A Novel by Eli Augustus Caldwell


San Francisco, California                                                                      May 7, 1960

This manuscript will likely catch you, the reader, going about your lives in 2020, by surprise. After all, you’ve heard the story of the Italian immigrant developing an investment scheme that ultimately ingrained his name in infamy. Unfortunately, you, like Mr. Ponzi’s investors, are the victim of a falsehood, a fraud, a con. For that story, much publicized as it is, is not the truth. I am partially to blame for your misconception. Some might say I am entirely to blame. I will let you, the reader, come to your own conclusion.

 You are probably saying to yourself, why should I believe this new story? After all, you’ve never heard of me. It’s been 100 years since Mr. Ponzi rose to fame like a meteor and just as quickly burned out, taking almost $10 million dollars (that’s probably $100 million in your dollars) from 30,000 people’s life-savings with him. Books, tv stories and newspaper articles have described his fraud in detail. The Boston Post received a Pulitzer for exposing the scam. Even Mr. Ponzi authored an account, biased as it is. How can there be something new?

But I’ve jumped ahead, and that is not fair to you, so let me begin at the beginning. My name is Eli Augustus Caldwell, Gussy to my friends, and I reported on business and finance for the Boston Financial Times in 1919.  I was born on Lake Street in Brighton, a section of Boston, in 1880 and attended public school there. No teacher would say I was a great student but there was a certain flair to my writing.  My high school graduation coincided with the Spanish American War of 1898, a short three-month war that many have forgotten. But it had an oversized impact on the United States in general and me in particular.  Remember the Maine, yellow journalism, and our takeover of Guam, Cuba, Puerto Rico and the Philippines- all were the direct result of the conflict. But the grandest result, both for the country and myself, was the rise to prominence of Teddy Roosevelt. His charge up Cuba’s San Juan Hill with the Rough Riders, his hand-picked, 1,000 strong cavalry brigade, established his bigger than life personality that ultimately led him to the White House. Being a stupid teenager with nothing to do and thinking war would be a great adventure, I joined up even though I wasn’t the cowboy type they were looking for; they needed lackeys and even I could clean up horse flop.

Teddy was everywhere at once, encouraging his men for the victory he knew was their destiny. Even a grunt like me wanted to fight and I did. Unfortunately, it cost me a left arm, not a good idea for a budding journalist. Caring man that he was, Teddy pulled a few strings with Ida Turnbull of McClure’s Magazine, the best-known writer for the muckraking publication that exposed corrupt monopolies. I was only a copy boy but was at the best place for honest journalism in the country. I worked hard and rose to reporter, then eventually returned to Boston before the Great War.

In case you hadn’t noticed, this manuscript is dated 1960 from San Francisco, a gap of forty years from 1920 and three thousand miles from Boston, and you deserve an explanation, or at least a partial one at this point. I left Boston after the Ponzi scheme imploded and settled here on the West Coast under a new name, Clarence Bloomfield, still practicing my trade. During those ensuing forty years, I wrote this manuscript to set the record straight, both for posterity and to ease my own nagging conscience. Its contents are based on my own investigation as the events unfolded and from dozens of interviews with the many of the actual participants, including Mr. Ponzi and his wife. To make it more readable, I have written conversations as if I were present, overhearing its’ contents. In fact, they are based on the recollection of the participants.

Since you are reading this and the lawyer I trusted, always a dicey decision from my experience, will be disbarred if he releases it early, I am assuming it is 2020.  I hope you enjoy this novel. No, that isn’t true. I haven’t written it to give simple enjoyment. I wrote it to give the truth, belatedly as it is, in hopes that you can benefit from it.

You can draw your own conclusion as to my veracity.                    

Eli Augustus “Gussy” Caldwell

PS. For those of you unfamiliar with the world MULCT, here is the Merriam-Webster explanation.


to deprive (someone) of something, as by fraud, extortion, etc.; swindle.

to obtain (money or the like) by fraud, extortion, etc.

These criminals are going to mulct every unsuspecting person they find.

Per Merriam-Webster dictionary.

CHAPTER 1 DREAM A LITTLE DREAM                                                  April 1918


She sat at the small wooden table, a scrap piece of wood wedged under the far-right leg to maintain its balance. Her mismatched wooden chair was hard despite the threadbare green cushion. She cupped her right hand under her chin and she investigated its landscape with her fingers. There were no signs of the dreaded chin hair her elderly Italian mother and aunts harvested in continual quantity despite their best efforts. Maybe she’d escape that particular curse when she got old, she thought.

Dinner had been over for an hour, and she’d cleaned the dishes and the pots and pans coated with tomato sauce. And yet there he sat, totally self-absorbed in his collection.

“Perhaps you should have married your stamps instead of me?” Rose asked. She’d spent the day, like all days since their recent marriage, cleaning the five-room apartment on the top floor of a Somerville, Massachusetts triple decker on Powder Hill Road, around the corner from Vine Street from where they’d been married a little over a year before. Then she’d talked on the front stoop with the other Italian women before heading to the market area for the evening’s dinner ingredients. Making the pasta and sauce from scratch required several hours work but it was always ready by the time he’d arrived from his job in Boston.

He looked up, holding a red and black stamp from Italy in one hand and a small magnifying glass in the other. He thought the woman sitting across from him was beautiful, the most beautiful thing he’d ever seen.  At 37 and a lowly clerk recording international transactions for his employer, he’d never imagined such a young woman, more than ten years his junior, would be his wife.

“I was thinking I want you to meet my mother and see my home town,” Charles said. “This stamp is from near there.”

“That would be wonderful” she said. “But do we have that much money?”

Charles shook his head, side to side.

“Then one of your ideas will have to work. Tell me about your meeting with that important banker fellow, Mr….”

“de Madellis, Roberto de Madellis of Fidelity Trust,” he said.

 “That’s him, Mr. de Madellis. He knew lots of ways to make money, didn’t he?” she asked.


Charles had met de Madellis during one of his routine stops at the bank for his employer J. R. Poole and Company, and they’d struck up a conversation about foreign exchange. He was the bank’s expert in foreign exchange transactions and investing in international currencies. When Charles had expressed an interest in de Madellis’s expertise, the banker expounded for so long that Charles was forced to skip his lunch.

“Mr. Ponzi, it’s really very simple,” he said. “Every country’s economy is like a patient- some are very healthy and will live forever, others are not so healthy and may contract a disease or disappear entirely. The healthy ones are very solid, like a healthy person going about his day. The sicker ones are riskier, like an elderly uncle who may not make it to Christmas. The difference between the two is quantified as a number, the exchange rate. But healthy countries can get sick, and sickly uncles can recover, and that changes the exchange rate every day, even sooner. If you’re smart and quick, you can make money betting on the changes. Do you understand?”

Charles didn’t get it at all; he’d never studied economics or finance during his Italian university days; his major was girls and wine. But he didn’t want to appear stupid to the banker, so he started to talk. Words flowed, descriptions of historical events and treaties and kings and wars and money and economic crashes and booms, and soon de Madellis was nodding his head, saying, “Yes, that’s about it, Mr. Ponzi, I think you’ve got it.”

There was only one problem, de Madellis said. Capital, lots and lots of capital, are required to make money from foreign exchange investing. After all, some days you bet the wrong way and have to cover your losses. The trick is to have less of those days than the good days.

“Then I think your bank should loan me the money, so I can invest,” Charles said.

De Madellis stifled a laugh with his big beefy hand with the diamond ring on its pinky. “I’m sorry, Mr. Ponzi, loans are a very serious thing here at Fidelity Trust.”

“I will give you a personal note to be repaid in ninety days from my winnings.”

“Mr. Ponzi, we require collateral, a house or a car or a business, to lend against. And we must be sure of your ability to repay the loan even if you lose money investing.”

“Well, if I had that much money, I wouldn’t need to borrow it, would I?”

“You might if you were sure of your plans, such as buying a new business that will be profitable. Do you have such collateral?”

“I have a solid job and my good name,” Charles said.

“That is most admirable, sir, but not sufficient for our loan committee. I’m sorry if I led you to believe otherwise,” de Madellis said.

“Oh, no bother. But one day, you’ll wish you’d invested in me. Thank you for the lessons,” Charles said. 

The banker didn’t notice that Charles had made “lesson” plural. de Madellis thought he’d only taught Charles one lesson- investing in foreign currency. But there was a second lesson, Charles thought as he left the bank’s Boston office at 709 Barrister’s Hall. These rich folks hold all the money and the power, and their main job is to keep it from the little people, like himself and his neighbors. The banker thought he was so smart; Charles would someday find a way to reduce that lofty self-image. A fellow banker sitting near de Madellis approached his desk after Ponzi’s departure.

“Who was that odd fellow?” he asked.

“A clerk from a customer,” de Madellis said.

“He had no idea what you were talking about, did he?”

“Not a word,” de Madellis said. “But if I didn’t know foreign currency like the back of my hand, he might’ve convinced me that he was the expert, and not me.”

“He certainly can talk,” the man said and returned to his desk.

Charles trudged through Scollay Square, then along Court Street back to Poole’s office at 24 South Market across from Faneuil Hall Market, his hands thrust in his pockets, deep in thought.


Charles put his stamps away and retrieved his mandolin from the closet. He played it for Rose for an hour or so, then he explained foreign currency trading to her with figures and calculations and how he would make them rich enough to buy their own boat for a cruise to Italy. They retired for the evening, their shared dream of wealth filling their last thoughts.       

CHAPTER 2 A PENNY FOR YOUR THOUGHTS                                              September 1918

The small, dirty hand trembled, holding the frayed newsboy hat out anxiously to receive the just reward for what its owner had divulged.  He wore a once-white shirt, its tail untucked from the brown, woolen knickers that was supposed to be its home. One or two trouser buttons needed replacing, but fortunately his pants were too large, and they protected his modesty. Knee high socks with random holes, an inadvertent relief against the summer heat, red suspenders and ankle high boots with flopping soles finished his probably only wardrobe.

 He’d approached Eli Augustus Caldwell on Tremont Street, a young member of Gussy’s Gang, his informal network of tipsters he relied on to do his job. Eli, Gussy to everyone who knew him and everyone knew Gussy, needed to know every piece of financial information in the city before anyone else. There were too many reporters from Boston’s other eight or so newspapers looking for scoops for him to be lazy and unemployed, and he liked his Boston Financial Times job.

The information from the boy, more of a tidbit really, was interesting. Turning that tidbit into a scoop was Gussy’s job. He weighed its current value and the longer-term value of getting more tidbits from young Angelo, a nice kid driven to the street by the Spanish Influenza that ravaged the Boston’s crowded North End in 1918, just last year. Gussy hoped he was one of the lucky ones to find a bed in the newly created Home for Italian Children, but he wasn’t sure.

But how much was it worth?

Coppers earned $.29 an hour before their recent strike, less than unskilled steelworkers, carpenters and even streetcar conductors.  Gussy held his Gang members in higher regard than coppers willing to do anything for a bribe, even after Governor Coolidge had fired most of them and hired replacements. At least his gang gave him information in return for their pay instead of a thwomp on the head with a nightstick.

A dime flipped and flipped and flipped and landed in the cap. It didn’t stay there for long before Angelo squirrelled it away in a secret pocket.

“They’ll be more, I promise Mr. Gussy,” he said and scampered away.

Gussy crossed Park Street at the Park Street Church, avoiding the horse turd piles. It won’t be a minute too soon for cars to take over the roads, he thought, just before a Ford Model T, driven by an idiot or a politician, two synonymous creatures in Gussy’s mind, almost flattened him. It was likely the latter, what with the State House up a block on Beacon Hill and City Hall around the corner.

His destination was a block down Temple Street, then a quick right onto Winter Street, more of an alley than a street. He entered 3-4 Winter Street, home to Lock-Ober Restaurant, the place to see and be seen for nearby state and city politicians and businessmen from the nearby financial district. Only the Parker House, famous for its rolls and Boston cream pie, on School Street attracted the same clientele. What better place to find out what was going on than the intersection of money and politics, he thought.  He could almost smell the corruption if it weren’t for the aroma of German sausage from the kitchen.

Lock-Ober was the epitome of fine dining, with vested waiters sailing across Turkish rugs in the softly candle lit room, pulling back red leather chairs with brass tacks for the patrons and offering white napkins for the well-dressed men. Large mirrors topped with stained glass reflected the light from the highly polished dark wood walls. Thank God the suffragette movement, their political victory securing the vote in sight, hadn’t yet focused their blistering attacks on places like this, Gussy thought. It was bad enough his publication had hired its first woman, even if only as a clerk typist to help Gussy meet his deadlines. Next thing she’d be after his job!

The restaurant was crammed with men dressed in expensive suits; it was, after all, situated at the epicenter of a dozen banks, eight newspapers, innumerable investment companies big and small, the State House, City Hall, and the Financial District. And times were good.

The last financial Panic of 1907, caused by a con man buying banks and trying to corner the copper market, was a distant memory. The Great War was over, and we’d won. The Flu Epidemic had not resurfaced, the streets had been cleaned of the thousands of gallons of spilled molasses (although on a hot summer day the sickly-sweet smell was still grotesquely palpable), and the Income Tax had not killed the US economy as predicted. Cars were everywhere, the radio was beginning to be a profitable business, and telephones were being installed at a rapid pace. Hell, Alexander Graham Bell had invented the contraption on Court Street, a few blocks from where Gussy sat. The paper’s headlines screamed with get rich quick schemes, the poor’s only hope of shrinking the enormous wealth gap with the hugely rich. Now if only Prohibition would end, things would be perfect. Although, truth be told, Gussy preferred the Scollay Square speakeasies to this snooty place.

He took up his usual post at the left end of the bar, providing a perfect view of all the comings and goings. Who ate with who was always interesting, if not for today’s story than for tomorrows. In the past he’d attempted to gain access to the second floor, the one with private, curtained-off dining areas, but his offer of next year Red Sox tickets hadn’t been enough. Maybe the matire’d had heard the same rumor as Gussy that Harry Frazee, the Red Sox owner, was losing his shirt producing a Broadway play, My Lady Friends, and that he might be forced to sell the Babe to pay off his debts.

In any case, he could still see who took the stairs to the second floor and that was half the story. Today, he’d remember later, was a banner day.

At 11:30, he saw a plain looking man, late forties with thin hair and a large forehead that was helped attain its size by a receding hairline, walk in. He didn’t smile but he didn’t frown either; his slightly doughy face just sat there, placid and calm. His plain brown, double-breasted suit and white shirt accentuated his red tie. Governor Calvin Coolidge shook a few hands as he crossed the forty- foot dining room before disappearing up the stairs. Gussy never saw him leave, but one of his Gang watched the private back entrance from an adjoining building and hopefully he’d find out Coolidge’s departure time later.

About an hour later, a second recognizable figure graced Lock-Ober. He didn’t enter so much as he exploded through the front door, almost like a tornado whipping across the Kansas prairie.  And in a sense, he was a tornado in human form, dressed in a derby hat and giant raccoon coat. His big, Irish face was topped with wavy hair and underlined by a round-tipped white collared shirt. He stopped to say hello to everyone, knowing every man’s name and his wife’s name and his children’s names and his mistress’s name. But most importantly, he knew what they needed and how he could help. James Michael Curley’s trip took considerably longer than Coolidge’s, but that was understandable. He was out of office and wanted back in; Coolidge simply wanted a Washington DC address. Gussy never saw Hizzoner leave either.

After lunch, another street urchin tugged on Gussy’s coat sleeve as he approached the 350 Washington Street address of the Boston Financial Times. Gussy bent down as instructed, listened, then flipped a nickel in the air. It was grabbed so quickly that it would’ve stayed dry during a hurricane.

The Times only produced one version per day, not like some of the other rags around town, and Gussy had already filed his story for the day about a stock tip that was sure to go sky high. Twenty reporters crammed the second story office, their desks practically touching, leaving a narrow aisle. Cigar and cigarette haze hung two feet from the yellowed ceiling. Once, not too long ago, only the clickity clack staccato of typewriters and the high-speed of the telegraph machine made everyone yell across the newsroom.  Now the newly installed telephones and their shrill ring added to the mix, making Gussy crazy, and he’d install earplugs to let him concentrate.

He threw his jacket over the back of his wooden chair, and Viola Bartlett snapped to attention, her fingers poised for action over her keys. Gussy barked out the lunchtime items and she filed the separate reports in their respective file folders. Gussy liked being 100% accurate; no half-baked memory recall for his stories.

“There’s one more,” he said. “A fruit company has a new owner. Remind me to check it out tomorrow.” The information was filed in the “New Items” folder and a separate reminder notice was placed in the “TO DO” folder on Viola’s desk. 

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