Category: Archive

Hibernian Chronicle 77 years ago: The Teapot Dome Scandal

February 16, 2011

By Staff Reporter

By Edward T. O’Donnell

Seventy-seven years ago this week, on June 30, 1924, indictments were handed down in the famous "Teapot Dome" corruption scandal. California oil tycoon Edward L. Doheny stood accused of giving the secretary of the interior, Albert Fall, a $100,000 bribe in exchange for access to oil on U.S. government land. It was the political scandal of the Roaring Twenties and one of the most infamous in all of American political history.

Edward L. Doheny was born in 1856 in Fon du Lac, Wis. His father came from Tipperary and his mother was born to Irish parents in Canada. Growing up in poverty, he yearned to get his piece of the American dream. At 16, he ran away from home and headed west in search of gold. He spent the next 20 years working in every conceivable job in mining regions of Texas, Arizona, and New Mexico. He struck gold several times, but never enough to be considered a fortune.

His breakthrough came in 1892. Living in Los Angeles, he noticed wagon after wagon of brea — Spanish for pitch — being trucked about the city day after day. He inquired about the black gooey stuff and learned that it bubbled up from the ground in several spots in the city and that locals simply burned it as fuel. Although his expertise was in precious metals, Doheny knew enough about precious liquids to realize that Los Angeles likely sat upon huge oil deposits.

Immediately, he leased some land near a large brea pit and started drilling. At 275 feet down he struck oil — black gold. Before long his well was pumping out 45 barrels of oil per day and Doheny was well on his way to creating and dominating the California oil industry. The poor boy from Fon du Lac was now one of the richest men in America.

Like most nouveau rich, he and his wife sought to "establish" themselves by living a lavish lifestyle. They built an unrivaled mansion in Los Angeles — Chester Place — replete with bowling alley, movie theater, swimming pool, chapel, and quarters for dozens of servants. Doheny adopted the persona of refinement, wearing a monocle and expensive tailored suits.

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By the early 1920s Doheny was worth more than $100 million. Still, he wanted more and saw his opportunity in the rich oil fields of Elk Hills, Calif., and Teapot Dome, Wyo. They were owned by the federal government as a strategic naval oil reserve but were soon to be leased to private oil companies. Fortunately for Doheny, he had an inside edge on the competition: Fall, an old friend from his gold mining days.

Their friendship went way back to the 1880s, but this was business. It was also the Harding administration — one of the most corrupt in American history. So Doheny would have to pay, though not as much as Harry F. Sinclair of the Mammoth Oil Company. The latter shelled out $400,000 to secure the rights to the oil at Teapot Dome. Doheny had to pony up a mere $100,000 to drill in Elk Hills. As part of the deal (largely to placate an irate Navy), he also agreed to build oil storage facilities for the Pacific fleet at a place called Pearl Harbor. Shrewdly, Doheny had his son, Edward Jr., withdraw the money and made the drop, thus establishing deniability.

The drilling started immediately, but so too did the grumbling about the big giveaway to the oil tycoons. Then came the stories about Albert Fall’s suddenly ostentatious lifestyle. President Harding died unexpectedly in August 1923 and the Senate began hearings into the oil matter in October.

Fall and Doheny came before the Senate committee and at first denied everything. Under pressure, Doheny eventually admitted that he had given Fall a $100,000 "loan." Enough evidence was compiled to get a Washington, D.C., grand jury to hand down indictments against Doheny, his son, Fall and Sinclair.

The trials began in October 1924. After many delays and several appeals, they concluded in 1927-28. Doheny benefited greatly from the oratory of his chief counsel, an Irish American named Frank J. Hogan, who argued that Doheny’s sole motivation in the affair was patriotic — to protect the Navy from losing its oil reserves to neighboring oilmen, who were allegedly siphoning it off.

The verdict was a classic. Fall was found guilty of accepting bribes and sent to prison. Doheny, the man who paid the bribe, was found not guilty of bribery. But he didn’t get off unscathed: He was required to pay back $47 million for the oil he extracted from Elk Hills and was never compensated for the millions he invested in the Pearl Harbor storage tanks. Still, he was hardly poor.

Doheny returned to Los Angeles to a hero’s welcome. But the Dohenys happiness was to be short-lived. Edward Jr. was murdered by his male secretary in 1929. Doheny Sr. suffered a steep decline in his health and lived out most of his last years bedridden. He died a very rich man in 1935.


June 28, 1922: The Free State Army launches an attack against the anti-Treaty forces at Four Courts in Dublin, starting the Irish Civil War.

June 30, 1936: Margaret Mitchell’s book "Gone with the Wind" is published in New York City.

July 1, 1690: William of Orange triumphs over the forces of James II at the Battle of the Boyne.


June 27, 1846: Home Rule movement leader Charles Stewart Parnell is born in Avondale, Co. Wicklow.

June 28, 1844: Nationalist and poet John Boyle O’Reilly is born in Drogheda, Co. Louth.

July 1, 1897: IRA General Tom Barry is born in Bandon, Co. Cork.

Readers may contact Edward T. O’Donnell at odonnell@EdwardTODonnell.com.

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