1872 LIBERTY SEATED 25C, MOTTO MS66
GEM BU. GORGEOUS TONING. ONLY 1 GRADED HIGHER AT NGC.
The California gold rush created so many jobs, expanded the western United States, and advanced the economy. Unfortunately good things also have their repercussions, especially when people take advantage of the positive. It was fairly common to see people advertising their supposedly fantastic, mineral rich mines that they had “salted” with gold flakes to give the appearance of abundance. This was the case in 1872 when two cousins, Philip Arnold and John Slack, from Kentucky claimed they had discovered a diamond rich mine in Colorado. They unfolded their scam in San Francisco that same year when they attempted to deposit a full bag of uncut diamonds at a bank. When the bank questioned the cousins they quickly left, which made them appear reluctant to share their discovery. This caught William Ralston’s – the bank director – attention so he decided to catch up with the cousins who then agreed to share their “discovery.” Ralston figured these two men were simple, unsophisticated country folk that he could take advantage of and take control of the promising mine. Shortly after Arnold and Slack agreed to have a blind folded mine expert check out their mine to determine their validity; he returned with great news saying the mine was very rich with both rubies and diamonds. Ralston jumped on the potential opportunity he had in front of him and developed the New York Mining and Commercial Company with several prominent financers. The company capitalized at ten million dollars and started to sell their stocks to eager investors but first Ralston gave the cousins six hundred thousand dollars “on good faith” to begin. Compared to the potential amount that Ralston could receive from the mine, this investment was small change. Furthermore, people became convinced that the American west had an abundance of diamond mines so an additional twenty-five diamond exploration companies formed over the next few months. Eventually people like Clarence King who led a geographical survey of the 40th parallel began to question the validity of the mine, so he snooped around for himself. Thanks to his geographical knowledge he was able to find the location of their mine and discovered several jeweler cut stones sprinkled throughout. King returned to San Francisco to out the cousins in an Evening Bulletin article on November 26, 1872. By then the cousins had fled with Ralston’s deposit and the embarrassed Ralston had to return the eighty thousand he received from investors.