How One Major Hoax Panicked an Entire Nation

How One Major Hoax Panicked an Entire Nation

Why you should care

In a world of information, one small fraud by man can equal one giant headache for mankind. And this was way back in 1864.

As the sun rose over Manhattan on May 18, 1864, thousands of New Yorkers picked up their morning paper to discover that their president was drafting another 400,000 men from their war-torn country to replenish the ranks of the Union Army.

Most believed that the three-year-old Civil War had to be nearing its final chapter, but both the New York World and the New York Journal of Commerce carried the news from Abraham Lincoln that Gen. Ulysses S. Grant’s new offensive in Virginia was failing and the president was calling for additional troops as well as “a day of fasting, humiliation and prayer” across the nation.

Another dark day in a very somber period, except for one thing: The story was utterly false.

How could two of New York’s largest dailies get such a major announcement — from the president of the United States no less — completely wrong?

A lie gets halfway around the world before the truth has a chance to get its pants on.

— Winston Churchill

It was a question that nobody wanted answered more than a furious Abraham Lincoln, who sent federal troops to shut down both papers and arrest their editors when he learned of the hoax.

But by noon, when the State Department in Washington confirmed that the proclamation had been a forgery, the damage had already been done. The bogus announcement of a new round of conscription had caused shockwaves on Wall Street, sending share prices plunging and gold soaring 10 percent as nervous investors hunkered down for a prolonged war.

As Winston Churchill would later say, “A lie gets halfway around the world before the truth has a chance to get its pants on.” An adage that was just as true in the 19th century as in an age of Twitter hacks and flash crashes.

BW portrait of civil war soldiers

Source Corbis

In this case, the globetrotting lie emanated from a forged dispatch from the Associated Press — precisely what would happen 149 years later when a spurious tweet that Barack Obama had been injured in two explosions at the White House wiped $136 billion from the S&P 500 index in a matter of minutes in 2013.

But, as Lincoln’s troops occupied their offices in 1864, the besieged editors at the two New York papers were not pointing fingers at the AP’s Twitter feed but to one of the AP’s “flimsies” that had been delivered by courier in the early morning hours.

Such overnight dispatches from the AP to New York’s seven dailies were the lifeblood of the morning news cycle. But this particular dispatch had been timed perfectly to arrive around 3.30 a.m. — right after the night editors at the papers had gone home but before the day staff arrived, leaving a single night foreman on duty to determine whether to include the dispatch’s contents in the morning edition of the paper.

The night foremen at New York’s other five newspapers were suspicious enough about the story to ask the AP to verify it, but the World and the Journal of Commerce were sufficiently impressed by quality of the forgery, and its apparent source, to slap the story on their front page.

Those responsible for the “Civil War gold hoax,” as investigators soon ascertained, were indeed quite familiar with the newspaper business. Three days later, authorities arrested Francis A. Mallison, a reporter for the Brooklyn Eagle, and Joseph Howard Jr., his boss and the paper’s city editor.

Those responsible for perpetrating the “Civil War gold hoax”…were indeed quite familiar with the newspaper business.

As is often the case with fraud, there can be a fine line between stupid and clever, and Howard, the 35-year-old mastermind behind the hoax, strayed onto the stupid side by making a conspicuously large investment in gold a mere day before the news headlines hit. But the disgraced journalist would serve fewer than three months in prison, his release coming just a month after Lincoln issued a very real conscription order for 500,000 more Union troops.

It should be a comfort that we are no longer a single night foreman’s judgment away from a front-page fraud — but instead we have created a media landscape flush with lone foremen and forewomen, constantly making questionable calls on partial information, and rife with potential conduits for misinformation for the thousands of fraudsters, hackers and modern-day Howards.

The lies will continue to make their way around the world. The question is: How quickly can the truth pull up its pants?

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