Salad Oil Scandal
Categories: Ethics/Morals
The United States has seen its fair share of scandals over its 240-plus-year history. From Abraham Lincoln’s assassination to Watergate, from steamy celebrity sex tapes to Enron, we’ve definitely seen some drama. But out of all those scandals, none pair as nicely with a bowl of fresh summer veggies as the “Salad Oil Scandal” of 1963.
Never heard of it? Well, it’s also called the “Soybean Scandal.” If that’s still not ringing any bells, allow us to shed some light.
In 1963, a company called Allied Crude Vegetable Oil used a bunch of salad oil as collateral to secure some huge loans. So far, so good, right? Salad oil, loans, collateral, everything looks fine here. Well, as it turns out, everything was not fine. A whole lot of that salad oil was actually just water hidden in salad oil containers and topped with just enough oil to fool inspectors (remember, gang: oil floats).
When all was said and done, this scandal ended up costing over $150 million to sort out. That’s like $1.25 billion in 2019 dollars. The company went bankrupt, the company’s CEO went to jail, the lenders that lent Allied Crude the loan money suffered huge losses, and the value of soybean-oil futures dropped into the toilet. All in all, it was a huge calamity, and its economic and financial effects were only compounded when President Kennedy was assassinated just a few short days later.
