Early Life and Marriage Arthur Coit Gilman was born in 1855, the son of Rev. Edward Whiting Gilman, a New England clergyman, and Julia Silliman, daughter of Benjamin Silliman Jr., the noted Yale chemist and geologist. Arthur Coit was the nephew of Daniel Coit Gilman, the first president of Johns Hopkins University, founding president of the Carnegie Institution, and co-founder mof the Gilman School, Baltimore.

Arthur married Bessie Lawrence in 1878 at Magnolia Plantation in Louisiana, connecting him to the Lawrence family of Flushing and New York. The couple lived in comfort and social prominence, maintaining a residence in Flushing and summering in fashionable circles.

Career Gilman began his professional life modestly as an office boy at the tea firm L. H. Labaree & Co. in March 1879 at a salary of eight dollars a week. Through apparent diligence and ability he rose rapidly and eventually became a partner, though without ever investing capital. His financial standing and refined tastes placed him among the well-to-do of the late Gilded Age.

He and his wife were active in New York society and were among the earliest box holders at the Metropolitan Opera, where Arthur was noted as an ardent admirer and defender of Richard Wagner’s music—a passion that was fashionable among the city’s cultivated elite of the 1880s.

Death and Scandal On December 15, 1890, Arthur told his wife that he was unwell and would remain home from work. He sent a telegram to the firm excusing his absence and promised to join his wife and her sister for lunch at Delmonico’s if he felt better. Later that morning, when his employer, Mr. Labaree, came to Flushing to discuss business, the servant found Gilman’s bedroom door locked. It was forced open, and Arthur was found dead on his bed, partly clothed. The attending physician declared the cause of death to be heart failure.

Several months later, auditors discovered that Gilman had embezzled approximately $220,000 (equivalent to about $5 million in modern value) from the firm between 1884 and 1890. The investigation concluded that the thefts had been “continuous, deliberate, and intentional, extending over six years and conducted with a degree of skill and baseness of treachery which can find but few cases to parallel.” The money’s destination was never traced; his personal income appeared adequate for his lifestyle, and no hidden assets were located.

In the firm’s safe were found life-insurance policies totaling $56,000, payable to Bessie Gilman. The company asserted that the stolen funds had been used to pay the premiums and laid claim to the policies. The dispute went to court, where Mrs. Gilman maintained that the firm was entitled only to the value of the premiums, not to the benefits themselves. These policies were the only assets remaining to her.

Although the physician’s report stated “heart failure,” the timing of Gilman’s death, the revelation of the embezzlement, and the existence of the insurance policies led to widespread suspicions of suicide, but by the time the fraud was uncovered it was too late for an autopsy.

The Supreme Cort of New York ruled:

“Held, that the plaintiff was entitled to recover the amount of such premiums as were paid from firm moneys by Gilman in fraud of the rights of the firm, but that he was not entitled to recover the moneys realized from the policies themselves.

That the partnership relation forbade the idea that one partner could steal or embezzle from the firm, inasmuch as each partner had an undivided part of the whole, and not the whole of an undivided part of the firm property.

That, as the wife had an insurable interest, protected by the laws of the State, the policy and its proceeds were not solely the result of Gilman’s payment of the premiums. (Per O’Brien, J.)

That, therefore, assuming the partnership relation to be one of trust, equity would not follow a fund diverted, but which had been subsequently invested so as to unite it with other property interests or rights, and give the whole investment to the party whose money had been diverted. (Per O’Brien, J.)”

Character and Legacy Arthur Coit Gilman’s life combined social brilliance, financial promise, and tragic collapse. His downfall, one of the most striking private scandals of late nineteenth-century New York commerce, destroyed a respected firm and left his family in near ruin. His story, though little remembered, reflects the speculative fever and moral fragility of the Gilded Age—an era when ambition, appearances, and temptation often proved fatally intertwined.