Essex County herald. [volume] (Guildhall, Vt.) 1873-1964, 1884-09-19
A GREAT DIAMOND HOAX.
HOW CALIFORNIA BAHE sRS WERE
DUPED BY RoGUES.
A Visionary Scheme which EIstGIA"
gIed Many IIiIIiOnaiTes-The First
Correct STORY Now TOid.

New \ lOrk star tells THIS strange story
While in the reading room of ths Russ
House this afternoon | met friend who
for few years prior to the great crash of
1878 was one of The b6ldest operators on
the Slope. Ralston's failure, howevet,
drew him down, and since that time he
has dropped out of the mad whirl of CAL
ifoPnla speculation. He now owns few
vineyards down near San Diego, and is
living quietly and contentedly. During
our three hours conversation my friend
accidentally referred to the great dia-
mond hoax of thirteen years ago which
duped a number of prominent California
operators. Aware that the inside history
Of the swindle had never been made pub
lie, l cleverly got him started, and he
divulged the following story!
In 1871 two rough looking prospectors
walked into the Bank of California and
asked for Mr.. Ralston, the cashier and
leading spirit of the bank. They had two
little buckskin bags, which they said con-
tanned something, and they did not know
exactly what it was. One of the bags
they said they believed had diamonds in
the rough, but the other they said they
did not "know what kind of stone
it was; they mout be garnets." Ralston
laughed at theidea of diamonds" but
he asked to see them. There was about
half pint of black, dirty-loolSing crys.
tails, ranging in size from a pea to a
hazel-nut. The other bag had dark,
blood.red stones that were promptly pro-
nounced Arizona "garnets" by the great
banker, and cast aside as worthless. He
told the prospectors to leave the bag with
the black crystals, and he would have
them examined by experts. He did so.
Professor LIE Conte, the geologist of the
University of California, pronounced
them diamonds. So did Professor Janin,
the best mining expert in San Francisco.
Shreve and other leading jewelers. all
agreed they were diamonds Shreve had
one partially cut, and it revealed beau
tiful white stone. The question then
arose, "Where did they come fromP
Ralston was greatly excited. He called
in Sharon, and even took D. o. Mills
into his confidence. The two prospectors
gave their names as William Arnold and
Isaac W. Slack, and said they had been
prospecting in Arizona and Utah and
Wyoming, and they had found the stones
in one of the regions named, but refused
to say just where. They said, however,
that there were "bushels" of the same
kind left. The diamond fever grew, and
finally Ralston, Sharon, Nicholas Luning,
a great San Francisco capitalist; William
M. Lent, S. L. M. Barlow, of New York
George D. Roberts, the present Postal
telegraph man; Michael Reese, the great
Jewish millionaire, and several Others
formed a syndicate and agreed to take
the diamond fields" at 81, 900, 600, pro
vided the representations of Arnold and
Slack were verified by experts. Mean
time the other little bag of specimens
was submitted to tests and found tc
contain genuine rubies. Some were sent
to New York to be cut, and were found
to be genuine stones. These were said tC
come from the same "felds"
When they had the bargain drawn ur
in black and white and $25, 900 paid as
earnest money Arnold and Slack revealed
secretly to Ralston the location of the
find and offered to pilot three of the
banks own experts to the ground. Ono
morning in April, 1872, four disguised
figures crept down in the dawn to the
Oakland Ferry. They were Arnold
George D. Roberts, Henry Janin and
George Hearst. Janin was the most &C.
complished geologist and mining en-.
gineer in the city, and Roberts and Hearst
were, and are yet, the best practica
miners in California. The party took
the cars and Arnold piloted them tt
Green river, Wyoming Territory. There
they left the train, got mules and al
ambulance and struck for the Greer
river mountains, forty-five miles south o.
the railroad. They were on the ground {
week. The "diamond field" did MOI
seem to be more than fifty acres in ex
tent, and was at the base of a low
range of barren red sandstone hills
They found diamonds in the
greatest quantities scattered about
in the low beds of dry gravel
They dug down and found them il
groups of six and eight. They were all
greatly excited except Arnold. Wher
at the end of a week they prepared tt
leave they had more than quart of dia
monds and rubies of all sizes. Well
when they got back to San francisco
the town was afame A company was
at once organized with Sc, 900, 900 capi
tai. The 81, 1000, 900 to pay Arnold ant
Stack was advanced by Ralston, and il
part made good by the syndicate. Rob
erts, Luning, Lent, Ralston and Sharon
each put in 800, 900, and Barlow made
up pool in New York to take up $3.50,
900 more. Then the public began tC
clamor for the stock, but so confident
were the promoters of the scheme thai
they had new Golconda that they
locked the stock up in the bank of Cali
fornia and refused to let share go out
Arnold and slack took their money anc
left the coast. Arnold got $40, 600 il
cash. He went to Elizabethtown, KY.
bought magnificent farm and settled
down. Slack went to Europe and wa
never heard of again.
Clarence King, the United States geolo
gist, had made a survey of that region
and remembered the exact spot in which
the diamonds were said to be found. HC
knew it was not diamond country. HI
suspected a fraud. Anyhow his reputation
as geological surveyor was at stake, ant
he went to examine it quietly by himself
A weeks close study revealed the whole
truth, and in an elaborate report h,
showed how the ground had beer
salted, and even the mechanical appli
ances used. He found a few of the dia
monds, and unheasitatingly declared
them of the same character as the stones
from South Africa An investigation
followed, and in few months the Who'll,
truth came out. Harpending had put vi
the job, and had supplied Arnold anc
Slack with the money to carry it out
The latter bought i'll London $40, 00(
s.1orLl, of rc,ll.h d;n1,nnnAn nnd e1n AAl