| Basil Zaharoff | |
|---|---|
| Born | Zacharias Basileios Zacharoff October 6, 1849 Muğla, Ottoman Empire |
| Died | November 27, 1936 (aged 87) Monte Carlo, Monaco |
| Nationality | France |
| Other names | Basileios Zacharias |
| Occupation | Arms dealer, financier |
| Known for | Vickers |
Basil Zaharoff,[1] GCB, GBE[2] (October 6, 1849, Muğla, Ottoman Empire – November 27, 1936, Monte Carlo, Monaco), born Zacharias Basileios Zacharoff, was an arms dealer and financier. Although he often lied about his origins, he formally became a French citizen in 1908, and worked for the Vickers munitions firm from 1897 to 1927.[3]
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Zacharias Basileios was the only son and eldest of four children of Basilius Zacharoff of Constantinople, born in the Anatolian town of Muğla. The name Zaharoff was adopted when the family was in exile in Russia as a result of the anti-Greek "Easter pogroms" of 1821. The family returned to Turkey in the 1840s. By 1855, the family was back in Constantinople (modern-day Istanbul), where they lived in the modest Greek neighborhood of Tatavla.
Young Basileios' first job was as a guide for the tourists to the Galata. He then reputedly became an arsonist for the Constantinople firefighters. The 19th century firemen of Constantinople were not so effective at extinguishing fires, but quite effective at rescuing or salvaging the treasures of the rich for a healthy commission.[3]
Zaharoff appeared in London in the midst of a controversy that had him in court over irregular commercial actions involving the export of certain goods from Constantinople to London. The Constantinople Greeks in London preferred that matters involving members of their community were not settled by English courts. He was released on the payment of £100 on condition that he pay restitution to the claimant, and remain within the jurisdiction of the court. He immediately went to Athens. Once there the 24-year-old Zaharoff was befriended by a political journalist Etienne Skouloudis. The eloquent Zaharoff succeeded in convincing Skouloudis of the rightness of his case in the London legal conflict.
By a stroke of good fortune, another friend of Skouloudis, a Swedish captain, was leaving his job as representative of arms manufacturer Thorsten Nordenfelt’s company for a more important posting. Skouloudis meanwhile had risen in politics and was able to recommend Zaharoff to fill the vacancy. Zaharoff was hired on October 14, 1877, beginning a spectacular career. The prevailing political and military circumstances involving the Balkan states, Turkey and Russia provided an excellent opportunity for the young salesman. Each state was ready to spend to cope with the perceived aggressive intentions of its neighbours, even after the Treaty of Berlin of 1878.
As a salesman for the Swedish inventor Thorsten Nordenfelt, Zaharoff was known for his crafty, aggressive and corrupt business tactics. These included selling arms to both sides of conflicts, selling fake or faulty machinery to clients, and sabotaging demonstrations. Zaharoff sold munitions to many nations of his day, including Great Britain, Germany, the Russian Empire, the Ottoman Empire, Greece, Spain, Japan, and the United States. Despite his reputation for corruption, he helped popularize a number of famous weapons and vehicles, such as the Maxim gun (one of the first fully automatic machine guns) and the first true submarine.
The next person to enter Zaharoff's story was Hiram Maxim. Maxim's automatic machine gun was a significant improvement over the hand-cranked models then in use. Maxim’s gun was certainly better than anything that Nordenfelt had on the shelf at the time. Zaharoff is believed to have had a hand in the events surrounding Maxim's attempts to demonstrate his invention between 1886 and 1888. In the first, Maxim's and Nordenfelt's machine guns were to be demonstrated at La Spezia, Italy before a distinguished audience that included the Duke of Genoa. Maxim's representatives did not show up; an unknown person had provided them a guided tour of La Spezia's nocturnal establishments leaving them in no condition to go anywhere the next day.
Round 2 took place in Vienna. Here the contestants had been asked to modify their weapons so that they could use the standard size of cartridge used by the Austrian infantry. After shooting a few hundred rounds Maxim's apparatus became erratic then stopped altogether. When Maxim took the weapon apart to see what had happened, he discovered that it had been sabotaged, but it was too late to recover. The third trial was also in Vienna, and here the gun worked perfectly. But an unknown person went through the gathering of senior officers convincing them that the workmanship required to produce such a marvellous weapon could only be done by hand, one at a time, and that without the means for mass production Maxim could never produce the machine gun in sufficient quantities to satisfy the needs of a modern army. Nordenfelt and Zaharoff had won. Maxim, who knew he had a good product, successfully sought a merger with Nordenfelt, with Zaharoff as the principal salesman with a fat commission rate. )
From 1886 to 1889, at the same time than Zaharoff got the machine gun Maxim, he managed to appropriate Isaac Peral's submarine; although these facts are less known. Zaharoff and Nordenfelt tried, for those years, to develop a submarine to increase their businesses.
One of the most notorious sales by Zaharoff was that of the Nordenfelt I, a faulty steam-driven submarine model based on a design by the English inventor and clergyman Rev. George Garrett, which U. S. Navy intelligence characterized as capable of "dangerous and eccentric movements." Thorsten Nordenfelt had already demonstrated his vessel at an international gathering of the military elite, and the major powers would have none of it, but smaller nations interested by the prestige were a different matter.
It was thus that, with a promise of liberal payment terms, Zaharoff sold the first model to the Greeks. He then convinced the Turks that the Greek submarine posed a threat and sold them two. After that, he persuaded the Russians that there was now a new significant threat on the Black Sea, and they bought two.
None of these submarines ever saw battle. The apparatuses, with steam propulsion, completely inadequate for underwater navigation, failed boisterously when the sea trials were made by the respective navies that acquired them. Besides the derived problems of the faulty propulsion system, they suffered of a serious problem of lack of stability and, in fact, the Turkish Navy submarine was unbalanced when shooting a test torpedo, put it in vertical position and sunk by stern.
At the same time, a Spanish inventor developed the first properly called submarine of the history, solving the propulsion, stability and armament problems at the same time. Isaac Peral designed and built the first submarine of the history that navigated submerged, with good command and the ability to shoot torpedoes, submerged and on the surface. Peral's submarine had electric propulsion, periscope, target practice apparatus, compensated compass needle, gyroscope, sliding electric, torpedo tube launcher and servomotor (to maintain the stability and the trim of the ship in all circumstances).
Zaharoff had knowledge, with astonishing speed, of the young inventor and Spanish Navy officer's works. Previously in shipbuilding, he had already inspected the plans and the memorandum reports that the inventor had sent to Spanish Navy ministry headquarters.
Later on and during Isaac Peral's visit to London, he tried to interview with him unsuccessfully, with the help of a Peral's Spanish Navy fellow officer. Peral refused twice, but after several attempts, he had a meeting with the Nordenfelt company owner, who offered him to associate him and purchase the patent of the stability servomotor. Isaac Peral rejected both offers and signed his sentence in that same instant, without knowing it.
Zaharoff has his own evil skills to operate. The Spanish inventor, as Maxim, suffered four sabotages during the tests: the first of them, in the previous test, in presence of the head of the Spanish State, but, Peral, more cautious than the North American inventor, had success in all of them.
In spite of it, Zaharoff used perverted methods, well-known later on, and was able to made controversy between the inventor and his own government and obtained, in the end, the Spanish government's disapproval of the invention of the submarine, which would have been a formidable weapon in the conflict with the United States, several years after.
Zaharoff traveled to Spain on several occasions from 1886 to 1890 with three objectives: boycott Peral's submarine, sell weapons to the Spanish armies and acquire a Spanish factory of weapons. He was successful in all three of them, mainly because he had a loving relationship with Pilar de Muguiro y Beruete that opened him many doors.
Pilar was the daughter of a powerful banker, Fermín Muguiro, a strongman of the regime and the boss of the conservative Spanish party, a personal friend and niece of Segismundo Moret, commander of the Spanish progressive thinking and the boss's of the liberal party's right hand. Also, she was unhappily married to a cousin of the king Alfonso XII: Francisco de Borbón, Duke of Marchena and Grande de España; a title that allowed her access without previous notice to the Royal Palace. During one of these trips, the presence of Zaharoff was detected in the shipyard where the Spanish submarine was built, but the Spanish authorities "covered" the matter.
By the purchase of one of the better Spanish armament companies, Euscalduna located in the north of Spain which they named as “The Placencia de las Armas Co. Ltd”; and thanks to his loving affair (he always attributed, the key of his professional success to his loving skills) and by the creation of a powerful kernel inside Spain, of influential politicians, journalists and military high officials that served him in a perfect way in his personals interest. This influential group of people took sides against the development of Isaac Peral's submarine, and the Spanish Government, in spite of the notorious success of the official tests, finally closed the project.
After the “Placencia de Armas Co. Ltd”; company, which swindled the Spanish Government selling useless and rather useless utility arms for Spain during the 1898 war (also, this company, provided to Maxim outstanding and "sensitive" information that passed to his government during the conflict), the Constructora Naval came and few years later, the Sociedad Española de Construcciones Navales, branch of Vickers in Spain were awarded, by the Spanish Government, the monopoly of the naval construction for the Spanish Navy.
The shade of the swindle, the prevarication and the bribe flew over above this fabulous business for the dangerous trafficker of weapons. A law officer of the Spanish Navy denounced the Spanish Government for two presumed prevarication crimes. The Spanish Government acted expeditiously and with special cruelty against these navy officers who made public their discontent with the ordinance. The Central Chief of Staff and the Boss of the Armada Juridic Service were fired and hundred of officers were imprisoned were meade to lose their jobs.
Zaharoff's power and influence in Spain lasted until his death in 1936. when Spanish Civil War began.
Also, the 1934 United States Senate Nye Committee Memorandum shows that Zaharoff was paid with considerable money commissions in the transactions that were made between foreign companies and the Spanish Government (for example, he got paid among a 5 and 7% commission of the price of the American submarines sold to Spain, during all these years).
Although very little could be documented, Zaharoff was viewed as a master of bribery and corruption, but the few incidents that did become public, such as the large bribes received by Japanese Admiral Fuji, suggested that a lot more was going on behind the scenes. In 1890, the Maxim-Nordenfelt association broke up and Zaharoff chose to go with Maxim. With his commissions, Zaharoff bought shares in Maxim’s company until he was able to tell Maxim that he was no longer an employee but an equal shareholder. )
By 1897, the Maxim company had become important enough that it received a buyout offer from Vickers, one of the then giants of the armaments industry. This involved substantial settlements in both cash and shares for Maxim and Zaharoff. From then until 1911, while Maxim's business enthusiasm waned, Zaharoff's enthusiasm and portfolio of Vickers shares grew. With Maxim's retirement, Zaharoff joined the Vickers board of directors.
The first decade of the twentieth century was a time for many European armies to rebuild and modernize. Germany and the United Kingdom both saw an especial need for improved naval units. Vickers and Zaharoff were there, willing and able to accommodate both sides. After its disastrous defeat by Japan in 1905, Russia too had a need to rebuild its navy, but the nation was beset by a wave of chauvinism that required a domestic industry for the rebuilding. Zaharoff’s response was to build a huge Russian arms production complex at Tsaritsyn as a subsidiary of Vickers.
The opening of Russian Tsarist archives after World War I led to some insights into thtsine tactics of the arms industry. One 1907 letter, in particular, was written from the Paul von Gontard factory (a secretly controlled Vickers company in Germany) to a Vickers associate in Paris recommending that press releases go out to the French press with suggestions that the French improve their military to meet the threats of military buildup in Germany. These French newspaper articles were read into the record of the Reichstag and were followed by a vote to increase military spending, all of which worked to the advantage of Zaharoff. )
In the years immediately preceding World War I Zaharoff’s fortunes grew in other areas to support his arms business. By purchasing the Union Parisienne Bank (which was traditionally associated with heavy industry) he was better able to control financing arrangements. By gaining control of the daily newspaper, Excelsior, he could be assured of editorials favorable to the arms industry. To gain public recognition and honours he set up a retirement home for French sailors, while a chair in aerodynamics at the University of Paris gave him the rank of an officer. On July 31, 1914, coincidentally the same day that the noted antimilitarist Jean Jaurès was assassinated, Raymond Poincaré signed a decree making Zaharoff a commander of the Legion of Honour.
In March 1914, Vickers announced the coming of a new era of prosperity. During the course of the war Vickers would produce 4 ships of the line, 3 cruisers, 53 submarines, 3 auxiliary vessels, 62 light vessels, 2,328 cannon, 8,000,000 tonnes of steel ordnance, 90,000 mines, 22,000 torpedoes, 5,500 airplanes and 100,000 machine guns. By 1915, Zaharoff had close ties with both David Lloyd George and Aristide Briand. It is reported that, on the occasion of one visit with Briand, Zaharoff quietly left an envelope on Aristide Briand’s desk; the envelope contained a million francs for war widows.
One of Zaharoff’s tasks during the war was to ensure that Greece became involved in the war on the Allied side, helping to reinforce the eastern front. On the surface, this seemed impossible since King Constantine was himself a brother-in-law to the Kaiser. Setting up a press agency in Greece to spread news favorable to the allies led, within a few months, to Constantine’s being deposed in favour of Prime Minister Eleftherios Venizelos.
With the end of World War I, The Times estimated that Zaharoff had sacrificed £50 million for the Allied cause; however this was but a small fraction of his commissions.)
In the years that follow, Zaharoff involved himself in the affairs of the lesser powers, which the Big Four that were remaking Europe would have happily ignored. In particular, he set out to ensure that Greece and Venizelos received a proper share of the spoils from a badly weakened Turkey. In 1920 he donated half a billion Gold franc to the Greek state for the Greek cause (Megali Idea).[4] Zaharoff convinced Venizelos to attack but, after some impressive initial success, the Greek army was eventually driven back. In the elections that followed, Constantine’s loyalists managed to force Venizelos to flee, but Zaharoff stayed around and persuaded the same king that he had to attack Turkey again, but with Mustafa Kemal now in charge of Turkey, this venture was bound to fail. Zaharoff’s war adventures were not well received by the press in Paris and London.
At the same time that he was carrying on his war, Zaharoff was also involved in two more significant financial ventures in October 1920, he became involved in the incorporation of a company that was a predecessor to oil giant, British Petroleum. He saw that there was a great future in the oil business.
His association with Louis II of Monaco led to his purchase of the debt-ridden Société des Bains de Mer which ran Monte Carlo’s famed casino, and the principal source of revenue for the country. He succeeded in making the casino profitable again. At the same time, Zaharoff had prevailed upon Clemenceau to ensure that the Treaty of Versailles included protection of Monaco’s rights as established in 1641. Louis had noted their gradual erosion in the nearly three centuries since.
Zaharoff was a friend of both the actress Sarah Bernhardt and her greek husband Jacques Damala who was once described as the handsomest man in Europe. When Damala's mistress (who injected him with heroin between Acts of plays he was appearing in), had an illegitimate daughter by him in 1889 she left the baby in a basket (with a note, on Sarah Bernhardt's doorstep. The baby who was baptised Teresa was given into the care of Zaharof who found a family to raise her in Eastern Thrace in Adrianpole. In 1920 she posed for Picasso and she had affairs with the American novelist Ernest Hemmingway and Gabriel D'Annunzio who was an early Italian Fascist. The story of her life is told in the historical novel Terese by Fredy Germanos (1997). Zaharoff was fascinated by aviation, and gave donations and support to pioneers in England, France and Russia. He encouraged Hiram Maxim in his attempt to build a flying machine, and later claimed that he and Maxim were the first men to be lifted off the earth, when Maxim tested his first "flying machine" at Bexley in 1894.[5]
In September 1924, Zaharoff, almost 75 years old, remarried. (He had been married to an English woman much earlier in life—primarily, it was believed as of middle February 2011, to obtain a British passport. ) He had met María del Pilar Antonia Angela Patrocinio Simona de Muguiro y Beruete, some three decades earlier on the business travel in Spain, when she was married with her new husband, the unbalanced Prince Francisco de Bourbon, Duke de Villafranca de los Caballeros. She was unable to divorce her husband, because of his relation of the royal Spanish family, despite his documented insanity. The Duchess and Zaharoff had to wait until the Duke's natural death. Some eighteen months after their marriage, Lady Zaharoff succumbed to an infection.
Afterwards, Zaharoff began a liquidation of his business assets, and undertook to compose his memoirs. When the memoirs were completed, they were stolen by a valet who had perhaps hoped to make his fortune by revealing embarrassing secrets about the greats of Europe. The police found the memoirs and returned them to Zaharoff. On payment of a cheque to the policemen, Zaharoff re-acquired the manuscript, which he then consigned to the fireplace.
He was interested in promoting aviation and study: he funded chairs of aviation at the universities of the Sorbonne, Petrograd and Imperial College and a chair of French literature at Oxford University.