Nestled among gumtrees on the side of a hill in a national park east of Canberra is a gaping hole that was once at the centre of one of Australia's most elaborate fraud schemes.

The geological formation known as the Big Hole is 100 metres deep and 35 metres wide.

Located in Deua National Park, it is thought to have formed about 50 million years ago when the roof of a cave collapsed. 

National Parks and Wildlife Services (NPWS) ranger Duncan Allen describes it as "just a big hole in the ground", but says there are many legendary stories involving the Big Hole.

It was that same intrigue that drew the Big Hole into what one early 20th century newspaper called "one of the most sensational swindles of this or any other century".

The Big Hole Mining Syndicate

In 1887 a crowd watched on as Sydney photographer Alexander Fraser descended to the bottom of the Big Hole. 

He disappeared from sight under an overhang, later emerging claiming to have found "a ready-made gold mine giving promise of great riches".

Fraser began selling £1 shares into a mining operation at the Big Hole and a neighbouring mine he said was the source of the gold.

The scheme attracted interest from Sydney's elite: barristers, attorneys, and even a judge.

To convince his investors and give the scheme credibility, Fraser made up characters: a London-based mining investor and millionaire called Mr Stangor, and a German mining expert called Gustave Von Dahl — who supported the project and confirmed via written correspondence that the rocks were likely rich in gold and diamonds.

"You have, at least, a very excellent gold mine and one of the sort that lasts forever," Mr Stangor wrote in a letter dated January 8, 1902.

Fraser promised investors a £26,000 return on a £150 investment.

It all comes crashing down

Fraser began crafting letters from Stangor explaining why the project had some delays. 

He took the letters to his investors and asked them to explain some of the more complex sections to him.

As the delays dragged on, investors became more and more suspicious.

When they demanded to meet Stangor, Fraser told them he was a recluse because he had a disease "from a fractured leg, which had developed into necrosis of the bone, causing an unpleasant smell".

Then the entire scheme unravelled because of a quirky typewriter.

An investor noticed all the letters written from Stangor, regardless of where he was in the world, were written on the same typewriter – identifiable because the top of the letter a was missing, and the N was out of alignment. 

The quirks all matched Fraser's typewriter.

In 1907, a reportedly dumbfounded Fraser was sentenced to five years' jail for having conspired to cheat and defraud investors of large sums of money.

The judge called it "one of the most extraordinary cases of persistent and deliberate fraud which has ever come before the Court".

The Clarence and Richmond Examiner said it was "one of the most elaborately arranged swindles Australia has ever known".

A half-page exposé The Big Hole: A colossal confidence trick ran in multiple newspapers around the country in 1907 after Fraser was arrested, and detailed how the fraud was carried out.

So what is at the bottom of the Big Hole?

Abseiling into the hole is restricted by NPWS, and requires a permit.

Canberra Speleological Society member John Brush frequently visits the site and has twice descended to the bottom.

"The little ferns you look at from the viewing platform at the top are actually huge tree ferns with fronds that are 2 or 3 metres long."

He once rescued a lyrebird he thought was trapped down the hole, using a canvas bag and a net, but has since seen lyrebirds "hop and flitter" up the edges of the hole, where they evidently enjoy living.