Oregon land fraud scandal
The Oregon land fraud scandal of the early 20th century involved U.S. government land grants in the U.S. state of Oregon being illegally obtained with the assistance of public officials. Most of Oregon's U.S. congressional delegation received indictments in the case: U.S. Senator John H. Mitchell and U.S. Representatives John N. Williamson and Binger Hermann. (Only Senator Charles William Fulton was uninvolved.)
In 1870, the United States government granted the Oregon and California Railroad 3 million acres (12,000 km2) of land to build a line from Portland south to California. The land, which was granted in a checkerboard pattern along both sides of the railroad's right of way, was then sold to settlers in parcels of 160 acres (0.6 km2) at the extremely low price of $2.50 an acre to encourage people to settle along the line, thus fostering development.
Since much of the land was unfit for development, it did not attract many settlers. However, the land was very rich in timber, which meant that timber companies would pay much more than $2.50 an acre. So to circumvent the requirements of the land grant, Edward Harriman, president of the Southern Pacific Railroad—which then owned the O&C—hired former surveyor Stephen A. Douglas Puter to round up people from saloons in Portland's waterfront district, escort them to the land office, have them register for an O&C parcel as a settler, and then transfer it to Puter's men. The accumulated parcels were then sold in large blocks to the highest bidder for timber harvest.
Harriman eventually had a dispute with Puter and fired him. Then when a lumber company bookkeeper exposed the scheme to an Oregonian reporter, Puter turned on his former boss, testifying against him, and writing a scathing expose, Looters of the Public Domain, about the scheme.
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