Some Distinguished Victims of the Scaffold

by Horace Bleackley

Thus there is almost complete evidence that Fauntleroy’s expenditure under three heads—domestic expenses, freehold property, and the two mistresses above mentioned—absorbed a sum of £64,000. It is not unreasonable to suppose that the man who could squander this money in less than seventeen years, while his firm was in so dire a plight, was capable of spending double the amount. It is improbable that his various establishments cost him no more than £2000 a year; and if The Times of the 1st of December is to be believed, he confessed that he had enjoyed a very much larger income. The age of pinks and bloods was as extravagant as our own, and many luxuries of life were more expensive. Fauntleroy was a patron of ‘Corinthian Kate’; and if Pierce Egan is an authority, we may conjecture—in spite of her denial to Joseph Parkins—that the unfortunate banker found her an expensive luxury. Like the great man whom he took a pride in fancying he resembled, it is notorious that the forger had a weakness for what his contemporaries termed ‘ladybirds’ and was in this respect a dissipated and worthless fellow. Moreover, he was celebrated for his costly dinners and rare wines—there is the grisly story of the friend who urged him as a last request to tell where he purchased his exquisite curaçoa—and he seems to have denied himself no luxury. Although it is not possible to give a complete explanation of Fauntleroy’s expenditure during the years of his race to ruin, it is satisfactory to know some portion of the details, and they show, through all possible coats of whitewash, that he was guilty of the most prodigal extravagance.

The conduct of the partners.

Since the partners of the Berners Street Bank were censured for gross negligence in two courts of law, it is not surprising that their creditors should have treated them with intolerance. At first the public had regarded them as unfortunate dupes, and it was not until Fauntleroy had made his defence that a popular outcry arose. It seemed incredible that three men of the world should have thrown the heavy burden of managing a firm, weighed down by embarrassments, upon the shoulders of a youth of twenty-two, and equally preposterous that, in the face of losses reaching into hundreds of thousands, the young man’s colleagues should have remained easy, trusting, asleep. Yet, in spite of the onslaught of the London press, and the clamour of the noisy creditors, headed by Joseph Parkins and his fellows, beneath the roof of the ‘Boar and Castle’ and the ‘Freemasons’ Tavern,’ it is certain that Messrs Marsh, Stracey & Graham were innocent of all guilty complicity in their partner’s frauds. The statements that had aroused the storm against them proved to be baseless or exaggerated. It has been shown that the Berners Street Bank did not lose £270,000 in building speculations between 1810 and 1816, as Fauntleroy suggested, and to meet the loss that did occur a large sum was raised by the supporters of the firm, to which William Marsh contributed £40,000. Thus, considering the reticence of their manager, there was good reason why the partners should believe that they had weathered the financial panic which brought to ruin so many of their contemporaries.

Modern commerce estimates more accurately the value of youth than the age of Mr Walter the Second; and as young Fauntleroy, who was one of the smartest bank managers in London, accepted his responsibilities with zest and cheerfulness, it is not surprising that he became the autocrat of the firm. Moreover, the juggler who could deceive the clerks working at his elbow day by day would have no difficulty in satisfying the periodical curiosity of sleeping-partners. Fat profits rolled into their coffers, and, like many another good easy man, they did not pause to look a gift horse in the mouth. Fools they were, and must remain, but in the end the world ceased to suspect their honour.

Still, their credulity was remarkable. All three of them appear to have been the instruments of most of the frauds, attending at the Bank of England to make the transfer under the forged powers of attorney, and instructing brokers to dispose of the stolen stocks and bonds. In one particular, however, the conduct of Marsh and Stracey appeared dubious. On the day of Fauntleroy’s arrest the daughter of the former cashed a cheque for £5000, while the latter drew out over £4000 in the name of his father. The trick was discovered, and restitution made to the creditors.

The Bank of England’s claim.

As might be supposed, the Bank of England received little sympathy either from the press or from the people. The directors never disputed their obligation—as managers of the public debt—to refund to the rightful proprietors the whole of the stocks that had been stolen, but they made every effort to enforce their claim against the Berners Street firm—amounting to a quarter of a million—which they contended that Fauntleroy had placed to the credit of his house. It was soon made clear by law that Messrs Marsh, Stracey & Company were responsible to the stockholders, who had been defrauded by their managing partner, and thus were equally responsible to the Bank, whose debt was similar to that of the stockholders. The chief obstacle to the enforcement of the Bank’s claim lay in the fact that the proprietors of the stolen stocks were clients, and, as a natural consequence, creditors also of Marsh, Stracey & Company. Being aware that the directors were legally compelled to replace their missing Consols and Exchequer Bills, they raised a great clamour against the claim of the Bank, for naturally they perceived that if it was enforced the cash balances in their Berners Street pass-books would be diminished. This difficulty compelled the Bank to seek the consent of the Courts to permit them to claim from the bankrupts the lump sum that had been restored to the stockholders, so that it would not be necessary to bring forward reluctant persons to prove each separate debt. Lord Chancellor Lyndhurst ruled, however, that each transaction must be established to the satisfaction of the Commissioners of Bankruptcy in the usual way, and thus the Bank was driven to depend upon the stockholders. Since the claim of half a million was compromised for a payment of £95,000, we may conclude that the majority of the Berners Street creditors were not disposed to assist the rival claimant to a share of their dividends.

The transfer of stock.

Much has been written of the lax methods of transferring stock in vogue at the Bank of England. As the frauds were so slovenly that Fauntleroy’s clerks had no difficulty in detecting their employer’s handwriting in the signature attached to the forged power of attorney produced at the trial, it is plain that the crimes could not have continued for so many years unless a most careless system had prevailed. The Berners Street swindle showed that it was possible for any applicant with whom the clerks at the Consols Office were acquainted to complete the transfer of another person’s securities, provided only that he possessed a knowledge of the exact value of the particular stock he wished to appropriate. A power of attorney seems to have been as readily acted upon as obtained, and no comparison of the real owner’s signature appears to have been made. This danger was pointed out subsequently at a meeting of the Court of Proprietors, and a shareholder made the wise suggestion that when any transfer was made immediate notice should be sent to the proprietor of the stock.

Yet checks and precautions did exist at the Bank of England in the days of Henry Fauntleroy. The purchasers of securities were recommended to protect themselves from fraud by accepting themselves—that is to say, by signing—all transfers of stock made to them, thus giving the officials of the Bank the opportunity of comparing the handwriting of the proprietor whenever necessary. Still, the investing public rarely complied with this regulation, and Fauntleroy must have been aware that there was no danger of detection on this account.