Bidwell Lore – George and Austin Bidwell, The Bank of England and the Primrose Path, Part II

Welcome to week 84 of Bidwell Lore! Last week we introduced the story of George and Austin Bidwell, who notoriously defrauded the Bank of England in 1873.

Now, let us go back to the beginning, starting with George and Austin’s parents. Austin Burnham Bidwell (1804-1865) married Laura Isabelle Butterfield in New York in 1832. Of their seven children, our story only sheds light on two of them: the eldest son George Coles Bidwell (1833-1899) and the youngest son Austin Biron Bidwell (1845-1899). 

Born in 1804 at East Harford, Connecticut, their father Austin Burnham Bidwell was a grocer in Brooklyn, New York who later wandered the Midwest with his family living in a number of towns in Michigan before settling in Grand Rapids in 1849. There he started a very successful confectionary business with his sons George and Austin. That success encouraged them to expand too rapidly and soon, “the indebtedness far exceeded the assets.”  George first encountered the art of the scam as a kid, when his father was conned out of every penny he had by a crooked business partner. George regarded his father as honest and hardworking but embarrassingly naïve. Deciding that there was no point in struggling to earn a legitimate living when there was much easier money to be had in fraud, George moved to New York to make his fortune in 1856 at the age of 23. He found employment with a wholesale grocery business and then invited his parents and his brothers and sisters to live with him in New York.

He was employed by various wholesale grocery companies while supporting his parents and his own family. These jobs included making buying trips abroad, giving him the opportunity to become acquainted with many foreign business firms. He came to the conclusion that the richest bank in the world, the Bank of England, was careless in its system of transacting business with bills of exchange and he decided to take advantage of those loopholes. 

If George was the mastermind of their eventual scheme, Austin was the confidence man. ‘The Tribune called Austin a “handsome rascal,” and his striking appearance and wily charm enabled him to gain quickly the trust of those who were marked to be conned. In New York, he ingratiated himself on Wall Street among young brokers. Soon, he was swindling long-established New York firms out of tens of thousands of dollars. He had once been, according to his brother, “a fine, steady young man, universally regarded as one likely to fill an honorable position in the world.” Now, by his reckoning, he had entered “the primrose way” — a Shakespearean term meaning an attractive path that ultimately leads to destruction.’

As their schemes expanded, George and Austin fell in with — and learned from — some of the most notorious criminals in America, including master forger Gottlieb “George” Engles and bank robber Joe Chapman. The brothers were arrested several times, and both spent time in jail. By the time of their release, according to the Tribune, America had become “too hot for them.” So they headed to Europe, with eyes on the Bank of England. 

The third member of the gang was the forger George “Mac” Macdonnell. Mac studied medicine at Harvard, but never practiced, and instead served several years in jail after running a bad check scam on Tiffany & Co. He was a year older than Austin and had met both Bidwells while imprisoned. A fourth man, Edwin Noyes Hills, also known as Ed Noyes, became part of the scheme.  

The plan involved the forgery of bills of exchange, which are essentially commercial checks promising payment after a certain date. For example, a manufacturer might sell goods to a retailer on three months’ credit, and the retailer might give the manufacturer a bill of exchange that is payable in three months. The four of them knew from previous experience that New York banks required these bills to be authenticated by the issuer before they were accepted. It was Mac who made the “great discovery” that the Bank of England accepted them on sight, without verifying they were genuine. Instead, the bank relied on the apparent trustworthiness of the customer presenting the bills.

An image of a bill of exchange for 6,000 pounds from January 24, 1873
Bill of exchange, 1873. Wikipedia [1]

On January 21, 1873, George sent the first batch of forged bills, with a total value of £4,250, from Birmingham to the Bank of England. A day later, a letter was received from Colonel Francis stating that the bills had been received and accepted.  The initial batch of bills was dated for March, presenting a window of just a few weeks before the Bank of England would attempt to obtain payment from the issuer and discover the bills were fake. By the end of February, the gang needed to submit as many forged bills as possible, withdraw the cash, cover their tracks, and prepare their escape.

Over the next few weeks, they sent six further packets of forged bills of increasing value to the Bank of England — from £9,350 to £14,686 to £19,253. All were accepted, and the funds were transferred from the Warren account to the Horton account, then withdrawn and converted into cash, gold, and bonds. By the end of February, with the March deadline arriving, they hurried to wind up their operations. Arrangements were made for their passage back to America, and George and Mac discussed whether they should “stop with what we had, or put in one more batch of bills.” They decided on the latter and, on February 27, the last lot of forgeries containing 24 bills totaling £26,265 was submitted to the Bank of England. 

Two of the bills did not have a date inserted, and could not be accepted. When the bills of exchange arrived at the Bank of England on the morning of February 28, the bills were then taken by a clerk to the office of the supposed issuer, B.W. Blydenstein & Co. banking agents, to have the error rectified. One of Blydenstein’s partners, William Trumpler, immediately identified the bills as forgeries. The scam was uncovered. In total, the Bidwell brothers Noyes and MacDonnell had successfully cashed 92 forged bills to the value of £102,217.  [Almost 11 million in 2021 dollars]

What happened after the forgery was discovered? Find out in next week’s Bidwell Lore!

 [1] A bill of exchange, also called draft or draught, short-term negotiable financial instrument consisting of an order in writing addressed by one person (the seller of goods) to another (the buyer) requiring the latter to pay on demand (a sight draft) or at a fixed or determinable future time (a time draft) a certain sum. {} 

A cheque is a type of bill of exchange, used for the purpose of making payment to any person. It is an unconditional order, addressing the drawee to make payment on behalf of the drawer, a certain sum of money to the payee. {Wikipedia}