Ulysses S. Grant
The Whiskey Ring was the largest scandal and involved widespread fraud. Grant had appointed an army friend John MacDonald as an Internal Revenue Service supervisor for the St. Louis area. In return for bribes, whisky distillers paid taxes only on a small portion of the whiskey they produced. They were cheating the U.S. government out of millions of dollars a year. MacDonald kept some of the money while some of it went to the Republican Party. The Whiskey Ring was paying some officials a regular salary to keep them from talking. Benjamin Bristow, the Secretary of the Treasury at the time, had no idea this was going on. Each time he sent inspectors on a raid to check out suspected cheaters, their records were always in good order. Bristow had no idea someone in his office was telling them in advance who was to be inspected. Meanwhile, Grant accepted expensive gifts from MacDonald not suspecting he was running a fraud scheme. MacDonald even told his friends in St. Louis that Grant was in on the scheme. In 1875, MacDonald and more than 350 distillers and government officials were indicted. This included Grant's personal secretary Orville Babcock. He was the one keeping ring members informed of any inspections. At his trial, witnesses lied and even President Grant wrote a letter stating Babcock was of good character. As a result, Babcock was exonerated of the charges, but the scandal prevented him from going back to his job in Washington. Of those accused, 60 paid fines while MacDonald and two others went to prison. The Whiskey Ring proved to most Americans that Grant's administration was filled with corruption.