• Choose a category
• All
• Classic-Fiction

That night Ponzi returned to the theater with Rose, accompanied by two of his lawyers, Frank Leveroni and Sam Bailen, and their wives. This time Ponzi took a step closer to a career on stage, joining Corbett and Van in an impromptu skit in which they bantered about the joys of becoming rich. Corbett and Van pretended to buy Ponzi notes; then Ponzi pretended to redeem them, using stage money.

Only fifty-seven people showed up in Pi Alley on Thursday, August 5, and some of them begged to invest before being turned away. Still, $168,000 would go out the door before the day was out. The biggest withdrawal was for forty-five thousand dollars by Ponzi’s pals Louis and Charlotte Blass. The Blasses had bought the note on June 24, so it was not due until Sunday. But Ponzi paid it anyway, for the full amount due at maturity. What were a few days among friends?

Meanwhile, Pride’s audit continued while Gallagher traveled to Washington to meet with his boss, the lantern-jawed United States attorney general, A. Mitchell Palmer, who took a moment from his hunt for Communists to hear an update on the Boston financier.

With the investigation plodding along and School Street quieting down, the newspapers struggled to find news to satisfy their readers’ insatiable interest. The Globe won on this score with a front-page story about Ponzi’s humble days in Mobile, Alabama. The story was innocuous enough, nothing more damaging than Ponzi had described himself about his rags-to-riches rise. But newspapers delving into his past held a distinct danger. If they dug deeply enough, Ponzi’s prison days in Montreal and Alabama might be exposed. Panic would ensue, and collapse would be certain.

The lowlight of Ponzi’s day was a long lunch at the Copley Plaza Hotel with the New York moneymen who claimed to be interested in buying his company. Their leaders were John Castwell, who identified himself as director of the Bolivian Wood Company, and Joseph Herman, who claimed to be an associate of the late South African magnate Cecil Rhodes. The longer they talked, the clearer it became that they would not be Ponzi’s salvation. The New Yorkers’ $10 million offer was contingent on Ponzi revealing his “secret,” and the payment would come only after they had taken their profits. Questions also soon began to be raised about whether the men were working a con of their own. When Herman’s and Castwell’s names became public, a Boston banker remembered them as fast operators with whom he had refused to do business with a year earlier.

While Ponzi wasted time with the New Yorkers, Bank Commissioner Joseph Allen discovered the first sign of weakness in Ponzi’s financial armor. A week earlier, Allen had demanded daily reports on Hanover Trust, with particular attention paid to Ponzi. Contained in one of those reports was a strange piece of information: Accounts under Ponzi’s control, but established in other people’s names, had been credited with more than a quarter million dollars in loans from Hanover Trust. Already suspicious of Ponzi, Allen had to wonder: If Ponzi was as rich as he claimed and as carefree as he appeared, why was he borrowing money from the bank he controlled? And why was he doing it in “straw” accounts held in other people’s names? Was it possible that he had nowhere near the $7 million in liquid funds he so often claimed? Was he using straw accounts to mask his true peril? Was he, as the Post story maintained, insolvent and teetering on the brink of failure? Allen ended the day by dispatching two bank examiners to Hanover Trust with a mission: Find out what Ponzi is up to, and find out fast.

When he awoke the next morning, Ponzi knew he could wait no longer to deal with Joseph Daniels, the furniture dealer whose million-dollar lawsuit had helped to create his current predicament, for good and bad. Though Daniels’s suit had incited the Post and the authorities, it had also drawn investors by the thousands. But it had lingered unresolved long enough. Ponzi did not mind borrowing money from