1
CONFIDENCE MAN
After six months of shifting and grifting between crooked card games, poolrooms, and horse tracks without a real job, George Graham Rice crisply aligned the brim of his derby with the top of his smart-looking spectacles and edged into the seven-story shadow of the Metropolitan Opera House, calmly but keenly observing New York’s urban blur from the yellow-bricked street corner of Fortieth and Broadway. Maintaining a countenance of congeniality, Rice shrewdly scanned the slushy chaos of foot, trolley, and carriage traffic, sizing up faces with a feral inner cunning his thirty years had honed to a sharp tool of self-preservation. Because the $7.30 tucked tightly into the pants pocket of his one good suit represented Rice’s entire net worth on this first Tuesday of March 1901, George was instinctively—but with casual, cultured dignity—on the hustle for marks who looked ripe to be suckered.
Amid the swirl of strangers, Rice recognized an old racetrack chum. Although George was a man of many acquaintances, he steered clear of true friendships based on mutual trust. Rice could play the part of a witty, charming ringleader when he chose, but he valued his charismatic personality more as an asset that afforded him an edge in social manipulation.
As the man from the track approached, George clicked into intuitive overdrive, calculating the costs and benefits of extended conversation. Without missing a beat, Rice beamed a phosphorescent smile and reached out to heartily shake Dave Campbell’s outstretched hand, even though he knew in his gut the gent’s too-robust greeting belied the desperation of a struggling soul down on his luck.
“Buy me a drink?” Campbell rasped as soon as pleasantries were out of the way.
Rice didn’t consider Campbell a sucker he’d fleece. But he was willing to speculate on the chance that Dave might be harboring some nugget of useful information worth extracting.
George wasn’t much of a drinker—the occasional silver gin fizz or flute of fine champagne—but he did have a weakness for good cigars. At a café table, Rice lit up a twenty-five-cent perfecto and set up Dave with a nickel beer. Over by the lunch counter, a regulation news ticker chattered away, spitting out a continuous tape of stock quotes and racetrack results.
“Still bet on the horses?” Campbell asked.
“No,” Rice replied, exhaling a plume. His unflinching blue eyes squarely met Dave’s. “Haven’t had a bet down in more than a year.”
This was an outright lie. Yet the man telling it possessed a most persuasive way of making even the most outlandish distortions of reality seem wholly convincing and plausible.
Although it was technically true there had been recent periods when George did not set foot in any gambling establishment, that’s only because those abstentions coincided with stints behind bars for stealing. For two and a half years at Elmira Reformatory, Rice was known as inmate No. 4018. Serving a six-and-a-half-year forgery sentence at Sing Sing, George was prisoner B-516. Prior to incarceration, he had abandoned his birth name, Jacob Simon Herzig, in favor of multiple aliases, trying out and discarding names—Abram Herzog, Joseph Hart, Jack Hornaday—as they suited his convenience. Rice’s current nom de plume—liberated from a deceased reform school inmate—had been his preferred moniker since he first tried to use it to win a short story contest. Around the gritty Tenderloin district, they knew him as GG. In racetrack betting rings, bookies dubbed him Ricecakes. His first wife called him Jock. His second bride probably had a nickname for him too, although Rice took great pains to ensure neither spouse became aware of the other’s existence.
As the twentieth century opened, Rice had not yet settled into the nebulously mysterious role of con artist. But he had tried it out, just like the various aliases, and would have bristled at the notion that anyone considered him a thief because of the series of—as he preferred to term them—“youthful indiscretions” that landed him in jail. George cultivated a literary style while incarcerated, reading voraciously, improving his manners, and earning early release. Now, back on the street, he could pass for a college graduate. Except his education took the form of the dark, nuanced art of swindling.
After Sing Sing, Rice hooked on as a newspaperman with the New Orleans Times-Democrat. He happened to be in Galveston, Texas, on September 8, 1900, in the hurricane eye of America’s most deadly natural disaster. His firsthand stories of carnage and courage made headlines nationwide, but conflicting accounts arose over whether Rice’s writing was more fiction than fact: One self-styled tale had George stealing a horse to escape the flood before heroically meeting a supply train to lead the relief expedition. A separate version asserted he was run out of town by colleagues for selling stories to rival papers and double billing expenses. Yet another contended the military ordered Rice out of Texas for spreading false panic. Now, back in New York, the only certainty about George was that whatever sensational tale he spun, it was bound to be brimming with the allure of tantalizing possibility. He didn’t care that he was broke and jobless; Galveston had sparked a brainstorm about the sensational selling power of a well-crafted story.
Campbell was cagey enough to know you didn’t get something for nothing from GG, not even a five-cent mug of suds. He followed his opening gambit about the racetrack by producing correspondence from a notorious horse hustler, the only item of value Dave had in his possession.
“Here’s a letter I just received from Frank Mead at New Orleans,” Campbell said, sliding a folded slip across the table. “It ought to make you some money.”
Mead wrote a racing column for the New Orleans States-Item under the pen name Foxy Grandpa and recorded bets as a sheet writer for a Crescent City bookmaking firm known as the Big Store. He also moonlighted as a night-shift croupier at a clandestine casino, and his unique combination of quasi-legal gambling gigs meant Mead frequently brushed up against inside information in horse racing’s premier winter betting market. The letter told Campbell to keep an eye out for a precocious colt named Silver Coin: Held back by his jockey the last few races to make the fast horse appear talentless, Silver Coin would be unleashed to run to his true potential next time out. Those in the know would bet big, presumably burning bookies at odds as high as ten to one.
Rice was quick to compute how to best leverage this edge. If he bet his last $7, it would net him $70 if Silver Coin won at ten to one—a decent return, but not the huge, breakthrough score GG was gunning for. If he was going to risk every last cent in his pocket, George wanted a gamble that paid off in life-altering terms.
Lost in a swirl of cigar wisps, he began sketching the outline of a scheme on a scrap of paper.
The ticker awoke with a clatter. Campbell idly went to unravel the jumble, then exclaimed when he read the tape: Silver Coin was entered to race the very next afternoon in New Orleans.
Rice sparked into action.
Grabbing the sketch, he hustled two blocks north to the classified office of The Morning Telegraph at 140 West Forty-Second Street. He pushed his entire bankroll across the counter to the cashier. Seven dollars bought a sliver of advertising space, a four-inch, one-column next-day placement in the nation’s most widely circulated horse-racing paper that read:
Bet Your Last Dollar On
SILVER COIN
To-Day
At New Orleans
He Will Win At 10 to 1
In fine print, the ad explained that this sure thing was the first and last free horse from a bold new “turf advisory bureau.” After Silver Coin proved the accuracy and veracity of the inside information, anyone who wanted the bureau’s best bets would have to subscribe to a $5 daily tipping service.
Rice christened his newly minted firm Maxim & Gay after glimpsing the regal-sounding stallion name St. Maxim on a racing sheet and coupling it with sporty-sounding “gay” for a euphonic pairing. George then leased a closet-sized walk-up at 1410 Broadway, secured secondhand furniture, and had tin signs painted to advertise Maxim & Gay—all, of course, on credit.
Campbell tagged along but didn’t really understand what Ricecakes was up to.
The next afternoon, March 6, 1901, Rice and Campbell went to the Gallagher & Collins poolroom on Sands Street in Brooklyn to learn the results of the second race at New Orleans. At the turn of the twentieth century, “poolrooms” in America had nothing to do with billiards. They were openly illegal gambling establishments where bookmakers offered wagering pools on horse races. The nation was zany over horse betting, and big-city poolrooms like Gallagher & Collins were equipped with cutting-edge technology that catered to the craze. Because it was imperative for bookies to have access to the order of finish before anyone else—lest they risk being “past-posted” by bettors who attempted to wager with advance knowledge of race results—top-notch poolrooms utilized clandestine telegraphy to receive cipher wired from racetrack spies. After being decoded in a back office, the results were chalked on a board in the gamblers’ lounge for all to see. An eager mob always hovered around the blackboards because the poolroom payouts were quicker than the “official” transmissions that went out on delay to the general public.
Waiting for the race to go off, George riffled through his Telegraph for the umpteenth time to check his ad. Buried at the bottom of a back page, its fifty-six agate lines disappointed him. “It looked puny,” he thought. “Would people notice it?”
At higher-class poolrooms, races were re-created by a back-room announcer narrating the running order off a ticker tape, embellishing the call with theatrical flourishes. If Silver Coin’s race was one of those performed aloud, the announcer had plenty of drama to work with: Careening into the turn, Silver Coin got cut off by a rival. Nearly whipsawed off the horse’s back, the jockey had no choice but to yank Silver Coin back to last and try to circle the field. Rallying from far behind, the colt stormed down the stretch and lunged ahead in the shadow of the winning post, nailing the favorite, Sarilla, to prevail by a nose.
When the prices were chalked up, the cheering was more boisterous than Rice and Campbell expected, considering the favorite had lost. By the time they crossed the East River back to Manhattan, the Tenderloin was abuzz with how bookies had been burned by some mystery horse out of New Orleans. Silver Coin had gone off at eight to one at the track in Louisiana, but an unexpected swell of action was so heavy in New York that the best price you could find in any East Coast poolroom was six to one.
Even though he hadn’t backed the horse himself, George got to feeling euphoric. He told Dave with an opportunistic glint that Silver Coin’s win was sure to snare Maxim & Gay at least ten solid subscribers to get the venture off and running.
The next morning, Campbell woke Rice with news of another telegram from Mead. This one advised to bet a hot horse named Annie Lauretta in Friday’s first race. The betting line in New Orleans was an astronomical forty to one.
When Rice and Campbell arrived on Broadway, they were confounded by a throng in the street, with half a dozen policemen attempting to corral the herd into some sort of line.
“What theater has a sale on seats today?” Dave wondered aloud.
George didn’t know. But when he turned the corner to climb the rickety stairs of their office building, he was startled to see the line traced straight up to the locked front door of Maxim & Gay.
Keeping their mouths shut, Rice and Campbell marched up the narrow stairway past an impatient file of customers. George turned the key, the two stepped in, and Rice re-bolted the door, bracing it with his back.
“What have we done?” he gasped.
The first order of business was deciding what to do about Friday’s best bet. Even GG was unsure about the audacity of selling a tip on a forty-to-one long shot. But the vision of all those $5 bills thrust at him by race-mad disciples assuaged any such concerns. The next dilemma was how to convey this hot horse into merchantable form. George sent for a typist from the Hotel Marlborough across the way.
The girl probably thought it was a peculiar assignment to be asked to strike the name “Annie Lauretta” hundreds of times on small slips of paper while Rice and Campbell sealed them in tall stacks of envelopes.
Keep typing, George urged the girl between tastes of envelope glue. Dave craned his neck out the window and saw the line snaked down Broadway for a block and a half.
They made the transactions as efficient as possible, with Dave handing out envelopes as each man handed George five bucks. Rice stuffed the cash into the right-hand drawer of his desk. When it became clogged, he crammed it into the left drawer. “Finally, the money came so thick and fast that I picked up the waste-paper basket from the floor, lifted it to the top of the desk and asked the buyers to throw their money into the receptacle,” George would later reminisce. “When a man wanted change, I let him help himself.”
The procession moved steadily for two and a half hours. By the time the race was about to go off, Maxim & Gay had sold 551 tips on Annie Lauretta, raking in $2,755—roughly $75,000 in 2015 dollars.
Rice and Campbell didn’t have time to make it to a poolroom, so they scurried to a neighborhood spa where a news ticker would discharge the New Orleans results thirty minutes after the race became official. The wait was excruciating.
Ticka, ticka, ticka … NEW ORLEANS … FIRST RACE … Ticka, ticka, ticka … WEATHER CLEAR … TRACK FAST …Ticka, ticka, ticka …
Finally, here it came.
Ticka, ticka, ticka …
The first letter was F.
Instantly, they knew their horse had lost. It was Free Hand. Free Hand won the race.
“Grim silence” was how George described it. He didn’t bother to watch the rest of the result sputter out of the machine.
Ticka, ticka, ticka …
“Here she is!” bellowed Campbell.
Annie Lauretta had just missed, finishing second at huge odds.
Any customer who had backed up win wagers with “across the board” place and show bets for finishing second or third was about to be rewarded with a twenty-to-one return. From a pure publicity perspective, GG knew giving out a narrowly defeated long shot would prove many times more profitable than if Maxim & Gay had tipped the actual winner of the race at much shorter odds.
George now had more cash in his pocket than he was accustomed to earning in a year.
Ricecakes asked his pal how much it might cost to keep him in beer money while helping to run Maxim & Gay. Campbell proposed a $10 daily salary. GG stripped a sawbuck off his wad and slapped it into his partner’s palm. Dave laughed that it was more money than he had touched in a month.
George hopped aboard a streetcar and rode down to the stately marble Stewart Building at Broadway and Chambers. He peeled off more bills and rented an office suite of “sober magnificence” commensurate with the status he wanted to project upon Maxim & Gay. Then he hightailed it back to The Telegraph and ordered a “flaring full-page ad” that unabashedly called attention to the bookie-busting success with Silver Coin and Annie Lauretta while announcing the firm was open for business at a swank new address.
After a sumptuous dinner—George relished the three-finger steaks and clubby “no women allowed” atmosphere at Browne’s Chop House—he wired Mead, empowering his man in New Orleans to spare no expense in setting up the best staff of “clockers, figurators and toxicologists” money could buy. In return for a sizable salary, Mead was to distill his racetrack intelligence into the form of a single wagering proposition each day, which he would then wire to the home office so George could trumpet the horse’s name nationwide as Maxim & Gay’s “One Best Bet.”
By the end of the spring season, New York’s most sought-after horse advisory bureau would be soaring toward its first million in profits. Yet George Graham Rice did not make a dime of this money by selling winners to gamblers.
Instead, he got rich peddling confidence to suckers.
* * *
Jacob Simon Herzig was born in Manhattan’s Lower East Side on June 18, 1870, on the cusp of a searing, rain-starved summer that no one yet recognized as the sultry, pulsating dawn of America’s golden age of con artistry.
During that same hazy time frame, a bold swindler known as the King of the Fakirs was tearing across upstate New York in a high-wheeled carriage drawn by a spanking team of horses. The grifter was William B. Moreau, but the French-Canadian hustler used a different alias everywhere he went and traveled fast enough to outdistance warnings of his broad-daylight rip-offs. Village by village, Moreau pillaged the countryside, working the Bohemian oats hoax here and the bogus diamond dodge there. After a successful run with the liver-pad racket and toothache fake in Dunkirk, the slick, mustachioed pitchman zeroed in on the sleepy hamlet of Fredonia, which he thought would be ripe for a nervy new fraud he had cooked up but not yet tried—the “giving away dollars” gimmick.
Moreau made a spectacle of his arrival, touring Barker Common with harness bells jangling, setting out placards announcing a free show. Although each swindle was different, the fundamentals were always the same. If people questioned him, Moreau breezily suggested they telegraph his good friend, police chief so-and-so, in the town he just came from, but no one ever bothered because Moreau seemed so avuncular and trustworthy. As he entertained a growing crowd with witty small talk and prepared to launch into a spirited performance, Moreau eloquently underscored to the townsfolk that he was there not for his own health or amusement but to make money.
With a flourish, Moreau produced a case of worthless goods. Usually, it was some defective tool he had liberated in bulk. He started in with his showman’s patter, but no one was willing to part with a dollar for a hunk of junk. So Moreau started giving the tools away, and at that price a few halfhearted cheapskates stepped up. Then Moreau started tossing fistfuls of coins into the crowd, cackling when boys scrambled after them. “I said I had no use for such stuff, and if I was crazy, as people generally said I was, I couldn’t help it.”
At this point, a man came forward and actually purchased one of the faulty items, paying with a $5 bill and getting back change. The unassuming gent tried to slip back into the crowd, but Moreau called for him to halt.
“What did I give you besides the purchase?” the pitchman demanded.
“Four dollars,” the man stammered, acting perplexed. He had arrived in town just before Moreau, but no one recognized him as the show’s hired “capper,” or planted accomplice.
“This is wrong!” Moreau boomed. “Here is your other dollar, and one of mine, too!”
A few stragglers, picking up the scent of something for nothing, suddenly wanted in on the deal. They too bought the worthless tool and triumphantly got what they paid back, plus a buck or two extra. Farmers, tradesmen, business leaders, bankers, schoolteachers, and church elders all queued up to the wagon, jostling for position. “The money rolled up in a blind stream, the fake article being handed out in each case,” Moreau later recalled. “Some dollars had to be reached over the heads of the excited people.”
He congratulated the sharp-witted townsfolk for knowing how to spot a bargain and hinted that it would be wise for them to stick around; the biggest surprise was yet to come.
After handing out $50 or $60 in this fashion, the swindler switched into deal-closing mode.
“Now, gentlemen, I have given away a good many dollars to-night,” Moreau called out to the eager swarm, switching his tone from conversational to conspiratorial. “I am a stranger in a strange land. Is there a man here who thinks enough of me to give me a dollar?”
Believing the fool was about to launch into another streak of irrational charity, men thrust bills at the showman. Those who had skeptically sat on the sidelines during the first part of the pitch were now fearful of missing out, and they too advanced, digging into their billfolds. Moreau patiently waited until every last sucker who wanted to had forked over cash.
Clutching $188 in his fist, Moreau stood tall, raised the bankroll over his head, and addressed the expectant horde. “I have some money here. If you were me, what would you do with it?”
If no smart aleck in the crowd had the presence of mind to wisecrack, “Keep it!” then it was the capper’s job to make exactly that suggestion, loud and clear.
“That seems to be good advice,” Moreau called back, pretending to mull it over. Then he nodded decisively and slipped the bankroll into his pocket. “I believe I’ll take it!”
None of the entranced locals had noticed the pitchman packing up while he distracted them with his spiel, and now Moreau closed with a hurried apology; usually, he said, he liked to end his shows with a festive song.
“But as I am a little hoarse to-night, I will simply give you a little advice.”
Moreau paused, eyes agleam, smiling down from his coachman’s seat at the bewildered villagers. Then he flicked the shiny leather reins at his muscular team of horses.
“No I won’t, either,” the King of the Fakirs declared, tipping his hat and waving cavalierly, clopping briskly out of town. “You wouldn’t take it.”
* * *
When the Austrian immigrants Simon and Anna Herzig settled in Manhattan’s Jewish ghetto in the decade after the U.S. Civil War to trade furs and raise a family, they didn’t have to worry about getting fleeced by traveling charlatans giving away dollars. Their own lawless neighborhood was teeming with the Lower East Side’s uniquely territorial cast of thieves, thugs, and ethnic gangs, and con artists like Moreau who relied on slick talk in the open country knew it would be ludicrous—if not fatal—to drive a fancy carriage into a maze of tenements to hustle up a swindle. Even though petty vice was rampant right outside the Herzigs’ front door, actual violence against ghetto residents was low so long as you banded together with your own kind and minded your own business. In this respect, the shadowy alleys of Ward 14 were comparatively safe for the Herzig clan. The family had no way of knowing it, but its greatest risk of ruin was festering from within.
Jacob was the third of five kids, four boys and a girl, born five years after Simon and his brother Philip opened a New York fur shop that did steady business at the busy intersection of the Bowery and Grand Street. Simon had been well educated in Europe and was fluent in German, French, and English, and when large-scale manufacturing took off, Herzig Brothers Furriers seized the opportunity to supply the nation’s hat and overcoat factories with imported pelts, skins, and feathers. The firm expanded to 133 Mercer Street, and the ensuing windfall meant an upward move for the family, to 147 East Forty-Ninth Street. By the time Jacob was ten, in 1880, the Herzigs had broken free from tenement squalor, with all five children away at school and a live-in Irish servant keeping house in their sprawling uptown apartment.
Jacob was undersized and scrawny, and his formative years spent avoiding ghetto pummelings taught him to rely on brains rather than brawn. As a schoolboy, he stood off to the side and observed older men cheating at street corner dice and card games, then adapted those techniques to gaining an edge at winning marbles. After liberating coveted marbles from older kids, Jacob frequently had to use his wits to talk his way out of beatings. He had been blessed with extraordinary intellect, but school bored him, and Jacob was not so much ambitious as aloof about being able to accomplish whatever he set his mind to—if he felt like doing it. He gravitated to stories about underdogs and entertained penmanship teachers with an uncanny ability to copy signatures. Even after the family moved uptown, adolescent Jacob still felt a pull to the seamy gambling haunts of his old neighborhood, yielding to the allure of illicit adventure as his psyche jelled around a core concept that honesty was dull and provided zero thrills.
Two of Jacob’s brothers, George and Leo, were being groomed to run the family fur business. George would turn out to be a South American pelt expert known as the “Chinchilla King,” leading years-long expeditions into the Andes Mountains. Leo rose to executive level at the company’s New York headquarters and gained sporting-class status as an international yacht racer. Their younger sibling Charles aspired to get into Columbia University’s prestigious School of Mines and would blossom into a world-renowned geological engineer, developing landmark mines on six continents.
Simon encouraged his four boys to go to college, join fraternal organizations, and pursue enterprise (his daughter, Helen, was expected to marry well). But by age eighteen, Jacob wanted no part of conventionality. He stole from the family fur business to pay horse-racing debts, and his father had him arrested. But instead of pressing charges, Simon took custody of his son and forced him aboard a boat to Europe, believing a temporary exile would sever the boy’s ties to bad influences.
Jacob treated his “punishment” like a holiday abroad, carousing across the Continent as if he had hit the number in the Lower East Side lottery. After a few months, Simon summoned him to return, confident the boy had learned his lesson. In a leap-of-faith placement, Simon set Jacob up with a job on the company accounting staff. Jacob still spent more time with bookmakers than with bookkeepers.
On one occasion shortly after returning home, Jacob took off on a whim to see the heavyweight champ John L. Sullivan spar in a boxing exhibition. The rural Vermont match was part of a barnstorming tour and meaningless in terms of the title, but Jacob got to see America’s first true sports superstar from a behind-the-scenes perspective. He would recall the experience for decades as a galvanizing lesson in showmanship.
A boisterous crowd had lined up to greet the champ at the small-town train station, and Herzig watched intently as Sullivan disembarked from his private car. It was neither raining nor blazingly sunny, but the boxer’s manager scurried in front of John L. to shield him with an umbrella. When the imposing fighter clambered into a waiting carriage, another handler immediately drew the blinds at all the windows. At the hotel, the coachman was instructed to divert to a side entrance, and the manager again hid the champ behind the umbrella and whisked him straight up to a guarded suite. Sullivan was similarly cloistered whenever he ventured from his rooms. His manager seemed intent on not letting a single soul glimpse the Boston Strong Boy before he appeared onstage in his customary woolen fighting breeches—the distinctively long, formfitting knickers that would come to be known for generations in his honor as long johns.
After Sullivan’s crowd-wowing display of fistic discipline, Herzig worked up his courage and approached the manager, who seemed less uptight with the rake from the gate tucked in his vest pocket. Jacob asked him why, if the purpose of the tour was to drum up publicity, such secretive measures had been taken to keep the champ hidden.
The showman sized up the plucky teenager and gave Jacob a straightforward answer.
“If the public thought John L. was just an ordinary human being with black mustaches and a florid Celtic face,” the manager scoffed, “they wouldn’t go to see him. The public demand that they be mystified, and to have shown people off the stage that Mr. Sullivan is just a plain, ordinary mortal would disillusion them and keep money out of the house.”
For Jacob, that explanation resonated as a truism of influence. It was as if a magician had revealed the simple secret behind an intricate trick.
* * *
By 1889, Jacob had begun to infuse a bit of mystery into his own life, experimenting with aliases and settling for a time on Joseph Hart. He fancied himself a dandy who liked to impress girls by spending big and moved into a ritzy apartment his $1,000 annual accountant’s salary doubtfully afforded. At five feet seven and a quarter inches tall and a slender 134 pounds, Jacob was budding into a magnetic charmer, with wavy light brown hair and a faint, intriguing scar at his left temple. His trustworthy face was framed by round ears, a narrow upper lip, and gold spectacles that adorned azure eyes. Not so much handsome as persuasive, Jacob had the ability to illuminate his expression at will with a broad, beaming smile—even if inwardly seething with rage. He sometimes changed tailor-made suits four times a day, and although his shoulders were stooped, Jacob carried his head high and topped it with the season’s most stylish hats. Strolling Broadway wielding an ornate ram’s head walking stick, Herzig was not yet an aristocrat grifter but grandly aspired to play the part.
A few months after his European sojourn, Jacob bolted to the West Coast, financing an eight-month betting binge by forging Herzig Brothers Furriers bank drafts. The amount Jacob stole was in excess of $500,000 in today’s dollars, but his father remained adamant about saving the family from embarrassment. Once again he honored the checks and once again had his son arrested. But this time Simon insisted that Jacob be committed to Elmira Reformatory, the nation’s first adult psychological institution based on rehabilitation rather than punishment.
The “Elmira system” had been the 1876 brainchild of the institution’s superintendent, Zebulon Brockway, and his model of reform was hailed worldwide as a visionary penal experiment. Male first-time offenders between the ages of sixteen and thirty were committed to open-ended sentences. Their actual lengths of jail time were calculated by a complex grading system based on performance in vocational training and military discipline. At Brockway’s insistence, attendance was required at brass band practice, ethics lessons, and regimented gymnasium calisthenics. The goal was to “correct the roots of deviance” and churn out sin-free, God-fearing gentlemen who would know their place in society when finally granted freedom. But when the erudite, white-bearded Brockway tried to apply his high-minded theories to hardened criminals who had conned their way into his reformatory solely to escape the horrors of New York State’s more barbaric lockups, the results proved more brutal than benevolent.
By the time Jacob was committed to Elmira for second-degree larceny on April 30, 1890, Brockway’s vision had been consumed by chaos. “Escapes, violence, gangs, drugs, predatory sex, arson and suicides were persistent problems,” one historian wrote. Another described sixty-three-year-old Brockway as a master of rhetoric who knew how to cast sadistic degradation in a progressive, forward-thinking light. Resistant inmates at his “college on the hill” were treated with “positive extraneous assistance” (lashings with a leather strap), “quickening slaps” (punches to the face), and “rest cures” (bread-and-water dungeon confinement). Brockway defended a regimen of “scientific whipping” as a component of reform, testifying that “patients” often thanked him after they had time to reflect on their course of treatment. “They come to me at interview very often, the very next evening or the same week, and we have a pleasant, friendly and social chat,” Brockway explained when state officials showed up to investigate complaints of cruelty. “A prisoner usually overestimates the treatment he receives.… I will state that no blow has been inflicted upon the spinal cord; it is protected by the protuberance of the buttock.”
Jacob’s handwritten intake record described him as “bad with gamblers” and noted he suffered from “simple venereal disease.” Brockway, who personally evaluated every incoming prisoner, budgeted a five-year plan for inmate No. 4018, mandating vocational rigor based on stenography so Herzig could aspire to a lifetime of clerical work. Jacob bought into the program—spitefully—only because he was shrewd enough to realize cooperation was his only chance at early parole.
Herzig marched in formation, kept his sky-blue uniform impeccably starched, and whizzed through Brockway’s requirements in half the time. But what Jacob truly learned at Elmira was how to assemble a nefarious swindling repertoire that would one day rival the most seasoned and brilliant charlatans on the planet.
* * *
Did twenty-year-old Jacob absorb tricks of the trade from con artists while locked up at Elmira? The answer is certainly yes, but Herzig would not have known or referred to his criminal tutors by that name. Neither would anyone else in 1890s America, because even though swindlers known as confidence men had been bilking suckers blind for as long as anyone could remember, their racket would not be elevated to the level of artistry for another twenty-five years. The term “con artist” would sweep into vogue around 1915, with Jacob at the vanguard of get-rich-quick profiteering, feasting on a nation of gullible prey.
Crimes of deception—as opposed to outright, smash-and-grab stealing—are as old as human nature. Medieval folktales from the tenth century celebrated Reynard the Fox, a sly cheater whose weapons were guile and trickery. In 1592, the British essayist Robert Greene authored a series of tawdry pamphlets portraying street grifting as “coney catching” (the Elizabethan term for taming a wild rabbit you later plan on eating). Colonial America was fraught with economic misrepresentation. “To make one’s way through the nineteenth-century marketplace required constant scrutiny of goods,” wrote one scholar of fraud. “Individuals and firms who did not remain vigilant soon found themselves saddled with dubious patent medicines, uncollectible debts owed by merchants who had misrepresented their financial conditions, stock certificates from fake life-insurance and mining companies, and counterfeit banknotes.”
In 1839, The Hand-Book of Swindling was published in London, based on an unfinished manuscript discovered after the death of Captain Barabbas Whitefeather, who billed himself as “Knight of Every Order of the Fleece, Scamp and Cur.” Whitefeather did not impart actual secrets of deception in his book, but instead aimed to guide aspiring fraudsters on the finer points of duplicity, outlining practical tips in sections titled “Blushing Fatal to Swindling,” “Difficulty of Choosing a Name,” and “The Use and Abuse of Mustachios.” It would be another ten years before cheats who fostered trust for the sole purpose of exploiting it got their own specific term in the American vernacular, when the actions of one Samuel (William) Thompson were reported in the July 8, 1849,New York Herald under the headline “Arrest of the Confidence Man”:
For the last few months a man has been traveling about the city, known as the “Confidence Man,” that is, he would go up to a perfect stranger in the street, and being a man of genteel appearance, would easily command an interview. Upon this interview he would say after some little conversation, “have you confidence in me to trust me with your watch until to-morrow;” the stranger at this novel request, supposing him to be some old acquaintance not at that moment recollected, allows him to take the watch, thus placing “confidence” in the honesty of the stranger, who walks off laughing and the other supposing it to be a joke allows him so to do. In this way many have been duped, and the last that we recollect was a Mr. Thomas McDonald, of No. 276 Madison Street, who, on the 12th of May last, was met by this “Confidence Man” in William Street, who, in the manner as above described, took from him a gold lever watch valued at $110.
The police apprehended Thompson several weeks later when he had the misfortune to cross paths with his victim on the street. After a brief scuffle and an appearance before a judge who recognized him as a repeat offender, New York’s first documented confidence criminal was locked away in the city’s hellacious Tombs prison.
It’s easy to snicker at nineteenth-century chumps for being gullible enough to hand over valuables to strangers, but one constant of con artistry is how potential marks never think they’ll get suckered themselves. Confidence swindlers—then and now—are the magicians of thievery. They rank at the top of the grifting hierarchy and take aristocratic pride in their craft, operating with a gentle touch and avoiding brutality. Truly fluid confidence men even evoke a twinge of admiration from impartial observers when they skillfully turn a con, because when suckers don’t get (physically) hurt and the swindles are compellingly clever, tales morph into lore and beg repeating.
Edgar Allan Poe’s 1843 essay “Diddling” examined popular scams of the day, postulating that conning others (diddling) is an inherent human trait: “A crow thieves; a fox cheats; a weasel outwits; a man diddles. To diddle is his destiny.” By the time Herman Melville published The Confidence-Man: His Masquerade in 1857 about a costumed fraud who sneaks aboard a Mississippi riverboat on April Fools’ Day, the “gold brick swindle” had left countless Americans holding gilt-leaved hunks of lead, and the “green goods game” had tricked innumerable aspiring counterfeiters into forking over real money in return for meticulously packaged bundles of sawdust.
In the goldbrick and green goods swindles, marks are led to believe they are getting the upper hand in a too-good-to-be-true transaction, yet their own willingness to be complicit in a shady deal is what sends them smack into a setup. In the first example, suckers are offered a suspiciously low price on “stolen” goldbricks, only later to discover that the doctored metal is neither stolen nor precious (the only actual gold being a wafer-thin veneer and tiny center core the victim is allowed to sample). In the second swindle, would-be conspirators are offered a chance to buy “green goods” (counterfeit money) at a fraction of their face value. The victims turn over real cash and are shown high-denomination bogus bills, but during a distraction the funny money is switched for tightly wrapped sawdust parcels that mimic the heft of banknotes. The marks are instructed not to open the bank bag until they reach a safe place, which of course means “safe” for the con artist, who will be long gone by the time the victim realizes he has been ripped off.
In order for these types of scams to be successful, con men insist that victims have a touch of larceny in their own hearts. Grifters bleed suckers dry by milking greed as soon as they tap into it, stoking traces of avarice from flickering latency into fully engulfed lust. The lawman Allan Pinkerton, founder of the high-profile Pinkerton’s National Detective Agency in 1850, wrote that the green goods game was safer for nineteenth-century criminals than almost any other fraud, because it was only practiced upon men “whose cupidity overcomes their judgment, and who in their desire to swindle others, become dupes themselves.” Victims rarely reported goldbrick and sawdust rip-offs to police, because doing so compelled them to acknowledge their own dishonesty. “As a natural consequence the swindled customers of these sharpers prefer to quietly submit to their losses,” Pinkerton wrote, “rather than to advertise themselves in the doubtful light which would follow any attempt to punish the offenders.”
An 1860 survey of New York police officers estimated one out of every ten city criminals was a confidence man. Around this same time, the idiom “There’s a sucker born every minute” was widely being misattributed to the pitchman extraordinaire P. T. Barnum (Barnum was a master hoaxer, but for the most part he sent people away satisfied they had gotten their money’s worth). It’s not that Americans were more naïve back then; they weren’t. It’s just that the truth about the most legitimate investments was never so tantalizing as the made-up deceptions of con men.
“Why, it would just make you giddy to read the evidence in some cases brought to our attention,” said one nineteenth-century antifraud official. “It almost makes a man want to quit work and get into the business of separating the gullible from their money. Get-rich-quick concerns, firms offering something for nothing, and companies guaranteeing attractive prizes at little or no risk … insert their advertisements in the newspapers, and the ‘suckers’ do the rest.”
By 1880, popular publications were jammed with blind ads promising dubious solutions to everyday problems. Dupes who sent fifty cents to a sham exterminator for “a sure way to get rid of rats” got a postcard with the obvious advice “Catch and kill them.” The same four bits got you a “cure for the liquor habit” (“Stop drinking”), the “best way to raise potatoes” (“With fork, at table”), and the secret of “how to break a kicking cow” (“Sell her to a butcher”). Newlyweds who mailed $1.25 for a “fine set of parlor furniture” got tables, chairs, and a sofa barely big enough for a dollhouse. Housewives unable to resist the dazzling ad for a “sewing machine for $2.00” were crestfallen to receive only an envelope containing a darning needle.
Spinsters who swooned at the prospect of their own Angora kitten did indeed receive a feline, but the yowling stray in a filthy box was hardly the silky, purring beauty they expected. “What they were Heaven only knows,” one investigator confided. “We discovered in this particular case that the man who offered the ‘Angoras’ did not breed the animals at all. When he got an order he roamed around the neighborhood, and the next day it was reported to the police that a household pet had disappeared during the night.”
But blind-reply magazine frauds were pocket change compared with the highly structured wave of con artistry that was just beginning to crest in America. By the early 1890s, mechanisms for ripping people off had begun to mirror the complexities of the country’s booming industrialism, and high-volume expansion of securities markets provided anonymity and liquidity for swindlers who branched into stock frauds. Discerning grifters began to differentiate between “small cons” (street corner hustles designed to clean out whatever was in a man’s pocket) and “big cons” (elaborately staged rackets that carved huge chunks of capital out of high-net-worth individuals). Swindlers were aligning in a new hierarchy, with the con men who could orchestrate elaborate rip-offs ascending to the top of grifting’s totem pole. Jacob Herzig would emerge from Elmira Reformatory just as American fraud was undergoing this grand metamorphosis, from hit-and-run pillaging to high-stakes coups of dizzying deception.
* * *
As America’s swindling landscape shifted, even the master pitchman William Moreau found it difficult to earn a living pillaging villages in the bold, high-carriage fashion he pioneered in the 1870s. After four decades on the road finally wore him out, the giving-away-dollars grifter began compiling an autobiography titled Swindling Exposed that he hoped to pawn off on some publisher before he died. Moreau took a dim view of low-level hustlers who didn’t respect the so-called code of confidence swindling, and when he wrote of his particular distaste for forgers—who occupied a lower, less honorable rung on the underworld class ladder—the King of the Fakirs might as well have been describing young Jacob’s career arc, even though the two never met:
The kindergarten of the forger is his early tendency to deception, lying, shifting responsibility and making things appear in a false light.… The forger and check raiser usually is known (before he is found out) as a gentleman, and associates with the upper crust of society.… A “Jim the Penman” does not associate with the toiling masses, for his aim is to gain recognition.… He makes a business of it, and takes chances of long terms in prison. With him life means desperation and no law is too severe in giving him his just deserts.
In contrast to common forgers, noble practitioners of the con in the 1890s adhered to a methodical framework that progressed through recognizable stages. Similar to the magicians’ code of honor, these secrets were only passed down from one con man to another. Although popular literature of the 1890s tried to illuminate snippets of this clandestine subculture, it would be another fifty years—when the golden age of hustling was sinking into its murky twilight—before the sociology of confidence swindling was codified in depth. Oddly enough, this fundamental blueprint came about entirely by accident, when a University of Louisville linguist undertaking a study of underworld dialects became sidetracked by the entrancing folklore of con artistry.
David W. Maurer’s The Big Con: The Story of the Confidence Man came out in 1940, and no historical record—published before or since—captures the sordid aura of swindling with such matter-of-fact detail, sly humor, and chilling appreciation. “The methods by which I collected my material were not in any way bizarre or unusual,” Maurer explained in the book’s introduction. “I did not resort to false whiskers.… I did not try to join any mobs incognito. I simply talked to confidence men, who, little by little, supplied the necessary facts, facts which were not available in libraries or police records, facts which could come only from the criminals themselves.” It helped that many of the old-time rogues Maurer got access to—Yellow Kid Weil, the High Ass Kid, Brickyard Jimmy, Limehouse Chappie—were well into the autumn stages of their swindling careers by the time the professor interviewed them. Perhaps sensing that grifting was mired in a post-Depression ebb and knowing there were too few aspiring inside men to prosper from their knowledge, these kingpins of confidence reversed the traditional flow of trust late in their lives and, somewhat surprisingly, opened up to Maurer.
Maurer had compiled thousands of index cards referencing low-life slang and the intricate taxonomy of swindling. “The impetus for [The Big Con] came from the half-humorous suggestion of a confidence man who was going through my files,” Maurer wrote. “The execution of it was made possible only by the cooperation of competent professionals.” Emphasizing that there are many offshoots and variations to core swindles, Maurer was the first researcher to paint a vivid, behind-the-scenes picture of American confidence artistry at its zenith, because the way he wrote it in 1940 was based on the collective intelligence of grifters who had risen to peak prowess in the final decade of the nineteenth century—exactly when Herzig was becoming acquainted with some of these same specialized secrets at Elmira.
True confidence swindlers, according to Maurer, take time to research both victims and potential markets. Once contact has been initiated (seemingly random to the victim), swindlers establish a focal point of trust that will later justify shared immoral behavior (psychologists have since dubbed this moral licensing). The process of reeling in the catch begins by dangling the irresistible lure of easy (or illicit) riches, often in the form of a too-good-to-be-true proposition. At this point, the deception might detour to allow the sucker to make a small amount of teaser profit (“giving him the convincer”) before determining exactly how much money the mark needs to invest for the whole shebang to succeed (“giving him the breakdown”). Blinded by gluttony, the victim rationalizes away any misgivings about being involved in a shady endeavor, oblivious to the fact that he is the actual intended target of the rip-off.
The deal is sealed by getting the mark to hand over cash in some highly scripted fashion (“taking off the touch”). Once the quarry has been ensnared and it becomes apparent to the victim that he isn’t going to get rich quick, the con artist either tries to “blow him off” by getting him to go away quietly or—better yet—“cools him out” to lay the groundwork for a future fleecing. The holy grail of grifting is a mark who can be talked into thinking it was his own fault or incompetence that botched the caper and in order to recoup losses will willingly go “on the send” to scrape together more cash to make up for his mistake. (You might recognize this as the basic plot from the 1973 Academy Award–winning grifter movie The Sting. Maurer did too. In 1974, seven years before his death, he filed a $10 million lawsuit against the studio, alleging that his description of the “wire” horse-racing scam had been lifted nearly verbatim. He received an undisclosed, out-of-court settlement.)
If the victim hollers for the law, the swindler can always call in the “fixer” (the underworld expert in every town who gets bribes to the proper officials) or get the case dropped by offering a partial return of money. A refund usually satisfies suckers but frustrates police and prosecutors who invest time building cases only to have to drop them (which further disincentivizes lawmen to pursue future frauds). But most of the time these final steps aren’t necessary, because marks are so embarrassed about being taken that they never report the crimes.
In the aftermath of a successfully turned con, swindlers feel zero remorse, rationalizing that marks motivated by greed get exactly what they deserve. Yet at the same time, they harbor no individual malice toward victims. In the worldview of a seasoned hustler, taking off a touch is strictly business, nothing personal, and—when suckers are so obviously ripe to be had—more of an inevitability of when they’ll be conned than if.
“Confidence games are cyclic phenomena,” Maurer emphasized. “They rise to a peak of effectiveness, then drop into obscurity. But they have yet to disappear altogether. Sooner or later they are revived, refurbished to fit the times, and used to trim some sucker who has never heard of them.”
That logic helps explain why low-level hustles like three-card monte are as productive today as the nearly identical shell game that rooked gullible unfortunates hundreds of years ago. Similarly, it’s why the Spanish Prisoner postal scam of the nineteenth century—in which a “foreign dignitary” solicits financial assistance to get out of a nonexistent jail by vowing an extravagant, nonexistent reward—is mirrored by the proliferation of spam that plagues twenty-first-century e-mail users (often taking the form of a deposed Nigerian prince seeking up-front funding or the use of your bank account to help sneak an “inheritance” out of his country).
The most enduring example of multigenerational repurposed swindling traces to the 1844 Charles Dickens novel,The Life and Adventures of Martin Chuzzlewit. In the book, a devious character cooks up a multilevel investment scam that promises extraordinary (but unsustainable) returns to early participants by paying them with premiums from subsequent recruits. The story was well-known in its day, but seventy-five years later no one recognized this “pyramid” scheme when the Boston businessman Charles Ponzi amplified the same fraud. He too delivered astronomical returns at first, but his top-heavy pyramid collapsed in 1920, burying speculators and landing Ponzi in jail for five years. Yet in another seventy-five years, money-hungry investors were equally oblivious when the Wall Street asset manager Bernard Madoff perpetuated similar deceptions. His highly complex, decades-long $65 billion swindle, exposed in 2008, is considered the largest financial hoax in history. Despite massive media attention and a hefty 150-year prison sentence imposed on Madoff, don’t bet on a nation of suckers being able to resist the next incarnation of a similarly styled great get-rich-quick craze.
“Confidence men trade upon certain weaknesses in human nature,” Maurer summed in the final paragraph ofThe Big Con. “Hence until human nature changes perceptibly there is little possibility that there will be a shortage of marks for con games.”
* * *
Just before his Elmira stint was up, Herzig struck up a jailhouse kinship with an eloquent older forger named Willie Graham Rice. The two shared an affinity for fast racehorses and faster women and passed time comparing notes on financial fakery. Willie was a newspaper reporter who had been convicted of falsifying banknotes against his employer, and he regaled Jacob with stories about the sensationalized nature of 1890s journalism. The wily, articulate Rice was probably the closest thing Herzig ever had to a mentor. At some point, Willie impressed upon Jacob how anyone with a flair for exaggeration would never go hungry in America.
The twenty-two-year-old soaked up the wiseguy guidance, but what especially captivated Jacob was the hustler’s ultra-persuasive way with words. When Willie first arrived at Elmira, his grifter’s sixth sense had sized up Zebulon Brockway as a malleable mark. After waxing passionately at interview sessions about his (totally false) zeal for martial training, Willie talked Brockway into granting him a free pass and $200 in spending money so he could travel to a prestigious military academy (most likely West Point) to learn how to organize a disciplined regiment back at the reformatory.
Willie, of course, disappeared as soon as he strode outside Elmira’s front gate. He bolted for Boston, landed work on another newspaper, and tried to keep a low profile.
Brockway took Willie’s vanishing as an act of extreme disrespect. He ordered his henchmen to spare no expense in hunting him down.
A short time after being forcibly escorted back to Elmira, Willie Graham Rice died in his cell under murky circumstances.
What happened was never clearly documented. But betting men inside the reformatory would have laid short odds that Willie’s demise was related to a vengeful frenzy of “rehabilitation” involving a notorious nail-studded cudgel that had earned the superintendent the derisive nickname “Paddler Brockway.”
If Herzig mourned for his mentor, it was not for long. Jacob seized upon Willie’s departure as an opportunity to create a new identity, or at least two-thirds of one.
As an aspiring writer, Jacob had been contemplating entering a short story contest in The Youth’s Companion. But because the nation’s most popular weekly magazine published only wholesome, benevolent stories that “warned against the ways of transgression,” Herzig knew his entry stood little chance considering the submission would be postmarked with the return address of Elmira Reformatory.
Having demonstrated ample chutzpah in stealing signatures, Herzig appropriated “Graham Rice” and experimented with a multitude of prefixes. Had he been alive to witness this pilfering of his persona, Willie might even have approved—or at least understood from the standpoint of practical con artistry.
Under his new pen name, Herzig decided to enter the contest, perhaps thinking that masquerading as a newspaperman might augment his chances. His story did not win, but Herzig’s nom de plume caught the eye of Brockway as the superintendent censored the outgoing mail. Shortly before Jacob’s release, Brockway affixed an “Alias” notation in regal, flowing penmanship to the upper left-hand corner of inmate No. 4018’s case file—the first known documentation of the swindler who would bilk suckers blind for the next fifty years as “George Graham Rice.”
* * *
Herzig walked out of Elmira on December 24, 1892, having achieved special parole contingent on eight months of probation to monitor his transition back into society.
Because he needed to replenish his bankroll, the first thing Jacob intended to do was get back into his father’s good graces. The next important item on Herzig’s to-do list—settling the score with the tyrant whose sadistic whims had consumed two and a half years of his life—would have to wait a few months until his penal paperwork was finalized.
Superintendent Brockway, it seems, sent Herzig home with a cranial souvenir of his stay at Elmira: a disfigurement at the base of his skull consistent with the type of injury that results from an untreated blow to the head. Jacob was so self-conscious of the lump that he began slicking his hair back to cover it, cultivating a style noticeably longer than the clipped-and-oiled, center-parted men’s standard of the day.
On July 17, 1893, Brockway summoned Herzig to Elmira for his final probation meeting, at which Brockway wrote he was “absolutely released.” Even as the ink was drying on his release, Jacob was scheming to lash back.
Within weeks, every sizable newspaper in New York state had been anonymously tipped off to the hellish cruelties at Elmira.
By September, journalistic exposés had so stirred public sentiment that Governor Roswell Pettibone Flower was demanding a sweeping investigation into the reformatory by the State Board of Charities.
It’s not clear if Herzig was able to orchestrate such a systematic exposure of Brockway’s oppression by himself or if he was part of a broader network of whistle-blowers. But the seeds for being able to pull off this sort of character assassination had almost certainly been planted by Herzig’s old pal Willie, who managed before his death to impress upon Jacob that a whiff of scandal was the best accelerant for igniting the press into a firestorm.
A special committee sat for twenty-five days, read nine hundred complaint letters, and heard testimony from two hundred former detainees. Inmate after inmate described patterns of “unlawful, unjust, cruel, brutal, inhumane, degrading, excessive and unusual punishment … frequently causing permanent injuries and disfigurements.” It was revealed that nine-foot iron hooks, seared in a furnace until glowing red, were used to yank reluctant prisoners out of cells. Guards would then string the men up by their thumbs in a bathroom to be whipped and flogged by Brockway, who only stopped when flesh resembled “raw liver.” After such beatings, the superintendent ordered convicts chained to the floors of dark detention cells, where they languished for days without medical attention. When returned to the general population, some abused prisoners were described as “gibbering idiots” who resorted to suicide to avoid repeat beatings.
Newspapers sensationalized the violence in macabre detail, with headlines shouting, “Shocking Brutality,” “Inmates Tell of Barbarous Punishments,” and “Brockway’s Paddle Must Go.” Once the stories had gained enough traction to achieve front-page status, a dapper Jacob S. Herzig came forward to make sure reporters knew to identify him as “one of the principal witnesses” to the ceaseless savagery.
Despite daunting evidence and damning testimony, reforming the reformatory proved an exasperating task. The committee took months to produce a twenty-four-hundred-page report that condemned both Brockway and the institution. The legislature then debated for a year over what (if any) action it should take. Brockway’s attorneys argued two contradictory defenses: first that Elmira was not a prison (and thus not subject to corporal punishment laws); then that Elmira was indeed a prison (and not subject to oversight by the State Board of Charities).
Eighteen months into the investigation, Elmira’s board of managers passed a toothless resolution forbidding paddling “until further orders.” But before the decree could go into effect, the reformatory and its officers were fully exonerated. The ruling dismissed the hundreds of documented cruelty charges as “distortions of fact,” adding that Brockway’s violence was justifiable because “there is a percentage of criminals so hardened and morally so abnormal that reformation cannot be begun with them except for the infliction of bodily pain.”
Paddler Brockway ruled for five more years, then retired to write an autobiography titled Fifty Years of Prison Service. He was so popular that the locals elected him mayor of Elmira.
For Jacob, it was back to the family fur emporium and the raffish gambling salons of New York City’s loud and lurid Tenderloin district.
Herzig had failed to topple Brockway. But during the process, he did acquire a taste for bucking the system. Jacob savored the rush he got from making authority figures squirm on the witness stand, and it dawned on him that he might have the unique talent it takes to harness the power of the public against the established order. He might not have yet known what the word “iconoclast” meant. But if it signified a lust for shattering old-boy networks and destabilizing conventionalism, Herzig was all for it.
* * *
Sixteen months. That’s how long it took Jacob to squander his freedom. Or at least that’s how long it took authorities to finally track him down and catch him.
“The young rascal is only twenty-four years of age, yet he has been half-way round the world on the strength of his knack in forging his father’s name,” the Philadelphia Record reported after Herzig’s November 8, 1894, arrest for racking up $40,000 in bad debt—the equivalent of $1 million today. “He was no sooner released than he resumed his old life,” chided The New York Times, painting Jacob as a poster boy for recidivism. “He has traveled from Boston to San Francisco, leaving a trail of forged checks and drafts.… The checks were always honored to save the family from disgrace.”
What the newspapers didn’t report was that at the same time Jacob was being pursued by Columbia National Bank, the police, and his father, a furious Canadian minister also wanted a piece of his hide: At the start of his betting binge, Herzig had persuaded the clergyman’s sixteen-year-old daughter to run off with him, and the two cavorted across the continent on a spree of debauchery bankrolled by fraudulent flicks of a fountain pen.
In St. Louis, Jacob lost $10,000 at the faro banks, even though—like most gamblers—he knew the wildly popular card game was notorious for being rigged in favor of the house. Kansas City dealers recognized “Joseph Hart” as the compulsive card chaser who burned through $1,000 an hour at their tables. At his arraignment in New York’s Tombs Police Court, Herzig/Hart had the audacity to demand $150 for the bank draft he had been trying to cash when apprehended, claiming that without the funds he couldn’t afford a lawyer. The judge tersely denied this request, citing the check as evidence of his crimes. Herzig shot back that the money had indeed been stolen—from him—by the corrupt arresting detective.
Jacob’s family had finally had enough. Living in sin with a teenage girl outside the Jewish faith was in some ways worse than the stealing. His parents and siblings disowned him, and no one was willing to post his $15,000 bail. The judicial docket was backlogged until spring, so Herzig was shackled and marched across the Tombs’ infamous “Bridge of Sighs,” a long gated passageway that connected the court complex with the dank, foreboding cesspool where New York’s most deviant thieves, hooligans, cutthroats, dope fiends, and murderers awaited their days of reckoning.
Erected in the style of an Egyptian mausoleum atop a sludge pond contaminated by decades of slaughterhouse offal, the original 1838 version of the Tombs encompassed an entire city block of imposing granite in lower central Manhattan. Twenty-two hours a day, Herzig was confined to a lightless ten-by-six-foot box that contained a filthy straw mattress and a noxious open drinking spout whose basin doubled as his toilet. It’s likely Jacob had to share this cell with two or three other prisoners, because right around the time he was locked up, the state senate was in the midst of a full-blown investigation into overcrowding at the jail. “Such treatment of dogs would be gross cruelty,” one report recommending closure concluded. “The Tombs prison, as it has existed for years past, is a disgrace to the city of New York. It ought to be immediately demolished. It cannot be made decent.”
Herzig languished in the Tombs until March 7, 1895, when he was roused to testify in his own defense. The only person who showed up to support him was the brown-eyed beauty who had been his companion on the cross-country check-kiting binge. The teenager’s presence piqued the interest of the crime beat reporters, so Jacob made a show of having the minister’s daughter pin a handful of white flowers to the lapel of his gray ulster overcoat. When the courtroom hacks clamored to learn the girl’s name, Herzig forbade her to give it.
The next-day newspapers focused more on the mystery of the “strange young woman” than the trial itself, which was fine by Herzig, who had little to say under oath anyway. He politely declined to answer specifics about his signature while under cross-examination and appeared beset by forgetfulness when peppered with questions about checks he had endorsed in the names of his father and uncle. “I know that I am under indictment for some forgery,” Jacob repeated, blinking quizzically. “That is all I do know about it.”
No one bought the amnesia act, except maybe Herzig’s swooning sweetie, who fainted and had to be carried out of the courtroom when the jury returned in less than an hour with guilty verdicts on all five forgery counts.
At his sentencing six weeks later, the presiding judge, John W. Goff, laced into Jacob with a severe scolding that explained why he would be ignoring the jury’s specific recommendation for a merciful penalty.
“An educated criminal is the most vicious member of society,” Goff spat in his excoriating Irish brogue. “This young man has had all the advantages of education and good social surroundings, and he has brought disgrace upon his family.… It is not his first offense.… He deliberately and systematically applied his talents for the purpose of swindling these banks, and obtained, according to his own testimony, some thousands of dollars, which he lost in speculation.… It would defeat the ends of justice if this prisoner did not meet with substantial justice for his crime.… I would be derelict in my duty if I did not give him a substantial remembrance.”
With a slam of his gavel, Goff condemned Jacob to six years and six months in Sing Sing.
Even if he had steeled himself for the worst, Jacob must have gone weak in the knees upon hearing his fate: Sing Sing owned a soul-crushing reputation as America’s most dehumanizing prison, an emasculating institution whose keepers took an iron-fisted pride in stripping away all traces of individuality.
* * *
Sing Sing prisoners—among the first to be outfitted in black-and-white-striped uniforms that would become emblematic of jailbirds everywhere—were forced to shuffle as anonymous units in shackled lockstep, from the mess hall to the slop toilets to the dreaded workhouse: right arms out straight, open palms tucked into the armpit of the man in front, eyes always riveted on the guards. Rigid, mind-numbing adherence to the “Auburn system” mandated strict silence and docile herd obedience, and convicts were driven beyond exhaustion by a slavish regimen of repetitive labor. Deviance from exacting standards resulted in punishments designed to inflict maximum psychological humiliation, and Sing Sing’s abnormally high suicide rate was rivaled only by what was then called its “insanity rate.”
It was common to hear of despondent inmates plunging their hands into molten metal in the smelting shop, self-amputating digits in the brickworks, or diving headlong from cell-block towers to the rocky Hudson riverbank hundreds of feet below. Sing Sing “represented all that was vile in American penology,” one criminologist would write in 1919. “The very site of the prison breathed physical as well as moral contagion.… In general, the population was the most terrifying to the conventional mind that could be found anywhere.”
Sing Sing’s mechanization was so ruthlessly efficient that its overseers had ample time to pursue rampant profiteering. Prisoners toiled night and day mining a distinctive local stone known as Sing Sing marble from the on-site quarry so jailhouse bigwigs could sell the bluish-gray slabs to builders of High Victorian mansions. Large-scale contract manufacturing was solicited for the prison’s various factories, with kickbacks buying private firms the right to beat inmates who failed to meet impossible quotas. But pervasive corruption cut both ways: Convicts who had a source of funding from an outside accomplice could funnel money into the paws of crooked officials to “shoot the curves,” which was 1890s prison parlance for buying one’s way into doing easier time.
At the extreme end of the scale, the wealthiest criminals could arrange for “escapes” guaranteed never to be solved. But most everyday Sing Sing graft involved upgrades to better cells or getting assigned to easier work crews. The prison also supported a robust underground economy, in which convicts established not-so-secret accounts with guards to procure contraband like candy, fruits, nuts, tinned meats, tobacco, the occasional jug of stout, or even fixes of morphine and opium to slake narcotic cravings. Because valuables and currency were confiscated upon incarceration, an outside “sponsor” was imperative. Without a flow of fresh cash, inmates slid to the bottom of the human slag heap, where they suffered in intensified misery as the most wretched subclass of Sing Sing society.
Jacob’s narrow window of opportunity between sentencing and the trip to prison was about to slam shut. Within an hour of being condemned by Judge Goff, he was to be part of a chain gang herded aboard the 2:05 P.M. Hudson River Railroad local chugging north to Sing Sing. The thirty-two-mile riverside journey was one of the most scenic rail trips out of Manhattan, but the ride was so infamously dreaded by those about to be imprisoned that the euphemism for it—“going up the river”—would soon become the colloquial catchphrase for going to jail anywhere in America, regardless of proximity to a waterway.
Herzig, uncharacteristically, sought the help of a man of the cloth. The Reverend William Lindsay was the chaplain of the Bleecker Street mission for “fallen women” and also volunteered his time to detainees at the Tombs who were about to be sent to Sing Sing. In just a few moments of hushed conversation inside his holding cell, Jacob managed to arrange for a bizarre last-minute blessing. The vicar didn’t know it, but Herzig had twisted the sympathetic minister’s confidence to his advantage.
The grim procession to the train station was nearly always the same: A horse-drawn van backed up to the waiting room entrance at Grand Central Depot and disgorged a motley collection of cuffed convicts. Deputy sheriffs and Pinkerton guards barked to get the prisoners in line and keep them moving, but unless a hysterical inmate refused to walk, displays of force were largely for show. And “show” was the key word, because the morbidly curious crowds at America’s busiest train station reveled in these daily parades of malaise, jeering and pointing as if the jailbirds’ walk of shame were a bonus included in the price of a train ticket.
As the chain gang threaded its way through the mob, taunts and heckling led to hats getting knocked off prisoners’ heads and shirt collars being ripped off their necks. Newsboys and bootblacks crouched at the front of an ever-tightening circle to be within prime spitting and stone-throwing range, and the pitying glances from factory girls were almost as unbearable as the abuse from the workingmen. To all but the most hardened criminals, the hostility was a kaleidoscope of fear and confusion—exactly the sort of atmosphere the lawmen wanted to create before moving on to the crucial phase of the transport.
Once on board, inmates were corralled into the smoking car. Guards chatted with passengers but did not allow anyone to converse with the convicts. When the train began rolling, a deputy broke out a bottle of whiskey (rotgut, for certain) and cigars (lung-searing cheap ones) and let the prisoners drink and smoke as they pleased. Then the lawmen began to brace up the inmates by imparting “inside” knowledge about Sing Sing, reassuring the felons that if they were tough enough, they could reasonably handle doing time there.
Having fostered a degree of trust, the keepers then made the rounds: Guards homed in on convicts who seemed overly fearful, offering to put in a good word with the jailers in exchange for cash (a scam that left convicts feeling damned if they participated and doomed if they didn’t). If Jacob was still wearing his good ulster overcoat or had a bundle of personal items, a deputy would explain how the penitentiary was going to take away everything upon arrival. But if Herzig handed his items over right now, the man promised to send them to a friend or relative for safekeeping. Inmates who fell for this ruse never saw their belongings again, even if they additionally parted with their last few dollars to ensure “express delivery.” Prisoners who refused to hand over anything would get another chance at being rooked, because the same false promises and confidences (minus the whiskey and cigars) were sure to be repeated by the more forceful guards who took them in at Sing Sing.
Jacob must have slipped a little something extra to the deputy sheriff Joseph Burke, the lawman in charge, because just as the train pulled out of Grand Central, Herzig was uncuffed and whisked back to the baggage car, where a conductor with long white whiskers had been paid to block access to curious passengers. At the rear of the compartment stood the pious reverend Lindsay with a Bible in his hand.
Alongside the clergyman trembled Jacob’s dewy-eyed teenage sweetheart, Theramutis Myrtle Ivey.
Among steamer trunks and hat boxes, the deputy gruffly affirmed to the minister that yes, he would vouch for the prisoner as his best man.
By the time the train passed beneath the massive stone arches of the High Bridge aqueduct at 173rd Street, the convicted forger and the runaway schoolgirl were man and wife. With no time to spare en route to prison, Herzig had secured his all-important outside accomplice.
The outlandish news about the jail-bound wedding spread so fast that reporters were on the story even as the train steamed into Sing Sing. Write-ups about the nuptials titillated readers up and down the East Coast and all the way to Ivey’s hometown of Jarvis, Ontario. Yellow journalism’s standard-bearer, the New York World, gave the ceremony prominent play alongside similarly sensationalized articles about an operation on conjoined baby twins and the theft of a prized Great Dane:
When the train arrived at Yonkers, the minister dropped off and Herzig and his bride came into the smoking-car and received the congratulations of “Moke” Murray, sentenced to three years and three months, and a tough looking negro to whom “Moke” was handcuffed. When the party left the train at Sing Sing, the woman was sent to a hotel and the prisoners were taken to prison. Burke, the deputy sheriff, denied that any ceremony had taken place, or that he had acted as best man, but the story was fully corroborated by train hands.
In the days to come, reporters hounded the teenage bride for details. The Norfolk Virginian ran an exclusive that emphasized the couple’s impulsivity, going so far as to suggest in its headline that the girl had been “Svengallied” into marrying the felon:
Hypnotism is said by Theramutis Ivey to have played no small part in her marriage to Convict Jacob S. Herzig.… [The bride] has been disowned by her parents for the persistency with which she has clung to Herzig, even after he was convicted.… “I had no intention of getting married when I went to the train to accompany my lover to Sing Sing. But before I knew it we were standing before the clergyman, and I became ‘Jock’s’ wife. I must have been hypnotized.… I am not sorry I married him, and yet—and yet—well, I don’t know. It all seems so strange and weird-like.…” The next instant she added: “Well I am glad I did it. I don’t believe Jock is guilty.… I love him, and I could never love anyone else.… I shall try to get my husband pardoned.… Jock always seemed to have such an influence over me that he could make me do almost anything.”
When the locomotive hissed to a stop at Sing Sing village, the prisoners were marched off the train. The platform was crowded, but unlike at Grand Central the sight of men in cuffs and leg bracelets was too common for the locals to bother gawking. Even boys shooting marbles on the sidewalk paid the chain gang no attention. The convicts were made to zigzag the tracks, dodging departing trains, before being ordered up a rock-strewn bluff to the long, dusty road that led to the hulking stone penitentiary.
If Herzig looked back, chances are it was not to exchange parting glances with Theramutis. The grinning deputies and Pinkerton men, arms laden with overcoats and misbegotten belongings, were what would have caught Jacob’s appreciative eye.
Even while plodding to the slammer, Prisoner B-516 would have grudgingly admired the thoroughness with which the crooked keepers had completely fleeced the captive suckers.
* * *
It didn’t take Jacob long to deduce he had made a mistake in marrying Ivey, at least from the perspective of banking on a love-struck seventeen-year-old to negotiate the byzantine appeals process and prison black market on his behalf. Other convicts facing sentences extending into the next century might have done everything they could to hold on to their wives, but it wasn’t hard for Jacob to conclude that his bride was a bothersome liability. Getting the annoyingly loyal girl to stay out of his life for good was what proved exasperatingly difficult.
Herzig first tried black humor. Didn’t she understand the ceremony had been an elaborate practical joke? Then he tried a made-up legal angle: Their marriage was not lawful because it occurred while he was in custody. In the end, Jacob figured caustic honesty would do the trick. When Ivey called one afternoon during visiting hours—she had secured a job as a dressmaker’s assistant and was trying to funnel a trickle of money into the jail on his behalf—Herzig made it clear that unless she could provide for him in significantly better fashion, he had zero use for her. Choosing words that stung like acid, Jacob ordered the girl to go away and never come back.
The cruelty worked. But for Herzig, it wasn’t enough.
Jacob talked up Theramutis—muttering out of the corner of his mouth to get around Sing Sing’s strict no-speaking rule—to an inmate named John J. Gilmore, a habitual offender who was nearing the end of his prison sentence. Omitting any mention of his marriage, Herzig intimated that he knew of a gullible working girl living alone near the prison. Upon release, Gilmore tracked down the easy target and took her for his wife. After they had been together for a short period, Ivey let it slip that she had already gone through one wedding ceremony with a convict but that of course it didn’t count because the groom had not been a free citizen when they exchanged vows. Learning he had been tricked into supporting another man’s wife, Gilmore flew into a rage and beat Theramutis so viciously that she lost an eye. This news filtered back to prison, and Jacob seized upon it as his chance to file for an annulment, petitioning the church to void his marriage on the grounds that his bride had abandoned him to live in sin with another man.
It was up to Herzig to fend for himself for the balance of his imprisonment, but no documentation exists as to how he managed to do so. Sing Sing’s surviving handwritten records from this era detail minutiae such as Jacob’s hat size (7?), shoe size (8½), and condition of teeth (“fairly good, some filled with gold”) but give no clue as to how he secured a transfer to the less severe Auburn Prison in 1899, where he served as the chaplain’s assistant and was the first editor of an inmate newspaper called Star of Hope. Sometime in the first few months of 1900, Herzig was granted early release after serving only five years of his six-and-a-half-year sentence.
In the decades to come, Jacob would reveal little about this stint behind bars, hinting only that he read voraciously and tried to stay out of trouble. By the time he got out, he had made up his mind to become a different person—in name if not in deed—and took great pains to obliterate his true identity while embracing life anew as George Graham Rice.
* * *
George/Jacob was approaching thirty after having spent the better part of a decade in New York’s most debasing jails. Considering the average life expectancy for an American male in 1900 was forty-seven years, it would not have been a stretch to say that Rice/Herzig had blown his opportunity to make a meaningful mark in life. But it’s doubtful that George, even with his gambler’s sense of probabilities, gave serious consideration to being past his prime. During most of the time he was in prison, America had been struggling to recover from a financial panic that rocked the nation in 1893, and it was not until the country turned the corner into the twentieth century that the economy truly started to regain steam. Rice emerged to a nation that had been made over as the playground of the new rich, and the hallmark of elite status within this exclusive, so-called smart set was the conspicuous ability to burn through fortunes with a lavish hand.
Taking care to avoid anyone who knew him by his former name, Rice upped his social ante, steering clear of the seedy Tenderloin while infiltrating the mink-and-monocle crowd at fashionable Broadway nightspots. Affable and impeccably mannered, George fit in easily and was well liked. But how he afforded daily extravagances like high tea in the Palm Garden of the Waldorf-Astoria or truffled Strasbourg foie gras in the Gilt Room of the Holland House must have been a bit of a mystery to his new acquaintances, because the outgoing newcomer had no visible means of support. Unbeknownst to his new circle of socialites, George viewed mixing with the well-to-do as an occupational prerequisite for tapping into fresh wealth.
Within weeks of hobnobbing with the theater district’s in crowd, Rice became smitten with—or at least pretended to be head over heels in love with—a matronly leading lady who loved a good splurge and owned an ample bankroll. A domineering presence both on and off the stage, Frances Drake had been one of the few female newspaper reporters in the Pacific Northwest during the 1880s (when women were compelled to write under a pseudonym), but around 1890 she gave up journalism to make a successful switch to playacting. Exuding confidence, the dark-haired Drake shone in everything from wistful French monologues to bawdy vaudeville knee-slappers. But male cast members resented Frances because her strong performances overshadowed theirs, and Drake routinely clashed with the managers of her various touring troupes. Still, houses continued to fill, so Drake’s queenly tantrums were tolerated, and in the spring of 1900 she starred in The Adventures of Lady Ursula, a romantic comedy about a bossy heroine disguised in men’s clothing who gets challenged to a duel. After debuting to acclaim in Rochester, the play got good reviews in New York City and up and down the Eastern Seaboard, including one write-up that noted, “Miss Frances Drake … is an actress of experience and reputation, [who], apart from her histrionic abilities, is an unusually clever woman.”
Drake, in turn, fell for Rice, who—as an actor in his own illicit way—came across as a cultured wiseguy with a flair for spontaneity. On June 13, 1900, when Lady Ursula was on a break between engagements, Frances and George got hitched in Rochester. Presumably, Rice enjoyed his honeymoon. He certainly didn’t find it necessary to spoil the good time by mentioning to his new bride that he already had a wife and—because he had never sought an official divorce—was still legally bound to her.
When the Rices returned from celebrating their nuptials, Frances had a disturbing revelation awaiting. But it didn’t come from George, and it had nothing to do with Theramutis Ivey. Among the accumulated wedding cards and notes of congratulations was a letter written by someone Frances did not know—Simon Herzig, a New York City furrier.
The gentleman identified himself as the father of her new husband, wished Frances happiness, and expressed hope that her love was strong enough to enable her to forgive his boy’s past errors. Then Mr. Herzig went on to enumerate his wayward son’s long list of ethical lapses and legal woes, supplying Frances with details, dates, dollar amounts, penal chronology, and George’s full real name.
Confronted with the contents of the letter, Rice figured there was only one thing to do: He got down on his knees and confessed fully—at least according to his prism of reality.
George came clean about his time in Elmira and Sing Sing. Then he laid out exactly how he had come to be shamefully branded as a felon—by a scheming father and spiteful uncle who conspired to have their own kin locked away for crimes everyone in the family knew he did not commit.
“I burst into tears,” Frances would recall a decade later, “but loved him all the more for telling what I thought then to be the truth.”
It is unclear exactly when it dawned on Frances that Simon Herzig’s version of events just might be more accurate than her husband’s. About a month after their honeymoon would be a good guess, because by then the newlyweds were leading separate lives: Frances was on the road with her theater troupe, while George had skipped town and was off on another cross-country betting bender.
* * *
After who knows how many train stops south from New York, GG found himself in New Orleans by the late summer of 1900. Although it was probably not his original intent to look for a job, he had no choice after the Big Easy’s infamous gambling gantlet of racetracks, prizefighting clubs, cockfighting rings, Cajun Bourré parlors, roulette wheels, and faro banks left him high and dry. Somewhere along the line, money wired from Frances had ceased to be an option.
Perhaps presenting himself as the Graham Rice who previously wrote for newspapers in the Northeast, George landed a gig on the staff of the New Orleans Times-Democrat. He was assigned to the hotel beat, which meant prowling the lobbies and scanning the registers of lodging establishments to report the comings and goings of influential businessmen and high-ranking socialites. As the new guy on the staff, he had to work Saturdays. George was hardly accustomed to spending his weekends rooting around for breaking news.
The evening of Saturday, September 8, 1900, was tremendously wet and gusty, and Rice took refuge in the lobby of the nearly deserted St. Charles Hotel. He was probably working harder on a La Belle Creole cigar than on meeting his deadline when he overheard a frantic clattering from behind the closed door of the Hyams & Company brokerage suite off the hotel’s main corridor. George knew the rudiments of telegraphy from years deciphering race results in poolrooms, and when he paused to eavesdrop on the mechanical sounder, he recognized the urgent dots and dashes as a distress call coming over the Western Union wire from somewhere on the Gulf Coast of Texas.
A devastating tidal wave had just leveled Galveston Island. Capsized ships, washed-out bridges, splintered buildings, uprooted trees, and thousands of livestock, pets, and humans had been swept away in a frothing vortex of death. The entire city was fifteen feet underwater and being battered by hundred-mile-per-hour hurricane winds. Rice recognized the tragedy as his chance to scoop the greatest natural disaster of the new century. He knew the value of a highly saleable human interest catastrophe, and fate had practically gift wrapped this one and dropped it into his lap.
George sprinted four blocks through the pelting rain to his newspaper’s business office on Camp Street. He roused the drowsing teller in the cashier’s cage and got him to front $500 in expense money and a one-way ticket to Houston on the Texas and Pacific Railroad, insisting he couldn’t wait for an editor’s permission to chase down the story of a lifetime. This was Rice’s chance to be the lone newspaperman rushing into the heart of an epic disaster while everyone else was evacuating away from it.
The overnight train got GG 350 miles west but no farther south because storm surges had already drowned eighty-five passengers in submerged railway cars. Relying on bribed rides aboard mules and in rowboats, George spent another full day negotiating the final fifty miles to Galveston. Arriving Monday at midnight, he was granted a pass by the U.S. Army to report from within the disaster zone. While under escort to view recovery efforts, he was strongly advised to stick to the military’s version of events.
Instead, Rice slipped his leash and took liberties with the officially issued reports. By Tuesday morning, he was on the run from military police trying to arrest him for spreading false panic.
“My offense lay in sending out the truth about Galveston,” Rice contended, savoring his claim of being the first outside newspaperman to land on the island. “When I first reached there I sent out an estimate of 5,000 killed. The authorities limited the dead to 1,000 then. Since that time they have gradually advanced that number until now Governor [Joseph] Sayers admits 12,000 dead. I believe that 18,000 would be nearer correct.… The stench of the city is frightful. [The American Red Cross founder] Clara Barton told me she recognized it—the battlefield smell—while she was on a Southern Pacific train fifteen miles outside of Houston.… People with no property interests are making every effort to leave the island. Men who will be ruined unless the city is rebuilt are trying to allay the panic and keep the people there.”
While George was journalistically correct to be skeptical of the casualty estimates, he was not so ethical when it came to deciding which newspaper would receive his exclusive reports. Because telegraph wires were down for miles around, Rice knew he was sitting on a big story as soon as he could get off the island to transmit the full-blown version. Even though The Times-Democrat had paid his way to Galveston, George didn’t see why he should turn over such a sensational scoop to a piddling publication that paid him thirty bucks a week. In fact, before he even left Houston for Galveston, Rice had sparked a bidding war and accepted a $5,000 offer fromThe New York Herald to deliver a first-person feature and follow-up series.
“When my pass was taken up I was in danger of being shot,” Rice boasted. “But I smuggled myself through the lines, and by the aid of Captain Rafferty, U.S.A., left the island on a tug. The objection to me was that in my dispatches, I had expressed the opinion that Galveston is irretrievably lost.… When I came away we were going through dead bodies [in the water] all the way to Buffalo Bayou, twenty-five miles distant.… Before I left there were many cases of what the doctors called malarial fever, and a scourge of yellow fever is feared.”
On his way home to New York, Ricecakes gave New Orleans a wide berth, returning north by way of Cincinnati. For a month, he was interviewed as an expert eyewitness about Galveston, feigning modesty while basking in the glow of recognition. “It was a ‘beat’ and I netted a big sum for a few days’ hard work, but the money had all been spent for subsistence,” he claimed. Back on Broadway, George embellished his adventures, including one version in which he allegedly stole a horse, raced to meet an onrushing supply train, then heroically led the relief expedition back to Galveston.
In addition to his upgraded social status, Rice now had some capital at his disposal. With part of his $5,000 windfall, he bought a horse-racing sheet called Spirit of the Times. George thought he was getting a bargain because the publication was in decline, and he had grand plans for a relaunch. But a printers’ strike caused him to miss several issues, and by the time the sheet came out again, its circulation had evaporated. Both Rice and his racing paper were yesterday’s news.
George next tried to catch on as a reporter with one of New York City’s nine daily newspapers. But even at the zenith of yellow journalism, Rice’s editorial credibility was shot because of the backstabbing stunt he had pulled on The Times-Democrat. While New York papers had been perfectly willing to bid on his onetime freelance exclusive, none wanted to hire a two-timing reporter as a full-time staffer.
In the first week of November, Rice checked in—alone, no sign of Frances—at the Park Avenue Hotel. He got the hotel beat writer at the New-York Tribune to list him as a “prominent arrival” in hopes of drumming up a business venture. Nothing came of it.
By Christmas, George, by his own admission, was “loafing” and quickly going broke.
By March 5, 1901, he had exactly $7.30 to his name and was out of options.
Then Rice spied Dave Campbell trudging in his direction through the slushy intersection of Fortieth and Broadway.
His grifter’s intuition picking up a whiff of opportunity, George beamed his phosphorescent smile and gregariously thrust out his hand as if welcoming a long-lost friend.
* * *
After making a splash with the big scores by Silver Coin and Annie Lauretta, the Maxim & Gay turf advisory bureau played it safe, selling tips on heavy favorites. Although these horses did not fail to win, their short prices “provoked some sensation of anti-climax among the boobs,” who were quick to grouse about forking over five bucks for obvious standouts. Still, the firm managed a winning record through its first four days, impressive for any tout.
Then, on day five, Frank Mead wired the name of a long shot owned by a man known to be “handy with a needle and syringe.”
In 1901, performance-enhancing pharmaceuticals were an open secret in American horse racing and not even technically illegal. The practice was so widespread that Maxim & Gay touted Mead’s “hop horse,” even though Rice knew that the main competitor in the race was also trained by a notorious New Orleans doper.
As one turf columnist described it, this race would be remembered as “a competition in stimulative medication” in which both horses “went to post frothing and preening like unto DeQuincey’s opium addict.” At the precise moment Mead’s eight-to-one tip surged past the winning post to snatch a narrow victory, the winner collapsed to the racecourse, stricken by a drug overdose.
“The success,” the scribe wryly pointed out, “under circumstances that denoted Maxim & Gay knew the very stride a horse would drop dead on, appeared symbolic. The high-riding Maxim & Gay people were now in the lap of the gods running before the wind with all sails bellowing.” The surprise score put two Herald Square bookies out of business, and the next day Ricecakes raked in $10,000—the firm’s highest gross yet.
When the racing swung north in the spring, Rice bought intelligence at the Benning race meet near Washington, D.C., and hired informants at tracks in New York. Walk-in customers were soon outnumbered by subscribers who wanted the establishment’s selections wired to them, which was understandable because George had expanded advertising to reach poolroom devotees in San Francisco, Los Angeles, Dallas, New Orleans, Chicago, Detroit, and Toronto.
Rice’s monthly budget for newspaper ads soared to $22,000, and the full-page displays ran true to George’s insistence that “small type was never intended for commercial uses.” Maxim & Gay diversified its product line, expanding from the “One Best Bet” to the “Three-Horse Wire.” Occasionally, GG dangled a “$50 Wire Special,” demanding ten times the usual rate. When enough rubes bit at that price, Maxim & Gay launched a “$100 Special” that required recipients, in lieu of payment, to make a $100 wager on the firm’s behalf. Business was so brisk that the Postal Telegraph Company and Western Union both had to furnish the Stewart Building with direct-loop switching systems to handle the volume of wire traffic.
There were competing tipster services, but early-twentieth-century horse touts were burdened by a shifty stigma. Maxim & Gay, by contrast, published an (allegedly) objective weekly recap of how its selections fared, noting not only winners but losers (with appropriate excuses). Rice wrote one clever “convincer” ad disguised as a letter of apology for “only” earning $540 for customers, berating the firm’s own experts for not doing better. By March 1902, Maxim & Gay had sixty-four thousand daily subscribers marching lockstep into poolrooms and bookie joints, laying it in so heavily on George’s best bets that every published nudge on a horse set off nationwide odds plunges.
As business grew, Rice realized he was sitting on a wealth of information culled from clients. Although it would be another full century before terms like “customer profiling” and “data mining” entered the lexicon, George was an early pioneer. He instructed his staff to keep meticulous records about individual purchasing patterns, and Maxim & Gay salesmen were among the first to ask “May I have your telephone number?” as part of routine transactions (in 1902, the phone was so newfangled that anyone who could afford one thrilled at the novelty of hearing it jangle). The compilation of this original “sucker list” would be Rice’s best long-term investment. Over the next few decades, he would crisscross the continent with it, seducing loyal old saps with newly enticing swindles, fine-tuning and expanding his database of prey by adhering to the time-tested truism “Once a sucker, always a sucker.”
Maxim & Gay’s success came not so much from which horses Rice touted as from how he touted them. George didn’t just offer the name of a hot horse, but used insider terminology and a cloak of secrecy to weave a compelling narrative. To Rice, it was imperative for clients to feel as if their $5 were buying entry into the exhilarating, behind-the-scenes world of the racetrack. “We used in our big display advertisements a nomenclature of the turf that had never before been heard except in the vicinity of the stables,” Rice would explain a decade later in his autobiography, My Adventures with Your Money. “It was our aim, in using the language of horsemen, to be technical rather than vulgar, the theory being that, if we could convince professional horsemen that we knew what we were talking about, the general public would quickly fall in line.”
As it was for John L. Sullivan’s manager, “The public demands to be mystified” became George’s mantra. That way, even when people lost a bundle betting on a Maxim & Gay stiff, they were sufficiently intrigued to come back for more.
Rice tried to walk a fine line between enjoying the luxe life his new line of work afforded him and keeping his identity secret from racing’s old-boy network. GG relished carousing along Manhattan’s Rubberneck Row, picking up checks at swank nightspots like Delmonico’s, Sherry’s, and Rector’s. But he had to keep his mouth shut about Maxim & Gay when deep-pocketed owners of prominent racing stables were around, because some of them forked over ridiculous amounts of money just to make sure they weren’t missing inside information about their own horses. Eventually, George cost himself his privacy by being unable to resist a few mocking jabs at a blue-blooded scion of the turf: William Collins Whitney, one of the richest, most powerful men in America.
By 1902, Whitney was in the autumn years of a full life, a retired secretary of the navy who had been legal counsel for Thomas Edison’s electric lighting patents. In his dotage, Whitney was co-developing New York’s first underground transit system. He owned both a high-class racing stable and a controlling interest in The Morning Telegraph, the bible of horse-racing publications.
Whitney owned a talented mare named Smoke who had trounced high-class competition and was then entered to race right back against inferior horses. She figured to dominate, but one of GG’s private clockers thought Smoke didn’t look quite right in her morning gallops, so he recommended betting against her. In a twist of misdirection, Maxim & Gay took out ads in The Telegraph offering this bit of cryptic advice:
Don’t bet on Smoke to-day.
She will be favorite, but will not win.
Despite Maxim & Gay’s caution, the betting opened hot and heavy on Smoke. Whitney’s own wagering commissioners scurried about the bookmaking ring, getting as much money down on the mare as they could.
Then Smoke turned in a lackluster performance, clunking home at the back of the pack. Whitney, spitting mad both at the inexplicable loss and at having been embarrassed in his own newspaper, demanded that officials launch an investigation into whoever tampered with, drugged, or paid a bribe for his horse to lose.
For the first time, the spotlight intensified on Maxim & Gay. George knew the tracks could make trouble for him if they learned of his criminal past, so Rice had his chief clocker write up a report documenting how in his opinion the filly had “soured” after Whitney’s trainer left her in the care of a lesser-qualified assistant. This explanation satisfied the stewards but infuriated Whitney. When Maxim & Gay gloated in subsequent ads about knowing more than W. C. Whitney did about his own stable, it constituted a very public and disrespectful slight.
In the aftermath of Rice’s exposure, bookies were curious to finally learn the identity of the anonymous insider who had been yanking their betting markets out of whack. When they saw it was some skinny advertising whiz with glasses and a cane, they felt duped. The public, on the other hand, didn’t give a hoot who George Graham Rice was so long as Maxim & Gay kept churning out reliable info. One notorious high-stakes plunger, Riley Grannan, befriended George after learning who he was. “Got to hand it to you, kid!” Grannan said, backslapping Rice. “Any time you can put one over on the Weisenheimers that have been making a living on race-tracks for twenty years you are entitled to medals!”
* * *
In the tout biz, when you were on a roll, you were on a roll, and when you weren’t, you were due. The following ad, tipping a well-meant horse at Sheepshead Bay in New York, was broadcast to distant cities in the spring of 1902, typifying Maxim & Gay’s go-for-broke spirit:
A GIGANTIC HOG-KILLING
We have Inside Information of a Long Shot that
Should Win To-Morrow at 10 to 1
and Put Half of the Book Makers out of Business.
Be Sure to Have a Bet Down on This One
Terms $5
This particular best bet failed to win. Half an hour after the sure thing ran out of the money, the first angry telegrams rained down on Maxim & Gay:
THE HOG-KILLING CAME OFF ON SCHEDULED TIME—HERE IN LOUISVILLE. I WAS THE HOG.
DEAR SIR: YOU HAVE BEEN ADVERTISING FOR SOME DAYS THAT YOU WOULD HAVE A GIGANTIC HOG-KILLING TO-DAY. I WAS TEMPTED BY YOUR ADVERTISING BAIT AND FELL—AND FELL HEAVILY WITH MY ENTIRE BANK ROLL.
PERMIT ME TO STATE, HAVING RECOVERED MY COMPOSURE, THAT ARMOUR OR SWIFT NEED HAVE NO FEAR OF YOU AS A COMPETITOR IN THE PORK-STICKING LINE, FOR FAR FROM MAKING A “HOG-KILLING,” YOU DID NOT EVEN CRACK AN EGG.
Rice smirked at the sarcasm. Sore losers were in the minority compared with gamblers who didn’t care about blowing a wad so long as they had a rollicking fine time watching it go.
“Good game,” wrote one undaunted disciple. “Have sent for more money!”
That summer Maxim & Gay opened a branch in Saratoga Springs, the upstate resort where New York’s fashionably wealthy retreated every August to partake of mineral spring baths, no-limit casinos, and elite Thoroughbred racing. Rice siphoned $50,000 from the “smart set” over the course of this three-week spree, and many of his clients were women (ladies, although not permitted inside the betting ring, were allowed to have wagers placed on their behalf by bet runners). George immediately conjured up a separate tip sheet he thought would appeal to the fairer sex, featuring clairvoyant selections from a mystic who claimed to be able to communicate with horses. This “straight from the horse’s mouth” angle was a huge hit, but not nearly as profitable as GG’s parody of a rival tip sheet.
A tout under the pseudonym Dan Smith had been undercutting Maxim & Gay with a rip-off service that printed glowing predictions of at least five horses in each race. When one of them came in, Smith crowed about “selecting” the winner. In retaliation, Rice launched the “Two Spot” sheet in the same crude vein at a cheaper price. This scheme worked so well that not only was George able to kill off his competitor, but because less astute bettors failed to discern the ploy as a hoax, many actually began to prefer the sham service. “The whole enterprise appeared to me in the light of an experiment—just trying out an idea, and having a lot of fun doing it,” George later recalled. “All the pleasure was in the accomplishing.”
Rice devised an ingenious hedging system in which Maxim & Gay advertised a refund of $6 if patrons bought a $5 “One Best Bet” that lost. The trick was to only advertise the refund on days when there was a two-horse race. He gave out the favorite as his published pick and bet a portion of gross receipts on the long shot as insurance. If the favorite won, the firm stood to profit from the increased sales, minus the cost of the hedge bet. If the long shot won, Maxim & Gay profited from the hedge bet, even after using part of the winnings to pay refunds on the losing favorite. Either way, Rice made money, customers were happy, and bookmakers couldn’t figure out how he did it. “It was taking candy from a baby,” George boasted.
But the problem with accumulating so much candy was that Rice had a self-destructive sweet tooth.
When Maxim & Gay first launched, George’s ego was so inflated that he insisted on betting his own selections. Then, realizing the power that his opinions had on moving wagering markets, George began intentionally touting horses he didn’t like just to drive up the odds on those he intended to bet for himself. By autumn 1902, Rice estimated Maxim & Gay had netted close to $1 million in profits—$28 million by today’s standards. But a staggering amount of that revenue had been flushed directly into the pockets of bookmakers.
“Recklessly and improvidently I had let it slip through my fingers,” Rice later admitted. “I spent the money as fast as I made it. It was easy come and easy go. The patronage of the bureau fell away to almost nothing.”
A change of tactics was in order.
George concocted an initiative to go after tens of thousands of customers right outside the front gates of New York’s racetracks, hiring an army of salesmen costumed in khaki military uniforms. His theory was that if he created a clamor over Maxim & Gay’s ubiquitous white envelopes, every sucker in the vicinity would flock to the authoritative-looking vendors out of fear of missing out on a sure thing. The Jockey Club, the genteel sanctioning body that governed the races, made it known that it strongly disapproved of such hucksterism. But Rice knew that as long as he kept his sheet sellers off the tracks’ private property, there was nothing The Jockey Club could do about it.
On the morning of October 30, 1902, Rice wasn’t feeling well and took a rare day off. Had he been at the office, it’s likely George would have micromanaged even the stuffing of the salesmen’s envelopes, because he was gaining a reputation as an exacting boss who insisted on control over every niggling detail. His minions apparently needed close supervision, though, because the lackey in charge ineptly sent the tip sellers out to Aqueduct with thousands of envelopes that contained blank slips instead of that afternoon’s best bet. Irate patrons demanded refunds, and even though the office promised to send a messenger to the track with the correct slips, no one ever arrived, and Maxim & Gay did not issue a single tip that day. When he heard of the debacle, George was livid.
In that afternoon’s fifth race, a no-hoper named May J. scored a shocking upset, winning at a hundred to one. “The spectacle of the derided filly finishing first startled the spectators for a few seconds,” The New York Timesreported. “Then the racegoer’s sense of the ludicrous asserted itself, and there was such an uproar of laughter and ironic cheering as never before was heard on a New York race track.”
The next day, an ecstatic customer showed up at Maxim & Gay, wanting to sign up for an extended subscription. He claimed to be rolling in money and was adamant that the firm had tipped him on May J.
The gentleman insisted he had purchased an envelope from one of the khaki-clad army men outside Aqueduct. Maybe he did, but it certainly hadn’t contained the winner. Euphoria had blinded him to the power of suggestion, resulting in a fanatical belief that Maxim & Gay had supplied him with the windfall.
A clerk asked if the gent would mind signing an affidavit acknowledging the firm as the source of his luck. The sucker obliged, and next-day ads ran nationwide featuring the man’s sworn statement. “The office was thronged with new customers who enrolled for weekly subscriptions at a rate that put new life back into the business,” Rice said, beaming. “Within a month our net earnings had again reached $20,000 per week.” (In his autobiography a decade later, Rice would exaggerate the winning price on May J. to two hundred to one and implausibly allege that he fired the clerk who had the affidavit printed because “I could not tolerate misleading advertising.”)
With business back on a roll, GG decided to go for the kill. First, he opened new turf bureaus in New Orleans and San Francisco. Three separate tout sheets meant he could cover even more horses in every race, with selections never overlapping.
Through extensive advertising, Rice had drummed up interest in playing the ponies in rural corners of the country. But what good was coast-to-coast coverage if there were no bookies in tiny towns to take people’s bets?
To fill this niche, the second part of Rice’s plan called for the establishment of mail-order betting. George moved his staff to New Orleans for the start of the 1902–3 winter racing season, renting the entire floor above Crescent Billiard Academy at 928 Canal Street. For six weeks, a thirty-paper nationwide ad blitz klaxoned that Maxim & Gay would hereafter function as a mail-order “commission house.” Clients could send in any amount of money, and it would (ostensibly) be kept on account and bet for them in accordance with the firm’s selections. For this privilege, customers would be charged $10 weekly—plus a 5 percent commission on winnings.
The final component of George’s brainstorm was the boldest: Advertising was the biggest drain on his bankroll. Too much of GG’s money was flowing into the pockets of W. C. Whitney in the form of full-page ads in The Morning Telegraph. So Rice bought a competing paper that was on the rocks, the Daily America. He stoked his sport-and-showbiz sheet by stealing the best writers and encouraging unbridled sensationalism. Once the Daily America became an established must read, the plan was for Rice to pull all his advertising out of The Telegraph,which he envisioned would be like yanking a very expensive carpet out from under Whitney’s feet.
“He became crazed with the megalomania of octopus-like expansion,” said Colonel Stingo, a racetrack columnist who admired George. “Not content with selling information, wagering his clients’ money, clipping them 5 percent of their winnings, shaving the odds and occasionally slipping them a wrongo, he decided to become a newspaper publisher, run his own ads and make a profit on himself.”
* * *
On November 25, 1902, two days before the Thanksgiving opening of the Crescent City racing season, George sauntered into a New Orleans post office to claim his mail. The postal clerk was startled when Rice stated his name, gaping as if coming face-to-face with a burglar.
“Wait a minute,” he stammered, backing away and scuttling out of sight.
The clerk did not return, but a U.S. deputy marshal did.
“Postmaster wants to see you,” the grim-lipped lawman said, clasping Rice above the elbow and escorting him to a chamber deep within the building, where George was given the silent treatment by three glowering men sent to keep him on ice.
“What’s the trouble?” GG genially inquired after the postmaster took his time in arriving.
The southerner stared at George, then seethed, finger-pointing in spasms: “You bring us a recommendation as to who you are, and what you are, and all about yourself before we will answer any of your questions as to how much mail there is here for you.”
Rice smiled. The advertising about the new betting service was a success, then.
George had prepared for this parry and had a riposte. He knew a network of local fixers from his days at The Times-Democrat, so within thirty minutes an attorney and some New Orleans bank men showed up to vouch for his character. Matter settled, Rice decided to leave the 1,650 registered letters and twelve sacks of first-class mail with his postal pals for the time being. He would need a wagon anyway; the envelopes were so bursting with coins and currency that they couldn’t be lugged out by hand.
This shakedown clearly came at the behest of W. C. Whitney, who had friends in high federal places and scores to settle with Rice. George had gotten his first taste of the tycoon’s influence just prior to Maxim & Gay’s moving out of New York. After the Smoke fiasco, he had been called to the Nassau Street chambers of August Belmont Jr., who was Whitney’s partner in the city’s first subway system and was building the opulent Belmont Park racetrack. Belmont laced into Rice, demanding that he cease advertising Maxim & Gay in his own Daily America.
“Why?” George asked. What could possibly be wrong with his Daily America ads that was different from, say, the identical ones that used to run in The Telegraph?
“They flagrantly call attention to betting on the races!” Belmont roared.
“But you allow betting at the tracks,” Rice countered.
“Yes,” Belmont huffed. “But public sentiment is being aroused against betting, and an attack is bound to result.”
George left and didn’t give the matter another thought until a few days later, when he was again summoned before the thundering industrialist.
“If you don’t quit advertising the Maxim & Gay company in the Daily America, I will see William Travers Jerome, and he will stop you!” Belmont bellowed. Jerome occupied a top spot in horse racing’s old-boy network and was then New York County district attorney.
“If Mr. Jerome sends word to me that the Maxim & Gay advertising is illegal, I will discontinue it,” Rice replied curtly, walking out.
No directive came down from the DA, but George was just as glad he had decided to move the wager-by-mail part of the operation to New Orleans.
Over the winter, the new commission house raked in $1.3 million. Sometimes Rice invested his clients’ money on the firm’s selections as promised; often he did not. If the horses won, he pyramided profits on paper. When they lost, he pocketed the thousands he was supposed to have staked and told clients to send more money.
On one occasion, Rice held off betting a ten-to-one shot as advertised. When the horse won, it cost the firm $130,000. Staffers panicked, but Rice waved off concerns. He ordered full-page ads braying about the latest score and wired them to fifty major newspapers (but not The Morning Telegraph). “The gain we will reap in prestige and fresh business will repay our loss on the horse,” he assured skittish underlings.
Ricecakes was right. Western Union had to scramble to assign extra cashiers to handle the incoming $150,000 wired to Maxim & Gay overnight. New subscribers wanted in on the deal; existing clients wanted to double or triple standing wagers.
The truest measure of Rice’s success was the imitation it spawned. By 1903, the tout market was glutted by copycat mail-order bookie shops. Incensed that shoddy imitators would besmirch his company’s good name, George took out “warning ads” to differentiate his upstanding firm from the frauds:
Maxim & Gay Co.
Has No Chicago Office!
Any one doing business in Chicago
representing himself to be our agent,
IS A SWINDLER!
A longer-winded version ran nationwide on March 1, 1903:
SPECIAL NOTICE
The Maxim & Gay Company believes it judicious at this stage of its long and useful career to point out to the unsophisticated that there is nothing in common between methods of the Maxim & Gay Company and those of the so-called get-rich-quick turf concerns which recently went to smash and buried their promoters in obloquy. Our methods are strictly honest, are founded on business principles, and have long since been endorsed by the most prominent and influential racing men of the country.
Horse race betting was technically illegal throughout the United States at the turn of the twentieth century, but bookies circumvented laws by bribing local authorities. George’s wager-by-mail enterprise was a murkier proposition, because Maxim & Gay was flirting with a litany of federal offenses for involving the U.S. Postal Service. It wasn’t clear whether the firm was breaking a specific law or even which authorities had jurisdiction. But the magnitude of Rice’s operation made Maxim & Gay the obvious target for a test case. GG’s reaction was to ratchet up market presence to an even more ostentatious scale.
Rice got major newspapers to extend up to $200,000 in credit, and he ordered the Daily America to run edition after edition of full-page Maxim & Gay ads without compensating the paper for the space. His racetrack comrade Colonel Stingo likened George’s maniacal marketing to “a dangerous practice if carried to extremes, like continual reliance upon strong stimulants.” The entire scheme was complicated by Rice’s inveterate betting, which ravaged both the turf bureau and his insolvent scandal sheet.
“My exchequer was low,” George confided. “Nearly every dollar I had made in the Maxim & Gay enterprise had been lost by me in plunging on the races myself.”
When the circuit switched to Washington, authorities refused to hand over mail until the company’s ledgers were audited (GG kept a doctored second set of books for this purpose). In New York, George rented a nondescript apartment at 67 West Forty-sixth Street and had the firm’s correspondence delivered there, establishing a covert basement mailroom that became Maxim & Gay’s new bet-processing center.
After the Daily America lost a libel suit in April 1903—an actress sued Rice because he made up a story about her eye being blackened by her husband—GG decided to dump the paper. He thought he had a resourceful plan for getting rid of it, so one spring morning, hat in hand, George called on W. C. Whitney at his Fifth Avenue estate.
After being made to wait through the tycoon’s leisurely breakfast, Rice was ushered in for an audience. He should have been on guard when Whitney received him magnanimously. George detailed how he wanted to offer Whitney the Daily America for the $60,000 he claimed to have put into it. Whitney quizzed him for an hour before concluding the meeting on an upbeat note, saying he had to cable a distinguished magazine editor in Paris who advised him on all newspaper acquisitions. Rice left confident he had swindled the old man into paying much more than the paper was actually worth.
A week passed without reply.
After ten days, it started to sink in for George that it was he, and not Whitney, whose confidence had been suckered.
“I did not hear from Mr. Whitney again,” Rice recounted. “But I did discover that my business manager was in close communication with Mr. Whitney and that the state of my financial condition every evening was being religiously reported to him.”
On April 23, 1903, Daily America Publishing Company filed for voluntary dissolution in New York Supreme Court. Whitney swooped in and bought the Daily America for pennies on the dollar, cherry-picking the best writers and reassigning them to his Morning Telegraph. He let the rest of the staff go and gave strict orders that when Rice came calling, The Telegraph was to refuse all advertising from Maxim & Gay.
At the same time, the Feds had begun cracking down on mail-order betting.
“These schemes are always fraudulent,” one inspector told The Washington Times. “The victims, who number tens of thousands, dare not raise their voices in protest or complaint, knowing full well that they would only be the butt of ridicule in their community.” When asked to tick off names, the official listed Maxim & Gay as the nation’s most egregious offender.
In June, District Attorney Jerome had an undercover New York detective write a letter to Maxim & Gay inquiring about betting by mail. In return, the cop got the company’s prospectus and remitted $30 for a Three-Horse Wire. A stakeout team witnessed his registered letter being signed for by Rice at the back door of the Forty-sixth Street basement office, then burst in and arrested George on charges of violating section 351 of the Penal Code, the law that broadly covered bet taking. George was bailed for $1,000, and it is unclear whether his case ever came up in court. But the arrest drove Maxim & Gay even further underground.
In a last hurrah at New Orleans, GG bled suckers for all he could, pumping up the commission on winnings to an absurd 25 percent. This lasted until just before Christmas 1903, when postal authorities issued a formal fraud order barring Maxim & Gay from operating by mail. Within ninety days, similar raids eradicated every sizable bet-by-mail competitor in the country. Rice had introduced America to grand-scale tipster thievery, and when his empire collapsed, he made sure every copycat con artist got yanked down with him.
“Having lost the Daily America and having ‘blown’ the Maxim & Gay company, I was again broke,” George explained. “But my credit was good, particularly among racetrack bookmakers. That summer, 1904, I became a racetrack plunger, first on borrowed money and then on my winnings. By June I had accumulated $100,000. In July I was nearly broke again. In August I was flush once more, having recouped to the extent of about $50,000.”
Rice’s big-bettor status afforded him a berth aboard the Cavanaugh Special, a private train chartered by bookies to shuttle high rollers back and forth to Saratoga. Its exclusive smoking car is where George made the acquaintance of two members of the New York shadow world who would influence his life in the coming decades: a debonair doctor and mesmerizing confidence swindler named J. Grant Lyman, and a quiet, milk-faced bookie who would grow up to be America’s first organized crime boss, Arnold Rothstein.
By September, Rice had sliced his losses to $8,000, but bookies were getting antsy about settling up. “Disgusted with myself, I longed for a change of atmosphere,” George said. “I stayed around New York a few days, [yet] the yearning to cut away from my moorings and to rid myself of the fever to gamble became overpowering.”
GG impulsively decided to head west and make a fresh start.
“I bought a railroad ticket for California,” he explained. “And, with $200 in my clothes, traveled to a ranch within fifty miles of San Francisco, where I hoed potatoes and did other manual labor designed to cure racetrack-itis. In less than six weeks I felt myself a new man, and decided to stick to the simple life forevermore—away from racetracks and other forms of gambling.
“But,” George would later write, penning his autobiography from the gloom of yet another prison cell, “I didn’t.”
Copyright © 2015 by T. D. Thornton
