. . . Or How Not to Do the Grand Tour
By Megan McKinney
In his book, Fabulous Chicago, Emmett Dedmon wrote that in 1929 Samuel Insull was “the most powerful businessman in America,” sitting on boards of 85 companies, chairman of 65 and president of 11. Although Insull survived the 1929 Wall Street Crash, by early 1932, he was resigning as head of his various interests in order to devote time and energy to “solving pressing financial problems.”
As the year progressed, Insull’s Empire continued to collapse—to the horror of its investors. In June, he was cleaning out his desk and telling reporters, “I’ve gone from the bottom to the top and now to the bottom again. I only hope I will be able to keep a roof over my head and care for my wife.” However, by early autumn, it appeared that dubious accounting methods had been used to inflate profits and hide losses. The previous assumption that Insull had failed with honor was now in doubt. It was said that he owed banks $10 million in addition to personal debts. This was just the beginning.
Author Arthur Meeker, who was a neighbor, described the flight of the Insulls in his book, Chicago, With Love.
1100 Lake Shore Drive was in an uproar. We pretended as hard as we could not to notice anything amiss, but it was plain this was no ordinary departure. The lift ran up and down innumerable times between the lobby and the sixth floor; once I came in from the street to find the whole entrance blocked by a number of large, odd-looking suitcases that were so heavy that Clifford, the doorman, could scarcely lift them. What was in them—gold bullion, perhaps? At length, no doubt after reconnoitering from above to make sure they would not be observed, the Insulls descended together, Mrs. Insull heavily veiled, and left the building forever. I never saw either of them again as long as they lived.
Then he added,
I can’t say we missed them.
The destination of their sudden departure was Quebec, from which they left for Paris, aboard the RMS Empress of Britain.
RMS Empress of Britain.
Insull’s brother and lieutenant, Martin Insull, reported to be $7 million in debt, also fled to Canada, where he was found by the press in Orillia, Ontario, a small town 86 miles north of Toronto, staying in a $20-a-week room in Anne McLean’s Boarding House.
The 63-year-old Martin characterized himself as a “man without a job, without plans, without a future.” He had thought his wife and daughter were secure until he discovered they both had been devastated by the deterioration in the value of their Insull stocks.
Sam Jr. remained in Chicago with his wife and year-old son, where he leased the bottom floor of his 25th and 26th floor duplex, losing his kitchen, living room, dining room and several bedrooms. Soon after, goods described as “exquisite furnishings and objects of art from the home of a prominent gentleman” were auctioned in Chicago.
The senior Insulls.
During the second week in October, Sam Sr. left his ailing wife in Paris at the Hotel Lincoln, where they had been staying. With him, as he crept out through the hotel’s dimly lit service entrance, was his son, carrying a small handbag. The two men hailed a taxi that took them to Gare de Lyon, where they caught the midnight express for Turin.
Gare de Lyon.
After spending the night there, they journeyed on to Milan and the office of a travel agent, where Insull identified himself and flashed a thick wad of bills. The clerk knew everything about him—as did much of the world—except that he was under indictment in Chicago for larceny and embezzlement. He therefore provided the fugitive with air transportation to Rome. Sam Jr. then returned to his mother in the Paris hotel, where reporters now besieged her.
The senior Insull’s lawyers had advised him that he would be safe from extradition in Greece. Therefore, after arriving in Rome, he boarded a plane for Tirana, Albania, and then flew on to Salonika, where he changed to a train for Athens and the Hotel Grande Bretagne.
The morning after his arrival, the Athenian police, who the American Legation had asked to detain him, tracked Insull down to the hotel and put him under arrest. Because the U.S. State Department had not established an extradition treaty with Greece, it needed time to decide whether or not to ask authorities there to return Insull to face justice in the United States.
Insull was not incarcerated in Athens; however an escort of police—to whom he had told of a kidnap plot to return him to Chicago—followed him everywhere, on the lookout for “Chicago gangsters.” A Greco-American extradition treaty was signed by Prime Minister Alexandros Zaimis of Greece and dispatched to Washington. In Chicago, State’s Attorney John A. Swanson rushed plans to present an official extradition request to President Hoover.
Greek Prime Minister Alexandros Zaimis.
During early November, Insull once again slipped out of a hotel service entrance. With him this time was M. Coutsamaris, chief of the Athenian Security Police. Three days earlier extradition treaties had been exchanged in Washington, and the United States was now able to demand the arrest and return of the fugitive. He was examined by doctors and found to suffer from diabetes, chills, arteriosclerosis, myocarditis, enlarged liver, high blood pressure and traces of brain congestion, and, therefore, given a special room in the police station. His Greek lawyer, Christos Ladas, appeared before the Greek Court of Appeals, and Insull was moved to the Aretaeio Clinic at Nicosia, Cyprus, to await the arrival of complete documents from the U.S.
On the third anniversary of the glorious opening night of a new Chicago opera house, its creator was in the only available room at the Aretaeio Clinic, the maternity annex. During the night, a baby was born on each side of Civic Opera House founder Sam Insull.
It was early 1933, when five justices of Athens Court of Appeals heard the U.S. Government’s petition to extradite Insull for trial in Chicago. Illinois extradition on embezzlement charges failed.
Greek folk hero Samouel Insullos.
Samouel Insullos had become a folk hero in a land where few had invested their life savings in American utilities, and Athenian crowds outside the courtroom roared: “Long live Greek justice!”
Insull was still ensconced in the Hotel Grande Bretagne the following August when President Franklin D. Roosevelt signed a warrant for his arrest.
Vintage New York Harbor.
Fast-forward to New York Harbor in early May 1934 and the dawn arrival of the S.S. Exilona. On the deck was Insull, and meeting him was his son whom he had not seen in nearly two years. He had spent 23 days at sea, and while the ship was at Casablanca suffered a “brief heart attack.” A Coast Guard cutter carried them to Fort Hancock on the tip of Sandy Hook, from where they were driven under guard to Princeton Junction, New Jersey, and, by 10 a.m., on a train bound for Chicago.
After being fingerprinted and suffering another slight heart attack, Insull was arraigned in Federal Court. Because the Insulls were unable to raise the $200,000 bail, Samuel was put in the hospital ward of Cook County Jail to await trial.
On Oct. 2, 1934, Insull, his son and 15 of their associates were put on trial for mail fraud. In the courtroom, a 22-ft. bookcase held two tons of government exhibits. After the two-month trial in which 200 government witnesses were summoned and 2,000,000 words of testimony were taken, the trial ended.
After deliberating for 122 minutes, the jury decided to accept Insull’s explanation that, like his investors, he was an honest victim of the Depression and it rendered an amazing verdict.
On July 16, 1938, 78-year-old Sam Insull, who had been living in Paris on his $21,000 a year pension, suffered a final heart attack in the Place de la Concorde Metro station on his way to lunch. He still held a Metro ticket in his hand and in his pocket was 20 centimes.
With this, the last of its Insull banner headlines, the Chicago Tribune simply reported the understated and all too accurate, “Thus ended one of the most spectacular careers in the modern world of business and finance and adventure.”
. . . And adventure!
Megan McKinney’s Samuel Insull series in Classic Chicago concludes with this segment.
Robert F. Carl