Just like the previous blog, this week we will be talking about another criminal that impacted the dynamics of the way in which American businessmen interacted with businessmen from other countries. In this blog, I will be discussing Victor Lustig’s scam and how he laid out his plan for selling the Eiffel Tower.
Victor Lustig was born on 4th January 1890 in the Austria-Hungarian town of Hostinné. He led his life, just like Charles Ponzi, full of crime and criminal opportunities. However, Lustig was forced to perform criminal activities for a living and thus, he was often involved in petty crimes like but not limited to shop lifting and pick pocketing. As time passed by, the seriousness of his criminal activities grew to an extent that he became a full time criminal and subsequently, performed bigtime crimes.
Before his main act of fraudulently selling the Eiffel tower, one of the most known crime of his involves the sale of a machine that could print currency notes using radium, which was, however, nothing but a hoax. In spite this, he sold over 200 machines that could, as he said, print currency notes. Lustig, later, also involved himself with other hoax-based crimes like organizing fake horse race schemes and bogus real estate investments that involved people contributing money to an investment pool built by him. The said plans combined, made him a public enemy and an understated millionaire.
The main game
In the summer of 1925, Lustig went to France to try out a new crime venture in the city of Paris. Lustig commissioned two French government officials and prepared ‘hoax’ property papers of the Eiffel tower. Lustig then began targeting people who would come from the US on expensive cruises and would admire the Eiffel tower during their city tours.
But, how could someone convince a stranger to buy something as significant as the Eiffel tower?
Lustig was smart. While documenting property papers for the Eiffel tower, he made the French officials underline a clause which stated that the Eiffel tower was on sale because the French government needed money to recover from the war and thus, the monument had become too expensive to maintain. The said reason also made sense as the French government did introduce the idea of decommissioning the maintenance of the Eiffel tower after the war. Though never passed, there were newspaper articles having normative statements that indicated the potential sale of the tower.
Using the aforementioned newspaper articles, Lustig developed his case. He invited several Americans to place a bid on his offering. After 3 sessions of continuous bidding, the Eiffel tower was finally sold to a businessman named Thomas Kearns. In order to appreciate Lustig’s cooperation Kearns offered Lustig a trip to his home – the place where the Lustig scam was finally busted.
At Massachusetts, after having a dinner with Kearn, Lustig went up to Kearn’s room where Kearn was supposed to give him cash for the said transaction. However, with the greedy nature that Lustig had, he tried to flee with all the money that Kearn had in his closet. Sadly, Kearn showed up and he was caught red handed by him, and later the police.
Could the crime had been prevented if it was done today? Absolutely, yes.
Would it have been possible to prevent this fraudulent transaction to take place in 1925? Maybe.
As far as I can estimate, it would have been very difficult to avoid such a fraudulent transaction to take place as the governments in 1925 were not as transparent as they are today, and hence, validating the deal would have been next to impossible.