The Great Port Angeles Gold Scam
How a clever land boomer used fake gold coins to manufacture excitement and swindle investors in the late 1880s.
The story, cleaned up
A cleaned-up reading of the newspaper page: spelling and layout repaired, one story lifted off a crowded page. It follows the original closely but it is not a transcription. The original page is below; read it if a detail matters.
Many a big stake has been made by clever boomers in times past in this Western country, but the methods adopted for working up excitement in some particular locality are never understood by the people at large. One of the cleverest tricks that has yet come to light was related last evening by a gentleman who got into a reminiscent mood. 'You were speaking of Port Angeles,' said he, 'and I want to tell you how the boom in that town was first started. It was several years ago and Mr. Hickey, of Victoria, engineered the scheme. He went to Port Angeles and purchased 320 acres of land in the name of a syndicate. Hickey thought if he could induce the people to believe that Dunsmuir was investing money in Port Angeles, others would also invest there. He went to a boiler works and had a large number of washers cut of the same size as twenty-dollar gold pieces. He got about a half bushel of the washers, put them in two sacks, and labeled each one $20,000. He hired a policeman to guard the gold, then walked into saloons in Victoria, letting everyone see the heavy bags. He whispered to the proprietors that it was old Dunsmuir's money going to be invested in Port Angeles. The ruse worked; within three weeks, people became so excited that an excursion was organized, and over 150 people went over to invest. Hickey told me afterwards that he made $45,000 out of the deal selling his acre tracts.'
“Hickey hired another policeman, and the two officers escorted him and his fraud down to the boat, where he threw the washers overboard.”
This scam perfectly captures the 'Boom & Bust' cycle that defined the Pacific Northwest's growth in the late 19th century. The story serves as a historical ancestor to the modern speculative real estate bubble, showing how easily 'social proof' can be engineered to inflate land values.
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