The Robber Barons of the Gilded Age and the Monopolists of
the early 20
th Century were not the first ones to build an empire
with vertical integration and synergies. No, the true business pioneer who
invented these techniques was a bearded con man born Jefferson Randolph Smith
II. Many knew him as Soapy Smith
Soapy Smith ran Denver, Colorado for almost eight years in
the 1880’s. He was no lone wolf either. He had a handpicked crew of scoundrels
working for him. His greatest innovation was learning to cultivate the right
people in the community so instead of being wandering drifters and grifters,
the Soapy Smith Gang set up shop permanently.
What He Did:
Soapy Smith arrived in Denver in 1879. By the time he left
Denver for good he owned a good chunk of the business district including a
saloon, a (fake) lottery shop, a “stock” exchange, a cigar store that was also
a front for an illegal poker club, a counterfeit jewelry store, and a small
office that sold stock in non-existent businesses.
Soapy Smith also controlled the police force, the mayor, and
most of the city council of Denver. He ran the elections, always ensuring the
“right” man won.
Soapy was not all about himself. He also built churches, donated
to charity freely, and paid for the occasional prostitute’s funeral expenses.
He was regularly called upon by at least one Denver clergymen to help organize
food drives and for donations to financially strapped parishioners.
When the heat got too hot in Denver, Soapy Smith and his
gang headed out to Creede, Colorado to take advantage of a nearby silver
strike. There he used his connections with local prostitutes to convince
influential civic leaders and businessmen to sign over most of Main Street to
him while he turned around and leased the properties to his friends and allies.
He left Creede just before most of the business district
burned down and spent a little while longer in Denver.
After almost triggering a civil war in Denver, he left and
headed to Skagway, Alaska where he begin to build yet another criminal empire.
During the Spanish American War Soapy formed a volunteer
army with the approval of the United States government and got himself the rank
of Captain with a letter to President McKinley.
How He Did It:
Soapy started his career with an ingenious scam. He would
stand outside the train station in Denver where travelers where coming into
town, looking to get washed up and find a hotel. He sold them soap. He would
take ordinary soap and sell it for 25 cents a piece. Of course the soap could
be bought at a local store for 5 cents. Once he gathered a big crowd, Soapy
would wrap the bars in tissue paper and make a big show of placing a $100 bill
in a wrapped bar of soap. Then he would place a $50 bill and a $20 bill in
other wrapped bars of soap. One of his gang would buy a bar and show how he had
won.
The travelers quickly started buying the soap. Through
careful slight of hand only the ringers ever won. Many travelers would buy multiple
bars trying to recoup their losses.
If the crowd was really big, he would start auctioning off
the remaining bars of soap, again ensuring he knew the winning bidder for the
$100 bar of soap.
Soapy also operated games of “chance” like three card monte,
at all of his businesses. So someone coming into the cigar store for a rigged
poker game would often play three-card monte while he waited for a table,
loosing more money. The same would be true at the stock exchange, where the
only thing that was exchanged was money and hot air.
Soapy assembled an all-star gang of conmen and grifters
including legends like Texas Jack Vermilion and “Big” Ed Burns.
Soapy got the support of the community by only targeting
tourists and being a generous citizen. He also had most of the police on
politicians on the take.
Back Story:
Soapy was born in Georgia to a wealthy plantation family
that was financially ruined by the Civil War. They moved to Texas where he saw
outlaw Sam Bass get gunned down in Ft. Worth. He left home as a teenager and
moved right into the life of a conman.
How It Ended:
Soapy Smith eventually found a game he couldn’t fix. His
associates were operating a game of three-card monte. A miner balked at paying
his heavy losses at what he rightly assumed was a rigged game.
The associates
during the argument liberated $2,700 worth of gold from the miner.
When Soapy refused to refund the gold, a local committee
requested a meeting at the Juneau Wharf. At that meeting an argument broke out
and Soapy was fatally shot, but he did manage to take out one of the committee
member before going down.
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Scourge of Scoundrels is a series about the women and men in history who
never let a little thing like rules or the law keep them from getting what they
wanted.
All images are in the public domain or are my creation. All rights reserved.
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He is the proud father of four amazing children and the happy husband of one wife. He aspires to be an extreme sleeper.
