Stavisky’s Fraudulent Schemes Rock French Government Summary

  • Last updated on November 11, 2022

A lifelong swindler who moved from petty scams to grandiose schemes involving huge sums of money, Alexandre Stavisky was found dead soon after the French police took action against him. He had either killed himself or been murdered to keep him from revealing the complicity of prominent politicians, civil servants, and journalists in his crooked dealings. Public outrage over the case led to the resignations of the prime minister and the head of the Paris police.

Summary of Event

Alexandre Stavisky was born in Ukraine in 1886. Emmanuel, his father, was a dentist who later committed suicide when it was suspected that he was involved in his son’s nefarious swindling activities. When Stavisky was three years old, his family moved to Paris, France, and later took up French citizenship. As an adolescent, Stavisky began a life of crime, operating on the margins of the world of theaters, nightclubs, and gambling sites. One early venture involved the printing of business cards with a publisher’s name that he used to obtain free theater tickets. Stavisky, Alexandre Chautemps, Camille Chiappe, Jean [kw]Stavisky’s Fraudulent Schemes Rock French Government (Jan. 8, 1934-Jan. 17, 1936) [kw]Fraudulent Schemes Rock French Government, Stavisky’s (Jan. 8, 1934-Jan. 17, 1936) Stavisky, Alexandre Chautemps, Camille Chiappe, Jean [g]Europe;Jan. 8, 1934-Jan. 17, 1936: Stavisky’s Fraudulent Schemes Rock French Government[00560] [g]France;Jan. 8, 1934-Jan. 17, 1936: Stavisky’s Fraudulent Schemes Rock French Government[00560] [c]Banking and finance;Jan. 8, 1934-Jan. 17, 1936: Stavisky’s Fraudulent Schemes Rock French Government[00560] [c]Corruption;Jan. 8, 1934-Jan. 17, 1936: Stavisky’s Fraudulent Schemes Rock French Government[00560] [c]Gambling;Jan. 8, 1934-Jan. 17, 1936: Stavisky’s Fraudulent Schemes Rock French Government[00560] [c]Hoaxes, frauds, and charlatanism;Jan. 8, 1934-Jan. 17, 1936: Stavisky’s Fraudulent Schemes Rock French Government[00560] [c]Murder and suicide;Jan. 8, 1934-Jan. 17, 1936: Stavisky’s Fraudulent Schemes Rock French Government[00560]

Stavisky’s youthful illegal activities earned him a brief jail term. After his release, he formed a company that advertised meat-based, canned consommé to gullible buyers, relying on an endorsement praising the nutritional merits of the nonexistent product that Stavisky obtained from a doctor. He also sought to market a useless device called a matryscope, which, he claimed, would accurately determine pregnancy. Other scams involved raising the sum on a check given him by a nightclub owner from two thousand to sixty thousand francs and dealing in fraudulent stock transactions and counterfeit treasury notes. Stavisky also was believed to have been responsible for the theft and sale in 1925 of bonds stolen from aboard the steamship Valdivia, which had anchored in France after sailing from South America.

For these misdeeds, Stavisky was confined for seventeen months in La Santé, the Paris city jail, in which he waited while the police dug for sufficient evidence to convict him. His attorneys maneuvered to postpone his trial nineteen times, and Stavisky finally was released late in 1927 on a faked medical diagnosis of internal disorders and a serious nervous condition. He vowed that he would rather kill himself than face another stay in prison.

Stavisky thereafter graduated into grander schemes. His core fraud involved the deposit of 155 “emeralds,” most of them worthless spinach-colored glass, in the municipal pawnshop the crédit municipal in Orléans, one of thirty-four such institutions in France and Algeria. The Orléans crédit municipal, operating with scant oversight, expanded its mission from aid to the impoverished into public works projects and banking transactions. Stavisky and his allies bribed an appraiser to set the value of the “emeralds” at wildly inflated amounts. This allowed the schemers to obtain short-term bonds from the credit organization with face values of millions of francs. Stavisky and allies then exchanged the bonds at a discount for cash from Paris banks and insurance companies.

In 1931, when the law enforcers, often handcuffed by Byzantine intramural antagonisms, became suspicious of the legitimacy of the Orléans operation, Stavisky hurriedly redeemed the pawned items and redeposited them with much grander financial benefits in a crédit municipal that he established in Bayonne in southwestern France. He craftily inveigled a cadre of luminaries who were greedy, short of funds, or naïve to serve on its board of directors to make the Bayonne operation appear to be a legitimate enterprise.

Stavisky also managed the Société d’Installations Mécaniques et Agricoles (SIMA), an agricultural supply company that produced Phébor, a wooden refrigerator that he claimed required no electricity for its operation. He said it was an ideal product for the North African market and for ships, but it soon became obvious that the Phébor did not work. Stavisky was besieged by disgruntled purchasers and SIMA stockholders. He managed to stay beyond the reach of the authorities by compensating those who kept after him with funds secured from subsequent gullible investors. As his loans became due, Stavisky sought unsuccessfully to purchase, at rock-bottom prices, agrarian bonds issued to Hungarians displaced during wartime and use them as collateral for additional loans from French banks or for sale to investors who were not aware that they were practically worthless.

A bon vivant, heavy gambler, and owner of racehorses, among other indulgences, Stavisky did not have the funds to redeem the bonds that he had placed with the banks and insurance companies. When the police closed in, he took flight to a ski chalet in Chamonix in the French Alps. On January 8, 1934, he likely killed himself, as his father had done; less likely, he was murdered by the police to protect prominent persons who had shared in his ill-gotten gains. Those who suspected murder emphasized that there were no powder burns on Stavisky’s body and that the pistol that was used was clutched in his right hand while the lethal wounds were inflicted on parts of his body somewhat inaccessible for a right-handed person. Profuse bleeding also suggested internal hemorrhaging. The headline of a Paris newspaper noted sarcastically, “Stavisky Commits Suicide with a Bullet Fired at Him at Point-Blank Range.”

On February 21, the Stavisky affair took a notably bizarre turn when the wife of Albert Prince, a court-of-appeal judge who had been the top investigating magistrate in the financial section of the Paris prosecutorial office, received a call allegedly from someone in the town of Dijon, telling her that her husband’s mother was in serious condition there and that he must go to Dijon immediately. Two days later Prince’s body was found on a railroad track near Dijon, ripped into three parts by a train, his head a dozen meters from his torso. It was claimed by some that he had been executed to keep him from implicating other officials in Stavisky’s nefarious activities, but the most likely interpretation is that Prince staged the suicide, hoping it would be seen as a murder, in an attempt to divert attention from his failure to have dealt forcefully with Stavisky’s crimes.

On November 4, 1935, almost two years after Stavisky’s death, the trial began in Paris for those allegedly tied to his fraudulent practices. Many persons who had been involved escaped prosecution because of the difficulty of convincing a jury that they had knowingly rather than innocently violated the law. Of the twenty defendants put on trial, the jury found nine guilty on January 17, 1936. Two defendants were sentenced to seven years in prison, the rest to shorter terms. Among those deemed not guilty was Arlette (Simon) Stavisky, Stavisky’s partner in a close-knit marriage. She later would marry an American Army officer and live out her days in Puerto Rico.

Impact

Stavisky’s dramatic end and the revelations that came in its wake convulsed France. The right-wing, conservative opposition accused Prime Minister Camille Chautemps and his government of having killed Stavisky to protect those in the government who, as rumors had it, were part of Stavisky’s dealings. The affair led to the resignations of Chautemps, several ministers, and civil servants. Jean Chiappe, the prefect of the Paris police, was forced from office by the government that replaced that of Chautemps. For a time the episode seemed likely to overthrow the liberal Third Republic that had been established in 1870 after the collapse of the empire under Napoleon III.

Riots, known as Bloody Tuesday, launched by right-wing forces erupted in Paris on February 6, 1934. Government forces managed to quell the outbreak but not before fifteen persons were killed and more than one thousand were wounded. Those on the political left retaliated by calling a general strike, but the Third Republic would survive, although discredited and dishonored by the Stavisky affair, until the German invasion of France during the 1940’s. Stavisky, Alexandre Chautemps, Camille Chiappe, Jean

Further Reading
  • citation-type="booksimple"

    xlink:type="simple">Guyer, Harold C. All Men Have Lived There. New York: Richard R. Smith, 1941. Observations on the mood of the French as recorded in the diary of a young American living in Paris at the time of the Stavisky affair.
  • citation-type="booksimple"

    xlink:type="simple">Jankowski, Paul F. Stavisky: A Confidence Man in the Republic of Virtue. Ithaca, N.Y.: Cornell University Press, 2002. Based on interviews and media and judicial archives, a comprehensive source of information on the Stavisky affair.
  • citation-type="booksimple"

    xlink:type="simple">Large, David Clay. “’Down with the Robbers’: The Stavisky Affair and the Twilight of the Third Republic.” In Between Two Fires: Europe’s Path in the 1930’s. New York: Norton, 1990. A short, jaunty review of the Stavisky affair that favors a verdict of suicide rather than murder in Stavisky’s death.
  • citation-type="booksimple"

    xlink:type="simple">Werth, Alexander. France in Turmoil. London: Jarrold, 1934. Analyzes the bureaucratic paralysis of the French government during the time of the Stavisky swindles.

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