In 1869, Babcock invested money in Jay Cooke & Company's Gold Ring, a scam by wealthy New York tycoons Jay Gould and James Fisk to profit by cornering the market on gold. Starting in late April, Secretary of the Treasury George S. Boutwell had regulated the price of gold by monthly sales from the Treasury in exchange for greenbacks. As part of the Gold Ring's effort, Gould convinced Grant not to increase the Treasury's September gold sale, helping make it scarce and inflating the price. Gould and Fisk then set up a buying operation, the New York Gold Room, where traders in their employ purchased as much gold as they could acquire, which artificially drove up the price. When Grant became aware of the full extent of the attempt to corner the market in late September 1869, he ordered the release of $4,500,000 in Treasury gold, which caused the price to collapse. Gould and Fisk were thwarted, but at the expense of a decline in the stock market and the overall economy. Babcock and other individuals who secretly invested with him lost $40,000 (about $750,000 in 2018). To satisfy his creditors, Babcock had to sign a trust deed on his property, which named Asa Bird Gardiner as trustee. The extent of Babcock's involvement was not revealed to Grant until 1876, when his complicity in the Gold Ring was uncovered during the investigation of his involvement in the Whiskey Ring.