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Reynolds affair

In the summer of 1797, Hamilton became the first major American politician publicly involved in a sex scandal. Six years earlier, in the summer of 1791, 34-year-old Hamilton became involved in an affair with 23-year-old Maria Reynolds. According to Hamilton's account Maria approached him at his house in Philadelphia, claiming that her husband James Reynolds was abusive and had abandoned her, and she wished to return to her relatives in New York but lacked the means. Hamilton recorded her address and subsequently delivered $30 personally to her boarding house, where she led him into her bedroom and "Some conversation ensued from which it was quickly apparent that other than pecuniary consolation would be acceptable". The two began an intermittent illicit affair that lasted approximately until June 1792.

Over the course of that year, while the affair was taking place, James Reynolds was well aware of his wife's infidelity, and likely orchestrated it from the beginning. He continually supported their relationship to extort blackmail money regularly from Hamilton. The common practice of the day for men of equal social standing was for the wronged husband to seek retribution in a duel, but Reynolds, of a lower social status and realizing how much Hamilton had to lose if his activity came into public view, resorted to extortion. After an initial request of $1,000 to which Hamilton complied, Reynolds invited Hamilton to renew his visits to his wife "as a friend" only to extort forced "loans" after each visit that, most likely in collusion, Maria solicited with her letters. In the end, the blackmail payments totaled over $1,300 including the initial extortion. Hamilton at this point may have been aware of both spouses being involved in the blackmail, and he welcomed and strictly complied with James Reynolds' eventual request to end the affair.

In November 1792, James Reynolds and his associate Jacob Clingman were arrested for counterfeiting and speculating in Revolutionary War veterans' unpaid back wages. Clingman was released on bail and relayed information to Democratic-Republican congressman James Monroe that Reynolds had evidence incriminating Hamilton in illicit activity as Treasury Secretary. Monroe consulted with congressmen Muhlenberg and Venable on what actions to take and the congressmen confronted Hamilton on December 15, 1792. Hamilton refuted the suspicions of financial speculation by exposing his affair with Maria and producing as evidence the letters by both of the Reynolds, proving that his payments to James Reynolds related to blackmail over his adultery, and not to treasury misconduct. The trio agreed on their honor to keep the documents privately with the utmost confidence.

Five years later however, in the summer of 1797, the "notoriously scurrilous" journalist James T. Callender published A History of the United States for the Year 1796. The pamphlet contained accusations based on documents from the confrontation of December 15, 1792, taken out of context, that James Reynolds had been an agent of Hamilton. On July 5, 1797, Hamilton wrote to Monroe, Muhlenberg, and Venable, asking them to confirm that there was nothing that would damage the perception of his integrity while Secretary of Treasury. All but Monroe complied with Hamilton's request. Hamilton then published a 100-page booklet, later usually referred to as the Reynolds Pamphlet, and discussed the affair in indelicate detail for the time. Hamilton's wife Elizabeth eventually forgave him, but never forgave Monroe. Although Hamilton faced ridicule from the Democratic-Republican faction, he maintained his availability for public service.