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Barnet 'Barney' Barnato (Isaacs)

Also Known As: "Barnato", "Barnet Isaacs (birth name)"
Birthdate:
Birthplace: 5 Ropers Buildings, Aldgate, London, England, United Kingdom
Death: Died in At sea, near Madeira
Cause of death: Suicide / Some say murder by his nephew Solly Barnato Joel
Place of Burial: Willesden Jewish Cemetery- Section FP.H, Row 1, Plot 2, London, Greater London, United Kingdom
Immediate Family:

Son of Isaac Isaacs and Leah Isaacs
Husband of Frances Christina Barnato
Father of Leah Primrose Haxton; Isaac Henry 'Jack' Barnato and Woolf 'Babe' Barnato
Brother of Sarah Rantzen; Catherine 'Kate' Joel; Henry "Harry" Barnato and Elizabeth Nathan

Occupation: Randlord
Managed by: Priscilla Taylor
Last Updated:

About Barney Barnato

http://www.findagrave.com/cgi-bin/fg.cgi?page=gr&GRid=6764&ref=wvr

BARNEY BARNATO (21 February 1851 – 14 June 1897)

Barnett Isaacs grew up in Whitechapel, the very poor East End of London in an area that was predominantly a Jewish neighborhood. The Isaacs family lived in the area for nearly one hundred years. Isaac Isaacs, Barney’s father made a living from selling second hand clothing and fabric remnants. When Barney and his older brother Harry reached fourteen, they left school and entered the business. Their mother Leah died when Barney was seven. Kate the oldest of the siblings, helped bring up the boys and two sisters Sarah and Lizzie.

Barney and Harry had a good basic education at the Jews Free School. When they were in their teens, Barney and Harry liked to perform on stage in the Music Halls of the area, of which there were many. For the longest time Harry was introduced as the Great Henry Isaacs. Barney was added as “and Barnett too” so he suggested to Harry that they call themselves Bar-na-to, the Barnato Brothers. From that time onwards, they were known by that name on the Music Hall stages.

Barney had a talent for boxing. In his day, the Marquis of Queensbury rules were rarely used in his amateur boxing bouts. Winning was the all that mattered. He made money from his bouts, mainly by placing bets with the bookies. He was not scared of anyone. The bigger they came, the better he liked it.

In 1866, a few diamonds were found in the Cape Colony in South Africa. At first, little was written about the find in the newspapers. After a spectacularly large diamond, given the name the Star of South Africa, was sold to the Earl of Dudley for £25,000, the newspapers got to writing about a new diamond rush. In 1869, thousands of men migrated to the Cape Colony to seek their fortune. Harry decided that he would go and try his luck. Barney, the younger of the two, wanted to go as well, but Harry insisted that he go first and give it a try. After a year, he invited Barney to join him.

Barney saved up enough money to pay for his steerage passage. He left England and when he arrived in South Africa, he could not afford the coach to get to where the diamonds had been found. He ended up walking all the way with a bullock cart that was delivering supplies to the miners. It took him three months to walk there. Barney arrived in Kimberley to find that Harry was not doing very well. In fact he wasn’t making money from diamonds at all, but from performances on stage and doing odd jobs.

Before the big rush, the area was a farming community. Boer farmers owned the land. The landscape was transformed as hundreds of acres of farmland had disappeared. On what was previously the Du Toits, Bultfontein and De Beers farms, twenty thousand men were digging for diamonds. In 1881 Kimberley was a mining town with 95% of the men living rough in all manner of tents. The saloons, brothels and supply stores were made out of wood, canvas and corrugated iron. It was a lawless and dangerous place to live.

Barney spent his first year learning about diamonds, buying a stone here or there and selling at a small profit and then buying more. It was a slow process and one that frustrated him. He wanted his own claim, he wanted to dig his own stones out of the ground, not purchase each stone one by one.

Barney had a good head for figures and was a fast learner. He was shrewd, always able to calculate the odds. Eventually, the opportunity to buy a claim came to Barney and Harry. In fact four adjacent claims were offered to them in Kimberley. The brothers barely had enough money to buy the claims, but somehow they managed to do it.

It was slow and arduous work. Barney was up every day before dawn, working their claims. He would go around the dealers and sell the days finds before dusk and would back at digging again the next day. Seven days a week, no breaks. After about a year, the Barnato mining claims started to show returns as larger quantities of stones were found.

A new problem faced the already financially stretched miners the overproduction of diamonds, which resulted in depressing the market prices. The World had gone from decades of declining production from India and Brazil to massive increases in diamond production, year over year, due to the finds in the Cape Colony.

Barney and Harry believed that the only people you could really trust in business were your family. His sister Kate Joel had three sons; Jack, Woolf and Solly. On a return visit to England, Barney asked Kate to allow the boys to come and work in the business in South Africa. Kate was reluctant, but Barney persuaded her to let one of the boys travel to Kimberley with him. Interestingly, she decided that Woolf, her middle son who was only seventeen, was the most mature to take on the responsibility of the job. Woolf became Barney’s right hand man in a matter of a year or so.

Within eighteen months, Jack and finally Solly Joel joined the Barnato diamond business in Kimberley.

Jack had an unfortunate run in with the law, which appears to have been a trumped up charge of Illicit Diamond Buying. Barney got Jack out on bail and immediately booked passage for Jack to return to England on the first available ship. At the hearing, bail was forfeited, but by this time Jack was already back in England where he took over the running of the London side of their diamond business.

  

Barney conceived the idea of controlling the amount of diamonds entering the market. Keeping sales as close to demand as possible, or even less than demand. He postulated that it was possible to maintain diamond prices by stockpiling during the years when the world markets were down. As the markets moved upwards and demand increased, the stockpiles could be sold at higher prices. Of course it was necessary to gain control first.

Overproduction was only one of the problems that all the diamond miners faced. Huge problems arose where adjacent claims were being mined at different rates and the levels. This was problematic because cave-ins became ever more frequent, especially where they were undercutting the adjacent claims. It was far worse in the winter when the rains came and flooded the lower levels, often drowning miners and burying equipment.

Consolidation became Barney’s goal. Cecil Rhodes, working the De Beers mine, had the same idea and became a major competitor in the race to consolidate. Initially there were more than three thousand, six hundred claims being mined at Kimberley. In time this number dropped to less than one hundred, and the Barnato Brothers were one of them. They used this name from the time Barney arrived in Kimberley, completely dropping the Isaacs name.

As the Barnato Brothers made more money, they plowed it back into buying up more claims. Barney’s goal and obsession was the complete consolidation of the Kimberley mine. There were plenty of other players with similar goals, so it was not an easy task to achieve.

A ‘battle royal’ ensued between Barney and Cecil Rhodes. The French Rothschild Bank was involved with Rhodes, as were a number of other wealthy men. All were experienced. All wanted control of the diamond mining interests of either Kimberley or De Beers.

De Beers mine was the first to be consolidated. Not by Barney, but by Rhodes, much to Barney’s ire.

A French mining company, Compagnie Française des Mines de Diamants du Cap de Bonne Espérance, held a large block of claims that split Kimberley mine in two. A wealthy Parisian diamond dealer, a Mr. Jules Porges, owned this company. Rhodes managed to secure substantial backing from Rothschild Bank to purchase this French Company.

Barney got wind of the sale and telegraphed Porges asking for an opportunity to bid if a sale were immanent. Rhodes bid £1,400,000 to buy the company. Barney topped the offer by bidding £1,750,000. Before getting a response from Porges, Rhodes telegraphed Barney and asked him to withdraw his offer. In return, Rhodes made Barney a tempting offer, one that he could not refuse.

In return for withdrawing the offer, Rhodes would buy the French Company at his original bid price and sell it to Barney for £300,000 plus a twenty per cent holding in the Barnato’s Kimberely Central Diamond Mining Company.

There is no doubt that this must have been a difficult decision to make. It would give him what he obsessed about, the control of the Kimberley Mine. Enabling him to convert it to underground mining. The dilemma was that he was giving up a large part of his company to a rival. They may have been competitors, but Rhodes and Barney actually liked each other and got on well, even though they came from diverse backgrounds and upbringing.

After several days consideration, Barney agreed to withdraw his offer and a month later the French Company was in his hands.

Rhodes undoubtedly calculated the odds well. He and his partners had been buying up shares in the open market in Kimberley Central DMC and may well have had ten to fifteen per cent of the shares at the time of the sale of the French Company. With the extra twenty per cent, they were well on their way to gaining control of Kimberley Central DMC.

Barney tried to keep control of his own company, but Rhodes outsmarted him, finally gaining control of Kimberley Central DMC a few months later. The upside was that shares in Kimberlery Central DMC rose from £14 to £49 each because of the competition from both camps. The downside was that it was higher diamond production that was fueling the buying spree. Resulting in diamond prices hitting an all time low.

Rhodes proposed that they merge the De Beers DMC into Kimberley Central DMC, forming one new consolidated company; De Beers Consolidated Mines. The merger made sense, even though they both knew that the merger would upset some of the shareholders.

Barney emerged as the largest shareholder with 6,658 shares in the new company. Not all the investors were happy with this situation. A group of shareholders from Kimberley Central applied in the Supreme Court of the Cape to stop the merger. The judge ruled in favor of the applicants. The result was that Kimberley Central was liquidated and the De Beers Consolidated purchased the company. The Barnato Brothers shares ultimately were bought out for the astronomical sum of £5,338,650 in 1889.

As part of their control of all diamond mining in the Cape Colony, De Beers Consolidated purchased two other mines in the area, Bultfontein and Dutiotspan. The yield on the latter was poor, but the quality of the diamonds found there was far superior to all the other mines. It was a gamble that underground mining could eventually make both of these mines productive.

Neither one of these was showing a return on investment, but they could not be allowed to pass into the hands of a competing company which might mean that at some point, they could undermine the prices, undoing the efforts made to stabilize prices. The most important thing that the merger produced was the 95% control of worldwide diamond production. Both Barney and Rhodes were in full agreement on this.

Rhodes and Barney planned to reduce the number of buyers for the rough diamonds to ten companies who would in turn sell to the diamond cutters and set up lines of distribution throughout the World. De Beers Consolidated duly carried out this plan and the ten companies became known as the syndicate. The syndicate included Barnato Brothers in London. Only these ten companies could buy production from De Beers Consolidated Mines.

Diamond prices leveled off and finally increased steadily in value. Regardless of production levels, supply was kept on or close to demand.

Harry returned to England to help Jack run the London side of the business. He was a very wealthy man at this point in his life he had tired of the rigors of Kimberley. He longed for a more genteel way of life that London could offer him and his wife and daughter.

In 1888, Barney, a man who refused to be involved in politics, a truly non-political person, got himself elected to the Cape Parliament. It was Rhodes who encouraged him to stand for election.

Barney turned his attention to the newly discovered gold area of the Witwatersrand or Rand as it became known.

	Gold in quartz is extremely difficult to separate. It is not like alluvial gold that can be panned in water. It takes a great deal of machinery and a great deal of money. This was money, most of the miners did not have.

The wealthy diamond dealers and owners of Kimberley understood what it would take. They were prepared to make the investment that was needed and went to the Rand where they bought up the most promising claims.

At the time of the initial discovery, Barney did not want to detract from his plan to take control of Kimberley Mine and rejected Harry and Woolf’s urging to invest in gold mining.

By 1888, after the consolidation of diamond mining had taken place, the Barnatos were late in coming to the mining town being called Johannesburg. Their big advantage was their coffers were full. And so began the start of a dozen gold mining companies floated on both the London Stock Exchange and the new Johannesburg exchange. These mining shares were given the nickname ‘kaffirs.’


Gold did not fluctuate, as did the price of diamonds, it was possible to calculate the exact amount of profit that could be made from a gold mine. The Bank of England backed its currency using a gold standard. The Americans were about to introduce a gold standard for their currency having had a silver standard for many years. Every ounce of gold that was mined could be sold to one government or another at a set price.

Two doctors, MacArthur and Forrest, invented a new process for extracting gold from the ore using cyanide. It was possible to extract ninety-six per cent of the gold from the ore, using this process. Barney ordered the necessary equipment to be shipped from England to set up a cyanide plant for each of his mines.

Investing in the Rand became the Barnatos highest priority. With the help of nephews Woolf and Solly, Barney went on a buying spree spending more than a million pounds in one year. Additionally, he invested in all manner of infrastructure that he knew would be needed for the future growth of Johannesburg. He purchased land in the new town to build offices, shops and market stalls, including a new stock exchange. Recognizing the need for somewhere to live in town, Barney purchased a farm in the Doornfontein section and completed the construction of a large house on Saratoga Avenue in a new exclusive suburb. Anything and everything that was needed to stimulate the growth of Johannesburg, was considered.

Solly moved to Johannesburg full time, whilst Woolf took over as principal partner on the diamond side of the business in Kimberley.

Barney married Fanny Christina Bees. They had 3 children: Leah (Lily) Primrose, Isaac Henry (Jack) Barnato and Woolf (Babe) Barnato.

Early in 1889, Barney floated his first gold mining company on the London and Johannesburg stock exchanges. The New Primrose Gold Mining Company was a combination of a number of claims he had purchased on two adjacent properties. At the same time he floated the Johannesburg Estate Company, which had nothing directly to do with gold mining, only real estate and peripheral businesses in the town.

After the formation of his Johannesburg Consolidated Investment Company that year, he went on a major acquisition plan and invested in multiple businesses; building materials, transport, food wagons and liquor.

In 1889 Barney met with Paul Kruger President of the Transvaal Republic for the first time. They met on many subsequent occasions and a friendship grew between them.

Water was critical to the survival of the town and it was fortunate that Barney had bought a controlling interest in the Johannesburg Waterworks, when Sir James Sivewright needed funds to continue operations.

Johannesburg had both bust and boom times. After a prolonged drought, food was in short supply. The supply wagons either did not make it to Johannesburg or were half-full when they arrived. A rumor spread like wildfire that the gold was played out. Share prices went into sharp decline, even though production levels were increasing and gold prices had not changed.

The geologists that Barney employed informed him that the gold deposits on the Rand were like an inverted triangle and went extremely deep. In fact they estimated two thousand feet or more. In the New Primrose Mine, they had already sunk a shaft three thousand feet deep and there was gold at that level. This meant the cost of extraction would increase exponentially the deeper the shafts were sunk. But the geologists were very positive about the potential of the gold deposits. It was estimated at that time that the cost to make a profit on any deep level mine was in excess of one million pounds.

Equipment arrived from England every month. The Barnato Mines had the very best. The cyanide plants were a great success and much of the discarded early tailings were reprocessed, adding more profit to the bottom line of the publicly traded companies.

Barney had an amazing amount of energy. He split his time between Johannesburg, Kimberley and Cape Town. He juggled multiple companies and knew almost to the penny what each one was making. He could remember huge amounts of financial information, rarely taking any notes.

The Transvaal Government taxed the foreigners, or uitlanders, as the Boer’s called them, unmercifully. Kruger ran the country with an iron hand. The Volksraad or parliament was made up of Dutch Boers only. Foreigners could not hold office. In fact they could not even vote.

Barney complained many times to Paul Kruger, but his complaints and those of others, fell on deaf ears.

Things got so bad that there was talk of rebellion in Johannesburg. A group calling themselves the Reform Committee, decided that it was time to overthrow the Boer Government and have the Transvaal annexed by Great Britain.

There is no telling if the British Government had any involvement in the action that followed. Certainly, Cecil Rhodes, then the prime minister of the Cape Colony, was in some way connected. His brother was one of the Reform Committee. Rhodes expansion of the British Empire in Africa was well known and had the backing of the government at Westminster.

Dr. Leander Starr Jameson had raised an army of roughly six hundred men. At the end of 1895, in preparation for a planned uprising, Jameson moved his men to Pisani, on the border of the Transvaal. The plan was for the men of Johannesburg to revolt and seize the Boer Government armory in Pretoria. The second part was for Jameson to immediately cross the border to restore law and order in Johannesburg, and secure the goldfields. Once he had achieved this, he was to go on to Pretoria and take control of the government of the Transvaal.

Jameson was ready, his men were ready, but the Reform Committee was not. A cable to Jameson from the Reform Committee, told him to stand down and wait. On December 29th, Jameson cabled Rhodes. Jameson received no reply and the next day sent a second cable.

Unfortunately, the first cable was delayed and both arrived at the same time, creating a lot of confusion. In the meantime, Jameson’s men had cut the telegraph wires so that the Pretoria garrison could not cable for reinforcements. When the Committee tried to send a reply, there was no possible way to hold the coup back. Jameson and his men invaded the Transvaal and headed for Johannesburg.

Unfortunately for the raiders, they had cut the telegraph wires to Cape Town, but had failed to cut the wires to Pretoria. From the time they crossed into the Transvaal, the Boer forces were tracking them. At Doornkop a decisive battle took place. It went on for several hours before Jameson, realizing that to continue was futile, surrendered to the Boer commander.

Kruger protested to the British Colonial Secretary, Joseph Chamberlain, in no uncertain terms, accusing the British Government of involvement.

Under pressure from the British Colonial Secretary, Rhodes was forced to resign as Prime Minister of the Cape Colony for his role in the affair. Dr. Jameson, his officers and all of the raiders in Boer custody were handed over to the British Government to be returned to England for trial.

On January 8th and 9th all sixty-four members of the Reform Committee were arrested on charges of high treason, and thrown into jail in Pretoria. Solly Joel, Barney’s nephew was among those charged.

	The trial of sixty-four members of the Reform Committee started on April 27th. Considering the number of men on trial and severity of the crime, it was short, only a few hours. In a bargain agreement with the Boer court, John Hays Hammond, Lionel Phillips, Percy Ferrar and Col. Frank Rhodes, Cecil Rhodes’ brother, pleaded guilty to the charge of High Treason. The other members pleaded guilty to lesser charges.  

The four were found guilty and were sentenced to death. The other members of the Committee were sentenced to two years imprisonment and fines of ten thousand pounds each, or in default, an extra year in jail. They were also banished from the Transvaal for three years after their release.

 

Many of the most prominent members of the mining community were amongst those found guilty. There was no doubt that this verdict would devastate the production of gold mining.

Barney wasted no time journeying to Pretoria. Without hesitation, he burst in on Kruger and demanded that all the men were released without delay. Kruger refused. He told Barney that the sentences would be carried out according to the laws of Transvaal.

Barney threatened to immediately shut down his entire mining business in the Transvaal. He had twenty thousand whites on his payroll and one hundred thousand natives. By closing down all his mines he would put more white men out of work than there were burghers in the State of Transvaal.

At the time his various companies paid out somewhere in the region of £50,000 every week in fees and taxes. Closure meant a huge loss in revenue to the state. He had already lost twenty million pounds in production since the beginning of the year. With the principals of all the major mining concerns in prison, Kruger was threatened to lose all revenues from gold mining.

This was no idle threat, Barney intended to get the men released or cripple the country. He told Kruger that under no circumstances would he reopen the mines until the Transvaal Government had fallen, if the sentences were carried out.


Kruger was not the sort of person that could be easily pushed around. It was probably the first time in his life that he had been confronted in such a manner. He was an intelligent man who knew that he was facing an adversary that could indeed bring down his government. He knew that the British Government would step in and annex his small country without hesitation if there was indeed a revolution.

An agreement was reached and Barney paid fines in excess of one million pounds to get all the men released. He had not only secured the future of the gold mining industry, he had saved the lives of four men, possibly more, as the conditions in the Transvaal prison could have killed a number of those with lesser sentences.

Barney decided to keep a low profile for a while. He was concerned that the Boers would take retribution, although there was none taken. However, he did receive threats to himself and the family. This raised his level of concern to the point where he seriously considered moving back to England, either for a year or permanently.

Early in 1897, the chief accountant at Johannesburg Consolidated pointed out to Barney that there was an irregularity in the accounts for an amount in excess of one million pounds. Barney was astounded by this and ordered a complete audit. The audit confirmed this and laid the blame on Solly Joel.

When Solly was confronted with the discovery he denied it. But Barney must have shown him the proof and ordered him to make it good to the company. Furthermore, he ordered Solly back to England, something that Solly had no intention of doing. The alternative was the threat of a trial and imprisonment.

	The story of the embezzlement has been handed down through the family, but there was definitely bad blood between Barney and Solly. 

At the beginning of June 1897, Barney, Fanny and the three children boarded the RMS Scot in Cape Town for a voyage to England. Solly was also on the ship. On June 14th 1897 close to the island of Madeira, Barney Barnato drowned off the ship. He was 46 years old.

The Inquest into the death of Barney Barnato

From the details of the inquest that was held in Southampton on Friday June 18th, 1897, the following details emerged:


Solly Joel was the first to testify. He stated the following: “I was a passenger on board the Scot, and the deceased Mr. Isaac Barnett Barnato was a fellow passenger. I was walking on deck with him on Monday last at nine minutes past three in the afternoon. I was getting tired, so I asked him to sit down. He said, “Oh, no, let us walk.” We, however, sat down, and he asked me – “What is the time?” I looked at my watch, told him, and then I saw him dash by. I had not time, in fact, to close my watch, or even to lift my eyes, when he gave a spring. I threw out my hands to catch him, but only caught the back of his trousers, and he jumped over the side into the sea. I screamed “murder,” and saw the fourth officer, who was sitting dozing, and said “For God’s sake save him.” He said, “I will try.” He took his hat and coat off, and dived into the sea, while I stood pointing out where he was. They stopped the vessel, and life-buoys were thrown over. The ship then turned round, and a boat was lowered. The fourth officer was first picked up and then the body. Every effort was made by artificial respiration and other means, but without success.

In answer to further questions, Mr. Joel said: “deceased at times was not in his right mind. One hour he appeared to be quite well, and the next his mind would wander. On the fatal day I noticed his behaviour, and made up my mind not to leave him, and I did not. I think he had never shown signs of suicidal mania before.”

William Tarrant Clifford, the fourth officer of the Scot, was the next witness. He stated: “I had seen and spoken to Mr. Barnato once or twice on the journey, and noticed nothing peculiar either in his appearance or actions. On the 14th, when in latitude 31.8N and 17.13 W., I saw him leap overboard. Mr. Joel said something I don’t remember, and I think I said “I’ll go,” and with that I pulled off my coat and jumped in after him. I did not reach the body, though I saw it some way off. I was subsequently picked up by the ship’s boat.”

Clifford produced the ship’s log, which showed that lifebelts were thrown overboard and that the ship rapidly turned and steamed in the direction of the body.

Answering a question from a member of the jury, Mr. Joel said there was no one beside himself with the deceased when he jumped overboard, and he did not know if others saw him. Mrt. Clifford subsequently explained that the ship’s rail was only about three feet high, where the deceased jumped off. When the body was found the face was downwards.

Mr. Solly Joel, before the jury gave their verdict, intervened and said that the Monday before sailing he received a telegram from Mrs. Barnato asking him to come to Cape Town because of Mr Barnato’s mental condition. He left Johannesburg by the next train, and found Mr. Barnato in very bad health. He had eaten nothing nor slept for three or four days, and at times wandered considerably. Subsequently, however, he improved, and was much better when the ship sailed.

(Fanny Barnato who was not at the inquest, denied that she had sent this telegram and that Barney was in very bad health, mentally or physically.)

The jury, after a short retirement, returned a verdict that the deceased jumped overboard, and met his death by drowning while temporarily insane.

Sources

Anthony Davis - Barney Barnato - King of Diamonds

http://www.tokencoins.com/barnato.htm

http://en.wikipedia.org/wiki/Barney_Barnato

http://www.npg.org.uk/live/search/portrait.asp?search=ss&sText=Barnett&LinkID=mp00260&rNo=0&role=sit

http://www.jewisheastend.com/Willesden%20Cemetery%20Barny%20Barnato.jpg

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Burial record:

http://www.theus.org.uk/support_services/find_your_family/burial_records/

First name(s) Last name Date of burial Section Row Plot #

BARNET ISAAC BARNATO JOEL 20/06/1897 FP.H 1 2

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Barney Barnato's Timeline

1851
February 21, 1851
London, England, United Kingdom
1893
March 16, 1893
Age 42
1894
June 7, 1894
Age 43
London
1895
September 27, 1895
Age 44
London, England
1897
June 14, 1897
Age 46
At sea, near Madeira
June 20, 1897
Age 46
London, Greater London, United Kingdom
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