During the 1900s, there were many officials who openly disagreed with holding oil reserves for the navy. The most well known official to have disapproved of the federal reserves was Republican Senator Albert B. Fall. His political allies convinced President Harding to appoint him as United States Secretary of the Interior in March of 1921.

The reserves were under authority of Edwin C. Denby, the Secretary of the Navy 1n 1922. Fall convinced Denby to give the administration of the reserves to the Department of the Interior.

Fall then gave rights of the oil to Harry F. Sinclair of Sinclair Oil, then known as Mammoth Oil, without any competition over it. Opposite of what many believe, this type of leasing was legal under the General Leasing Act of 1920. Fall also gave some oil to Edward L. Doheny in exchange for a loan without any interest.

In return for giving these two the oil reserves, Fall received about $400,000. This money was the illegal part of the transaction, as Fall was not allowed to gain profit off of the government’s property. Fall tried to keep these transactions a secret, but the increase in personal property brought about speculation.

Any money Fall had gotten went into his cattle ranch, along with some investments in his business. Finally, when the investigation was ending and they were ready to declare Fall innocent, Walsh found some evidence Fall had forgotten to hide, which was Doheny’s loan to Fall for $100,000.

Albert Fall was found guilty of bribery in 1929, was fined $100,000 and sentenced to one year in prison. He was the first Presidential cabinet member to go to prison for his actions in office. Harry Sinclair refused to cooperate, and as such was also fined $100,000, and received a short sentence for tampering with the jury.

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