Saturday Rabbit Hole: The $100,000 Bill

The $100,000 gold certificate, printed for only three weeks in 1934-35.
Reverse of U.S. $100,000 note.

The question came up a few mornings ago: What’s the largest denomination currency the U.S. Treasury has ever released? I had vague recall of a $100,000 bill with Woodrow Wilson’s picture on it. Or was it Salmon P. Chase? It was easy to find out.

Per the U.S. Treasure’s Bureau of Engraving and Printing:

“The largest note ever printed by the Bureau of Engraving and Printing was the $100,000 Gold Certificate, Series 1934. These notes were printed from December 18, 1934 through January 9, 1935 and were issued by the Treasurer of the United States to Federal Reserve Banks (FRB) only against an equal amount of gold bullion held by the Treasury. These notes were used for transactions between FRBs and were not circulated among the general public.”

And Salmon P. Chase is on the no-longer-circulated $10,000 bill, if you were wondering.

In any case, I liked the images of the 100-grand note and thought: That’s a quick, easy post I can put up without spending most of an afternoon on it.

Or maybe not.

A second page on the engraving bureau’s site advises that the $100,000 note “cannot be legally held by currency note collectors.”

Is there a rabbit hole I can go down here?

There is. So let’s get to it.

A Smithsonian Institution page on the $100,000 bill also mentions the prohibition on private individuals owning these notes. The page allows public comments, and a few have been left there over the years. The most recent comment is signed by a Richard M. Sales, who said this:

I possess several of these 1934 Gold Certificate Banknotes presented to me personally by former Heads of State and Sultanates. I would like to know the specific legal statute that states I cannot own or sell them. It is my understanding that the 1974 Executive Order issued by President Gerald Ford released the restriction of owning, trading or selling of all gold certificate banknotes issued by the US Bureau of Engraving. Can I sell these publicly or must I redeem the face value from the US Treasury?

Richard M. Sales

Thu, 2021-12-09 10:05

What an intriguing possibility — someone out there in the world who actually has gotten their hands on not just one, but several of these notes.

Following standard rabbit-hole protocol, I pondered that possibility for a few seconds, then googled “Richard M. Sales.” If you do the same — use the quotation marks — you’ll find United States v. Sales, a federal criminal prosecution, near the top of the results.

The case involves a December 2017 wire fraud indictment issued by a federal grand jury in Eugene, Oregon. The indictment alleges Richard M. Sales scammed would-be investors out of $900,000 as part of a scheme that promised as much as 100 percent return on investment within as little as 60 days.

From what source was this incredible river of returns supposed to flow?

“Although Sales’ description of the details of the investment varied,” the indictment says, “generally, the investors were led to believe that Sales possessed the ability to recover hundreds of millions of dollars worth of U.S. Treasury Notes that were located in East Asia and the Pacific.”

And according to the grand jury, Sales assured investors he was well connected:

“Sales represented that he was the ‘Commissaris’ of a secret group comprised of heads of state, world-renowned economists, the Vatican, and others. He claimed the ‘doctrine of our syndicate’ carried the signatures of John F. Kennedy, Pope John Paul VI [sic], Golda Meir, Chang Kai Shek [sic}, Lee Kuan Yew, Queen Victoria and many others.”

Queen Victoria!

Federal agents arrested Sales in Indonesia and brought him back to the United States to answer the charges in early 2018. As the case proceeded, his fanciful claims about his access to heads of state and immeasurable riches raised questions about whether he could assist in his own defense. U.S. District Judge Ann Aiken ordered a competency evaluation, and two M.D.s and a licensed counselor met with the defendant. Aiken’s later opinion summarized their findings:

Both Dr. Truhn and Dr. Guyton diagnosed defendant with delusional disorder, grandiose type. Defendant’s alleged delusions involve his self-reported previous work and life history. In short, defendant told his examiners that over later portion of his life he was involved in high level international diplomacy and humanitarian efforts. He represents that he has met, interacted with, and advised world leaders such as Margaret Thatcher, Mikhail Gorbachev, and Boris Yeltsin among others. According to the reports, defendant maintained that he has access to large sums of money and assets related to the Bank of China which he used for his humanitarian efforts. At oral argument, defendant explained the history of some of these beliefs which involve thousands of years in history and assets worth trillions of dollars.

But Judge Aiken noted “the diagnosis of a mental disorder alone does not mean defendant is incompetent to proceed to trial.” She found that other evidence — Sales’ clear understanding of the proceedings and the charges against him and his ongoing consultations with his defense counsel — showed he was competent.

In the end, no jury heard the case. Sales pleaded guilty to one count of wire fraud and in October 2021 was sentenced to time served in jail and three years of supervised release and ordered to pay $1,028,010 in restitution to his victims.

Sales’ attorney noted in his sentencing memorandum that his 72-year-old client was recently divorced, that he was suffering from heart trouble, and that his sole source of income was a $924 monthly check from Social Security. I’ll add that the terms of his restitution agreement require him to pay at least $25 a month to help liquidate his $1 million restitution debt.

And that’s that, except to note that Judge Aiken passed final judgment on Sales on December 13, 2021. That was four days after Sales, or someone using his name, was inquiring about the legality of the “several” $100,000 notes he claimed to have in his possession.

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