The Swindling Presidente—I
By Janet Flanner, August 19, 1939
As one of France’s internal political reactions to the Munich accord and the unprepared-for-war crises that came afterward, the Leftist Front Populaire was formally and finally declared defunct in the fall of 1938. Without a French woman by the name of Marthe Hanau, there might never have been any Leftist Front Populaire. Had Mme. Hanau not been a trader on the Paris Bourse in 1928, it is unlikely that Léon Blum would have been Premier of France in 1936. It wasn’t that the lady was a suffragette who worked for the Socialist cause. The lady was a swindler, laboring only to fill her capitalist pockets. She was the greatest, brainiest, most convincing and comical confidence woman France ever produced. Her swindles during France’s boodling nineteen-twenties, under the Radical-Socialist machine, may be ranked with the masculine chicaneries of the Oustric, Aéropostale, Baron Pacquement, and Sacazan scandals, which were the Ponzi affairs of France of the time. In a country where the female sex isn’t given half a chance, her achievement was even more remarkable because it became a cause célèbre and led to the public revolt which later swung the Socialist reformers into power. Indeed, in bringing things to a head, Mme. Hanau was topped only by one performer, and he was a prince of his profession. Alexander Serge Stavisky outdid her by crooking nearly ten billion francs and causing the February 6th riots of 1934, in which fourteen people were shot dead in the Place de la Concorde. Mme. Hanau merely caused seven citizens to quietly do themselves to death at home when they discovered her schemes had taken their last sous. As she was a spicy Paris personality, her death in prison the summer before Blum took over the governing of France was a loss to the chroniqueurs. Her life also represented a loss—one hundred and fifty-five million francs—to her investors.
Marthe Hanau was born Parisian, commercial-minded, and respectable. Her mother, a patient, penny pinching Jewess, was owner of a small Montmartre baby-clothes shop called La Layette pour Fr. 8.45. Though the profit was slight—one of everything an infant needed for $1.69 took close figuring even in those days—she was able to give a dot of 300,000 francs to her daughter Marthe when, in 1908, at the age of twenty-four, she married Lazare Bloch, a handsome, callow suitor whose family had done nicely in the jute business. By the time he and his wife arrived in the Correctional Courts twenty years later, they were divorced but still inseparable. She had taken back her maiden name, he had lost his patrimony and her dot, had been through bankruptcy, and was working for his ex-wife as a jolly, cigar-smoking customers’ man in her so-called investment house. Bloch described himself to the judge as “the kind of fellow who could sell peanuts to the Pope.” Police records showed that the only thing he ever sold was a bottled refreshment called the Tube du Soldat and described on the label as “Café et Rhum,” an unholy fraud palmed off on soldiers during the war. Because he omitted the word “imitation,” Bloch was arrested for misrepresentation of merchandise.
By the time Mme. Hanau came to court, she had for three years been one of the most talked-of figures in Paris. The financial pages of certain newspapers had given columns to her meteoric rise, the front pages of all newspapers had given double space to the facts of her sudden fall. During her apogee, millions of French had read about her and thousands had, unhappily, written to her, enclosing checks. Comparatively few people had seen her till she appeared, aged forty-six, in the prisoner’s dock. She was an unusually short, round woman, with vulgar, virile gestures, a taurian head, small even features, full rouged lips, sharp almond-shaped eyes, and a fulminating vocabulary and voice, both indicative of the crass energy on which she had built her career.
She had started her career, after her divorce, by selling perfumes and soap. The war was just over then and helping make women attractive once more had seemed a good, peaceful business. It was not, however, sufficiently exciting or devious for Marthe. She had learned through her ex-husband’s mishandling of their little fortunes how money could be lost on stocks; she was curious to know how it could be gained. She was an exceptionally intelligent woman, as the prosecution later stated; so intelligent indeed that, as the judge agreed, only when she was in prison would the stupid be safe. She had been educated to be a schoolteacher and had taken a first prize in mathematics; her brain had a native preoccupation with, and a fabulous memory for, figures. In the postwar air of France, Marthe Hanau had sensed the gathering of the monetary clouds which were to represent the true atmosphere of the nineteen-twenties. She suspected that credit, not cash, and that speculation, not investment, would be the crazy climate the world would have to weather, and she got herself ready.
It took time. It wasn’t till 1925 that she managed to open a one-room curb brokerage shop in one of the narrow streets behind the Opéra-Comique. There she also started publishing her famous Gazette du Franc, at first a tipster’s sheet. In three years it had become powerful enough to worry the French government and upset millions of gullible investors. For in casting about for a new method of arousing the postwar French appetite, Hanau had hit on an ideal dose—a mixture of publicity and patriotism. The average provincial xenophobic Frenchman swallowed it like a tonic. To appeal to him, she advertised herself as a new broker loyally supporting the French franc and French investments in opposition to the well-established brokers then universally boosting the English pound and American Can. She furthermore managed to be the one European of her time who made a good thing out of the League of Nations and the Treaty of Locarno, both then in high emotional favor owing to the signing of the Kellogg Pact. Hanau honored Mr. Kellogg’s work by getting out a special Kellogg Pact Gazette number. It was skillfully compiled by a new editor, Pierre Audibert, a high-class journalist who was a League fanatic and former political protégé of Minister Herriot. Through his Herriot and Geneva connections, Audibert obtained signed photographs and letters from some of the leading political and public figures of France and Europe: Briand, Barthou, Paul-Boncour, Primo de Rivera, Cardinal Dubois of Paris, and Poincaré. They were put in the flamboyant Kellogg Pact Gazette. There was even a picture of Mussolini, dedicated to “Il mio amico, Bloch,” which was a result of an interview Hanau’s ex-husband had had with Il Duce when they discussed some bland Franco-Italo-Hanau farm-mortgage scheme. Because of a political tie up with the Minister of Education, the Kellogg number was franked to all ambassadors in Europe and, what was worse, to every school-teacher in France. Though the diplomats doubtless realized that Briand, Barthou, et al., in donating their photographs, were merely getting advertising for themselves and their political policies, the school teachers thought the leaders were endorsing Hanau and were, in fact, okaying her investments along with Locarno and peace among men. For, besides Poincaré’s face, the Gazette also included announcements of Hanau’s projects—her Consortium Francais, Société des Valeurs, Ile-de-France real estate, Midi golf courses on abandoned farms, all offered with the pledge, believe it or not, that they would not be permitted to pay dividends of more than forty per cent. To the little French speculator, investing with Hanau seemed like investing with the League, la belle France, and heaven on earth, with, for once, a fat reward for his virtue. Investors’ money began pouring in from all over the Republic.
Then followed Hanau’s greatest period. By 1928 she had installed herself in impressive quarters at Nos. 124-6 Rue de Provence, with 450 local employees, 175 agents operating all throughout France, and a job for her ex-husband which gave him, among other things, 7,500 francs weekly for cigar money. She paid herself 150,000 francs a month. Marthe Hanau had become la présidente of the Compagnie Générale Financière et Foncière, which advertised itself as “a centre of brokerage operations and administration of capital.” Madame Présidente, as she was called, was the busiest woman in France, advising her 60,000 investors, supporting the franc, raiding the Stock Exchange, running seven new syndicates in oil, textiles, etc., and managing a business called Interpresse, which published two daily customers’ sheets, one of prophecy before the Bourse opened for the day, one of explanation after it closed. She was also busy paying her bank depositors eight per cent and telling the public that any bank which paid less was a robber. She worked from ten to fifteen hours a day.
Her special power as a promoter apparently came from the facts that she half believed in what she was selling and that, being French, she regarded cupidity as a national virtue. This last gave strength to her gift for advertising. Since she was contentious and well informed, her shrewd attacks in the Gazette on big business and its privileged profits made her seem a champion to the small bourgeois, squeezed between the depreciated franc and the new postwar industrialism. Her relations with her readers and investors became half avuncular, half demagogic. Being a dominant personality, she was obeyed as if she were a man; being a woman, she was loved as if she were a friend. Along with their checks, provincial investors sent presents of homemade pâtés, garden flowers, and knitted scarves. Her customers were principally the clergy, widows, retired military fogies, school teachers, and small-town shopkeepers.
Hanau’s psychological chemistries were violent and personal. She hired people just as she wrote her market prophecies—on hunches. Her staff adored her. Competence and experience were of no interest to her and probably she sensed that such qualities would have cramped her broad style. She saw herself as a woman of destiny. She had a tremendous gift of gab. Her conversation, whether with a customer in her office or with her Bourse touts at a Montmartre inn table, was a swift alto combination of swearwords, salty repartee, unbalanced invention, and unvarnished common sense. She loved hard-luck stories; she gave thousand-franc notes to down-and-outs and costly gifts to her pals. As she said, “I give an automobile away the way I give a box of candy.” She gave three handsome motors to herself: a Hispano, a Voisin, and a Panhard. Because she was too busy to fuss with fine clothes, she wore outsize schoolgirl black dresses with schoolboyish white collars and cuffs. However, she found time to purchase 2,000,048 francs’ worth of diamonds and pearls and some sable coats as a sort of distraction. She always kept a minimum of a half-million francs in her checking account; during one market crisis, she carried one million in cash in her pocketbook. Though her ex-husband, Bloch, had moved up enough in the world to buy Chez les Zoaques, Sacha Guitry’s Normandy estate, Mme. Présidente’s official residence remained a simple suburban villa in the outskirts of Paris. There she lived with a lady’s maid so devoted that she later helped her lady escape from prison. For her occasional flings at gay night life, Hanau also had a little town flat in the Rue de Varize, decorated with racy mythological scenes. With her favorite friend, Mme. Joseph Pollack, exotic-looking offspring of a respectable Parisian jeweller, Marthe sometimes rushed overnight in the Hispano to Monte Carlo for a weekend of gambling. Money was the only thing Hanau could work at or even play with.
As the winter of 1928 opened, the French Radical-Socialist government began getting cold feet. Its leaders had rashly lent their faces and sentiments to Hanau’s house-organ Gazette, and were under suspicion of having done far worse; smaller party figures had accepted tips, subscriptions, or cigars from the ubiquitous Bloch. Savings banks reported enormous withdrawals; it was rumored that six hundred thousand million francs had been turned over to la Présidente for speculation. The French government was in financial difficulties, as usual. It was feared the Banque de France was going to have to offer another measly three-per-cent national loan, and as long as Hanau and her promised forty per cent were on hand, who would buy?
On December 3, 1928, a special Cabinet meeting was held to decide what to do with the woman. It was done the next day. A year after Premier Poincaré had given Hanau his photograph in the interests of world peace, he made war on her by having her arrested. She was locked in St. Lazare Prison, accused of swindling, abuse of confidence, and infraction of corporation laws. Bloch was lodged in La Santé Prison as her accomplice, along with editor Audibert and an elderly Count de Courville, Hanau’s business manager, who had been hired because he had a title and knew nothing about business. Though they were to discuss her in detail in the courts for the next twenty-seven months, it took the state’s financial experts only an hour in the Hanau offices the next morning to see that she was a crook. Her underwriters in her promotion schemes were dummies, usually her ex-husband, operating under a series of fictitious names. Her investment syndicates the experts described as cisterns from which she dipped old investors’ capital to ladle out as dividends to new speculators. Her eight-per-cent bank had neither ledgers nor bonded cashiers, having operated through pretty girl secretaries who fluttered around with loose leaf notations, with the totals on file only in the Présidente’s head. As the government’s spite and legal machinery, now both powerfully directed against her, proceeded, Hanau was declared bankrupt. She protested that her assets “almost equalled her liabilities,” and though this was no ideal of solvency, it was nothing to go bankrupt about in the then money-wild France. The sum of her escroqueries was figured at 155,971,000 francs. Her bankruptcy was based on a little estimated deficit of 28,000,000 francs. ♦
—— AUTO – GENERATED; Published (Halifax Canada Time AST) on: October 18, 2020 at 10:13AM