Gregor MacGregor, born at Glengyle in 1786, is less well known. He deserves more attention: he pulled off the greatest confidence trick of all time.
MacGregor’s biggest swindle raised £200,000. Over his lifetime, his bond-market frauds ran to £1.3m (as a share of Britain’s economy, around £3.6 billion today). It is true that more recent scams have raised more. Bernie Madoff, a New York-based fraudster caught out in 2008 ran a scheme 20 times bigger, at $65 billion. In cash terms alone Mr Madoff trumps MacGregor.
But fraud is about creating false confidence, and making people believe in something that does not exist. For some, like Mr Madoff, it is the belief in the trickster’s shamanic stock-picking skills. For others, like Charles Ponzi, it is a fail-safe mathematical scheme. MacGregor was far more ambitious: he invented an entire country. He was, he claimed, the “Cazique” or Prince of this land—Poyais—located near the Black River, in modern-day Honduras (see map).
MacGregor claimed that Poyais covered 8m acres (an area larger than Wales). It was rich in natural resources but in need of development. That would require both cash and manpower. Through an elaborate publicity campaign, he succeeded in persuading people not only to invest their savings in the bonds of a non-existent government, but also to emigrate to a fictional country. How on earth did he manage it?
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