Trader post scandal
The trader post scandal, or Indian Ring, took place during Reconstruction and involved Secretary of War William W. Belknap and his wives receiving kickback payments from a Fort Sill tradership contract.
In 1870, Belknap was granted the sole power to appoint and license sutlers with ownership rights to highly lucrative "traderships" at U.S. military forts on the Western frontier.
[1][2] Belknap appointed a New York contractor (Caleb P. Marsh) to the trader post at Fort Sill which was already held by John S.
During the investigation, Custer testified on hearsay evidence that President Grant's brother, Orvil, was involved in the trader post rings.
A native of New York, and Iowa attorney, William W. Belknap entered the American Civil War in 1861 fighting for the Union.
[1] These sutlers set up trading posts inside U.S. Army forts and were chosen by the regimental officers to do business.
[5] To increase profits, Belknap forced soldiers to only buy supplies from tradership monopolies at exorbitant prices, leaving them destitute.
[7] This policy caught the ire of Col. George Custer, stationed at Fort Lincoln, who discovered most of the actual profits from the traderships were going to investors rather than the licensed sutlers.
[5][9] John S. Evans, the experienced sutler already at Fort Sill, appointed on October 10, 1870, did not want to give up his lucrative trader post to Marsh.
[9][10][11] An illicit financial arrangement, approved by Belknap, was made where Evans would keep the tradership and give Marsh quarterly payments amounting to $12,000 per year.
[5] Amanda had, just as her sister Carita, enjoyed an opulent lifestyle that cost a considerable amount of money during the Gilded Age.
[5] National attention was drawn to the plight of American Indians in 1874 when paleontologist Othniel Marsh revealed that the Lakota Sioux had "frayed blankets, rotten beef and concrete-hard flour.
[12] The New York Herald, a Democratic newspaper, reported rumors that Belknap was receiving kickback money from tradership posts.
[12] The Democratic Party had recently obtained a majority in the House of Representatives and immediately had begun a series of vigorous investigations into corruption charges of the Grant Administration.
[13] Clymer's committee did not have far to look for corruption, and information was soon gathered from witness testimony that Belknap and his wives had received illicit payments from the Fort Sill tradership contract.
[12] Belknap defended himself by acknowledging that the payments took place, however, he stated that the financial arrangements were instigated by his two wives, unknown to himself.
[14] When Bristow reached the White House, Grant was eating breakfast and getting ready for a studio portrait session with Henry Ulke.
[14] He then began to leave for Ulke's studio when he was interrupted by Belknap and Interior Secretary Zachariah Chandler in the White House's Red Room.
[16] Clymer continued his investigation into Belkamp's War Department, having called upon Col. George A. Custer, stationed at Fort Lincoln, who testified in Washington, D.C., on March 29 and April 4.
[17] Custer testified to Clymer's committee that sutlers (military post traders) gave a percentage of their profits to Belknap.
[18] Custer said he had heard that Grant's brother, Orvil, was involved in the tradership rings, having invested in three posts with the President's authorization.
[21] This angered Philip Sheridan, who wrote to the War Department and contradicted Custer's claims, including concerning Hazen's reputed banishment.
[21] Although Custer's lengthy testimony was mostly hearsay, his reputation as military commander impressed the Clymer committee, Secretary of State Hamilton Fish, William T. Sherman, and the American press, and added significant weight to the hearings.
[24] Protective of his family, Grant was furious that Custer testified against the President's brother Orvil at the Clymer committee hearings.
[30] On March 3, 1876, a committee of five from the House of Representatives, headed by Clymer, presented Belknap's articles of impeachment to the Senate.
