Albert Bacon Fall

Quick Summary

Albert Bacon Fall was the U.S. Secretary of the Interior under President Warren G. Harding who became the central figure in the Teapot Dome scandal, the most infamous corruption case in American politics until Watergate. Fall secretly leased federal naval oil reserves at Teapot Dome, Wyoming and Elk Hills, California to private oil companies in exchange for approximately $404,000 in bribes. Convicted of accepting a bribe in 1929, he became the first sitting Cabinet member in American history to be imprisoned for crimes committed while in office.

Timeline of Events

The Details

The Teapot Dome scandal takes its name from a rock formation in Wyoming that resembled a teapot, located above Naval Petroleum Reserve No. 3. These naval reserves had been set aside by President Taft in 1909 and President Wilson in 1915 to ensure the U.S. Navy would have guaranteed oil supplies. The reserves were under the jurisdiction of the Navy Department.

Fall, upon becoming Secretary of the Interior, persuaded Secretary of the Navy Edwin Denby to transfer oversight of the reserves to the Interior Department. President Harding signed Executive Order 3474 on May 31, 1921, completing the transfer. Fall then leased the reserves without competitive bidding to two oil magnates: Harry Sinclair of Mammoth Oil Company (Teapot Dome) and Edward Doheny of Pan American Petroleum (Elk Hills).

In exchange, Fall received approximately $404,000 in total. The $100,000 from Doheny was hand-delivered in cash in a black bag by Doheny's son, Edward Jr. Fall initially claimed the money was a loan, but no promissory note was produced until after the Senate investigation began, and it was later revealed that the note had been torn in half. From Sinclair, Fall received about $304,000 in Liberty bonds, cash, and livestock delivered to his Three Rivers ranch in New Mexico.

Fall's sudden improvement in his ranch, expansion of the property, new livestock, and debt repayment, attracted attention. Senator Thomas Walsh of Montana doggedly pursued the investigation despite initial indifference from colleagues. Fall appeared before the committee and initially denied receiving any money from the oil companies. When confronted with evidence, he claimed the money came from Edward McLean, the publisher of the Washington Post. McLean initially corroborated this story but later recanted, and the Doheny connection was exposed.

What Happened

Fall was convicted on October 25, 1929 of accepting a bribe from Edward Doheny, and was sentenced to one year in prison and a $100,000 fine. He entered the New Mexico State Penitentiary on July 20, 1931, becoming the first U.S. Cabinet member ever imprisoned for crimes committed while in office.

In a notorious paradox of American jurisprudence, Edward Doheny was acquitted of paying the same bribe that Fall was convicted of receiving. Doheny's defense argued that the $100,000 was merely a loan between old friends. Harry Sinclair was acquitted of conspiracy charges but served approximately six and a half months in prison for contempt of the Senate (for refusing to answer questions) and for jury tampering during his trial.

The oil leases themselves were voided by the U.S. Supreme Court in Mammoth Oil Co. v. United States (1927) and Pan American Petroleum Co. v. United States (1927), and the reserves were returned to government control.

Fall spent approximately nine months and nineteen days in prison before his release on May 9, 1932. He spent his remaining years in poor health and poverty in El Paso, Texas, where he died on November 30, 1944.

Financial Impact

The bribes were broken down as follows: $100,000 in cash from Edward Doheny delivered in November 1921, and approximately $304,000 from Harry Sinclair provided through Liberty bonds, cash, and livestock between 1921 and 1923.

The broader economic impact was far larger. The oil reserves themselves were valued at hundreds of millions of dollars. The leases allowed Sinclair and Doheny to extract oil from public land at below-market rates, representing a massive transfer of public wealth to private interests. The Supreme Court voided the leases and returned the reserves to government control.

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