Great frauds in history: Tino De Angelis’ salad-oil scam
Anthony “Tino” De Angelis decided to corner the market in soybean oil and borrowed large amounts of money secured against the salad oil in his company’s storage tanks. Salad oil that turned out to be water.
Anthony “Tino” De Angelis was born in 1915 in the Bronx. After leaving school to work for a butcher in a meat market, he joined a large meat processor, the Adolf Gobel company. He worked his way up to become its president in 1949, but the company was soon forced into bankruptcy as a result of a scandal in 1952 that involved overcharging the US government $31,000 ($274,000 today) for substandard food. De Angelis quickly moved on to start another business, the Allied Crude Vegetable Oil Refining Corporation, which he set up in 1955.
What was the scam?
De Angelis decided to corner the market for soybean oil, buying up huge amounts of the physical commodity, as well as soybean futures, in order to profit from any price rises. To get the necessary funds to do this, as well as keep paying his staff, he borrowed large amounts of money secured against the salad oil in his company’s storage tanks (which were guaranteed by American Express). However, unknown to outsiders, the tanks were partly filled with water, giving an inflated view of the reserves. De Angelis also stole blank receipts from American Express and started forging his own receipts.
What happened next?
Initially the firm’s buying pushed prices higher, helped by speculation that the US was about to agree a trade deal with Russia that would involve the export of large quantities of soybeans. However, when talks on another agricultural trade deal collapsed, the soybean price plummeted. This left Allied Crude Vegetable Oil with huge losses in the futures market, forcing it to declare bankruptcy in November 1963. When the receivers came in to investigate its assets, they discovered the scam. De Angelis was arrested, and later sentenced to twenty years in jail.
MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Lessons for investors
The scam destroyed two brokers, Williston and Beane, and Ira Haupt and Co, who had lent money to De Angelis. Both sold to competitors for a pittance. American Express also had to pay $150m ($1.25bn today) to cover guarantees on Allied’s oil. The whole debacle shows the importance of proper due diligence on any investment. Even after American Express was tipped off about possible fraud, it still allowed Allied to audit its own tanks. Amazingly, investors would allow themselves to be conned out of $7m ($33.2m today) by another Ponzi scheme that De Angelis ran after he was released from jail in 1972.
-
Boost for over 100,000 families on Child Benefit as new HMRC payment system rolled outThousands of households will no longer have to pay the dreaded High Income Child Benefit Charge through self-assessment
-
Are you being haunted by the ghost of Christmas past? How festive cutbacks could boost your long-term wealthThe average family spends around £1,000 over the Christmas season. Here’s how much you could have gained if you had invested some of the money instead.
-
Stock markets have a mountain to climb: opt for resilience, growth and valueOpinion Julian Wheeler, partner and US equity specialist, Shard Capital, highlights three US stocks where he would put his money
-
The steady rise of stablecoinsInnovations in cryptocurrency have created stablecoins, a new form of money. Trump is an enthusiastic supporter, but its benefits are not yet clear
-
SRT Marine Systems: A leader in marine technologySRT Marine Systems is thriving and has a bulging order book, says Dr Michael Tubbs
-
Goodwin: A superlative British manufacturer to buy nowVeteran engineering group Goodwin has created a new profit engine. But following its tremendous run, can investors still afford the shares?
-
A change in leadership: Is US stock market exceptionalism over?US stocks trailed the rest of the world in 2025. Is this a sign that a long-overdue shift is underway?
-
A reckoning is coming for unnecessary investment trustsInvestment trusts that don’t use their structural advantages will find it increasingly hard to survive, says Rupert Hargreaves
-
Metals and AI power emerging marketsThis year’s big emerging market winners have tended to offer exposure to one of 2025’s two winning trends – AI-focused tech and the global metals rally
-
8 of the best houses for sale with beautiful fireplacesThe best houses for sale with beautiful fireplaces – from a 15th-century cottage in Kent to a 17th-century palazzo in Oxfordshire
