Walkabout: Where's Mrs. Bradford? Part 2

Wall Street, 1911. Photograph: Shorpy.com

Read Part 1 of this story.

Like the celebrity sightings of today, in May of 1894, Kate Bradford could be found everywhere. Only weeks before, this married woman and mother disappeared from her Williamsburg neighborhood in Brooklyn without a trace, taking with her thousands of dollars belonging to family, friends and neighbors. Perhaps as much as $100,000 was missing.

At first, the family and authorities feared the worst. She had been despondent, they said, upset about downturns to her lucrative money-lending and investment business. Her husband, Charles Bradford, a Manhattan mattress manufacturer, told the police that Kate had left a goodbye note, in which she told him and their two young sons that she couldn’t endure her life any longer, and was on her way to end it all by weighting her skirts, and throwing herself into the river.

The family lawyer, Peter J. Mahoney, came to the police with the letter as evidence, saying the he thought she was dead, and under the circumstances, her actions were “entirely justified.” But even the family gave up on that notion when a pawn ticket for her diamonds and a sealskin bag turned up. Kate was still in the land of the living.

Like the 19th century Charles Ponzi, for whom this game is named, Kate Bradford was running a Ponzi scheme. This con is much older than Ponzi, and at its simplest form, is one of the easiest and potentially longest running cons around.

All you need is a slick talking salesperson, a get-rich scheme that is too good to resist, and greedy and/or gullible people to invest in it. Kate found all of the right conditions right in her own backyard.

She told people that as a former teacher, she was in touch with all of the teachers who lived from paycheck to paycheck. Sometimes they didn’t make it, and so she lent them money, at an unbelievably high interest rate, and on payday, they paid her back. Of course, they now had even less money to make it to the next month, so her business had a built-in guaranteed stream of steady customers.

It couldn’t fail. Twenty dollars here, ten dollars, fifty dollars there, the returns on all of these small loans added up to thousands of dollars. And the best part, friends and neighbors, is that she would share this business with them, and they could make money too!

She showed her ledger sheets to her neighbors and relatives, and showed her church lady friends her jewels and fine clothes. This was a win-win situation. There were plenty of teachers, they could branch out to other salaried people, and she was so confident in her financial acumen that she had graduated to Wall Street stock market picks. How could they possibly lose?

She was a good God-fearing mother and neighbor who had been blessed with this simple, yet lucrative financial opportunity! Her church friends, her neighbors, including some wealthy people who should have known better, her butcher and grocer, even her father-in-law and her maid believed in her, and all of them gave her money, in all, a great deal of money.

At first it went well, they were getting the returns they expected. But then times got tough. Kate started to miss payments, and started making promises, and not keeping them. Her father-in –law was not happy. Neither was Mr. A.C. Squires, her next door neighbor, who had invested $30K with her, and had mortgaged his house in order to do so. They were ready to file suit. When she disappeared, only days before having to appear in court for Mr. Squire’s case, people began to suspect the worst. They had no idea what was coming.

There were no teachers. Not a single teacher in Brooklyn could be found to have been in contact with Kate Bradford, and not one had borrowed money from her. Kate had been using new investor’s money to pay off the original investors. There were no huge profits, no Wall Street bankroll. There was just Kate, lying through her teeth, and pocketing the profits. Apparently as her juggling act grew to be too much, she had planned an exit strategy, and took it. She got out of town.

The papers, of course, ate it up. Kate was literally front page news, with daily and weekly stories about her, mostly in the Brooklyn Eagle, but also in the New York Times. Soon Kate was being sighted all across North America. The Eagle called her “the confidence queen”, and the “finance queen.” She was seen in Rockaway Beach, and then in Philadelphia, then Albany. But none of those storied proved to be true, and she was never caught.

A month after she disappeared, there were no credible leads. Kate Bradford had successfully disappeared. With no Kate to haul into a court of law, there was nothing to do but sue.

In June of 1894, a grand jury met in order to indict Kate Bradford in absentia. The list of people she had gotten money out of was simply amazing. Many were successful business men, lawyers, and others who should have known better, but couldn’t resist the lure of cheap and easy money. The Eagle opined that they didn’t think Mrs. Bradford would ever be prosecuted.

As the paper said, “People who loan money without security, and expect to receive therefore interest at the rate of from 50 to 240 percent a year are not likely to take their affairs into court. There is little doubt that some of the people who invested their funds with Mrs. Bradford, are, in sporting parlance, even with, or ahead of the game.” The grand jury could not get enough evidence, and did not hand down an indictment.

Many of her friends and family couldn’t believe that she had done this. They defended her and her actions to the end. Her own husband had mortgaged their Bedford Avenue property, and the furniture itself, in order to get investment money. Those who had been successful in investing with her told of giving her the profit back upon her payment to them, and reinvesting the money. That’s how she was able to get recommendations from others, and keep the scheme going. She had unwitting dupes making character references.

At the end of June, there was a Kate sighting in Los Angeles. But no one really believed it. Many believed that she was still in Brooklyn, and one of her victims actually hired a private detective to hang around the house to see if she was still coming by.

Her husband and children were living behind locked and chained doors, letting no one in. Angry investors had been pounding on their doors, some trying to break in. In July, a woman was arrested for attempted forgery in Marietta, Georgia. For three days, the Eagle speculated that this was Kate Bradford. Some people went down to Georgia to check, which took a couple of days. It was not her.

By August, Mr. Charles Bradford, the long suffering husband, had had enough. He too sued his wife, charging that she owed him over $3500, money he had lent her for investment. His suit had to get in line behind those of her neighbor, Mr. Squires, as well as her father-in –law, Charles Stoll, the butcher, and a cousin in New Jersey.

And there the story ends; there are no more newspaper reports. Kate Bradford never came home, never wrote to any friends or relatives, and was never seen again. She disappeared from the face of the earth. Her victims were mostly too embarrassed to make too much of a fuss.

As the Eagle story mentioned, there was not all that much sympathy for many of them, as the interest rates that they were so eager to make money from amounted to usury, and they should have been ashamed for taking advantage of people, and they should have known that it was all too good to be true. They were greedy and rather stupid.

The less wealthy, less educated and more gullible, like the maid, and some of the family, church ladies, and neighbors were the true victims. They had given their life’s savings to Kate, and they lost everything. Presumably, Charles Bradford and the children’s lives would never be the same again.

We’ll never know what really happened to Kate Bradford. Did she commit suicide, after all? Or did she live the rest of her life out in obscure, but comfortable anonymity, somewhere far away; or perhaps still in the city that has never, ever, really slept? Who knows? But Ponzi Schemes are still with us, and there is always a new crop of people who fall for one of the oldest cons in the book.