Whitaker Wright - Sharp Practices

Sharp Practices

Wright's career as a swindler peaked in the 1890s, when he formed the London and Globe Company which floated a variety of stock and bond issues dealing with mining. Wright purposely called some of these stocks "consols", the term used by the British government for state bond issues that were solid and reliable. He loaded the directorships of his companies with peers of the realm; for instance, the Chairman of the London and Globe Company was the Marquess of Dufferin and Ava, a former Viceroy of India. This served the purpose both of impressing the public and attracting wealthy investors. Wright also sought to make a place for himself in late Victorian English Society. Besides a mansion at Lea Park, Surrey, where he had a smoking room built beneath a roof aquarium, Wright also owned the yacht Sybarita which beat the yacht Meteor (which belonged to Kaiser Wilhelm II of Germany) before the Royal Yacht Squadron.

Wright became a friend and financial advisor to Sir James Reid, the personal physician to Queen Victoria. In fact Reid became the trustee for Mrs. Wright in the financier's will; later this would lead to financial difficulties for the physician for neglecting her interests in the events connected to Wright's fall. Reid eventually had to pay Mrs. Wright £5,000.

Everything was apparently working well in Wright's empire, when in 1900 he sought to float a bond issue for the building of the Baker Street and Waterloo Railway (now the London Underground's Bakerloo line). The line had been difficult and costly to construct. Why Wright sought to get involved in the company is contentious; he was a mining engineer, not a construction or railroad engineer. It is likely that Wright believed he would be able to cap his career in City finance by getting knighted for his public spirited activity. In any case the bond issue was a disaster - Wright found it strained his resources, and few people were willing to subscribe. It started the collapse of the entire Wright group.

At this point Wright made his criminal error. To maintain an image of solvency and success Wright kept pushing thousands of pounds from one of his companies to another in a series of "loans". This led to some misrepresentations on balance sheets. But when he announced that, despite the apparent prosperity of his group, there would be no dividends, people became suspicious. In December 1900, the companies collapsed. Wright fled, but was brought back to stand trial.

The shock waves led to a panic in London's exchange. There were other losses. The humiliated Marquess of Dufferin and Ava died in 1902 in the midst of the investigation.