USA > Colorado > History of the State of Colorado, Volume II > Part 12
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According to this veracious (?) correspondent, Dr. Wallens, like all contemporaries, possessed a theory concerning the origin of these gems. Indeed, the very atmosphere of the Southwest was, so to speak, redolent of theories, mixed with the odors of bad whisky and tinctured with Mexican onions. The man without a theory was without standing. It seems a little remarkable, however, that not one of the many professors and experts ever gave public utterance to a theory of the first impor- tance, that had even half the reports of the quantity and size of the precious stones said to have been gathered and collectable, been true, the market value of diamonds, sapphires and rubies, ceasing to be precious, owing to their abundance, would have dropped to the level of garnets and agates. If they were to be had by the bushel and cart load, and if an area of forty to one hundred square miles was literally strewn
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and impregnated with them to unknown depths, it would have been sheer waste of time and material to cut and polish them.
Wallens' theory took this rather original line of expression, that the vast mesa or tableland lying between the Rocky Mountains and the great Cañon of the Colorado River in remote ages had been strewn with precious stones, and that in succeeding ages the larger and more weighty sunk by specific gravity, while the lighter ones remained at the surface, so that to find the whoppers-the Kohinoors and the Orloffs, excavation would be necessary. Again, such gems would be found in the ant hill region, a barren, volcanic district, and he claimed further that where the larger ants swarmed, there would be found the largest diamonds at or near the surface, on the hypothesis, perhaps, that only ants of robust proportions could manage to lug them out of the depths, and having a taste for the beautiful, decorated their abodes with them.
Here ends the glittering tale. It was wholly impossible that a con- summate, deliberately planned swindle of this magnitude could be long sustained, and it is a matter of wonder that it endured so long, escaping detection, and involving so many fair reputations in its coils. We can tasily imagine how the public was duped into giving some of the earlier reports its fullest confidence, because the men who circulated them had prepared their scheme with extraordinary shrewdness, and pushed it with surprising ingenuity, as will appear in the sequel, but that no crucial tests were applied to the bagsful of spinels, crystals, garnets, etc., conveyed to Denver, San Francisco, St. Louis, Chicago and New York, and the fraud at once exposed, passes understanding. But even here the adroit managers appear to have been singularly skillful in preventing analysis, except of genuine diamonds and rubies, with which they were well supplied.
One exposure followed another until the crash was complete, yet the frenzy prevailed with constantly increasing intensity from May until about the first of December, 1872. Clarence King, the eminent geol- ogist, took occasion to make a cursory examination, which resulted in the publication of his views in the San Francisco papers. The diamond
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syndicate, which had already put forth a large amount of stock, was preparing to issue twelve millions additional to be sold in that city and New York, when King's thunderbolt fell. No less than three of the principal banks in San Francisco were large operators in the stock. The social and moneyed influence behind the transaction was immense. It was said that Arnold and Slack were paid something over half a million dollars, which enabled them to carry their part of the scheme with a high hand. These precious rascals who, prior to the events nar- rated, had resided in Yuba County, California, where they were engaged in hydraulic mining, having carefully matured their swindle, went in the first instance to some of the great mining brokers of San Francisco, among them Roberts, Harpending and Lent, to whom they represented that they had discovered and located claims upon a diamond field of fabulous richness, named their price for an interest, fixed certain conditions, and at the same time exhibited specimens of what the land contained. It was taken under advisement. An agent of the syndicate was sent out to make an examination. As it was con- ducted by Arnold and Slack, who had taken care to pave the way in advance, the report was favorable. This settled the matter. A com- pany was formed and stock issued. The crafty projectors being well supplied with funds, started out to create an excitement. Their expe- rience in the mining regions taught them the efficacy of enjoining silence upon all to whom the momentous secret was whispered; of cunningly devised movements, vital hints dropped here and there in out of the way places, behind doors and in locked rooms. Having the real gems in their possession, they were exhibited to the chosen few in whom con- fidence could be placed. They traveled about from place to place, setting afloat vague reports that found their way into the press. Next, when the ground had been well seeded, appeared the Arnold interview in the Laramie "Sentinel," which sent the tidings broadcast.
The capital stock of the company was placed at ten millions, par value one hundred dollars per share. As already intimated, large quantities of this stock were sold at forty dollars per share. Gen. Geo. B. McClellan
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and S. L. M. Barlow of New York, with many distinguished financiers of the Atlantic and Pacific cities, were among the corporators and promo- ters. But one of the most prominent influences exerted, and which probably more than any other served to float and sustain the stock and deceive the public, was the early capture of Professor Henry Janin, an expert renowned for his scientific attainments. Arnold informed Janin that he had made two excursions to the diamond fields, securing in the first a bag of precious stones valued at a million dollars, which had been sealed and deposited in the Bank of California, and in the second a sack of brilliants valued at two hundred and fifty thousand dollars, the latter being then on deposit with the banking house of Duncan & Co. in New York. On the strength of this statement Janin was taken to the res- idence of Tiffany, the famous jeweler, who told him, as he afterward stated in the presence of Gen. McClellan, Barlow and others, that the gems in Duncan's bank were worth at least one hundred and fifty thousand dollars. This avowal disarmed Janin's mind of any suspicion it might have entertained, though it does not appear that he inspected any of the alleged gems. It followed that he was easily persuaded to make an examination of the fields, in company with Arnold and Slack. These worthies, while appearing to afford Janin every opportunity for a full and free investigation, adroitly led him from place to place where certain predetermined results were of course found. Having collected a quantity of diamonds, rubies and sapphires, they whirled the Professor out of the region to San Francisco, where his report was published, jus- tifying the claims put forth, and concluding with the statement that he considered any investment in the stock at forty dollars per share, or at the rate of four millions for the entire property, a safe and attractive one. He was paid a generous sum for his services and accorded the privilege of buying some of the stock at ten dollars per share, which he took and subsequently sold at forty dollars each, realizing something over thirty thousand dollars' profit, but at the sacrifice of his reputation.
Other parties went to the fields, among them George D. Roberts, who brought back undeniable evidence of their richness. But Henry
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Janin's report was sufficient to send the stock up to still higher flights than it had previously attained, had there been no other testimony. The stones placed by Arnold in the Bank of California were exposed to public view, which only added fresh fuel to the flame. They were of all shapes and sizes, from bird seed to beans, and of various colors. For reasons of their own the precise locality was undisclosed. Startling rumors came at intervals to increase the infection. Prospecting parties were sent first to one point, then to another, from whence remarkable statements were received and published.
But let us proceed with Clarence King's expose. He stated that his attention was first called to the alleged discoveries by the publication of Janin's report. He had at that time three parties operating in Wyo- ming and Colorado, from two of whom he received information concern- ing the movements of the Arnold and Janin party. He knew they had not gone to Arizona, and from Janin's report of the appearance of the country, he readily located it. He went there because, whether good or bad, it would be a blot on any geological survey not to have known of its existence, and he had to do it in self defense. He reached the spot November 2d, 1872. He then gave an account of his prospecting of the ground and his failure to find anything except along the trail of Arnold and Janin. After a thorough examination, he went to the Union Pacific Railroad and proceeded to San Francisco, where he sought out Janin and exposed the matter to him and the Diamond Company.
Then the great leaders began to unload their stocks and to seek shelter from the storm which they knew could not be long delayed. King convinced Janin of the duplicity of which he had been the victim. In public the company refused to credit King's expose, and though secretly convinced of its accuracy, to gain time to prepare for the inevi- table catastrophe, they went through the form of sending out another expedition, which was accompanied by King and Janin.
But instead of proceeding to Arizona, they were taken to Black Butte Station on the Union Pacific Railroad, whence they were guided to a point in Summit County, Colorado, eight miles from the Wyoming
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boundary, and on one of the prominent geodetic lines of King's Geolog- ical Survey. The alleged mines were situated at the northern base of a pine-clad ridge that runs east and west, north of Brown's Hole, once a noted rendezvous for the trappers and hunters of the American Fur Company. Here it was discovered by careful search that the widely heralded gems had been planted, in other words, the ground "salted" with them. On parts of the high, smooth mesa, where the winds of ages had swept them bare of verdure, Arnold and Slack had strewn the barren places with foreign brilliants and inserted them in the ant hills, and having set their bait went out into the world to spread the tidings of their "wonderful discovery."
Information of when and how they obtained the rough gems was some time later brought out in the courts of London. About the first of September, 1872, a letter was received in New York from London, stating that about twelve months previous two Americans came to the office of the writers who were brokers in precious stones, and asked to see some diamonds and rubies. They were wholly unacquainted with the gems they were seeking, but as they produced a letter of credit in their favor to a large amount on a well-known London banking house, the negotiations proceeded. After looking at the first lot of rough dia- monds for which eight hundred pounds was asked, they desired to be shown some larger ones, and some rubies, from which they selected without reference to weight or quality, rough diamonds and rubies to the . value of fourteen hundred and ninety-five pounds, for which they paid and departed. A few days later another selection was made, the total purchases amounting to nearly three thousand pounds. The weight of the largest diamonds was from seven to eight carats, which corresponded to the weight of the largest genuine stones displayed by Arnold. These men informed the broker that they had been contractors on the Union Pacific Railway. In the spring of 1872, the same house sold to an American gentleman, recommended to it by the parties mentioned above, about eleven hundred carats of rough diamonds, mostly of an inferior description.
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In December, 1874, a man named Rubery, who was associated with Harpending, Arnold and Slack, in the arrangement of the scheme, began an action for libel against the London "Times" for imputing to him complicity in the diamond frauds so called. A diamond merchant named Leopold Keller, at 58 Hatton Garden, London, testified that on the 7th of July, 1871, a clerk sold to a person named Buchanan rough diamonds to the value of {125, 125. 6d. On the 12th of July a person answering to the name of Buchanan, purchased rough diamonds and rubies to the value of £2,808, 18s. 6d. Later in July Buchanan and a man called Arundell, called at the store at various times and made large purchases of diamonds and rubies. The witness was shown photographs of Slack and Arnold and he at once recognized them as Buchanan and Arundell.
Samuel Barlow of New York, testified in the same suit that Har- pending, Lent and Gen. Dodge, introduced themselves to him in Octo- ber, 1871, and stated that they were possessed of a secret of great importance, which they afterward explained to be a newly discovered diamond field in Summit County, Colorado. They then showed him a traveling bag full of diamonds, rubies and other precious stones. He, acting for Lent & Harpending, paid Arnold $100,000, which he demanded in advance. Arnold told Dodge that the diamonds were found in the Indian country ; that their arms were taken from them by Capt. Jack's band of Utes, but that he (Arnold) spoke the Ute lan- guage, and he made a treaty with Colorow and Jack, which would enable them to return to and work the diamond fields. A vast amount of other testimony was taken, but the foregoing is sufficient to establish the basis of the fraud.
When the explosion came, Arnold and Slack disappeared. They did not leave the country, but prudently went into seclusion for a time. Janin, the learned geologist, who until this blow fell upon him gave promise of a brilliant career in his chosen profession, was utterly pros- trated, while avalanches of denunciation swept over McClellan, Roberts, Lent, Harpending, and the chief operators in the great company. But
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it was said that Lent had lost over four hundred thousand by the expose; that Ralston, who afterward committed suicide, though not impelled to the act by this cause, had lost two hundred and fifty thousand and others from twenty to fifty thousand each. The two "original discoverers" having nothing, not even reputations, to lose, and having received large sums from the company, presumably enjoyed their gains in retirement while waiting for the storm to "blow over."
But the enterprising head of the firm, whose fertile brain had con- ceived and whose dexterous hands executed one of the most daring swindles of the country, was not the kind of a man to let concealment, like a worm in the bud, prey upon his colossal cheek. About the middle of December he was heard from through a card addressed to one of the San Francisco papers,-date and place of writing omitted,- to this effect :
TO THE DIAMOND COMPANY :- I see by the papers that Arnold and Slack are to be prosecuted, and that eminent counsel has been employed. I have employed counsel myself,-a good Henry rifle,-and I am likely to open my case any day on California Street. There are several scalps I would like to string on a pole. I don't include Janin, your expert. He is of no consequence; send him to China, where he will find his equals in the expert business. As you all are going into the newspapers, I'll take a fling at it myself one of these days. I'm going to the fields on my own hook in the spring, with fifty men, and will hold my hand against all the experts you can send along. If I catch any of your kid-gloved gentry about there, I'll blow the stuffing out of 'em.
P. ARNOLD.
The great white heat of popular indignation fell not so scorch- ingly upon the originators of the exciting drama, as upon those who, by the eminence of their names and standing, had given countenance to it, and by their stock jobbing deals defrauded hundreds of credulous investors. Yet gambling is gambling, and he who participates in it is a gamester, and as such must take his chances. Stock gambling is not one whit more respectable than card playing, nor should any person who engages in it be shielded by law or public opinion any more than the faro dealer or poker player. I am unable to discover the justice of a law which punishes a card player who fleeces a victim, while a stock
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gambler who engineers a corner in shares, wheat, pork or oil, and thereby ruins thousands, is not only allowed to go free, but crowned a very "Napoleon of Finance." Hence I was not among those who sympathized with the victims of the diamond frauds, who plunged into the stock pool and lost their money. But upon the hundreds who were deluded into leaving comfortable homes and remunerative occupations, in many cases sacrificing all they possessed to obtain the means. wherewith to enter upon the pursuit of Phil Arnold's ignis fatuus, com- miseration might have been worthily bestowed, for they, at least, were honest.
To close the chapter, Phil Arnold died at his home in Eliza- bethtown, Kentucky, in February, 1879. What became of his partner, Slack, I am not informed.
IO II.
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CHAPTER VII.
1872-REVIEW OF THE YEAR-MURDER OF GEORGE BONACINA BY THEODORE MEIERS -CAPTURE, TRIAL AND EXECUTION OF MEIERS-MURDER OF JOSIAH COPELAND BY VAN HORN-RIOTOUS ATTEMPTS TO LYNCH THE PRISONER-HEROISM OF SHERIFF COZENS-LEGAL EXECUTIONS DOWN TO 1888-THE FIRST ADMINISTRATION OF GOVERNOR M'COOK-APPOINTMENT OF GOVERNOR ELBERT-ARRIVAL OF PRES- IDENT GRANT-M'COOK'S SCHEME TO OUST ELBERT-REMOVAL OF FEDERAL OFFICERS-A GREAT POLITICAL UPHEAVAL-DETAILS OF THE CONSPIRACV- INVOLVEMENT OF D. H. MOFFAT, CHAFFEE AND ELBERT-THE LAS ANIMAS LAND GRANT.
The year 1872 had been reasonably prosperous. The volume of general trade at Denver, estimated by the crude and informal processes of gathering data then employed, was placed at $21,241,980, about forty per cent. in excess of 1871. In the line of improvements the records indicated that 1,497 buildings and additions had been erected, at a cost of $3,722,000. The taxable, otherwise the assessed valuation of prop- erty in the Territory, aggregated in round numbers $31,000,000, an increase of nearly eight millions over the preceding year. The products of agriculture, the mines, the cattle industry, manufactures, etc., were estimated at $14,250,000. On all sides gratifying progress was shown, more especially, however, in the several departments of productive industry. The public finances were in excellent condition. There was no debt, and the treasury held a satisfactory balance over the gross expenditures, without any tax levy for 1872. In the field of agriculture almost phenomenal development was exhibited, both in the areas culti- vated and the harvests secured, the value of the several crops being estimated at $4,000,000. Great advances marked the efforts of stock- growers in the breeding of fine cattle and sheep. Six railways had been
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constructed, with a total mileage of six hundred and forty-two miles. Some extraordinary results accrued from the development of mining, though the more productive sections were still confined to Gilpin, Clear Creek, Boulder and Park Counties, but in these unwonted activity pre- vailed, owing to the increased facilities for economical working, the better regulation of titles to property by the act of Congress of that year, and the higher prices paid for ores by the Boston & Colorado Smelting Company. A number of new coal mines had been opened and the markets for fuel widely extended.
On the 10th of August, 1871, an atrocious murder was committed at a ranch twelve miles south of Denver. The circumstances were such as to give it greater historical importance than it actually deserved, hence its introduction here. A man named George Bonacina, with a reputed sister named Arabella Newton, who was widely assumed to be his mistress, occupied the ranch and cultivated it. On the second of August, a German laborer named Theodore Meiers applied for employ- ment as a farm hand, and was engaged. Neither Bonacina nor Mrs. Newton bore untarnished reputations for integrity and virtue. Meiers had saved a small sum of money. On Sunday, the 6th, Bonacina being short of funds, borrowed twenty-five dollars from his employe and came to Denver for Mrs. Newton, who had been making a short visit in this city. On their return to the ranch, employer and employe armed them- selves and went out to sleep in some strawstacks near the house, as Bona- cina had been informed that some of his neighbors with whom he had quarreled, intended to burn them. Meiers took with him a shot gun and a revolver. During the evening he asked his employer for the money he had loaned him. Angry words were exchanged, resulting in a fierce altercation, in which Meiers shot and killed Bonacina with a revolver. He then went to the cabin with the design of removing Mrs. Newton in like manner. In his confession made after his arrest, he distinctly stated that he went there to kill her. Answering his boisterous calls, she opened the door, when he fired from his gun a charge of buckshot into her breast. Though severely wounded, she was not killed,
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as the assassin supposed and hoped. Meiers returned to the straw- stacks, rolled the body of his first victim in buffalo robes, covered it with sheaves of straw, then laid down beside the corpse and slept, as upon a righteous and wholly commendable deed well executed. At day- break, fearing discovery and arrest, he fled, going southward toward Pueblo.
In the meantime Mrs. Newton came to Denver and rendered an account of the murder to the authorities. The physician who dressed her wounds discovered that the entire charge of buckshot had entered her breast, four of the missiles passing entirely through her body. Sheriff D. J. Cook being apprised of the crime, summoned his chief deputy, Frank Smith, proceeded to the ranch and found matters to have occurred as related. After a short search Cook discovered the assassin's trail and followed it to a place known as "Woodbury's," twenty-five miles north of Pueblo, where' Meiers was captured without serious difficulty. On the return journey the murderer related to Cook all the 'circumstances of the killing. He was tried before Judge E. T. Wells, in February, 1872, and convicted of premeditated murder. A motion for a new trial was made and granted, and the time fixed for the April term of that year, but the cause was continued by agreement of counsel to October 21st following, when it was again heard and a second ver- dict like the first returned. On the 30th of December, Judge Wells pronounced sentence of death upon Meiers, the execution to take place on the 24th of January, 1873.
The counsel for the accused put forth extraordinary efforts for a supersedeas, appealing to each of the three judges of the Supreme Court in turn, but without receiving the slightest encouragement. Next, some of the prominent Germans of Denver who felt that their countryman was being needlessly sacrificed because he happened to be poor and friendless, signed a petition to the acting Governor praying for a commutation of the sentence to imprisonment for life. Governor McCook being absent, the petition was presented to me with strong oral arguments in behalf of the doomed man. I listened to them attentively,
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but at the close stated my convictions that the decrees of the courts when fairly reached should not be set aside by the Executive, unless some palpable error could be shown in rendering judgment, or new evidence adduced not given in the trial and which if produced, would effect a material change in the verdict. If they had such evidence it should be presented to Judge Wells, from whom a note stating that upon further consideration he had discovered sufficient cause for a rehearing, would immediately be followed by a respite for such time as might be suggested. An attempt was made, but nothing came of it. The next step taken by the petitioners was to telegraph Governor McCook as follows :
"Can you respite by telegraph, Theodore Meiers, to be hanged Friday, the 24th instant, for thirty days, so that a petition signed by over three hundred citizens for commutation of sentence to imprisonment for life, may reach you ?"
On the 24th at 8 o'clock in the morning came this reply :
"Mr. Frank Hall is acting Governor in my absence. If he is not in the Territory, take this to Thompson (Major J. B. Thompson, his private secretary), and let him make out a reprieve for thirty days, acting in my name.
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