Butler was approached by a couple of sketchy people representing $300 million dollars
They were con artists. They
claimed they had $300 million, in reality they had nothing. Just as they claimed they had control of the largest Veteran Organization in the country, and a fighting force of over 500,000 men. That was all as fake as the money they claimed they had.
To give an idea, General Butler was one of the top leaders of the Veterans of Foreign Wars (VFW). And one has to understand that the situation then is vastly different than it is today.
At that time as today, the American Legion and VFW were bitter enemies. The VFW was founded by those who served in the Spanish-American War, and at that time tried to restrict their membership largely to those that served in that conflict. And Smedley of course was a veteran of that war.
The American Legion however was formed by veterans of WWI, and had much more open requirements for membership. And at that time, you could be a member of one, or the other. But absolutely never both. Membership to both was absolutely prohibited by each organization. And it was not unusual for the groups to actually fight each other, their relationship prior to WWII was very hostile to each other.
Now being one of the top leaders of the VFW, when Gerald MacGuire (who really was a con artist and vacuum cleaner salesman) approached him, one of the things he promised is that General Butler would gain control of the American Legion. And be free to dissolve the VFW and bring it into the enlarged organization that he would control. He promised $300 million, yes. He also promised over half a million fighting men to assist in this coup.
Now just look at it logically, that is completely nonsensical. Half a million men, and the ability to combine the two most powerful Veteran organization in the nation, all under his control. Historians are still questioning what the end game of MacGuire was, but he had none of that. He had no backers, and the investigations into it found absolutely nothing.
And Smedley had been denied being appointed Commandant for several reasons. He was the son of a career politician, and the son of two grandfathers who were also career politicians. He got his commission in the Marines because of his father, and multiple times during his service he would actually leave the Corps to take on political appointments or run business ventures. One of the first was when he was diagnosed with having a "nervous breakdown", and left for over a year to manage a coal mine.
During WWI he requested assigned to combat multiple times, but it was denied as his commanders felt him "unreliable". And towards the end of the war he was finally assigned to France, to command the debarkation point. And afterwards when stationed at Virginia he would often take his division on weeks long field exercises, and conduct reenactments of Civil War battles. That got him a lot of attention, but also had many starting to question his sanity. Like when he led a group to dig up Thomas Stonewall Jackson's arm.
But in 1924, his father was able to secure him a leave of absence from the Marines again, to take charge of the Philadelphia Department of Public Safety. He held that position for two years, and despite him and his father trying to extend it for a third year, that was denied and he was sent to San Diego to resume his duties as a Marine. Where his mouth damned near got him court martialed after an international incident where he would make claims that the leader of Italy had killed a child in a hit and run.
At that time the Commandant died, and he was the senior Marine General so was expected to replace him. However, by then his father had died so he no longer had the political support he once had. And he had made an enemy of Secretary of the Navy Charles Adams III. And not just because of the international scandal, but his frequent sabbaticals for up to 2 years to do other things as well as his erratic behaviors when he was a Division Commander.
Like when he was trying to use political pressure to be named the Commandant of the Marine Corps, he was also requesting another sabbatical to command the Oregon State Police. So needless to say, he did not become Commandant and it was suggested he retire. Where he then started a speaking tour, and tried to run for the Senate as a Prohibition supporter (and campaigned for a Socialist for President).
And most agree, by that time his sanity was likely already slipping. And once the affair became public and was dismissed as a fraud, he exited the public eye completely. Where he died 5 years later of cancer.
