Cooking the books

Frederick Albert Cook was a doctor, explorer and Texas oil promoter who probably should have stuck with doctoring. He was a surgeon with Robert Peary’s Antarctic Expedition from 1897-99 and led expeditions to Mt. Everest in 1903 and 1906. 

Today, he’s still best known for claiming to have been the first human being to reach the North Pole, a claim later disputed by Peary and other human beings. Cook was no stranger to controversy then, and he never would be. He also claimed he was the first person to climb Alaska’s Mount McKinley in 1906 but photographs he took to support his claim didn’t. His companion, Ed Barrill, later recanted his corroboration of the feat. 

In September of 1909, Peary and Cook returned from the Arctic within five days of each other and announced to their backers and the wider world that they had reached the pole. Peary said he got there on April 6, 1909. Pretty good, but not good enough, claimed Cook— he said he reached there a year earlier, on April 21, 1908. Peary commenced a campaign to discredit Cook, igniting a debate that has never been fully resolved. 

The New York Oil Company named Cook its president in 1917 but he resigned a year later and headed west to work as a geologist. He formed the Texas Eagle Oil Company in hopes of exploiting Salt Creek’s “Big Dutch” gusher in Wyoming but the price of Wyoming oil cratered, forcing the Texas Eagle into bankruptcy. 

Three years later, Cook convinced a group of Fort Worth investors to finance a new multi-million-dollar enterprise, the Revere Oil Company, but the company earned only a fraction of its costs. Investors wanted their money back, creditors wanted the money Revere owed them and the company slipped into receivership. 

Undeterred, Cook launched another company, the Petroleum Producers Association (PPA). PPA took several struggling companies, consolidated them into one and sold stock to unwitting dupes gleaned from a “sucker list” of investors that Cook purchased from other oil companies for a couple hundred dollars apiece. He offered the designated suckers a chance to trade their failed stock for PPA stock if they agreed to pay a modest 25 percent conversion fee.

 Cook’s profits didn’t come from the non-existent oil fields but from the fees and from shady marketing tactics. For that, Cook turned to mad adman Seymour “Alphabet” Cox, who was already under investigation by the Federal Trade Commission and Post Office Department. 

PPA set itself up as a petroleum company, but it operated without the expenses of actual oil fields or oil field workers. Instead, the company employed 53 full-time stenographers, two addressograph operators, two printers and someone to mail the 24,000 to 32,000 pieces of mail they produced every day. Every day. 

In the mailings, Cox described “a vast secret oil field, a place where many of the big oil sands converge, forming a basin of oil so much larger than anything yet discovered that bringing in the first well will startle the oil men of the world and start a stampede for the district such as had never been heard of.”

Cox’s hype and hyperbole caught the attention of frontier journalist Don Hampton Biggers, who had been reporting and writing about Texas since the 1870s. After hearing what Cook and Cox were selling and how they were selling it, he wrote a story for the Ranger Record under the headline: “Something is Wrong. Who is to Blame? What are YOU going to Do About It?” even after someone stole his notes and records for the story. 

Biggers went on to co-found the Independent Oil News and Financial Reporter, which specialized in exposing fraudulent promotion schemes. When threatening Biggers with violence didn’t work, a group of promoters got together and bought the paper, through an agent, for $23,000. The paper’s focus soon switched to promoting the schemes of the new owners. 

Biggers turned his evidence of skullduggery over to the federal district attorney in Fort Worth, who had no trouble exposing, charging and convicting Cook and his band of scammers. Prosecutors produced 283 witnesses and gathered voluminous stacks of evidence to support charges that Cook and the others had “cooked the books” and claimed income from wells that never produced a drop of oil. The defense offered alcohol—several defense attorneys were said to be drunk during the trial—and slurred insults. 

The court fined Cook $12,000 and sentenced him to fourteen years in the federal penitentiary in Leavenworth. “You have at last got to the point where you can’t bunko anybody,” District Court Judge John Killits told him. Cook was paroled in 1930 and pardoned in 1940 by President Franklin Roosevelt as an act of mercy for a man who would die shortly afterwards at age 75.