Charity fraud, famous 'get rich quick' book author dies alone and poor: Shocking truth about the founder of self-development books
The end of charity scams is never good.
But few people expected that reporter Matt Novak's investigation according to Gizmodo showed that this author was the most famous scammer of all time, even defrauding charity money and ending tragically, dying alone and poor.
In 1922, Napoleon Hill, who was not yet famous for his self-help books, opened the Intra Wall Correspondence School with the goal of raising funds to educate prisoners in Ohio prisons, thereby helping them reintegrate into society more easily.
But the school was just a front for Hill to scam charity money, sell his magazine and other get-rich-quick courses.
The Mansfield News in Ohio reported on December 21, 1923, that Hill easily raised $1,000, or $14,000 in today's dollars, on a single fundraising trip. He usually targeted churches and religious people, and did not stay long in each town to solicit donations.
Of course, no money was ever sent to the Ohio State Prison. PEThomas prison officials told the Mansfield newspaper in 1923 that they had never received a penny from Hill.
However, after many times in and out of prison, this time Hill learned his lesson by letting a convicted criminal, Butler R. Storke, become the principal of Intra School. Therefore, when the case broke out, Storke himself had to return to prison, without affecting Hill at all.
Of course, the author's ending was not good, living alone and poor at the end of his life, willing to do anything to earn a few pennies to get by.
Origin
Oliver Napoleon Hill was born in 1883 in Virginia, the son of an unlicensed dentist, James Hill, and a bootlegger, Sara. At the age of nine, Hill's mother died of illness and his father remarried his stepmother, Martha.
According to books written about Hill’s life, he married at the age of 15 after getting a girl pregnant under pressure from her furious father. However, shortly after the wedding, the bride admitted that Hill was not the father.
Napoleon Hill
Although the marriage was later annulled, it left Hill with early trauma.
At the age of 17, despite his poor family, under Martha's supervision, Hill graduated from high school and went to Virginia to attend college. During this time, he worked part-time and was appointed manager of a 350-person mine owned by businessman Rufus Ayres. His honesty and meticulous calculation down to the numbers are said to be the reasons for Hill's promotion. At this time, Hill was only 19 years old.
However, according to what the New York Times recorded in 1995, Hill was involved in a murder cover-up and for this merit, Ayres rewarded the 19-year-old boy to become mine manager.
By the period 1903-1908, books written about Hill's life during this period have been quite omitted. Most say that he graduated from university with a law degree, worked as a part-time reporter, and was the manager of a lumber company.
But from the newspapers that Novak collected during this period, the truth about Hill gradually became clear. In 1903, Hill married Edith Whitman and had a daughter in 1905. Hill's family life was full of violence and instability.
By June 1907, Hill had moved to Alabama and was involved in the lumber business with a business called "The Acree Hill Lumber Company," according to records. In 1908, he was arrested for check fraud but was released after paying restitution.
Hill's biggest scam, however, began in the lumber business. That same year, in 1908, Hill bought lumber on credit from sources as far away as Georgia, Florida, Indiana, and sold it on credit in Alabama. Of course, he only accepted cash, not checks.
By the second half of 1908, word of Hill's fraud had spread throughout the lumber industry and creditors were scrambling to find him, but Hill had fled his office in September 1908. This was confirmed in the Pensacola Journal on October 17, 1908: "ONHill's absence as president of the Acree Hill Lumber Company is causing concern among creditors. Mr. Hill has not been in the office since September 8."
Meanwhile, an investigation by the Lumberman newspaper published on November 1, 1908, said that Hill told his secretary that he was going to visit some lumberyards, then disappeared.
An Alabama court issued a warrant for Hill's arrest, and his lumber company was also seized. However, Novak has not yet found out how the fraudster escaped punishment.
All we know now is that in December 1908, Hill fled to Washington, DC, changing his name and creating a false story about his background, such as automobile expert, educator, sales expert...
This was the time when Hill officially used the new name Napoleon Hill instead of having the last name Oliver as before.
Andrew Carnegie
According to what Hill recorded in his autobiography, 1908 was the pivotal year when he met the legendary billionaire Andrew Carnegie. Thanks to being taught the secrets of getting rich and the principles of success by Carnegie, Hill developed a mindset about getting rich.
According to Hill, Carnegie introduced him to other successful businessmen in the US to interview how they got rich, from Thomas Edison, Henry Ford to Alexander Graham Bell. This project lasted 20 years and Carnegie did not pay him, instead Hill could learn from these businessmen.
All of Hill's claims were complete lies, according to Novak. The journalist's investigation revealed that Hill spent much of 1908 in hiding from the authorities due to divorce lawsuits, fraud, and property disputes.
Journalist Novak said that the most respected biographers of billionaire Carnegie affirmed that the two men had never met and that the details of their conversations or Carnegie's advice in Hill's book were completely fabricated.
Automobile College of Washington
Multi-level marketing scam
In fact, Hill had to flee from creditors in 1908. In 1909, he founded the "Automobile College of Washington" with advertisements in newspapers that with only 6 weeks of training, he could turn ordinary people into skilled workers in assembling automobiles, which were in dire need of manpower.
Trainees were promised to receive about $75-200/week (equivalent to $5,000 at today's exchange rate) after completing the course and going to work. This was confirmed in the Washington Post published on October 10, 1909.
However, according to Novak's investigation, this school was simply a place to recruit free labor for auto factories. Students would have to pay "tuition" to Hill to assemble cars at the Carter Motor Corporation's Washington branch. Carter had an agreement with Hill to pay these cheap workers. So the fraudster Hill took money from both sides throughout the years 1910-1911.
Also during this time, Hill married for the third time to a rich young lady.
However, Hill's scam was exposed in 1912 when the Carter car company went bankrupt due to poor quality, especially when the workers were all amateurs who did not understand what they were doing, while many students accused Hill of cheating them out of money.
However, Hill quickly calmed public opinion by changing direction, instead of training them to assemble cars, he switched to teaching them to sell... cars.
Motor World published an article in 1912 about Hill's unusual course, promising each student would earn $4,800 a year or $400 in commission for each $2,250 car.
What is suspicious is that each student will earn an additional $3 for every new person they introduce to this sales line. This model is no different from today's multi-level marketing.
Despite his efforts and a $4,000 loan from his wealthy wife's family, Hill's vocational school went bankrupt in 1912. He had to move back in with his wife's family in Lumberport.
Not long after, thanks to his wife's family connections, he was able to get a job as a lecturer in the Law Department at LaSalle Extension University in Chicago, even though Hill himself had never graduated or worked in any field related to this field.
Presidential Advisor?
After a stint as a law teacher, Hill quit his job and opened the George Washington Institute in 1915, which taught self-confidence and wealth creation. Learning from his experience, Hill tried a different, more sophisticated scam.
Postage magazine described Hill’s school as a corporation, with the founder valuing it at $100,000, divided into 10,000 shares. Hill kept 51 percent of the shares and sold the rest to students at $10 a share. But the company, which Hill valued at $100,000, was actually worth nothing.
In March 1918, authorities began investigating Hill’s school for financial fraud. The Chicago Daily Tribune published an investigation report showing that Hill’s school had only a few desks, chairs, a printing press, and other miscellaneous items worth about $1,200.
However, this was just one way Hill made money when he also cheated students of their tuition fees. Specifically, Hill established the First National Trust Association and invited students to borrow money from them to pay tuition fees at an interest rate of 5%.
This means that students will borrow money from their own tuition to pay Hill back, then repay the debt plus 5% interest.
In June 1918, a warrant was issued for Hill's arrest and he was indicted. It is unclear how Hill resolved the case and whether he repaid the students, but subsequent scams in the following years suggest that Hill somehow escaped punishment.
Despite this, Hill’s memoirs recall the final years of World War I very differently. The author says he was invited to serve as an adviser to US President Woodrow Wilson to help end the war. Hill says he accepted the offer without taking a penny, doing it out of patriotism.
Ironically, in a state of near bankruptcy, Hill worked for free out of patriotism, while the President didn't even know what Hill's major was.
Documents on Napoleon Hill's fraud at the George Washington Institute
According to Novak's investigation, this advisory story is also imaginary because there is no data recording President Wilson's appointment of Hill as an advisor.
After the George Washington Institute failed, Hill founded Hill's Golden Rule magazine, which helped companies cheat investors. In October 1919, the Federal Trade Commission fined Hill's newspaper for advertising fraud.
Thomas Edison
One of the few photos Hill had of a celebrity was of Thomas Edison. The Specialty Salesman Magazine in 1923 described the meeting as quite casual, with Hill claiming to be the magazine's editor who wanted to award Edison a medal for his contributions. Of course, the inventor agreed, even to have his picture taken.
But what Hill captioned the photo was far from reality: "Two famous Americans - Thomas A. Edison (left) and Napoleon Hill (right). Mr. Edison was the inventor of the phonograph, electric light, moving pictures and many other things that served humanity. Mr. Hill was the editor of Napoleon Hill magazine and The New Philistine. He believed in the Golden Rule, the law of all human behavior. Edison was born into a poor family and began his career as a boy delivering newspapers on a train. Hill began his career working in a coal mine. Both achieved great fame through their own efforts."
After receiving the medal, Edison decided to return it to Hill without further comment.
In fact, most of the people Hill claimed to have met, other than Thomas Edison, have no evidence. Hill said he had many papers and photos to prove it, but they were destroyed in a fire in the mid-1920s.
Napoleon Hill used a photo with Thomas Edison to fool people.
The founder of the 'Self Help' book series
In early 1928, Hill sensed an opportunity to make money from publishing self-help books and secrets to getting rich. This was the period when the American economy began to fall into the Great Depression of the 1930s and of course everyone wanted to forget the pain of reality to learn how to get rich.
Hill borrowed money from his wife's wealthy family to write the book "Law of Success". Because he was bankrupt, Hill had to borrow money from his brother-in-law to make a decent suit and rent a luxury hotel room in Philadelphia to impress publisher Andrew Pelton into agreeing to publish the book. Every time he met Pelton, Hill lavished tips all over the hotel, from the bellboy to the receptionist, to prove his "success".
Pelton eventually agreed and the book sold well because it suited the reader's taste, although Pelton himself admitted that it was not really a good book.
In early 1929, Hill earned about $2,500 a month from book sales, equivalent to $35,000 today. However, this amount of money was nothing compared to Hill's lavish lifestyle, hoping to prove his success in the upper class.
For the first time in years, Hill moved his wife Florence and children into a luxury apartment in New York. However, the Great Depression of the 1930s affected Hill as he had no income except from book sales.
In the mid-1930s, his wife Florence and children had to move back to her mother's house when Hill sold their luxury apartment to pay off debts. "The Magic Ladder to Success" that Hill had hoped to revive his career could not be published and he officially went bankrupt, returning to a life of being a parasite at his wife's house.
Think and Grow Rich
After this failure, Hill continued to open a new magazine called Inspiration Magazine to continue his scam. In 1933, Hill proudly announced that the administration of US President Franklin D Roosevelt had approached him to be an advisor to restore the US economy. Of course, this story was fabricated when Hill went bankrupt, living off his wife's family while Novak could not find any evidence for the above event.
In 1935, Florence's wife's family could no longer stand their dependent son-in-law and asked for a divorce.
In 1936, Hill remarried a woman named Rosa Lee Beeland. Because they had no money, the couple moved into the small apartment of Hill's son, Mr. Blair, the only one of the children who still spoke to this con man.
It was Beeland who polished Hill's words and ideas for the book, and then introduced it to Pelton, who was initially hesitant because the recession was bad and he could barely afford food, let alone books.
However, when it was published in 1937, "Think and Grow Rich" became a hit because people were desperate for life and they loved publications that encouraged them that everything would get better. So the book was like an addiction, making people forget their hunger because they believed that everything would be okay, helping them think positively, and continue to work hard.
Despite making a large profit from the book, Hill transferred all royalties to Ms. Beeland to avoid having to pay any financial obligations to creditors or his ex-wife and children.
After receiving a large sum of money, Hill and his new wife began to live lavishly on luxury cars, jewelry, clothes... and quickly returned to a state of near bankruptcy in 1939.
Tired of her useless husband, Mrs. Beeland decided to divorce Hill. While her husband was away, she sold all of her assets, including Hill's beloved car, and left him nothing. She hired a private investigator to follow her husband to get evidence of his adultery, and later married the lawyer who had defended the divorce.
In 1941, Hill published "Mental Dynamite" but no one paid any attention.
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