Some Distinguished Victims of the Scaffold - Horace Bleackley

The private estates of Messrs Stracey and Graham paid twenty shillings in the pound before the end of 1833; and upon that of Mr Marsh, the senior partner, who appears to have been indebted to the firm for a loan of £73,000, excluding his overdraft on his private account, a distribution of 17s. 6d. had been made before 1834. Little was received on Fauntleroy’s estate, as it was claimed almost entirely by the creditors of the Berners Street Bank.

Losses under Fauntleroy’s management.

It is now possible to form an estimate of the extent to which Messrs Marsh, Stracey & Company were defaulters, and what were the losses under the Fauntleroy régime. The total receipts set against the claims of the creditors and the money stolen from the Bank of England, show a deficiency of £522,980. Thus:—

Dr.		Cr.
Claims of the creditors (to pay 20s. in the £)	£554,916	Total receipts	£392,150
Gross loss of the Bank	360,214	Deficiency	522,980
	————		————
	£915,130		£915,130
	————		————

How the losses were incurred.

Although it would be difficult, with any degree of accuracy, to apportion under the separate charges this adverse balance of over half a million pounds, and although much must be left to conjecture, it is possible to explain some of the ways in which this vast sum was dissipated. At the outset, the suggestion—arising out of one of the pleas of Fauntleroy, and believed at the time—that the overdraft on loans to two of the partners was responsible for a deficit of £100,000, is refuted by the fact that both Messrs Marsh and Graham refunded eventually their obligations to the full extent. In like manner, the belief that large sums were lost owing to the necessity of reinvesting constantly the various stocks sold by Fauntleroy in order to avoid detection, overlooks the fact that, on the other hand, these transactions must have afforded similar opportunities for making a profit. It is probable that many such losses did occur; but since we may believe that the Berners Street Bank prior to the forgeries was earning an income of £7000 a year, it is likely that such an astute manager as Henry Fauntleroy would be able to cancel many of these losses through reinvestment by the profits he earned on the immense capital he had secretly appropriated.

(a) Loss of £160,000 in building speculations.

(b) £90,000 lost by paying dividends on the stolen stocks.

Although the forger’s estimate of the result of his building speculations is extravagant, the newspapers of the 20th of December 1824 make it clear that the Berners Street house must have lost in this manner £160,000. It is certain also that immense sums were absorbed by the payment of dividends to the proprietors whose stocks had been stolen. Nearly £7000 per annum must have been required for this purpose from the year 1816, and the sum would accumulate at compound interest, until, as some say, an annual fund of £16,000 was required. Setting aside all excessive calculations, we have the great authority of the historian of the Bank of England that £9000 to £10,000 a year was thus expended during the progress of the forgeries. Further than this, notwithstanding that the partners in the bankrupt firm were not entitled to any fraction of profit, the testimony of almost the entire press credits each of them with receiving an income of over £3000. At the examination of William Marsh, reported in the newspapers of the 1st of March 1825, it was proved that he was indebted on his private account for an overdraft of £26,000. As there is no reason to believe that Mr Stracey or Mr Graham had enjoyed a smaller income, a further deficit of nearly £80,000 is the result. And finally, as will be shown, there is an overwhelming weight of evidence to prove that the iniquitous Henry Fauntleroy, during the nineteen years he was a partner, dissipated at least £100,000. In addition, the repayment of the capital of Sir James Sibbald (who died the 17th of September 1819), which formed a large portion of £64,000—the capital of the firm in 1814—would swell the adverse balance still further. Leaving this out of the question, the facts stated above explain the deficit of £430,000; and with the material at our disposal any further solution would involve a more elaborate use of the methods of conjecture.