Investor - Page 2
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Early in 1899 there was
excitement along the Grand Canyon,
where had been staked a large area of lime-carbonate capping, thought to
have been valuable for platinum. The bubble was punctured by Professor W.P.
Blake, Director of Mines of the Territorial University, who after careful
assays reported that the "ore" sent him was a carbonate, containing only
silica, calcium, magnesia, iron and a little alumina. Not a trace of
platinum could be found, though similar rock elsewhere submitted was
reported to have returned values of $300 a ton in platinum. While
deploring the influence of his report upon the prospectors who thought
they had found wealth, he said, "the people of
Arizona generally do not propose to profit by ignorance, pretense or
misrepresentation." It is probable that the excitement all started through
efforts made to assure trail holdings down into Cataract Canon.
Miners at the Grand Canyon.
Another notable swindle
was that of the Two Queens and Mansfield Mining companies. The former had
several prospects, near Winkelman, about 100 miles southeast of Phoenix.
The latter had a mine in the Patagonia District of Santa Cruz County. The
Post Office department secured the arrest of several Kansas City, Missouri
stock brokers, who had been selling shares in the two companies, by means
of extravagant full-page advertising. As is usual in such cases, strong
defense was made on the basis of testimony taken in
Arizona, but the defendants finally were convicted and were sent to
jail in May, 1909, though, as usual in such cases, they received
relatively light sentences.
Another typical instance
concerned a temporary resident of Wickenburg,
Arizona, who had bought a mining claim a few miles from town. He sold
at least $100,000 worth of stock in several villages along the Hudson,
near West Point, and, in order to show his good faith, brought out a Pullman carload of selected stockholders to view the wonderful mine
from which he was to make them fortunes. After showing the potential
investors the mine, stock was quickly sold and the men returned the east.
The following day, Sheriff Hayden of Maricopa County appeared on the same
ground with an attorney and formally sold, under a judgment of debt, all
the property owned by the promoter or his company in that vicinity. Hayden
afterward was filled with regret that he had permitted the attorney to
delay him one day on the sale, or he would have been on the ground at the
same time as the investors' party.
The Great Diamond Swindle
A company with a capital
of $10,000,000 was organized in San Francisco in 1872 for the exploitation
of a diamond field somewhere north of
Fort Defiance in Northeastern
Arizona. The reputed discoveries of the field were two miners named
Arnold and Slack, who exhibited in New York and San Francisco some
magnificent rough diamonds and some very good rubies. The San Francisco
company included a number of the wealthiest men of the city, with
significant mining experience. They sent out some agents who returned with
more diamonds, picked up from the surface of the ground. Just the location
of the find was disputed; however, for it was told that locations made
Fort Defiance were merely for the purpose of diverting attention, when
in reality, the field where the diamonds had come from was south of the
Clarence King (far right), who later became
head of the U.S. Geological
Survey, and his men helped foil the Great Diamond Swindle.
The whole scheme was a
fraud on a gigantic scale. It was uncovered by Clarence King, the noted
western geologist, who first demonstrated that the diamonds were not of
the same character, bearing characteristics both of the South African and
Brazilian fields. King visited the
Arizona field and confirmed his own belief that it had been salted
with stones brought from abroad. It is probable that the two "discoverers"
were merely tools of much more wealthy men, who expected not only to get
back the gems that had been "planted," but to sell stock to the unwary
small investor. There was another fake diamond "discovery" down on the
Gila, not far from Yuma, but this was on a much smaller scale and
excitement died even more quickly.
(Editors note: The Great
Diamond Hoax was exposed on November 26, 1872 when the San Francisco
Evening Bulletin published Clarence Kings findings. William Ralston, who
formed the New York Mining and Commercial Company to invest in the
reported Diamond Mine, had given $600,000 to Arnold and Slack, but was
never able to recover it. Arnold reported lived his few remaining years in
Kentucky, and Slack blew his money in New Mexico).
A Basket Soon Emptied
One of the many
short-lived boom camps of
Arizona was Quijotoa, located 65 miles west of Tucson, by the side of
a mountain shaped like a basket. The name came from the Papago word, "kiho,"
meaning basket. The first mining locations were made early in 1879 at the
bottom of the hill, renamed Ben Nevis by a man named Alexander McKay, one
of the pioneers of the boom camp. On May 11, 1883, Charles Horn or Alexander McKay discovered rich croppings
at the summit of the hill and then the excitement began. It was claimed
that five tons of the ore gave a return of .$2,500 at the Benson smelter.
Tunnels were started into the hillside to cut the ledge at depth, but
failed, for there was no ledge. In the language of a San Francisco mining man,
the deposit was ''merely a scab on top of the mountain."
McKay gave a bond
on the property to the Flood-Fair-Mackey-0'Brien syndicate of San
Francisco at a price of $150,000, but the option was not taken up at
maturity. A half-dozen companies were formed in San Francisco, each with
ten million dollars capitalization, for the working of the Quijotoa mines,
and the news broadcasted that
Arizona had found another Comstock Lode. As a result, thousands of men
flocked in, despite warnings that the mines were only in the development
stage. Around the original Logan town site were four or five additions. In
January, 1884, at Quijotoa, were only a couple of tents, ten miles from
water. Two months later, several thousand people had come and there were
many marks of a permanent town, including a weekly newspaper, "The
Prospector," published by Harry Brook. The time the boom broke is
indicated best by the fact that the printing office was moved to Tucson in
the fall of 1884. Soon thereafter, J. G. Hilzinger of Tucson bought the
mines, a mill that had been moved over from Harshaw, and all the other
property of the principal corporation for $3,000.
James Harvey McClintock in 1913, compiled and edited by
of America, updated November 2013.
Mining and Miners in
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American West (main page)
Treasure Hunting In
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Notes and Author:
This article is primarily a tale told by James Harvey
McClintock between the years of 1913 and 1916, when he published a three
volume history of
called Arizona: The Youngest State. However, the article that
appears here is far from verbatim. While the story remains essentially the
same as originally published, heavy editing has occurred for spelling and
grammar corrections, revisions for the modern reader, and updates to this
McClintock began his career working at the Salt River Herald
(later known as the Arizona Republic). He later earned a teaching certificate, served as Theodore
Roosevelt’s right-hand-man in the Rough Riders, and become an
State Representative. He died in
California on May 10, 1934 at the age of 70.
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