This lot is closed for bidding. Bidding ended on 4/18/2024
[PONY EXPRESS] -- [ABSTRACTED INDIAN BONDS]. Autograph document signed (“Russell, Majors & Waddell”) to John B. Floyd, Secretary of War, Washington City, 16 August 1860. 1 page, oblong 12mo (121 x 197 mm), old folds, docketed in red on recto (“No. 60”), endorsed on verso. ABSTRACTED INDIAN BOND SCANDAL. Floyd (1806-1863) was the 31st governor of Virginia and Secretary of War under President Buchanan (1857-60), and a Confederate General in the Civil War. Floyd’s time as Secretary was fraught with scandal which included the case of the “Abstracted Indian Bonds”, which surfaced at the end of the Buchanan administration. “One night early in the secession winter, for a third and final time, a clerk named Godard Bailey entered his own empty office in the Interior Department building, removed thousands of dollars of negotiable bonds belonging to the Indian trust fund from his safe, and delivered them to War Department contractor William Hepburn Russell. As Russell told Bailey when they first met that July, Secretary of War John Buchanan Floyd had been propping up Russell’s firm with ‘acceptances’ - legally dubious memoranda approving future payments - which Russell used as security on loans. The acceptances now encompassed a sum greater than Russell’s contracts, had no legal justification, and were increasingly likely to ‘embarrass’ both Russell and Floyd. Russell had learned that Bailey was Floyd’s relative by marriage, and Russell played on Bailey’s loyalty to convince the clerk to ‘loan’ him a portion of the bonds in his office for use as security on still more loans to cover his outstanding debts. Bailey carried out the first ‘abstraction’ just hours after Russell proposed it. He made two more trips in September and December, but by now Russell had failed to redeem the first bonds he had ‘hypothecated’ with Wall Street banks. His creditors claimed them and they were lost to the government for good… All parties escaped criminal conviction as the war pushed the affair from the public’s mind, but not before it provoked a congressional investigation and a novel intervention by the federal government in how it invested and managed the funds generated by Indian dispossession - the Indian Trust Fund - as a part of the national debt. During and after the war, in discussions of the bonds, Republican policy makers rhetorically joined tribes and northern taxpayers as common victims of a robbery by disloyal Democrats and, in doing so, bound tribes to their vision of national political economy” (Schneider, The Case of the Abstracted Indian Bonds, 23 June 2022).