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X Still Marks Sunken Spot, and Gold Awaits

The discovery of sunken gold conjures up visions of instant riches: Swiss bank accounts and lazy afternoons on faraway beaches, daiquiris in hand.

But the quest to salvage the S.S. Central America — which went down in 1857 in a hurricane off South Carolina carrying 425 souls, as well as thousands of coins, bars and nuggets of California gold — has produced a quarter-century of broken dreams and legal nightmares.

The bones of the side-wheeler were discovered in 1988, nearly a mile and a half down. The finder hauled up glittering coins and boasted of treasure worth $1 billion.

Gold bars taken from the S.S. Central America ship which sank in 1857 are displayed at the Museum of American Financial History January 8, 2003 in New York City.
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Gold bars taken from the S.S. Central America ship which sank in 1857 are displayed at the Museum of American Financial History January 8, 2003 in New York City.

But paralysis ensued as waves of insurers and angry investors filed rival claims. Recovery of the shipwreck languished as courtrooms echoed with charges of fraud. In 2012, the finder became a fugitive.

Now, with the legal obstacles cleared, a private company working with a court-appointed receiver has become the first to revisit the shipwreck in two decades. It is, the team was delighted to find, still heavy with treasure.

On April 15, the company, Odyssey Marine Exploration, lowered a robot into the depths of the Atlantic Ocean and hauled up five gold bars weighing 66 pounds — worth about $1.2 million as metal and more as artifacts. That step, the company says, opened a new chapter in the saga of the Central America that will include raising the rest of the gold and exploring the deteriorating shipwreck. "We want to show that it can be done right," Gregory P. Stemm, Odyssey's chief executive, said in an interview. "It's a great opportunity."

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When it sank, the Central America was steaming toward New York with a cargo meant to strengthen the city's banks. The 280-foot vessel was carrying so much gold — commercial and personal riches from the California fields estimated at three tons, as well as a rumored secret federal shipment of 15 tons — that its loss contributed to the Panic of 1857, considered the first global financial crisis.

From the start, the locus of the recovery drama has been Columbus, Ohio — a landlocked city not known for treasure hunters. It is, however, home to the Battelle Memorial Institute, a private contractor specializing in science and technology.

Thirty years ago, Thomas G. Thompson, a plucky Ohio native who was a young engineer at Battelle, began wooing investors with dreams of finding the Central America. Soon, the Columbus America Discovery Group was formed to finance the hunt, including a robot with lights, cameras, arms and claws.

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The team hit pay dirt in September 1988: Piles of gold coins and ingots lay scattered across the ship's rotting timbers, and overnight, the investors became millionaires — in theory, at least.

In all, the team lifted up about two tons of gold. If sold today as pure metal, it would fetch $76 million.

But as news of the sensational find went public, the group's investors were not the only ones paying attention. Claims to the fortune came from an order of Catholic monks, a Texas oil millionaire, and Columbia University, where an oceanographer had provided Mr. Thompson with sonar imagery of what turned out to be the shipwreck. And scores of insurance companies insisted that the treasure was rightfully theirs because of claims paid more than a century earlier.

Thus began a legal battle that kept the gold locked away. The disputes crippled Mr. Thompson's ability to raise new funds, and treasure. It was not until about 2000, when insurers were awarded $5 million in gold, that his hands were untied. He sold much of the remaining treasure that his team had recovered, making a reported $52 million.

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But his 251 investors got nothing. In 2005, some of them sued. John G. McCoy, a Columbus mogul who had invested $219,000, told Forbes in 2006, "I think he was dishonest from the word go." Mr. Thompson avoided courtrooms, always speaking through intermediaries.

One dispute centered on 500 coins that had seemingly vanished. In a 2012 filing, Mr. Thompson said they had gone into a trust in Belize, and in August of that year — when he failed to show up for a hearing — a federal judge ordered his arrest.

It turned out that Mr. Thompson and his assistant, Alison Antekeier, for years had lived in Vero Beach, Fla., in a mansion set on four acres. By the time federal marshals went there to arrest Mr. Thompson, they had fled.

The Columbus Dispatch, whose parent company had invested $1 million in the gold hunt, reported that the couple had left behind empty coin boxes, currency wrappers marked $10,000 (used to band $100 bills in stacks of 100), a bank statement listing a balance of more than $1 million, and a book on assuming a new identity.

Federal marshals had billboards put up in Ohio and Florida seeking information about Mr. Thompson and Ms. Antekeier.

Mr. Thompson's last known lawyer, Shawn J. Organ, in Columbus, no longer represents the gold hunter. "He's incommunicado," said Liberty P. Casey, Mr. Organ's office manager. "We haven't seen him or been able to track him down."

Last May, the marshals auctioned off Mr. Thompson's 180-foot ship, the Arctic Discoverer. Its safe was empty.

An important part of the legal drama was resolved that month, when Judge Patrick E. Sheeran of the Court of Common Pleas in Franklin County, Ohio, named as receiver Ira O. Kane, a Columbus lawyer and businessman whose task was to recover as much gold as possible for the benefit of creditors and duped investors.

This March, Mr. Kane picked Odyssey — based in Tampa, Fla., and publicly traded — to resume the hunt.

The stakes? Mr. Thompson recovered 532 gold bars and some 7,500 gold coins whose total face value, in 1857 dollars, was $1,126,000. Experts hired by Mr. Kane estimated the likely face value of the remaining gold at $760,000, but put the range at $343,000 to $1,373,000. In other words, more than half the treasure could still be sitting at the bottom of the sea, at least in theory.

Mark D. Gordon, Odyssey's president, told investors in March that the remaining treasure, thought to be mostly gold coins, would fetch at least $85 million if sold for its value to collectors. On eBay, $20 coins from the original haul sell for up to $26,500.

Not included in the receiver's estimate was a cargo long rumored to be aboard the wreck: 15 tons of Army bullion. A best-selling book about the discovery, "Ship of Gold in the Deep Blue Sea" by Gary Kinder, published in 1998, called it a secret shipment meant to shore up the faltering Northern industrial economy, and said the Army had recently declassified its existence.

In an interview, Mr. Stemm of Odyssey said the reconnaissance dive and retrieval of the five gold bars on April 15, as well as two gold coins, was important for demonstrating that, contrary to rumors that the site had been looted, the deteriorating shipwreck was still tantalizingly rich with treasures.

"It's clear they didn't do a complete recovery," Mr. Stemm said of the original team. He added that the dive "confirms that the site has remained untouched" since the last retrievals more than two decades ago.

Helping direct the April 15 operation was Bob Evans, the chief scientist and historian of the Recovery Limited Partnership, one of Mr. Thompson's insolvent companies and the legal owner of the shipwreck. "I'm elated," Mr. Evans said in an interview. "I'm fulfilling my dream."

On April 23, the new recovery ship, Odyssey Explorer, sailed from Charleston to renew the hunt. As a prelude to recovering the remaining gold, Odyssey is surveying the wreckage and will perform an archaeological excavation of the remaining artifacts. The company also plans to collaborate with a scientist from the Woods Hole Oceanographic Institution to study deep-sea life colonizing the site, and to continue science experiments initiated by Mr. Thompson's team.

Odyssey will absorb the expedition costs if little treasure is recovered. If the take is substantial, the company will get 80 percent until it recoups its costs. After that, Odyssey's share will drop to 45 percent.

Judge Sheeran, like the surviving investors, is eager to see what develops.

The new plan, he wrote last year, bodes well for "the rebirth" of the enterprise and a renewed sense of awe as "more treasure, both historical and monetary, makes its way from the depths of the seas."

As for Mr. Thompson, it seems likely that he, too — wherever he is — is giving serious attention to what emerges next from his ship of gold.

—By NYT's William J. Broad

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