Thursday, July 24, 2014

California gold rush........

"Obviously, he will return," stated attorney Avonte Campinha-Bacote.

She began life as the SS George Law in 1852 but was renamed the SS Central America.  The 280 foot long, wooden hulled, copper sheathed side-wheel steamer regularly ran a route between Central America and the east coast of the US.  In less than 5 years, she was sitting at the bottom of the ocean.

On Sept 3 1857, she set sail from Colon, Panama with 477 passengers and 101 crew members.  She was carrying approximately 10 tons of gold in various forms that had been mined in California and brought east through the Panama Canal.  Her passengers were mostly wealthy businessmen and miners who were returning east with their possessions and wealth from years of mining.  The ship made a quick stop in Havana Cuba and then headed north towards her final destination of New York.

The ship was caught up in a category 2 hurricane off the coast of the Carolinas on Sept 9 and by Sept 11, she was taking on water and sunk by 8 pm that evening.  She took 425 passengers with her as well as gold ingots and $20 gold double eagles worth $2 million dollars.  The loss of that much gold has been cited as a factor in the Panic of 1857 and the ship became known as "The Ship of Gold."

In 1985, the Columbus-America Discovery Group was formed by Thomas G Thompson to find the wreck and salvage the gold.  Thompson had a background in ocean engineering and understood the uses of the new technologies in deep water exploration that were being developed.  The ship had gone down on the Blake Plateau about 200 miles east of Charleston SC and it was about 1 1/2 deep.  It was felt that the wreck site had probably not been buried in sediment or torn apart by strong currents.  Thompson knew that the chance to bring back the gold that had been aboard would attract investors for the search and recovery.

Thompson began assembling a limited partnership of investors to fund the search as well as finding a team of scientists and technicians.  He managed to get a group of 161 investors to pay $12.7 million dollars to find the wreck and recover the gold.  The wreck was found in 1988 and Thompson began to bring up the gold.  The investors were even more excited until they ran into the roadblocks they never expected.

No one really knows how much of the gold Thompson brought up after he found the wreck.  The investors know that he did sell ingots and gold coins to a California mint for $52 million dollars but the did not receive any of the proceeds.  The team of nine technicians who helped find and recover the gold are owed $2 million dollars for their work and they have sued Thompson as well.  Thompson recovered gold from the wreck until 1991, when the recovery effort was hit with legal issues that included 39 insurance companies filing claims for the recovered gold.

US Circuit Judge Edmund Sargus issued a warrant for Thompson's arrest in August 2012 and issued a temporary block on the sale or transfer of 500 restrike gold coins that were made from some of the recovered gold.  The coins were part of a deal made in 2000 with the California Gold Marketing Group for the rights to the remaining treasure.  They paid Thompson $52 million, of which, $30 million remained after the costs of the recovery were deducted.  Sargus ordered Thompson to reveal the location of the coins as well as turn over the money which was held in trust.

Thompson never showed for his court date and has not been found yet.  His attorney stated that Thompson is out to sea and is not even aware that there had been a warrant issued for his arrest.  He is now in his early 60's and no recent pictures of him exist.  His last known address was in Vero Beach FL and he has not been seen there either.

Tampa based Odyssey Marine Exploration Inc has been selected to recover any remaining cargo and conduct an archaeological excavation of the wreck by Ira Owen Kane.  He was appointed as the receiver for interests in the ship and it's gold.  The Odyssey was granted exclusive rights to salvage what is left of the cargo and items and they will receive 80% of recovery proceeds until a fixed mobilization fee are paid and negotiated day rates are paid.  After that point, they will receive 45% of the recovery proceeds.  Experts that were hired by Kane estimate that the ship may hols from $343,000 to $1.4 million dollars of gold from the 1857 values which translates to approximately $97 million dollars at today,s rate.

The Eureka Bar was sold in 2001 for $8 million dollars to a Forbes 400 business executive for their personal collection.  The bar that was brought up by Thompson weighs about 80 and is said to be the largest and heaviest numismatic item to exist.  It was fabricated by the assayers Kellogg & Humbert during the San Francisco gold rush and was worth $17,433.57 in 1857.  An 1852 $10 gold coin from the wreck sold last year for $11,750.

The wreck has not been disturbed in 20 years and the new recovery team is excited to be a part of history.  They expect to find more than just gold while working the wreck, since technology has made even more advances in the past two decades.


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