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GOLD TREASURES FROM 1857 SHIPWRECK FINALLY DISPLAYED, TO BE SOLD BY SOTHEBY'S DECEMBER 1999.
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(August 10,1999) Gold coins, bars, and nuggets from the S S Central America make their first public appearance this week, and will be auctioned Dec. 8-9th. Could this be the end of the most controversial treasure story ever? No, and not by a long shot.
(August 10,1999) Finally, after all the contention and bickering, the waiting and uncertainty, the lawsuits and personality clashes, the years of effort in the recovery of the treasure, the years of effort in the courts and investor meetings, the whole fascinating story which we began telling here first on April 10th ("The Baffling Story of 21 Tons of Treasure", now available in our archives), at long last, some 400 pounds of the gold treasure from the 1857 wreck of the S. S. Central America will be displayed to the public for the first time and sold at public auction this year.

The entire treasure recovered so far from 8,000 feet down in the Atlantic Ocean off the coast of the Carolinas amounts to some three tons of gold - a fantastic array of mint-fresh coinage from the fledgling San Francisco Mint, rare privately issued Territorial California gold coins and ingots, and hundreds of pounds in nuggets of native gold just as it came from the ground during the days of the California gold rush. This time capsule of riches is a snapshot of wealth as it existed in 1857, an enormous holding from the days when money and gold were one and the same.

The part being exhibited and sold this year is the roughly 8% share of the gold recovered which was awarded to a consortium of insurance companies who claimed to have paid on losses suffered in the maritime accident of 1857. The remaining 92% which belongs to the salvage group Columbus-America Discovery Group (CADG, founded and led by Tommy Thompson) is still tied up in litigation involving disgruntled investors, a $3 million judgment against CADG involving a loan default, and a $35 Million suit by Christies' auction house against CADG for funds loaned to CADG and never repaid.

On June 17, 1998, the three tons of gold recovered so far were physically divided between the insurors and Thompson's CADG after the insurors were awarded 8% of the recovered treasure. The treasure was split into 90 lots of coins, ingots, and nuggets, and attorneys for the two sides took turns selecting lots to accomplish the split.

Thus we have the result that we reported last April - the insurance companies will have the first shot at marketing gold from the S. S. Central America. And Sotheby's is mounting a traveling exhibit this fall which should stir up quite a bit of interest in the event.

"The California Gold Rush is not only one of the defining moments of American history, but one of its most exciting and evocative," David Tripp, special consultant to Sotheby's is quoted in the 8/16/99 edition of "Coin World" magazine. "As public awareness of the discovery has been growing, the sale of Gold Rush treasures from the S.S. Central America, will without doubt be one of the most exciting of the auction season."

Paul Gilkes of "Coin World" reports in his article that Sotheby's estimates the value of the material to be sold this December as between $7 and $10 million. This 8% share of the total recovered treasure includes over 30 pounds of native, or natural, gold ranging from dust to one large nugget inlaid with quartz and weighing 20 ounces. Also included are some 47 gold ingots, weighing from a few ounces, up to one from Kellogg & Humbert, assayers, weighing 662 ounces (about 41 pounds) and containing over $150,000 in gold value alone.

Federal coinage to be sold include 150 coins, including some 70 - 90 examples of 1857 dated San Francisco mint double eagles in such superb states of preservation that their quality will easily exceed any formerly known gold coins from that era.

A fabulous sale, indeed, all the more incredible for the fact that it represents such a small part of the recovered treasure. But Tommy Thompson has always asserted that there were 21 tons of gold aboard the Central American. Only three tons have been recovered so far, and salvage operations have come to a halt. What gives?

Well, in short, there's some controversy as to what's still down on the ocean floor amidst the debris of the "Central America." Tommy Thompson says that there was an army shipment of some 15 tons of gold in the form of large gold bars aboard the ship, and they have yet to be recovered. However, documentation of this gold shipment is sketchy at best, and some say nonexistent. Barry Schatz, one-time partner in the salvage and Thompson's boyhood friend, says flatly "There never was an Army shipment."

Although the salvage ship used by CADG (the "Arctic Explorer") has been docked in Florida for months, and the salvage operation seems to have come to a complete halt, Thompson has been trying to raise an additional $40 million to continue the hunt for the 'Army gold' and further exploration of other undersea wrecks unknown. His relations with his original investors is strained, to say the least, as not one dime has been returned to them for the millions of dollars invested with Thompson over the years.

So, Thompson's story is one of unqualified success in pinpointing the gold-laden wreck of the "Central America" and the unprecedented recovery of most of its gold at almost 8,000 feet below sea level. Again, we refer our readers to Gary Kinder's book "Ship of Gold in the Deep Blue Sea," which is now out in paperback. Though Kinder had to rely on Thompson's filtered version of the story in writing his book, he tells a fascinating tale of the location and recovery of the gold.

But everything that has transpired since the actual salvage operation has been a virtual disaster for Thompson and his investors with CADG. Although they are sitting on 92% of one of the most astounding historic gold treasures in U.S. history (which cost millions to recover), a tangled web of secrecy, litigation, and bad-faith dealings have so far prevented any sales, or even exhibition, of their share of the gold.

And now, ironically, the insurance companies are beating CADG to market with their share of the treasure. And the insurors won their share of the treasure not through foresight, determination, grit, risk and expense, but simply by filing suit in court.

Sotheby's will conduct a two-day auction sale of this material at their New York gallery December 9-10th, 1999. More information should soon be available at their website, www.sotheby's.com.


 

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