An Act of Desperation:  The Bribery Scheme

    The results of the ADC’s massive test, known by late 1922, soon overshadowed all efforts of the Kimberlite group.  If anything could be described as a decisive blow, it was that stunning bit of information.  Now, the arguments of critics–that either the processing was faulty or the syndicate had triumphed–persuaded very few outside of Pike County.[1]  Diamonds had been discovered sixteen years earlier; since then, tests had consistently told the same story, and now the biggest test of all confirmed it.

    As funds dwindled annually, the Millars and Wilder kept depending almost entirely upon a few lenders.  The basic group of three Chicago investors put up $7,500 in October 1923 after the company pledged exhibition diamonds and more stock as collateral; an old associate of Austin Millar provided a personal loan of $1,500.[2]  Clearly, this was no workable long-term arrangement.  Something had to be done.

    The group missed few opportunities to try to extract themselves from the situation.  From late 1922 into 1924, the Millars and Wilder entangled themselves in an improbable effort to persuade the Ford Motor Company to buy both their property and Reyburn’s operation.[3]   In early 1925, Austin Millar watched as the Dallas-based British-American Company leased the Mauney Mine and began its unrestrained stock promotion.  He informed W. L. Wilder “there may now be a possible chance of selling the Ozark to the Mauney promoters if they have the money, which as yet we have been unable to ascertain.”[4]  Later, in 1926, Austin offered the Ozark and Kimberlite Mines to a Chicagoan for $1,150,000 and $500,000, respectively, with one-third down, one-third within a year, and the balance within two years.[5]


    By August 1926, W. L. Wilder‘s imagination had gotten the best of him.  Constantly frustrated and increasingly convinced the diamond syndicate had tied up the Arkansas field to keep it out of the market, he conceived a scheme to force De Beers to buy the Ozark Mine at a price netting the Kimberlite Company at least $1,500,000.  Austin Millar and C. Warren Buckley, a member of their small inner circle, approved the plan.  Howard considered such ideas too “wild” for his taste.[6]

    In short, the three agreed to bribe a powerful U.S. Senator from Missouri if he would persuade the international diamond syndicate to buy the Ozark Mine.  The Senator would get 10% of the sale price “plus one-third of any advance on this price he could obtain.”  As an overture, the Senator could inform DeBeers’s associates in New York that he was one of the owners of the Ozark, and tell them “of the careful tests[,] after spending $200,000 on the Ozark, showing that the mine is a commercial mine producing 11 carats per 100 loads . . ..”  If necessary, the Senator could underscore the seriousness of the proposition by threatening “to introduce a bill in Congress, changing the tariff on both cut and uncut diamonds from 20-10% to 50-40% or more [,] and to curtail the present large smuggling operations of diamonds in this country.”  Further, the bill would favor immediate development of domestic diamond resources, particularly industrial grade.[7]

    Wilder, with his fellow conspirators’ approval, explained the “plan” to their lawyer in St. Louis, Bennett C. Clark:


      We all know that [Thomas Fortune] Ryan holds a 22 percent interest in the DeBeers selling syndicate . . . and that Morgan and Company are also interested in this organization and [we] feel quite confident that the powers that be would immediately be glad to acquire the Ozark property, paying a reasonable price for same, say anywhere between 1 to 2 millions, rather than have a man of the caliber of Senator . . ., with his strong Democratic following in Congress, introducing such a bill as I mention.  It seems to me that this plan would bear fruit and it might be the solution of all of our difficulties.[8]


    Although the records are mute on the point, the plan apparently was aborted shortly after Clark received word of it.  An effort to raise the tariff on diamonds, however, continued into the late 1920s; targeted Washington politicians included Senator Thaddeus H. Caraway of Arkansas.[9]



[1] The issue of equipment and the question of Zimmerman’s competence usually were taken up by others, including John Fuller, as indicated previously.  The Millars and Wilder focused more narrowly on variations of the conspiracy thesis.


[2] “Diamond Collateral Notes of October 6th, 1923, II.L, Crater archive; Austin Millar to W. L. Wilder, with attached diamond valuation, December 29, 1923, ibid.  The valuation included forty rough diamonds and six cut, for a total of almost $11,000.  The stock collateral was an extra inducement; the lenders’ $7,500 was covered by gem-quality diamonds.  In early 1924 two of the lenders discussed buying the earlier stock collateral at half price; the outcome of that is not clear (Austin Millar to W. W. Willits and Frederick T. Vaux, Chicago, February 4, 1924, I.W).


[3] The Millars’ correspondence clarifies their perspective of the affair (I.W., “Henry Ford–Reyburn’s dealings).  Documents in the Ford Museum and Archives, Dearborn, Michigan, including the correspondence of Ford’s administrative secretary, Ernest Liebold, essentially show that a typically courteous Sam Reyburn found himself in an uncomfortable position.  Because of the backdrop of anti-Semitism at the time—a widespread movement involving Ford—the topic needs more-thorough treatment than can be provided in this space (for a glimpse of the problem, see Howard A. Millar to Austin Q. Millar, November 29, 1927, ibid.).

    Ford’s involvement was rarely mentioned in publications, in the early era or afterwards.  “Diamond Field Development Hoped For,” Arkansas Gazette, June 16, 1940, p. 11, had one paragraph concluding that “Mr Ford, like many other prospective developers, is said to have wanted to control the field at a price too low to be accepted by the Arkansas interests.”  Gross, “Incredible Mine Mystery,” 99, fit the topic into his analysis of the alleged conspiracy to keep Arkansas diamonds off the market.  He repeated Austin Millar’s version of events (later repeated in Howard Millar’s Finders Keepers, pp. 61ff.), then cited “the Ford archivist” and Sam Reyburn.  Gross, as Millar, indicated Reyburn had stymied the negotiations.

[4] Millar to Wilder, March 29, 1925, I.N; supra, “Enterprising Mauneys” (British-American Company).


[5] Memo agreement, Austin Millar to John T. Keegan, Chicago, September 4, 1926, I.N.


[6] W. L. Wilder to Bennett C. Clark, c/o Fordyce, Holliday and White, St. Louis, Missouri, August 17, 1926, I.W, conveyed the trio’s plan.  Wilder stated that he, Austin Millar, and Buckley “after due discussion” had “arrived at a conclusion which we would like your reaction to.”  He noted Millar and Buckley had initialed the letter, “indicating their approval of the plan.”  Howard revealed his distaste later (Howard Millar to Austin Millar, November 20, 1927 and November 27, 1927, I.W).


[7] Wilder to Clark, ibid.


[8] Ibid.


[9] A cryptic notation in the margin of Wilder’s letter to Clark, supra, included the last names of three additional members of Congress, two from Utah and one from Arkansas—“Carraway.”  That referred to Senator Thaddeus Horatius Caraway, husband of the pioneering Hattie W. Caraway, who took his seat in Congress after his death in late 1931.  T. H. Caraway, Democrat, was once described as “a political gadfly on the broad complacent back of the G. O. P. elephant.”

    Although there is no available evidence of an immediate follow-up in 1926, the Millars’ effort to increase the tariff resumed by early 1929, as the new Hoover administration and trade protectionists in Congress took charge of economic policy.  In April Austin Millar solicited the support of Hugh Miser, of the US Geological Survey; Miser, always courteous, replied that if called as a witness he would provide all the information he could about Arkansas diamonds (Miser, USGS, to Millar, April 13, 1929, I.W).  Howard Millar then wrote Senator T. H. Caraway of Arkansas, member of the Committee on Agriculture & Forestry (the reply, Caraway, Washington, D.C., to Millar, March 2, 1929, I.W, was merely a standard courteous response).  Later that year, Millar wrote again, this time urging Caraway to oppose a current attempt to eliminate the tariff on diamonds (August 20, 1929, ibid.; supporters of the measure argued that putting diamonds on the free-trade list would curb smuggling).

    A following letter to Bennett Clark also referred to “Senator Smoot,” meaning the cosponsor of the Hawley-Smoot protective tariff (Austin Millar to Bennett H. C. Clark, St. Louis, August 30, 1929, ibid.).  Perhaps the Millars felt some sense of accomplishment when Hoover signed Hawley-Smoot in June 1930; but the high levies on foreign goods provoked similar measures abroad and thus helped spur the depression.


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