intended to use to manipulate the election of board directors in favour of Gould. In return, Gordon said he wanted to name three English directors to the railway’s board while the other directors could be named by Gould, although Greeley had to be one of the latter.
Gould was apparently enthused by Gordon’s proposal, as following the “Erie Battle,” the railway was in the process of being reorganized with rival factions vying for control. Gould feared his enemies would force him out as a director and president of the company.
Gould was taken in hook, line and sinker by Gordon’s tall tale, and for two weeks the co-conspirators in the scheme to rig the railway company election worked out the details of their agreement.
Another part of Gordon’s plan was revealed when he told Gould that his preliminary investigations had cost him at least $1 million and insisted that one-half of the amount would have to be paid to him by the new management when it was elected. In the meantime, he would have to acquire more than Gould’s word. Believing that he was being saved from disaster, Gould agreed to give Gordon 600 shares in companies related to the Erie, 4,722 shares in the Old Creek and Allegheny Railway, $21,000 in bonds of the Nyack and Northern Railway and $160,000 in cash.
The 600 Erie shares were given to Gordon by Gould for security to be used in the alleged purchase of farm in Chappaqua opposite to a property owed by Greeley. According to Gordon, Greeley had urged him to buy the farm.
“The careful recipient of these securities and cash presently found an error of $40,000 in the footing of Gould’s memorandum and sent word of the shortfall,” wrote Folwell in his History of Minnesota. “Gould did not think there was such an error, but under the circumstances he would not dispute the point and came back with an additional $40,000.”
Gould asked for a receipt for the cash, but Gordon replied that his word was sufficient and handed the bundle back to Gould, who made it as far as the door before turning around and laying the cash on a table in the room.
“It must have been sheer sport in playing a fish which had taken his hook so greedily that led Gordon to demand that Gould separate himself from the old directorate (of the Erie),” commented Folwell. “On March 9, Gould delivered to him his resignation as director and president of the Erie Railway Company, to take effect upon appointment of his successor.”
Of course, Gould believed his successor would be himself.
“It is amazing to us to see a schemer like Jay Gould ‘hoist with his own petard!,’” wrote Bryce.
Gould came to realize he had been duped when it was reported that Gordon began selling his Oil Creek and Allegheny stock at a reduced price.
In his affidavit to the court, William M. Tweed, the infamous “Boss” Tweed, who controlled New York politics through Tammany Hall, said Belden and Gould visited his Duane Street office where Gould told him that he was swindled by Gordon. Gould was a friend and supporter of the highly-corrupt Tammany Hall politician and a frequent visitor to Tweed’s law office. It was Tweed who helped Gould and Fisk gain control of the Erie Railway from Vanderbilt by legitimizing their watered down stock in the state legislature. For his help, Tweed received a hefty chunk of Erie Railway stock and was named as a company director.
If Gould wanted something done about Gordon, Tweed was the man to see.
Tweed said he had heard of Gordon in connection with transactions involving the Erie Railway, but that was all since he had never inquired further about the man nor had he met the alleged lord.
“I told Mr. Gould that if he wanted to make an arrest (of Gordon) he might as well speak to Judge (Edward J.) Shandley (of the Essex Market Police Court), who was in the next room waiting to see me on business,” said Tweed. “I then called Judge Shandley in and told him Mr. Gould had a matter which he would explain ...”
Tweed said the three men left his office and he later went to the Metropolitan, finding Gould, Belden and the judge in the room that he used in the hotel.
“As I first entered the room I saw lying on the sofa two packages, which Mr. Belden told me contained $200,000 in greenbacks each, and had been returned by Gordon, with the statement that he was willing to do whatever was right in the matter ...”
Gordon said he gave up the money, because he “feared outrage.”
During his subsquent trial on May 17, 1872, Gordon testified that he submitted to the “extortion only because I had no means to avoid it except by submitting to greater utrage and wrong.”
Afterwards, he was watched or followed on the street, and on April 9 was arrested by Deputy Sheriff Jarvis for felonious conversion of the stock he received from Gould, who wanted the New York Supreme Court’s help to recover $273,000 in stocks and certificates from Gordon.
His bail was set at $37,000 which was paid by Horace Clark, and Gordon was released pending his trial in May. Gordon then telegraphed his Philadelphia brokers not to turn over the stock he was in the process of selling, contravening a promise he made to Gould.
At his trial, Gordon was said to have answered each question with composure and dignity. But Gordon’s downfall came when Gould’s attorney, David Dudley Field, started to ask questions about his family. He gave the names and addresses of an alleged stepfather, a brother-in-law and an uncle. Cables were immediately sent to the American consulates in Paris, London and Berne, Switzerland, asking staff to investigate the information provided by Gordon. The investigators replied to the cables from New York that no such persons or addresses existed in the respective cities.
According to Bryce, Gordon was the illegitimate son of a “cultivated Englishman, who sent him to a london boarding school, under the name of John Hamilton. The boy was then sent into trade, and soon scandalized himself by obtaining goods under false pretenses.”
Bryce said Gordon next surfaced as an assistant master in a school in Sommerset, but quit to partner with a country lawyer to purchase an estate, “but had nothing to pay, and of course returned it.”
“He then assumed the role of a clergyman, and in London for some time followed the sacred office, but was discovered to be an impostor. His career for a few years after this escapade is unknown, but he reappeared as Herbert Hamilton.”
In 1867, he adopted the name of Herbert Glencairn, claiming to be the heir of the Scottish earldom of Glencairn.
“The operator now sought a wider sphere. He made a connection with a legal firm of the Metropolis, whose leading figure was Mr. (Howard) Paddison.
“To him he was known as ‘Glencairn.’
“With this firm he deposited a number of large boxes, declaring them to contain valuable plate, jewelry and title deeds belonging to his family. These boxes bore in gold letters the name ‘Right Honorable Lord Glencairn.’”
Gordon went to Scotland for the shooting season under the name Hamilton, where he gained more friends by exploiting his “pleasant manner.”
In the following year, he returned to Scotland using the title “Glencairn,” and became a friend of J.W. Simpson, the Free Church minister in Glenisla.
“His manner was not to tell any one directly who or what he was, but to make statements which led you to infer that he was a man of title and had property in various places in Scotland, England and Ireland,” wrote Simpson in a letter to the New York court dated October 3, 1872.
Through Simpson, Gordon was introduced to the goldsmiths and jewelers, Marshall and Son of Edinburgh, as Lord Glencairn. In London, he was introduced to the diamond merchants Kellers.
“At one time,” wrote Bryce, “the Edinburgh and London jewelry firms became anxious about his extravagant orders and his failure to meet his bills, but on a conference with them he succeeded in quieting them.”
He then obtained a loan of £25,000 from Paddison under false pretenses, after which he allegedly fled to Scotland, but he could not be found there.
When the jewelers came knocking, an embarrassed Paddison returned the items that had been presented as gifts to him from Gordon, but there were still some pieces missing and presumed to be in the possession of the fleeing felon.
At this stage, the bogus lord was on his way to the U.S. in pursuit of bigger fish to con. Ultimately, Gould became his most famous victim and the millionaire wanted Gordon to pay for this transgression against his person.
As was the case in the Old World, Gordon knew the jig was up and failed to return for the next day of his trial. It was rumoured that he then fled to Montréal and Toronto. Two of Gould’s lawyers, Elihu Root and General Collis, went to Toronto with a member of the firm of Marshall & Sons of Edinburgh to arrest Gordon on a British warrant.
Toronto turned out to be a dead-end — Gordon had again fled to points unknown.
Gordon next re-appeared in Winnipeg, registering at Munro House in October 1872. Gordon knew that he was relatively safe in Winnipeg as local newspapers hadn’t reported on his crimes in Great Britain nor on his U.S. trial. It is amazing that such a sensational case escaped the attention of Winnipeg newspaper editors, who were by then connected to the world via telegraph.
(Next week: part 2)