Emeralds in ant hills and jewels in everything
These are, beyond question, precious stones of enormous value
It had been a decade since silver first brought prospectors to Nevada — two, since gold found them flooding the streams of Northern California. Like clockwork, the American west had another boom on its hands – this time promising an even greater windfall than its immediate predecessors.
By the early 1870s, the luster had worn off the country’s near-obsession with precious metals, as more recent efforts had petered out, failing to recapture the excitement or scope of their processors. Entrepreneurial optimism was still high in the young, expanding nation, but the focus had shifted.
"The intelligent prospector nowadays finds rubies in rivulets, sapphires in sand dunes, emeralds in ant hills and jewels in everything,” The San Francisco Chronicle noted in early 1870. “Diamonds have been found in profusion in every known quarter of the great West. At the rate things are going, we shall soon have the whole of North America ablaze with brilliants.”
The report was, at best, a dramatic overstatement. Diamonds had occasionally and unexpectedly surfaced in a few gold pans over the decades. But aside from the repeated tall tales of legendary frontiersmen like Kit Carson, little had surfaced to justify that level of excitement.
In the summer of 1871, however, a pair of men arrived in San Francisco with a small bag that would change all that. Seasoned Kentucky prospectors, Philip Arnold and John Slack, deposited several uncut diamonds at the five-year-old Bank of California. Neither man spoke of the haul – such an admission would almost certainly prove a safety hazard and another rush, should the location be revealed. Word would, however, ultimately trickle up to the bank’s cofounder William C. Ralston, who confronted the pair.
Arnold and Slack confessed that they’d stumbled upon a diamond field positioned along the Colorado-Wyoming border. The gems were in such abundance, one could simply walk along and pick them directly off the ground. The two men kept the field’s location a secret, but on returning from a second trip, presented the bank’s owner with their latest discoveries. Word traveled fast of a location that might rival South African’s diamond production.
In August, a headline from The Harrisburg Telegraph noted that the gems had been examined and verified by New York jewelers. “The cutting shows that the brilliants are of a finer water than the South African and equal to the South American, that some will be worth as much as $5,000, while a majority fall below as many hundred,” the Pennsylvanian paper noted. “Beyond this, little is known about what is a curious find and may be an important one.”
Adding to the curiosity of the discovery was the inclusion of several rubies, found among the diamonds. Following the second haul, Ralston was able to convince Arnold and Slack to lead an expedition, in hopes of ultimately buying the pair out. The 27-man team traveled by train to Rawlings, Wyoming, before commencing a four-day trip full of winding paths designed to obfuscate the field’s precise location.
One team member – under the cloak of anonymity – recounted the trip for The Chronicle. He described how the team was attacked by native people. All managed to survive unscathed, save for a mule, who was struck non-fatally by an arrow.
“We examined the fields very imperfectly, not venturing at any time from camp, and always working in full force, ready to repel any attack,” he told the paper. “As far as we made the search, we found diamonds and rubies everywhere. But candor compels me to state that they were all very minute, and with few exceptions, not worth saving. This, of course, was owing to our inability to prospect freely and fully.”
The haul was enough to convince Ralston to pull together a team of investors, including Horace Greeley, Nathaniel Rothschild and prominent jeweler, Charles Tiffany, among others, purchasing the claim for $660,000. “Gentlemen,” Tiffany told the group upon inspection, “these are, beyond question, precious stones of enormous value.” The San Francisco and New York Mining and Commercial Company was founded to capitalize on the discovery.
Three months later, a page three Chronicle headline sported the single word: “Salted!” It was bold text, all of the way down,
The Diamond Bubble Bursts.
The Most Gigantic Swindle on Record.
The Money Kinds of California Taken In and Done For.
The finding had seemed far too good to be true, and in November of that year, land surveyors confirmed that it was indeed. Among the clear red flags was the fact that diamonds and rubies simply don’t appear together in nature. Papers picked up the hoax with the same fervor they’d employed to describe the initial finding. Arnold and Slack had been tremendously lucky three months prior. The jewels they’d used to salt the field amounted to little more than gem cutting byproducts, purchased in Europe and strategically placed in the field.
During the firestorm, the pair fled. Arnold returned to Kentucky, to start a career in banking. Slack departed for St. Louis, starting a new life as a casket maker and undertaker.
Upon his discovery, Arnold was defiant.
“I’m going to the fields on my own hook in the spring, with 50 men and will hold my hand against all the experts you can send along,” he wrote, in a letter addressed to the mining company. “If I catch any of your kid-gloved gentry about there, I’ll blow the stuffing out of ‘em.”
Sources:
The Explorer King: Adventure, Science, and the Great Diamond Hoax by Robert Wilson
History of the State of Colorado by Frank Hall