Tuesday, June 25, 2024

Lightly Peated

Whisky, Blabber 'n' Smoke


Kritz Not Pomeroy

I thought I was done with Jay Pomeroy but research is never neat and tidy and fully resolved. There are always threads left dangling that can either be ignored (the safest option) or pulled. One thread concerned the associates involved in the whisky tax case. Is anything known about them? Does it matter? After some further digging I think that in on case it might.

Abraham Kritz was originally included, by the Inland Revenue, in the tax case concerning Thomas Barr and Company,  as he had been paid an extravagant fee of £17,500 for introducing the business to Jay Pomeroy as a possible target. Although the Court of Session dismissed his liability for Excess Profits Tax, his name on the sheet not only shows a connection, it suggests he was one of the group of promotors. This suspicion deepens when we find out that one of the people who nominally bought Strathisla during the game of pass the parcel was Ada Kritz, his wife. In that case the Court could not unreservedly conclude that she was acting as proxy for her husband but the suspicion was very strong. He was definitely one of the gang.

Interestingly he had a similar background to Jay Pomeroy being a Russian Jew, who had a history of trading in various goods and periodically going bankrupt. Their association is not surprising as they were part of a small London community. It is very easy to imagine people of similar background meeting socially, becaming friends and discussing business, plans, and ideas. Could they have then seen an opportunity for profit by working together? They would be independent businessmen making a temporary alliance, whilst maintaining their own businesses and identity. But is it also possible that those individual identities might have become muddled to outsiders?

I say that because the Jay Pomeroy described in the whisky press  is nothing like the man who promoted opera, whilst it is spot-on as a description of Abraham Kritz. This man was a thoroughly bad lot, an unreconstructed rotter who deserves all the epitaphs thrown at Jay by the whisky press. He was fraudulent, dodgy and shady, without a care for his victims.

He was the man sentenced to prison for four years, in 1949, for fraud.

The case is quite extraordinary in that he somehow managed to persuade five people (friends and relatives) to give him control of their bank accounts and then write large cheques in favour of himself. How can someone be so silver tongued that this is possible? Presumably he had outlined some infallible way of making big money and like all the best con men he was very plausible.

The fraud though was not really against these people, they were collateral damage, it was against the bank. He started by paying in a large amount of money into his account and then drawing it out so that during 1946 he paid £1,879,232 in year ending December 1946 and withdrew £1,894,133. When the bank manager became suspicious and questioned what was happening he was told it was about a whisky deal and took him to a room full of stock as proof. But this was not about whisky; whisky was merely used as a commodity with which is was possible to make excessive profit. What he did was pay cheques from the surrogate accounts and immediately draw money out against them, relying on the 5 days it took to clear a cheque and hence discover there were no funds to cover it. In the end he owed the bank between £70,000 and £80,000.

Presumably he had created some sort of Ponzi scheme where early investors were repaid by money given by later investors. Eventually such schemes always crash. Abraham Kirtz was then made bankrupt and the crooked dealings were revealed and then prosecuted. He was found guilty and jailed.

If you look at the details of the scheme, it dangled whisky as something that can be sold outside the normal channels for a big profit and then you go back to the testimony of Stewart McBain about whisky being sent to unknown London dealers and the suspicion it was being resold on the black market. It makes sense.

Unfortunately Kirtz was incorrigible. In 1955, only a few years after being released, he was again convicted of fraud, this time committed against textile merchants. He was jailed for seven years. At his trial the judge called him “an impudent and persistent rascal …by your actions tie have done your best to undermine the whole of commercial trust that exists in this country.”

He was a fraud and a criminal but he was not Jay Pomeroy, even if, in 1948, they had offices in adjacent buildings (140 and 141 Park Lane). This physical closeness gives me pause for thought. I hope the opera business kept Jay Pomeroy busy enough to not be sucked into any other business schemes with Abraham Kritz.

P.S. The picture at the head of this post comes from the film The Lavender Hill Mob. I thought it appropriate because the plot involves a couple of inconspicuous outsiders (a clerk in the Bank of England and an amateur artist who casts tourist memorabilia) who hatch a plan to rob the BoE of gold bullion and make their escape by casting it into Eiffel Tower paperweights. At first the plan succeeds but then it all goes wrong. Never mind the comparisons with The Great Gatsby I have previously made, the whole whisky tax case is probably more like the Lavender Hill Mob.

The Pomeroy Posts:

  1. An Introduction
  2. The Two Jays – how a novel can be used as a lens to compare characters.
  3. The Years of Obscurity – the first ¾ of his life.
  4. The Glory Years – His  years as an impresario.
  5. The Whisky Tax Case – the revenge of the Revenue
  6. Sam and Jay – There were some similarities between Sam Bronfman and Jay
  7. Chinese Whispers – how the whisky literature has misrepresented Jay Pomeroy
  8. McBain and Maclean – A source of some misunderstandings
  9. And Finally – at last

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