The Great Texas Treasury Raid

When the bell atop Austin’s First Baptist Church began clanging that moonlit Sunday evening of June 11, 1865, the town’s civilian home guardsmen knew it signified trouble, not a call to worship.

With hundreds of battle-hardened ex-Confederate soldiers swarming the town of 4,000, none of the volunteers were surprised that a need for their services had arisen. But the nature of the emergency would rock the war-weary state.

Once the Civil War effectively ended with Gen. Robert E. Lee’s surrender on April 9, Texas rapidly descended into near anarchy. One Confederate general refused to lay down his arms: Joseph “Jo” Orville Shelby. Hoping the South might rise again, Shelby and the 400-plus soldiers of his “Iron Brigade” of Missourians marched toward Austin enroute to Mexico.

Most Texas officials, unsure if they would be hanged as traitors or merely told to go and sin no more, preferred not to find out and vacated their offices. Only the lieutenant governor (now acting governor) and two financial officials, Comptroller Willis L. Robards and Treasurer Cyrus H. Randolph, opted to stay.

“…Confederate soldiers, without officers or order, are coming in every hour, and there is nothing but plunder and sack going on—and the citizens are as bad as the soldiers,” Amelia Barr wrote in her diary on May 25. Eight days later, she noted, “Everything in confusion…and there is no law.”

But newly discharged Confederate Cavalry Capt. George Freeman had taken it upon himself to organize a 30-man home guard to help preserve the rule of law in the capital city.

Shortly before nine, on the night of June 11, Nathan Shelley, a former state attorney general before joining the Confederacy, received word that some 40 armed men had broken into the unguarded state treasury.

Shelley told Freeman something was afoot. Easing through the shadows toward the Capitol, the two heard metal striking metal from the treasury. Freeman ran to spread the alarm.

Confederate veteran Fred Sterzing heard hurried footsteps followed by someone knocking on the door and yelling that the treasury was being looted. He raced to the Dieterich Building, where the armory occupied the second floor.

Nineteen volunteers removed rifles from their stacks, fixed bayonets and gathered in formation in front of the building. Freeman led the company to the Baptist church across from the Capitol. At his command, the guardsmen charged toward the three-story limestone state house. Lookouts posted by the bandits fired at them, but no one got hit.

Freeman’s men entered the Capitol without encountering further resistance. They sprinted to the adjacent treasury. The bandits inside the treasury bailed out the north door, clutching their hats, shirts and tied-off trousers filled with coins.

Johanna Domschke, who lived across the street from the treasury, heard the sharp reports of rifles and pistols. As she watched, wind raised her apron and a stray bullet punched a hole in the garment, barely missing her. Despite the danger, she stayed outside and observed the bandits as they fled on horseback.

His men dismounted and outnumbered, Freeman decided not to give chase. He focused on the one intruder who remained inside. Freeman and three men headed for the second floor. He and his brother took one set of stairs; Sterzing and Al Musgrove, the other. The rest of the volunteers surrounded the building.

When the guardsmen reached the top of the stairs, the man fired at them. Musgrove recalled that the bandit “came…into the hallway. In one hand was his hat filled with silver and his six-shooter in the other.…”

Musgrove and Sterzing fired back, and one of the bullets hit the robber in the stomach. The man retreated into the vault room. Musgrove stuck his pistol through the door to fire again, but before he could pull the trigger, the man cried, “Don’t shoot…I am mortally wounded.”

Still covering the man, Musgrove watched as he “came out bent almost double and fell to the floor,” whiskey oozing from his wound.

Inside the vault room, scattered coins, negotiable bonds and worthless Confederate States of America cash covered the floor. The robbers had used pickaxes to punch holes in the backs of two large safes to get to the money.

Freeman’s men carried the wounded bandit to the former Swisher Hotel, the San Marcos. Musgrove recognized the man as a drunk he had seen in town a few hours earlier. “As he passed me he said, ‘It’s about time for the boys to meet, isn’t it?’” Musgrove recalled, but he had paid no attention to the remark at the time.

Freeman’s company guarded the treasury that night. Shortly after daylight, Freeman led a posse in pursuit of the bandits. The raiders had split into two parties to make following them harder. One trail led northwest, and another ran north. Riding each, all the volunteers found were a few dropped coins.

Alex Campbell, the gut-shot robber, died hard. While refusing to name his colleagues, to his last breath, he profanely upbraided his fellow bandits as cowards.

One night, shortly after the raid, someone broke into Sterzing’s room. Awakening to see a man standing over him with a knife, he struggled with the intruder, who escaped. Sterzing snapped off a shot, but missed. The same night, someone found Comptroller Robards bound and gagged. The city feared another attack on the treasury, but nothing more happened.

Austin not only lacked sufficient law enforcement to keep the peace, it also had no newspaper to report the crime. The Galveston News later ran an item that noted, “It is the universal belief of the citizens that the robbers…had been waiting to lay blame on Shelby’s men when they arrived there.”

Freeman wrote to Maj. F.W. Emory in Galveston, telling him that the troops had saved about $30,000 in specie and U.S. coupons, and hundreds of thousands of dollars in liabilities to the state. “This service was voluntary and without expectations of reward,” he declared.

A final audit showed the treasury held $1.753 million in railroad bonds, $475,000 in U.S. Treasury bonds, $384,000 in valueless Confederate notes, $90,000 in Comptroller’s certificates, $25,000 in state warrants and $27,525 in specie. A reported $17,000 in coin had been taken, which, based on growth in financial asset to today, would equal $3.18 million.

Until federal troops reached Austin in mid-summer, Freeman’s men continued to guard what remained of the state’s public funds. They also tried to identify the bandits, but no arrests were made.

Some thought it suspicious that Gov. Pendleton Murrah left town with Gen. Shelby soon after the raid, but he probably fled because he feared federal prosecution.

Shelby vigorously denied that he or his men had participated in the break-in. He threatened to torch the town if residents persisted in spreading that rumor.

Some suggested Shelby’s men pulled off the robbery on their own. Treasury defender Joe Owens insisted years later that “such was not the case.” He said Shelby’s command had not even reached Austin until the day after the robbery.

Texas’s oldest cold case remains unsolved on the books, but circumstantial evidence points to John Rapp—a rebel soldier originally from Missouri who had been living in Austin—as the mastermind of the raid.

In 1861, Rapp had joined the Confederate Army, with the 5th Regiment of Texas Mounted Volunteers, and taken part in two bloody battles in New Mexico before returning to Texas in the summer of 1862. Rapp’s final discharge came in May 1865, just days prior to the treasury raid. Having been wounded and captured in the war, he may have felt such a strong sense of entitlement that he and his comrades helped themselves to some hard currency.

But in two years, Rapp’s name surfaced in print as a likely suspect. The revelation didn’t become well known until 1897, when Shelby’s death prompted some newspapers to publish excerpts from a sensational and largely inaccurate account of the general’s career, written in 1867 by his adjutant, John N. Edwards. Edwards claimed Shelby’s men, not Freeman’s volunteers, had mitigated the treasury raid. That falsehood riled Freeman and others who had risked their lives that night. Freeman wrote the Galveston newspaper to blast Edwards, and so did Owens.

Owens indirectly suggested the raid had been led by Rapp, who Edwards had mentioned in his book: “…some thirty or forty Texans from the neighborhood of the town—led by a notorious Captain Rabb [sic]—made a furious sledge-hammer and cold-chisel onslaught upon five large iron safes in the treasury house there….”

No one outright said Rapp was the ringleader. But one of Freeman’s men reported that a raider had called out to Rapp by name during the melee following the discovery that the treasury was being robbed. The woman who nearly got shot during the raid said she recognized Rapp among the bandits.

Another person who may have been involved in the robbery became one of the Old West’s most noted characters—gambler, gunman and gadabout Ben Thompson. Near the end of the Civil War, Thompson had recruited a company of men to protect the Texas settlements from hostile Indians. Rapp became captain, and Thompson became his lieutenant.

Thompson disappeared from Austin immediately after the raid. Returning in July, he soon got arrested for another offense, but escaped and fled to Mexico.

Further bolstering the belief that the two had participated and even led the treasury robbery, Alex Campbell, the raider killed in the robbery, had been a member of the Rapp-Thompson company.

As for the 19 heroes, in 1909, the Texas House adopted a resolution extending thanks to the defenders of the state treasury that summer night 43 years earlier. One hundred fifty years after the robbery, the State of Texas is still short $17,000, nearly $3.2 million today.

Mike Cox is the author of 23 nonfiction books, including a two-volume history of the Texas Rangers. An elected member of the Texas Institute of Letters since 1993, he writes a syndicated news column called “Texas Tales.”