The "Racketeer Nickel"

[Music] the nickel since 1938 the front has borne an image of thomas jefferson third president of the united states the reverse usually shows a picture of his home monticello although there were special editions minted in 2004 and 2005 to commemorate the 200th anniversary of the louisiana purchase and the lewis and clark expedition in a world where we barely use change anymore at all nickels don't seem to gain a lot of attention but that wasn't always the case in 1883 a new nickel design was minted that gave the united states mint great consternation and led to fraud all over the country and one of the most famous fraudsters of the 1883 racketeer nickel was said to be both deaf and mute which essentially helped him to perpetrate his fraud it is history that deserves to be remembered counterfeiting is nearly as old as coinage around 600 bc ancient lydians committed coins out of electrum a naturally occurring gold and silver alloy believed to be among the oldest coins ever minted greek historian herodotus credits them as the first people to use gold and silver coins although historically that is a matter of debate even these ancient coins seem to have been counterfeited as versions with base metal cores plated with electrum gold or silver have been found in the early modern period coins were often clipped or shaved for the precious metal which was always a value coins were given readed edges specifically to prevent people from passing off shaped coins the first american coins with raided edges were struck in the 1790s on half dimes they weren't yet known as a nickel as well as on larger coins but a good counterfeiter or fraudster was always on the lookout for an opportunity from the 1790s american coins were minted in a variety of denominations including the half cent two cent and three cent pieces up to the gold two dollars and fifty cent quarter eagle the five dollar half eagle and then ten dollar eagle coins most of these coins were made of varying amounts of precious metal usually gold or silver with lower denominations made of copper half dimes valued at five cents were originally silver which changed in the 1860s thanks to lobbying efforts by joseph wharton who had a near monopoly on nickel production in the united states he successfully lobbied for the three cent piece in the five-cent piece to be made with copper nickel leading to the james longacre designed shield nickels shield nickels were only legal tender up to one dollar initially and that combined with a widely criticized design led to numerous suggestions for change the american journal of numismatics even described the shield nickel as the ugliest of all known coins the shield nickel is also what would eventually lead to the term nickel to describe a five cent piece it's not actually the first coin to include nickel in 1857 the mint had shifted penny production to an alloy of 88 copper and 12 nickel these nickel pennies were the first coins to be called nickels in the united states differentiating them from the most coinage made of gold or silver besides wharton's lobbying there were other good reasons by 1866 to make coins out of base metals during the civil war commerce slowed dramatically in large part because americans began hoarding gold and silver coins which would hold value regardless of inflation this caused both the union and the confederacy to issue paper money in cent denominations some banks even printed their own paper money so that commerce could continue the issue of scarcity and hoarding continued after the civil war the mint simply could not keep up with demand for coinage thus in 1866 the mint began producing three and five cent pieces made of 25 percent nickel and 75 percent copper however the nickel was not the only five cent piece to be minted during this time silver half dimes continued to be minted until 1873. both the five cent piece and the three cent piece could be called nickels after that as they were the only coins made from the material in the years immediately after the civil war these coins were minted in huge numbers nearly 15 million in 1866 and over 30 million in 1867. so many of the coins were minted that by the late 1870s the glut of coinage forced the meant to cease minting five cent nickels completely none were minted for circulation in 1877 or 1878 and fewer than 70 000 were minted in 1879 80 and 81. wharton seeking to sell more of his nickel to the government began lobbying for more coins to be made out of nickel wharton hoped to convince the men to shift pennies to copper nickel as they were being minted in much larger numbers by 1881 his consistent lobbying led mint superintendent archibald loudon snowden to order new designs for the one three and five cent pieces from the mint's engraver charles barber barbara was given very specific instructions on his designs the obverse the head side was to have a classic liberty head while the reverse was to feature a wreath around a roman numeral denoting the value b for the five cent piece the nickel was also to be slightly larger than the shield nickel the smaller denomination coins were meant to be identical except for size and the roman numerals on the reverse but early in the design process development of the penny and the three cent piece were abandoned and only a new nickel design was produced a large number of pattern coins coins that were not released but used to evaluate the design which was modified slightly before being approved and sent to the treasury secretary the initial design was actually rejected as the words united states of america appeared on the head side of the coin and coinage statutes actually required to be on the reverse while other issues had been considered one thing the coin did not have when it was approved was the word sense the mint could be excused for a mitigate early silver and copper nickel designs and three cent pieces didn't say since and had circulated for years without complaint the coin was meant to start minting in 1883 but the dies for striking the coins weren't ready in time and so throughout january the philadelphia event struck nearly a million and a half 1883 shield nickels the new design was finally released in february and almost immediately others noticed that the coins were problematic on february 11 the new york times published a press release from washington d.c that stated chief brooks of the secret service says that he regards the new nickels as very dangerous coins a thin plating would enable persons to pass them off as gold coins of a new issue the problem arose from the new nichols similarity to the five dollar gold half eagle coin both borah liberty had design on the front and were nearly the same size 21.21 millimeters for the nickel and 21.6 millimeters for the half eagle the reverse of the half eagle was an eagle behind a shield but a gold-plated nickel was nearly the same weight and size and if only glanced at could easily be passed off at a hundred times its value and there were enough clever people to take advantage the most famous story of fraud using gold-plated nickels is that of josh tatum a death mute reportedly from boston depending on the source tatum was said to have collected a good number of the new nickels before enlisting someone usually a pawn shop owner who may have been an amateur jeweler to plate the change the palladium item newspaper of richmond indiana relates that carrying the thousand-plated nickels in a small black bag and looking respectable with a mustache and balding head he would enter a tobacco store place the coin on the counter and point to a five-set cigar the clerk would grab the cigar and hand it and four dollars and ninety-five cents in change back tatum would then move on to the next door he eventually had moore plated making his way from boston to new york and hitting every shop that sold a cigar by some claims he was able to make 15 000 on the scheme before someone caught up to him and he was arrested but there was an issue when he was taken to court by the store owners he had cheated they couldn't convict him when each witness who had been cheated out of 4.95 was asked if tatum had ever asked for change each witness had to say no the man was mute by asking for only a five cent cigar tatum could claim that he never misrepresented the coin it was the seller's mistake giving him change a coin collector explained to the fort worth star telegram the shop owners were simply out of luck thanks to carelessness it's been claimed that this act is the source of the phrase just joshing you to mean usually a harmless joke or prank the first certain report of gold-plated liberty nickels appeared only 12 days after the coins were first issued the new five-cent coins are so perfectly gold washed as deceived any ignorant persons and pass readily among them for new 5 gold pieces reported another press release the baltimore sun reported on the february 19th that a gold-plated 5 cent piece of the new issue has reached the sun office and its resemblance to a 5 gold piece is quite enough to deceive four days later the charlotte observer in north carolina reported that the merchants who had seen the nickel give the authorities credit for their wisdom in stopping the coinage of the dangerous peace but others were less understanding the intelligence or journal of lancaster pennsylvania printed someone about the philadelphia mint has a mania for putting new faces on coins and unfortunately good judgment and good taste seldom attend the performance only two weeks after their introduction there was already talk at the mint and the treasure department about withdrawing the new coins from circulation treasury secretary charles folger seems to have believed that unnecessary but reports continued to proliferate that the coin was being used for fraud secret service agent henry finnegas arrested a man for trying to pass off a gold nickel across the country in san francisco finegas also reported that several persons engaged in the gold and silver plating business in this city have called upon me to ascertain if they could guild the new five-cent nickel without my interfering with them archibald loudon snowden chief executor of the mint fought the changes well arguing that no one had plated the three-set piece and passed it off for the quarter eagle but it hardly mattered by march the decision had been made to alter design to include sense on the reverse though the york dispatch of york pennsylvania reported that minting of that no sense nickel continued with nearly five thousand dollars being minted in philadelphia every day papers across the country reported however that the no sense coins would be collected by the mint to be destroyed the new design finally began minting on june 26 but only after 5 million 479 519 no sense coins had been minted because of the reports that the coin would be recalled many of those 5 million were hoarded by collectors who believe the coin would be valuable ironically because so many of them were saved high quality no sense nickels are relatively common while high quality sense nickels are considerably more rare it might disappoint you to find out that the famous story of josh tatum is likely nothing more than legend the coin was certainly plated and likely used in schemes similar to the one attributed to tatum but he doesn't appear as any of the men arrested across the country for the scheme more importantly his story doesn't appear in any contemporary newspaper account the story seems to proliferated in 1965 when it appeared in multiple papers on articles about coin shows but possibly the earliest version appears in the southwest times of pulaski virginia on december 14 1958 told by a miss willie long it isn't clear where she heard the story even more disappointing the story is definitely not the origin of the phrase just joshing you in fact the phrase's origin is uncertain but merriam-webster dates its origin to at least 1845 well before tatum's supposed exploits the phrase has also been suggested to come from humorist josh billings the pen name of henry wheeler shaw whose career began in 1858. the origin of the phrase is unfortunately simply unknown well the story of josh tatum might be purely legend the fraud surrounding the controversial no sense nickel was very real and since then the nickel has come to be commonly called the racketeer nickel liberty nickels were produced clear until 1912 when they were replaced officially by the buffalo nickel but no buffalo nickels were actually minted that year and there are 1913 examples of the liberty head nickel nickels became more popular in the 20th century partly because of the proliferation of movie machines that were coin operated and asked for five cents called of course a nickelodeon and while today methods of preventing fraud and counterfeiting are much more sophisticated than they once were the 1883 racketeer nickel is still a cautionary tale fraudsters will take their chances wherever they can i hope you enjoyed this episode of the history guide short snippets of forgotten history and if you did enjoy feed the algorithm by making a comment or clicking that like button if you have suggestions for future episodes please send those to our suggestions email box check out our webpage at thehistoryguy.net and of course we're on facebook instagram and twitter you can book a special message from the history guy on cameo and check out our merchandise teespring.com and if you'd like more episodes of forgotten history all you need to do is subscribe

Channel: The History Guy: History Deserves to Be Remembered

Views: 111,312

Rating: 4.9820681 out of 5

Keywords: history, history guy, the history guy, coins, nickel, crime, counterfeiting, racketeer nickel, numismatic, us history

Id: LklHnhthGz0

Length: 12min 19sec (739 seconds)

Published: Mon Jul 26 2021