=The Crédit Mobilier.=--Perhaps the most widely noticed scandal connected with the railroads was the scheme known as the Crédit Mobilier. This was made much of by the Grange and other anti-monopoly movements which reached their height in the ’seventies. Charges having been made that many congressmen had been bribed by an organization known as the Crédit Mobilier, a Congressional investigation was made,[108] Thomas Durant, vice president, and other leading stockholders of the Union Pacific Railroad, secured a controlling interest in the stock of the Pennsylvania Fiscal Agency in 1864 and had its name changed to the Crédit Mobilier of America. One of the ostensible functions of the company was to loan money for railroad construction. The same men were instrumental in awarding the contract for the building of the Union Pacific Railroad to one of their number, Oakes Ames, a member of the United States House of Representatives, for stipulated amounts per mile for the different sections ranging from $42,000 to $96,000, amounting in the aggregate to $47,000,000. The contract was right away transferred to seven trustees composed of the same controlling stockholders, who were to execute it receiving therefor $3000 per year each, and the profits were to be divided among those stockholders of the Crédit Mobilier of America who would comply with certain conditions. The Crédit Mobilier agreed to furnish the necessary money at 7 per cent per annum and 2¹⁄₂ per cent commission, not to exceed the amount provided in the contract to be paid by the Union Pacific company. These same leading stockholders of the Union Pacific being also controlling stockholders of the Crédit Mobilier were thus, because the contract prices were said to be twice the actual constructing prices, making a big profit, practically all of which was coming from the United States treasury. Complaints were being made and adverse legislation was feared. Stock in Crédit Mobilier was offered to members of congress at a very low figure on which it is said they made dividends of 340 per cent. It amounted to this: The men entrusted with the management of the road let the contract for its construction to themselves at a figure double its real cost, and pocketed the profits, estimated at about $30,000,000. These same men started the scheme, which afterward became common, of watering the stock, that is increasing the outstanding stock, and distributing it as dividends, upon the plea that the property had increased without any new outlay of money. It also appears to be a method of earning dividends upon money never invested.