From Ohio History Central
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<p> In 1920, Ohioan Warren Gamaliel Harding won election as president of the United States. As president, Harding assembled a respected and geographically diverse cabinet, including Secretary of State Charles Evans Hughes and Treasurer Andrew Mellon. Some historians claim that the term “Ohio gang” referred to the cabinet, but it did not. The Ohio Gang term evolved in the press in the years after the Harding administration and referred to men loosely associated with Harding’s attorney general, Harry Daugherty, who was from Washington Courthouse, Ohio. This group involved Jess Smith, also from Washington Courthouse, and Howard Mannington from Urbana. Fred Caskey from Marietta and M.P. Kraffmiller of Illinois ran the “little green house on K Street” in Washington D.C. The group used the house as a commercial headquarters, with their interests focused on peddling influence, selling permits to withdraw liquor from bonded government warehouses and arranging for the illegal sale of government property.</p>
<p>In the months before Harding’s 1923 death, knowledge of these deals was unknown and only rumors existed. The growing problem, though, was that the rumors swirled around men associated with Daugherty, which, in turn, could turn into a stain on the President’s reputation. Close Republican friends who mentioned the rumors to Harding received a strong rebuke. Harding indeed could not imagine that these men were involved in shady dealings. “Despite later claims, this much is clear,” stated historian Robert K. Murray. “The Ohio Gang had very few of the characteristics of a gang because it had no concrete form, no cohesion, and no plan. If it had any leadership, it was provided by Jess Smith. The Ohio Gang was simply a collection of rank opportunists who worked together as a matter of expediency. Each was jealous and distrustful of the other; they owed no allegiance to anyone. They looked for the quick buck, not sustained graft.”</p>
<p>Smith, who had been in Daugherty’s unofficial care for years, committed suicide. Smith was upset about not being included in the entourage heading to Alaska in June 1923, and also suffered from complications from diabetes and paranoia, perhaps because of the fear of discovery of his misdeeds. Daugherty and the Justice Department were investigated, resulting in Daugherty’s indictment. He
never was convicted.