Read Online A Bright and Guilty Place: Murder, Corruption, and L.A.'s Scandalous Coming of Age by Richard Rayner - Free Book Online Page B
Authors: Richard Rayner
Ads: Link
later wrote. “I was for the ‘cause’ and loved a fight.”
Buron Fitts’s first big objective was the prosecution, not of some racketeer or notorious murderer, but the previous District Attorney, Asa “Ace” Keyes, the man who until recently had been Fitts’s boss. Behind this unlikely turn of events lay the most spectacular fraud in L.A.’s history. “The Julian Petroleum debacle, in which thirty thousand investors were milked out of untold millions of dollars, touched off the fuse which blew the politicians out of the limelight,” wrote Leslie White. “The grafters had been in power a long time and Los Angeles was in a bad state of affairs. The Julian Pete symbolized it all.”
The story began years earlier, in 1885, when Chauncey C. Julian, later to be known as “C.C.,” was born in Manitoba, Canada, the son of an impoverished farmer. As a boy he sold newspapers. As a young man he drove a milk wagon, clerked in a clothing store, sold jewelry and building supplies, worked in real estate, and in the oil fields of Texas worked as a rigger. In 1921 he arrived, penniless, in L.A. and started peddling stock in oil leases. His first promotion fizzled. Then he had a massive stroke of luck: on a four-acre lease he drilled five wells and all five came in, producing gushers. His first investors earned money, and he gained a following. Soon he was acquiring more leases, opening gas stations, and selling millions of dollars in stock. He had his own radio station and pilloried the big oil companies. He called his own gas “Defiance”—a nice touch.
Breezy as a door-to-door salesman, brandishing his fist or pointing his thumb and forefinger in the shape of a pistol, Julian had shrewd insight into the mind-set of the small American investor, confronting head-on the accusation that he was a con man. His daily press advertisements became a feature of city life. He told those who couldn’t afford to take a chance not to bother while urging the adventurous of spirit to plunge. “Come on, folks, you’ll never make a thin dime just lookin’ on. I’ve got a surefire winner this time, a thousand to one shot. We just can’t lose. We’re all out here in California where the gushers are and we just ought to clean up. Come on, folks, get aboard for the big ride,” he said. Or: “I’ve got a wonder coming up, folks. She’s not only warm, she’s ‘red hot’—right off the coals. How big? Oh, I don’t know—she looks like a hundred million dollars.”
Julian became for a couple of years as grand a celebrity as any in L.A. Reporters tracked his every step, gleeful when Chaplin decked him after a spat in the nightclub Café Petroushka or when he gave a Cadillac to a hatcheck girl. To continue doling out dividends, and to pay for his four homes and the gold-lined bathtub into which he plunged each morning, he kept issuing more and more stock, turning his original operation into a scheme of the sort recently made famous by Charles Ponzi. Ponzi, a smiling, skimmer-wearing, cane-wielding con man who ran a get-rich-quick scheme in Chicago, had promised that investors would double their money within three months. To fulfill this pledge, he only needed ever larger numbers of investors, and for a while they flocked forward. It was a classic pyramid scheme, earning Ponzi $2 million a week at one point, typical of the money-mania that swept America in the 1920s and seen more recently in the Bernard Madoff affair. But taking from Peter to pay Paul can’t last forever: Ponzi’s scheme collapsed and he was sent to jail.
Likewise, by 1925 C. C. Julian was in trouble. He bowed out, or was pushed out, handing over control of his companies to a group of businessmen, “nimble-witted magicians” according to the Times. They were led by S. C. Lewis, a lawyer from Texas, and his sidekick Jake Berman, alias Jack Bennett, “the boy Ponzi of the Pacific Coast,” “a two-name man as dangerous to a community’s state of mind as a
Buron Fitts’s first big objective was the prosecution, not of some racketeer or notorious murderer, but the previous District Attorney, Asa “Ace” Keyes, the man who until recently had been Fitts’s boss. Behind this unlikely turn of events lay the most spectacular fraud in L.A.’s history. “The Julian Petroleum debacle, in which thirty thousand investors were milked out of untold millions of dollars, touched off the fuse which blew the politicians out of the limelight,” wrote Leslie White. “The grafters had been in power a long time and Los Angeles was in a bad state of affairs. The Julian Pete symbolized it all.”
The story began years earlier, in 1885, when Chauncey C. Julian, later to be known as “C.C.,” was born in Manitoba, Canada, the son of an impoverished farmer. As a boy he sold newspapers. As a young man he drove a milk wagon, clerked in a clothing store, sold jewelry and building supplies, worked in real estate, and in the oil fields of Texas worked as a rigger. In 1921 he arrived, penniless, in L.A. and started peddling stock in oil leases. His first promotion fizzled. Then he had a massive stroke of luck: on a four-acre lease he drilled five wells and all five came in, producing gushers. His first investors earned money, and he gained a following. Soon he was acquiring more leases, opening gas stations, and selling millions of dollars in stock. He had his own radio station and pilloried the big oil companies. He called his own gas “Defiance”—a nice touch.
Breezy as a door-to-door salesman, brandishing his fist or pointing his thumb and forefinger in the shape of a pistol, Julian had shrewd insight into the mind-set of the small American investor, confronting head-on the accusation that he was a con man. His daily press advertisements became a feature of city life. He told those who couldn’t afford to take a chance not to bother while urging the adventurous of spirit to plunge. “Come on, folks, you’ll never make a thin dime just lookin’ on. I’ve got a surefire winner this time, a thousand to one shot. We just can’t lose. We’re all out here in California where the gushers are and we just ought to clean up. Come on, folks, get aboard for the big ride,” he said. Or: “I’ve got a wonder coming up, folks. She’s not only warm, she’s ‘red hot’—right off the coals. How big? Oh, I don’t know—she looks like a hundred million dollars.”
Julian became for a couple of years as grand a celebrity as any in L.A. Reporters tracked his every step, gleeful when Chaplin decked him after a spat in the nightclub Café Petroushka or when he gave a Cadillac to a hatcheck girl. To continue doling out dividends, and to pay for his four homes and the gold-lined bathtub into which he plunged each morning, he kept issuing more and more stock, turning his original operation into a scheme of the sort recently made famous by Charles Ponzi. Ponzi, a smiling, skimmer-wearing, cane-wielding con man who ran a get-rich-quick scheme in Chicago, had promised that investors would double their money within three months. To fulfill this pledge, he only needed ever larger numbers of investors, and for a while they flocked forward. It was a classic pyramid scheme, earning Ponzi $2 million a week at one point, typical of the money-mania that swept America in the 1920s and seen more recently in the Bernard Madoff affair. But taking from Peter to pay Paul can’t last forever: Ponzi’s scheme collapsed and he was sent to jail.
Likewise, by 1925 C. C. Julian was in trouble. He bowed out, or was pushed out, handing over control of his companies to a group of businessmen, “nimble-witted magicians” according to the Times. They were led by S. C. Lewis, a lawyer from Texas, and his sidekick Jake Berman, alias Jack Bennett, “the boy Ponzi of the Pacific Coast,” “a two-name man as dangerous to a community’s state of mind as a
Similar Books
