The mid-19th century was the heyday for séances, mediums, and psychics. In Boston, a chemist and silver engraver named William H. Mumler saw an opportunity to mix the hot new technology of photography with paranormal activity to make some big bucks. So he announced that if you sat for a picture in his studio, your dead relative might just turn up for the photo opp. Mumler's secret? Ye olde magical double exposure that he stumbled upon after accidentally taking a self-portrait on an already-used negative. From Mysterious Universe:
Typically, he would take a glass photographic plate that held the image of the dead person in life and simply place it over a new glass plate meant to hold the image of the customer. When the photo was then developed the two images would be fused together into a composite and voila, ghost photo. On many occasions Mumler did not have access to an actual photo of the deceased, and so he got creative, using other figures that were blurred just enough that the client could believe that it was the presence of the lost loved one, easy enough to do with a bereaved, gullible person who is willing to do anything to see them again.[…]
Mumler might have been able to keep this going for many more years if he had been a little more careful. He started producing ever more outlandish ghost photographs, including even one of the dead president Abraham Lincoln photobombing a picture of his wife Mary Todd Lincoln. When some of these "ghost photographs" began accidentally turning up the ghostly images of people who were still very much alive, the gig was up. Mumler was brought to trial for fraud, during which his nemesis PT Barnum even showed up to produce his own doctored image of himself posing with Abraham Lincoln. Although Mumler was eventually acquitted, his reputation was in tatters and he would never recover his spirit photography business. He would nevertheless go on to continue a successful career in the field of the chemistry of photo development, and even created the "Mumler process," which allowed the first ever photographs to be printed in newspapers and revolutionized journalism.
"The Strange Tale of the Father of Fake Ghost Photos" by Brent Swancer (Mysterious Universe)