John Bealby Smith, a successful farmer at Waitoa and a prominent resident of the wider district, invested in the Te Aroha and Waiorongomai goldfields. In 1886 his announcement of finding gold on his farm created considerable excitement but also puzzlement, as it was an unlikely location and the nature of the gold was unusual. When tests made by some experts convinced them that the find was genuine, adjacent farms and even land throughout the Waihou Valley were tested as well, with some encouraging results being reported. Despite the results being erratic, they were sufficient to cause Smith to form a private company to develop his land; almost all the investors lived in the South Island. People in Auckland were also excited at the possibilities, although Te Aroha residents were more cautious. Because of continued doubts about the nature of the gold and whether it would be payable, more tests were made in Auckland, resulting in the fraudulent salting of the sands being uncovered. Despite this verdict, for a time many people, including one apparent expert, retained faith in the ‘goldfield’, and Smith denied any wrongdoing. His denials were undermined by his precipitous departure from the colony, to which he never returned.