In the summer of 1866 the banking house of Overend, Gurney and Company failed, causing widespread panic in the money markets, resulting in extremely limited access to investment. The opportunity was taken within eight months to abandon the proposed Haslemere extension. The abandonment was sanctioned by the Chichester and Midhurst Railway Extension Abandonment Act of 31 July 1868, but there were a series of claims from creditors trailing the simple decision. The LBSCR considered trying to recover the money from the Directors of the Midhurst company (who had given personal guarantees) but this proved impractical, and the LBSCR took most of the loss, amounting to well over £70,000, itself.Richard S Grossman, Unsettled Account: The Evolution of Banking in the Industrialized World Since 1800, Princeton University Press, 2020, ISBN 9780691202785, page 194Clark, pages 23 and 24Grant, pages 112 and 113
