Panama scandals: Difference between revisions

The '''Panama scandals''' (also known as the '''Panama Canal Scandal''' or '''Panama Affair''') was a corruption affair that broke out in the [[French Third Republic]] in 1892, linked to the building of the [[Panama Canal]]. Close to half a billion [[franc]]s were lost when the French government took bribes to keep quiet about the [[History_of_the_Panama_Canal#The French project|Panama Canal Company's financial troubles]] in what is regarded as the largest monetary corruption scandal of the 19th century.<ref name="panama">[http://www.ak190x.de/Bauwerke/panamaen.htm Why de Lesseps failed to build the Panama Canal], THE PANAMA CANAL 1880-1914</ref>

 

 

On 4 February 1889, the ''Tribunal Civil de la Seine'' ordered the winding up of the Panama Canal Company in [[Paris]]. Work on the [[isthmus of Panama|isthmus]] was stopped in the meantime, while the court-appointed liquidator arranged to maintain the existing buildings, tools and machinery. Within a few years, however, high losses were incurred due to the damp, warm climate. The French government delayed the [[liquidation]] further and further, because the take-over offers by various [[United States|American]] companies seemed insufficient. An intermediate company could not be started for lack of capital. The liquidator appointed a commission of inquiry, whose 1890 report recommended continuation of the sluice canal and renewal of the 1878 contract with [[Colombia]]. This was agreed on in 1890 in [[Bogotá]], to run until 1904.

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[[File:Panama scandal.jpg|200px|left|thumb|1891 Panama Canal Company Liquidation Court Trial in Paris, France]]

In 1894, a second French company, the Compagnie Nouvelle du Canal de Panama (New Panama Canal Company), was created to manage the assets, and potentially finish construction. The new company sought a buyer for the assets, with an asking price of US $109 million. The construction of the canal was taken over by the United States which bought out the lease, the shares and assets in the [[Hay–Bunau-Varilla Treaty]] of November 1903, for US $40 million. Work resumed in 1904 and the canal opened 3 August 1914.

 

In 1898 Sir [[Arthur Conan Doyle]] published in the Strand magazine a fictional story [[The Story of the Lost Special]] in which a South American Financier and his bodyguard and their "Special" train vanish in the English countryside while trying to get to Paris France in the summer of 1890; mention is made of a political scandal [apparently in France] at the same time. Although off by two years the Panama Scandals were the only scandals involving France and South America at this time period.