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1872

Crédit Mobilier Scandal Emerges

The Crédit Mobilier was positioned as a supposedly independent, and thus impartial, company that Union Pacific could hire for construction and contract management of the railroad. Instead, UP directors funneled projects through Crédit Mobilier — of which they were also investors — paying the transparent holding company inflated prices and pocketing the difference. The fraud came to a head when the New York Sun revealed that several members of Congress had accepted cash bribes or shares of Crédit Mobilier stock. The scandal resulted in a Congressional investigation that censured two participants and caused a financial collapse that left UP on the verge of bankruptcy.

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In the mid-1860s Thomas Durant and Union Pacific Director George Train bought control of the Pennsylvania Fiscal Agency. Impressed with the work of the Crédit Mobilier de France, an international banking firm, they changed the name of the Pennsylvania company to the Crédit Mobilier of America.

In 2012, Union Pacific celebrates the shared stories that have shaped our country since 1862. To mark our 150th anniversary, we invite you to explore how the nation’s largest railroad came to be and how UP continues to build America with innovation and tenacity, touching the lives of nearly every citizen.