Extraordinary Popular Delusions and the Madness of Crowds (Complete Edition: Volume 1-3). Charles Mackay
apprehension of Knight. The Commons ordered the doors of the House to be locked, and the keys to be placed upon the table. General Ross, one of the members of the Committee of Secrecy, acquainted them that they had already discovered a train of the deepest villany and fraud that Hell had ever contrived to ruin a nation, which in due time they would lay before the House. In the mean time, in order to a further discovery, the Committee thought it highly necessary to secure the persons of some of the directors and principal South Sea officers, and to seize their papers. A motion to this effect having been made, was carried unanimously. Sir Robert Chaplin, Sir Theodore Janssen, Mr. Sawbridge, and Mr. F. Eyles, members of the House, and directors of the South Sea Company, were summoned to appear in their places, and answer for their corrupt practices. Sir Theodore Janssen and Mr. Sawbridge answered to their names, and endeavoured to exculpate themselves. The House heard them patiently, and then ordered them to withdraw. A motion was then made, and carried nemine contradicente, that they had been guilty of a notorious breach of trust—had occasioned much loss to great numbers of his Majesty's subjects, and had highly prejudiced the public credit. It was then ordered that, for their offence, they should be expelled the House, and taken into the custody of the sergeant-at-arms. Sir Robert Chaplin and Mr. Eyles, attending in their places four days afterwards, were also expelled the House. It was resolved at the same time to address the King, to give directions to his ministers at foreign courts to make application for Knight, that he might be delivered up to the English authorities, in ease he took refuge in any of their dominions. The King at once agreed, and messengers were despatched to all parts of the Continent the same night.
Among the directors taken into custody, was Sir John Blunt, the man whom popular opinion has generally accused of having been the original author and father of the scheme. This man, we are informed by Pope, in his epistle to Allen, Lord Bathurst, was a dissenter, of a most religious deportment, and professed to be a great believer. He constantly declaimed against the luxury and corruption of the age, the partiality of parliaments, and the misery of party spirit. He was particularly eloquent against avarice in great and noble persons. He was originally a scrivener, and afterwards became, not only a director, but the most active manager of the South Sea Company. Whether it was during his career in this capacity that he first began to declaim against the avarice of the great, we are not informed. He certainly must have seen enough of it to justify his severest anathema; but if the preacher had himself been free from the vice he condemned, his declamations would have had a better effect. He was brought up in custody to the bar of the House of Lords, and underwent a long examination. He refused to answer several important questions. He said he had been examined already by a committee of the House of Commons, and as he did not remember his answers, and might contradict himself, he refused to answer before another tribunal. This declaration, in itself an indirect proof of guilt, occasioned some commotion in the House. He was again asked peremptorily whether he had ever sold any portion of the stock to any member of the administration, or any member of either House of Parliament, to facilitate the passing of the hill. He again declined to answer. He was anxious, he said, to treat the House with all possible respect, but he thought it hard to be compelled to accuse himself. After several ineffectual attempts to refresh his memory, he was directed to withdraw. A violent discussion ensued between the friends and opponents of the ministry. It was asserted that the administration were no strangers to the convenient taciturnity of Sir John Blunt. The Duke of Wharton made a reflection upon the Earl Stanhope, which the latter warmly resented. He spoke under great excitement, and with such vehemence as to cause a sudden determination of blood to the head. He felt himself so ill that he was obliged to leave the House and retire to his chamber. He was cupped immediately, and also let blood on the following morning, but with slight relief. The fatal result was not anticipated. Towards evening he became drowsy, and turning himself on his face, expired. The sudden death of this statesman caused great grief to the nation. George I was exceedingly affected, and shut himself up for some hours in his closet, inconsolable for his loss.
Knight, the treasurer of the company, was apprehended at Tirlemont, near Liege, by one of the secretaries of Mr. Leathes, the British resident at Brussels, and lodged in the citadel of Antwerp. Repeated applications were made to the court of Austria to deliver him up, but in vain. Knight threw himself upon the protection of the states of Brabant, and demanded to be tried in that country. It was a privilege granted to the states of Brabant by one of the articles of the Joyeuse Entree, that every criminal apprehended in that country should be tried in that country. The states insisted on their privilege, and refused to deliver Knight to the British authorities. The latter did not cease their solicitations; but in the mean time, Knight escaped from the citadel.
On the 16th of February the Committee of Secrecy made their first report to the House. They stated that their inquiry had been attended with numerous difficulties and embarrassments; every one they had examined had endeavoured, as far as in him lay, to defeat the ends of justice. In some of the books produced before them, false and fictitious entries had been made; in others, there were entries of money, with blanks for the name of the stockholders. There were frequent erasures and alterations, and in some of the books leaves were torn out. They also found that some books of great importance had been destroyed altogether, and that some had been taken away or secreted. At the very entrance into their inquiry, they had observed that the matters referred to them were of great variety and extent. Many persons had been intrusted with various parts in the execution of the law, and under colour thereof had acted in an unwarrantable manner, in disposing of the properties of many thousands of persons, amounting to many millions of money. They discovered that, before the South Sea Act was passed, there was an entry in the Company's books of the sum of 1,259,325 pounds, upon account of stock stated to have been sold to the amount of 574,500 pounds. This stock was all fictitious, and had been disposed of with a view to promote the passing of the bill. It was noted as sold at various days, and at various prices, from 150 to 325 per cent. Being surprised to see so large an account disposed of, at a time when the Company were not empowered to increase their capital, the committee determined to investigate most carefully the whole transaction. The governor, sub-governor, and several directors were brought before them, and examined rigidly. They found that, at the time these entries were made, the Company was not in possession of such a quantity of stock, having in their own right only a small quantity, not exceeding thirty thousand pounds at the utmost. Pursuing the inquiry, they found that this amount of stock, was to be esteemed as taken in or holden by the Company, for the benefit of the pretended purchasers, although no mutual agreement was made for its delivery or acceptance at any certain time. No money was paid down, nor any deposit or security whatever given to the Company by the supposed purchasers; so that if the stock had fallen, as might have been expected, had the act not passed, they would have sustained no loss. If, on the contrary, the price of stock advanced (as it actually did by the success of the scheme), the difference by the advanced price was to be made good to them. Accordingly, after the passing of the act, the account of stock was made up and adjusted with Mr. Knight, and the pretended purchasers were paid the difference out of the Company's cash. This fictitious stock, which had been chiefly at the disposal of Sir John Blunt, Mr. Gibbon, and Mr. Knight, was distributed among several members of the government and their connexions, by way of bribe, to facilitate the passing of the bill. To the Earl of Sunderland was assigned 50,000 pounds of this stock; to the Duchess of Kendal 10,000 pounds; to the Countess of Platen 10,000 pounds; to her two nieces 10,000 pounds; to Mr. Secretary Craggs 30,000 pounds; to Mr. Charles Stanhope (one of the Secretaries of the Treasury) 10,000 pounds; to the Swordblade Company 50,000 pounds. It also appeared that Mr. Stanhope had received the enormous sum of 250,000 pounds as the difference in the price of some stock, through the hands of Turner, Caswall, and Co., but that his name had been partly erased from their books, and altered to Stangape. Aislabie, the Chancellor of the Exchequer, had made profits still more abominable. He had an account with the same firm, who were also South Sea directors, to the amount of 794,451 pounds. He had, besides, advised the Company to make their second subscription one million and a half, instead of a million, by their own authority, and without any warrant. The third subscription had been conducted in a manner as disgraceful. Mr. Aislabie's name was down for 70,000 pounds; Mr. Craggs, senior, for 659,000 pounds; the Earl of Sunderland's for 160,000 pounds; and Mr. Stanhope for 47,000 pounds. This report was succeeded by six others, less important. At the end of the last, the committee declared that the absence of Knight, who had been principally intrusted, prevented them from carrying on their inquiries.