FBI Hunt for Civil War Gold Detailed in Unsealed Affidavit

(Bloomberg) -- Was a ton of vanished Union gold stolen by a secret group of Confederate sympathizers and hidden in a rural Pennsylvania cave at the height of the Civil War?

That’s what an FBI agent was seeking to find out in 2018 when he applied for a search warrant to dig at the site in Elk County, northeast of Pittsburgh, according to a court filing unsealed on Thursday.

In an accompanying 30-page affidavit, Federal Bureau of Investigation Special Agent Jacob Archer cites tips from treasure hunters, old newspaper clippings and magazine articles as “probable cause” that a ton or more of gold mined in California and destined for the U.S. Mint in Philadelphia when it disappeared in 1863 was buried in cave located inside a 217,000-acre state forest. According to Archer, the gold may have been stolen by a shadowy group called the Knights of the Golden Circle.

Archer got his warrant, but the FBI later said it didn’t find anything. The treasure hunters cited by Archer aren’t so sure. Father-and-son team Dennis and Kem Parada think the government may have found the gold and kept it quiet to avoid having to give them a cut of the find. They fought the government for records relating to the search, which led the Philadelphia Inquirer and Associated Press to request the unsealing of the warrant and Archer’s affidavit.

The FBI didn’t respond to a request for comment.

Perilous Journey

Archer, a member of the FBI’s art crime team, colorfully detailed how transporting gold from the West to fund the war effort had become an enterprise fraught with peril by 1863, with the changing front lines, gangs of outlaws, Confederate sympathizers known as “copperheads” and “just plain train robbers” all threatened cross-country transport. Archer said a story found in the archives of the Military History Institute entitled “The Lost Gold Ingot Treasure” suggested the gold believed to be in Elk County in 2018 started off in Sacramento and traveled east in an epic journey along the Oregon Trail, down the Platte and Mississippi Rivers before reaching a rendezvous point near Pittsburgh.

According to the story, this last phase of the journey involved a caravan of “wagons and armed horsemen” led by a Lieutenant Castleton. The gold ingots were painted black and hidden under false bottoms, so that the wagons appeared to be carrying ordinary freight. According to the story, Castleton paid “an old woods rat known as Joe” to lead the caravan, which became “helplessly lost.” Some of the men went for help, but the rest and the gold were never seen again, despite a comprehensive post-war search by Pinkerton detectives.

But Archer said further research suggested the story was in actuality a “waybill,” or coded map the Knights of the Golden Circle used to mark hidden caches. The group, which operated in both Union and Confederate states during the Civil War, “buried secret caches of weapons, coins, and gold and silver bullion, much of which was stolen from robberies of banks, trains carrying payroll of the Union Army,” the FBI agent wrote.

The Paradas believed they had located the gold after making hundreds of visits to the Elk County cave and conducting tests with radar and metal detectors. Archer said in his affidavit that the FBI hired a contractor to survey the site with a microgravity meter, which detected a “large underground mass” with a density matching that of gold and having a weight of up to nine tons. The FBI agent said he was seeking the warrant in part because the federal government was worried the state of Pennsylvania might try to seize the gold.

William Cluck, a lawyer for the Paradas, said the release of the affidavit confirms that the FBI “determined there was a scientific basis to conclude there was nine tons of gold buried at that site.” But Cluck said his clients were still seeking additional records about the search itself, noting the Paradas were never allowed up to the site during the dig.

“Why wouldn’t the FBI allow the treasure hunters to be present during the dig?” Cluck asked.

©2021 Bloomberg L.P.