Jabez Balfour as Liberal candidate in Croydon at the general election but lost to the Conservatives. He also stood unsuccessfully for the Liberals at Walworth in 1886. In 1880 he was appointed chairman of the Northampton Street Tramways. Together with City financiers Leopold Salomons and Sir John Pender, Balfour founded the investment underwriting firm the "Trustees, Executors and Securities Insurance Corporation, Limited" in December 1887. In 1892, he was at the centre of a scandal over the failure of a series of companies which he set up and controlled, starting with the London and General Bank and culminating in the Liberator Building
Jabez Balfour Society, leaving thousands of investors penniless. Instead of advancing money to home buyers, the Liberator had advanced money to property companies to buy properties owned by him, at a high price. After the swindle was discovered, Balfour fled the country. He was arrested in Argentina by Inspector Frank Froest of Scotland Yard in 1895; with extradition proceedings held up by legal wrangling, Froest simply bundled Balfour into a train and then a boat sailing for England, "The Tartar Prince". The captain of the ship, Thomas Hesketh, later received a letter from Balfour thanking him for the kindness and hospitality shown