A Scottish con man invented an entire fake country, sold bonds and land grants in London, and sent 250 settlers to the jungle — where more than half of them died.
In 1821, Scottish soldier Gregor MacGregor arrived in London claiming to be the 'Cazique' (prince) of Poyais, a prosperous Central American territory. In reality, Poyais was entirely fictional — a patch of jungle MacGregor had obtained from a Mosquito Coast king in exchange for rum and jewelry.
MacGregor built an elaborate fiction. He commissioned a 355-page illustrated guidebook describing Poyais's thriving capital city, St. Joseph — complete with theaters, an opera house, a domed cathedral, and a Bank of Poyais. He sold land certificates, issued government bonds on the London Stock Exchange, and distributed Poyaisian currency printed by the Bank of Scotland's official printer.
In 1822 and 1823, two ships left Britain carrying roughly 250 settlers — mostly Scots — who had invested their life savings in Poyaisian land. When they arrived, they found untouched jungle and no trace of the capital city. The captain of the first ship abruptly sailed away, stranding them on the coast.
Disease rapidly tore through the stranded colonists. A passing British magistrate eventually found them, informed them the country did not exist, and arranged rescue. Of the roughly 250 who had sailed, at least 180 died. Fewer than 50 ever made it home to Britain.
MacGregor was tried for fraud in a French court after running a variation of the scheme in Paris. He was acquitted — his defense argued that a man of his reputation would not have needed to invent a country if he hadn't actually possessed one. His co-conspirators were convicted; he walked free.
MacGregor was never meaningfully punished for any of it. He eventually returned to Venezuela, where his earlier military reputation survived intact. He was welcomed as a hero, dined with the president, received a state pension, and died in Caracas in 1845 with full military honors. He has been called the 'founding father of securities fraud.'