In April 1862, an elaborate scheme was uncovered in Victoria. A man named Aimé Marchand had set up an assay office where he would test the gold dust for purity, weight, composition and value. Then he would melt it into bars. But, instead of returning gold bars to their rightful owner, Marchand would sell the gold to someone else.
Yesterday morning, at 11 1/2 o’clock, the Police Court room was again densely crowded with citizens who had gathered to hear the preliminary examination into the charges of fraud and embezzlement preferred against Aime Marchand. The prisoner, looking pale and careworn, took his stand outside the prisoner’s dock, with his back to the spectators, and his side to the bench, and with his face concealed in a white pocket handkerchief, seemed to pay little or no attention to what was going on around him.
Samuel Goldstone testified: I took three different lots of gold dust to accused for assay, and received a receipt for the dust from him; the gold was to be assayed and melted into gold bars and the bars were to be returned on the same day before the close of the banks… I was to receive the bars on Friday, and asked for them on Friday afternoon. Mr. Marchand said they were done, but that in melting they had got dirty and required cleaning…I saw the bars on the shelf behind the counter and he gave me the certificates. I did not take the bars as he said he would clean them and bring them in a few moments. I asked for the bars on Saturday; he promised to bring them in the morning. I asked again on Saturday afternoon…
It was revealed that Marchand sold the gold bars to Wells, Fargo & Company for the sum of $1,326. The employee for Wells, Fargo & Company didn’t ask Marchand for a certificate. He testified that most of the gold bars passed through without certificates. It was his habit to purchase gold bars and pay out cash based on the amount stamped on the bar. “Even the Auditor of the Colony has sold me gold bars without certificates,” he told the court.
The clerk’s testimony showed there were procedures that weren’t being followed. The assay officer was supposed to mark the gold bars with the same stamp as appeared on the certificate. It was required by law that both the certifcates (signed by the owner) and the gold bars were needed to bring to a bank to exchange for cash.
Due to the high cost of converting gold to currency in Victoria, many miners sent their gold to the United States for a better conversion rate. The court also heard how Mr. Marchand offered to bring back $12,000 of coin for the up-front payment of $500. The money never arrived and Marchand “absconded through the back door and was not seen again…until brought in by the police from Cowichan.”
Needless to say, the jury found Mr. Marchand guilty of obtaining money under false pretences.