Latest / Pionerd / The Foshay Tower Scandal: Towering Ambition, Financial Ruin, and the 1929 Crash
Transcript
- The 447-Foot Obelisk of Roaring Ambition Downtown Minneapolis stood on the precipice of absolute transformation over Labor Day weekend in 1929. At Marquette Avenue and Ninth Street, thousands gazed upward into the late summer sky. A 32 story Art Deco obelisk rose 447 feet above the pavement. Newspaper accounts recorded 25,000 guests flooding the streets as military batteries fired nineteen-gun salutes. The limestone facade projected permanent wealth, even as Foshay’s larger utility empire was increasingly dependent on precarious financing. At the center stood utility promoter Wilbur Foshay. He was an obsessive dreamer who genuinely believed his own inflated ledger valuations. Foshay built a monument to his unshakeable ambition, only to watch it collide with the unyielding reality of systemic market collapse. The Paper Empire and the Union Tower Wilbur Foshay began his rise in 1916 with a $6,000 loan to purchase a modest Nebraska power company. By August 1917, he incorporated the W. B. Foshay Company right here in Minneapolis. Over the next decade, his firm went on a relentless spending spree. Corporate ledgers listed utility holdings across thirty states, the territory of Alaska, Canada, and Central America, driving his paper net worth past twenty million dollars. Foshay needed a headquarters that matched his growing empire. Remembering a childhood trip to the national capital, he ordered a skyscraper modeled directly after the Washington Monument. Chief designer Léon Eugène Arnal of Magney and Tusler conceived an Art Deco monolith designed to taper four inches on every successive floor. The crown carried ten-foot illuminated letters spelling FOSHAY on all four sides, using a display technique patented by the building’s designers and assigned to the W. B. Foshay Company. The Foshay Building Corporation sold stock to finance the project. The tower ultimately cost about three point seven five million dollars to build. Foshay then made a provocative tactical decision. In a city strictly controlled by the anti-union Citizens' Alliance, he hired exclusively union labor to pour the concrete and set the steel frame. Inside, no expense was spared. Skilled masons laid Italian Siena marble and African mahogany while Crown Iron Works installed custom ornamental bronze. Sculptor Harriet Frishmuth cast a bronze figure, Scherzo, for the courtyard fountain. On the twenty-seventh and twenty-eighth floors, Foshay built a private executive suite featuring a marble fireplace, glass-paneled ceilings, and gold-plated bathroom fixtures. The three-day dedication, beginning August 30, 1929, cost more than one hundred twenty thousand dollars. Sixty-Seven Days to Black Tuesday The dedication party reached its climax as United States Secretary of War James W. Good delivered the keynote address. On the temporary stage, march king John Philip Sousa raised his baton to conduct the inaugural performance of the "Foshay Tower Washington Memorial March". Foshay gave Sousa a company check for twenty thousand dollars. Days later, he rushed to New York seeking financing to keep his company afloat. The grand celebration hid an impending catastrophe. Behind closed doors, bank credit had evaporated entirely. Sixty-seven days after the opening ceremony began, Black Tuesday arrived on October 29, 1929. The crash shattered confidence in Foshay’s paper empire, and the securities tied to it soon became effectively worthless. The cash dried up. Foshay's twenty-thousand-dollar check to Sousa bounced, prompting the outraged composer to ban all future public performances of the march. The financial collapse moved with terrifying speed. Within days of the crash, Judge John B. Sanborn placed Foshay’s companies into receivership, appointing Joseph Chapman as receiver to administer the enterprise under court supervision. Foshay was unceremoniously evicted from his business headquarters. According to local news reports, he was forced out without ever spending a single night in his lavish twenty-seventh-floor penthouse suite. By 1930, the United States Department of Justice stepped in, launching a sweeping federal investigation into mail fraud under Section 338. Prosecutors alleged that Foshay’s organization had sold overvalued securities by misrepresenting company assets to thousands of investors. On February 18, 1931, a federal grand jury returned a seventeen-count indictment against Foshay and six associates. The case ultimately narrowed to Foshay and his executive vice president, Henry H. Henley. Third Street Spectacle and the Deadlocked Juror In September 1931, the federal courthouse at Third and Marquette transformed into a circus. Crowds packed the sidewalks every morning to glimpse Wilbur Foshay arriving in his grey suit and bow tie. Special Prosecutor Fred Horowitz presented a mountain of financial exhibits, attempting to dismantle Foshay’s empire. Defense attorney Josiah Brill countered that Foshay had merely committed an honest accounting error. During testimony, Foshay even claimed he was colorblind to explain why symbols replaced red ink in his financial ledgers. Deliberations began under intense pressure. Inside the locked jury room, eleven male jurors voted to convict. One lone woman, Genevieve Clark, refused. On October 23, Judge Joseph W. Molyneaux declared a mistrial. Following the discharge of the jury, prosecutors learned that Clark had previously worked for the Foshay company and had failed to disclose relevant business connections during jury selection. Prosecutor Horowitz immediately charged Clark with contempt of court. She was convicted and sentenced to six months in jail. Before she reported to serve her sentence in April 1933, Clark, her husband, and their two sons were found dead in their family car from intentional carbon-monoxide poisoning. The federal government retried the case in early 1932. Both Foshay and Henry Henley took the stand. Foshay’s hair had turned entirely white. When asked if he believed his investors would profit, he answered simply, "I did". At the retrial, the jury convicted Foshay and Henley on four counts. Judge Molyneaux sentenced both men to fifteen years in federal prison. On May 5, 1934, United States Marshals escorted them to Leavenworth Penitentiary to begin serving their terms. Prison, Pardons, and the Fur-Bearing Trout Back in Minneapolis, the towering obelisk stood as a vacant monument to ruined capital. Court records show the Foshay Tower remained tied up in receivership and changed hands over the following years as liquidators sought buyers. Inside Leavenworth, Foshay maintained his characteristic optimism. His attorney, Brill, organized a massive clemency campaign, gathering over ten thousand signatures from citizens and former business partners. The legal tide eventually turned. In 1937, President Franklin D. Roosevelt commuted Foshay’s fifteen-year sentence to five years, making him eligible for parole after credit for good behavior. Ten years later, President Harry S. Truman granted Foshay a full executive pardon. Foshay moved west to Salida, Colorado, taking a job as Secretary of the Chamber of Commerce for eighteen hundred dollars a year. The unstoppable promoter quickly launched a nationwide publicity campaign. Foshay fabricated the legend of the "fur-bearing trout," distributing fur-covered fish models to advertise Colorado's icy mountain streams. Famed journalist Ernie Pyle profiled Foshay in print, marveling at the endless energy of a former magnate hawking small-town tourism. Foshay eventually returned to Minnesota penniless in 1957 to live with his son. Shortly after arriving, he suffered a severe stroke and was moved to a nursing facility. Wilbur Foshay died in Minneapolis in late August 1957, around the twenty-eighth anniversary of his tower's grand dedication. The Unbroken Line on Marquette Avenue Today, the obelisk at 821 Marquette Avenue still stands as a permanent fixture of the Twin Cities skyline. The building survived corporate bankruptcy, receivership, and decades as Minnesota's tallest building until the IDS Center surpassed it in 1972, long before its conversion into a modern luxury hotel. High on the twenty-seventh floor, Foshay's private suite now welcomes visitors as the Prohibition Sky Bar. Sousa’s march remained entangled in the scandal for decades. It was performed publicly by the U.S. Marine Band in 1976, and accounts later credited Minnesota investors with settling the unpaid debt to the Sousa estate in 1988. Wilbur Foshay's paper empire vanished into financial history, yet his physical creation endures. His journey reminds us that while personal fortunes and corporate schemes inevitably crumble, bold human ambition can leave a lasting legacy. When we look up at those ten-foot letters high above the asphalt, we see more than an old scandal. We see an unshakeable monument to audacious hope and the relentless drive to build skyward.