The following is an excerpt from Jonathan Burton | December 4, 2015 | marketwatch.com |
Before Bernie Madoff, before Charles Ponzi, there was George Graham Rice.
For more than two decades, from the turn of the 20th Century to the Roaring 20’s, Rice’s illicit, sophisticated scams and hustles earned him a huge fortune and national notoriety. By 1925, Rice’s net worth was estimated at around $100 million — equivalent to almost $1.4 billion today.
Racetrack tipster, stock swindler, and unreformed huckster, Rice was a master at taking your money and convincing you that the loss was your fault. Yet Rice, improbably, was for many a champion of the little guy. Rice would rail against the vast wealth of the then-rich and famous such as John D. Rockefeller — the 1% of that time — portraying himself as a friend to small-time investors even as he picked their pockets clean.
Rice had a willing audience. Americans at the beginning of the 1900s were obsessed with get-rich-quick schemes, and Rice readily obliged. The stock market then was largely unregulated, and tailor-made for touts like Rice. His most lucrative scheme involved creating and promoting publicly traded gold-mining companies in the Western U.S., then selling shares to unsuspecting, unskilled investors — rich and poor alike — through seamy “bucket shop” brokerages under his control.
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