April 5, 1933 President Roosevelt issued an executive
order over the gold standards, which forbid US citizens from hoarding or owning
private. On January 17, 1934, President Roosevelt signed the Gold Act. The
Federal Reserve set the price of gold at $35.00 per troy ounce. This helped with
making the Federal Reserve stronger and the foreign debt easier to amortize.
A few years earlier Professor Morada had predicted
this outcome. His group known as the Trabuco group purchased to buy all the
Mexican gold at $20.67 or less if possible, hold it, and then sell it in the
His prediction was that gold in the US could go as
high as $40 per ounce by 1935 or 1936. Professor Morada at the time planned a
way for the group to smuggle the Mexican gold into the US and sell it for a huge
profit. Before he had the deal completed he had already stored around 8 tons of
gold and another of his group, Ricardo Artega, had stored 4 tons.
In August of 1933, Trabuco and two other employees
drove over the border of the US explaining they were going hunting in New
Mexico. In New Mexico, they told officials they had permits to hunt in Colorado.
While here, they contacted various crop dusting companies until they found Salt
Lake Flyers and one of their best pilots, Bill Elliot. Elliot with the money
sent to him for fuel in the amount of $200 visited Trabuco in Kirkland, New
A deal was agreed in that Trabuco would supply all
the fuel, the groceries and $2,500 per flight to bring the Mexican gold to the
US. The rest of 1933 was used to carry the bullion from Mexico to what we call
Four Corners. Of course, the Mexicans were patrolling the area to ensure the
plane and its contents would go undiscovered.
It was reported that Elliot made 10 flights from
August 1933 until November 1933 in order to move all the Mexican gold.
On January 17, 1934, the Gold Act was signed and enacted. This is not what
Trabuco had really expected. The order was that all banks, storage refiners, and
brokers had to turn their gold over to the federal mint, which would give them
paper money in its place at $35.00 per ounce. The bad news was that it became
illegal for private citizens to turn in their gold or they could face the
illegal storage laws violation that had been enacted earlier. It was also
illegal to sell to anyone except for the federal mints. Exporting or selling
gold to foreigners was also against the law.
Late in 1935, Trabuco went back to the US to begin
selling the Mexican gold. He went back to his group after his visit to explain
that selling in the US could be impossible and they should look at a different
plan. The reason he came back with this report is that he spoke with private
broker in Denver, Colorado that explained no private broker would touch foreign
He learned at Denver, no private broker would touch
foreign gold. Trabuco's plan was to acquire a trusted Latino U.S. citizen
partner, file a mining claim and filter the bullion through the mine records to
the federal mint sales.
A bit of history occurred with several members of
the Trabuco group dying from either illness or World War II. At the end of the
war, the only surviving member was Trabuco.
Trabuco tried on various occasions to sell his
gold; however, all were met with problems. During 1933 and 1934, it is believed
the gold was stored near by the Shiprock area, on the Indian reservation,
however, at a later date he did move the gold to his private site. Searches have
been made throughout the area, but the gold has never been recovered.