The journalist and writer Ramón Pérez de Ayala said that "when the scam is huge it already takes a decent name". Name that in the case of the ruse carried out by the Scotsman Gregor MacGregor took the name of Kingdom of Poyais , a fictitious country that never existed and with which he managed to trick bankers, businessmen and settlers, a scam with which this person became a millionaire at the expense of the greed and illusion of many unscrupulous people.
Gregor MacGregor
MacGregor was a soldier of some prestige who for much of his youth served in the British Army where he reached the rank of general. Closed his military stage he participated as a mercenary in various uprising movements against the Spanish Crown, even fighting alongside Simón Bolívar. Perhaps tired of the ups and downs in his life, perhaps wanting to start another stage, he decided to return to the United Kingdom in 1821.
Once in London, the former soldier spread the rumor that he had been named "cacique de Poyais", a territory located in Central America, in the space that Honduras now occupies, and that according to several expeditions it was immensely rich in natural resources that must be exploited. Without a doubt, the offer was tempting for bankers and businessmen eager to invest in new markets, but what they did not imagine is that this country was an invention that only existed in the mind of this MacGregor.
The beginning of the deception
To understand the deception in all its extension, one must take into account the historical context in which it takes place. After the defeat of the Napoleonic troops, the golden age of the British Empire began. Textile workshops and factories multiplied in the large urban centers and the coal mines were not enough to cover the demand. Bond yields were at record lows, and investors wanted to diversify their portfolios. Countries like Russia or Denmark were consolidated as preferential destinations, but among these those countries that were born from the collapse of the Spanish Empire slipped in. New countries like Mexico or Colombia needed financing, and offered 6% bonds, so no one was surprised that a country like Poyais offered a similar return. Despite the fact that there was no cartographic record of the country, MacGregor circulated newspaper advertisements telling of the founding of that nation and printed books referring to it. The deception was completed with other formalities, such as the drafting of a constitution, the attribution of an anthem, the creation of a flag, and even its own currency, the Poyais dollar. All of this was also backed by the prestige that this military man had acquired in his campaigns, and by a smooth talk with which he managed to fool everyone.
With this he achieved a first investment of 200,000 pounds at the time, the equivalent of 553 million pounds today. The loot would have been enough for many, but MacGregor continued to deceive him in view of the profitability of the business. Not content with the amount defrauded of him, he traveled to his native Scotland in search of settlers with whom to populate the imaginary country. Not only did he obtain new investments, but up to 250 people offered to travel to that country with the intention of founding commercial ports and exploiting the supposed gold and silver mines, something for which, obviously, they had to pay the self-proclaimed cacique, and they were forced to pay a toll and exchange all their savings for Poyais dollars before boarding.
The ship ended up leaving Scotland with the colonists and arrived in the self-styled territory of Poyais at some indeterminate time between 1822 and 1823. And the landing could not be more disheartening. One of the ships ran aground, causing the death of part of the new settlers. Those who survived landed on the Mosquito Coast , a swamp with very thick vegetation and where there were neither resources to exploit nor land suitable for cultivation. They also encountered the hostility of the natives who were not willing to trade or give them food. In this environment, malaria and other tropical diseases did not take long to appear, and up to two thirds of the new settlers perished in this adventure. Rumors eventually reached London, and the decision was made to send in the navy to rescue the few remaining survivors.
Escape to Paris
Following this scam, to avoid reprisals and escape justice, MacGregor fled to Paris. Not content with the amount of money he had cheated so far, he tried to repeat the deception by repeating the same system, trying to place bonds on the French market and looking for colonists who had to pay him a toll to settle in his imaginary country. Perhaps because the French authorities were more diligent in the control, perhaps because they had already been warned of the ruse, this time MacGregor could not repeat the deception in all its magnitude. He ended up fleeing back to London to escape French justice, but once on British soil he was arrested and sent to Edinburgh.
His connections enabled him to escape from the action of justice, and while his closest collaborators were sentenced to prison terms, he was only charged with a crime of "false promises". Incredible as it may seem, he obtained financing again (and also, from the same bank that had lent him money in the previous deceptions) with which he organized large-scale sales of land in his country to other unwary people, and in order to continue with the deception changed its name to 'Territorio de Mosquitia '. He operated like this until 1837, when he was no longer able to deceive anyone, and he ended up moving to Venezuela. In that country he was received with honors by his former comrades-in-arms, being rewarded with the salaries accumulated since his departure in 1820 and he obtained Venezuelan nationality. He spent his last years dedicated to the breeding of silkworms, and ended up dying in 1845 in Caracas, but not before leaving his own biography for posterity.
Gregory Mac Gregor