Frustrated that people continued to consume so much alcohol even after it was banned, federal officials had decided to try a different kind of enforcement. They ordered the poisoning of industrial alcohols manufactured in the United States, products regularly stolen by bootleggers and resold as drinkable spirits. The idea was to scare people into giving up illicit drinking. Instead, by the time Prohibition ended in 1933, the federal poisoning program, by some estimates, had killed at least 10,000 people.
During Prohibition, however, an official sense of higher purpose kept the poisoning program in place. As the Chicago Tribune editorialized in 1927: "Normally, no American government would engage in such business. … It is only in the curious fanaticism of Prohibition that any means, however barbarous, are considered justified." Others, however, accused lawmakers opposed to the poisoning plan of being in cahoots with criminals and argued that bootleggers and their law-breaking alcoholic customers deserved no sympathy. "Must Uncle Sam guarantee safety first for souses?" asked Nebraska's Omaha Bee.
By mid-1927, the new denaturing formulas included some notable poisons—kerosene and brucine (a plant alkaloid closely related to strychnine), gasoline, benzene, cadmium, iodine, zinc, mercury salts, nicotine, ether, formaldehyde, chloroform, camphor, carbolic acid, quinine, and acetone. The Treasury Department also demanded more methyl alcohol be added—up to 10 percent of total product. It was the last that proved most deadly.
The results were immediate, starting with that horrific holiday body count in the closing days of 1926. Public health officials responded with shock. "The government knows it is not stopping drinking by putting poison in alcohol," New York City medical examiner Charles Norris said at a hastily organized press conference. "[Y]et it continues its poisoning processes, heedless of the fact that people determined to drink are daily absorbing that poison. Knowing this to be true, the United States government must be charged with the moral responsibility for the deaths that poisoned liquor causes, although it cannot be held legally responsible."
http://www.slate.com/id/2245188/?GT1=38001 
But it never crossed my mind that it would be illegal to make. You can buy ethanol at home depot which is basically moonshine. I would think you could water that stuff down to a lower percentage and mix drinks with it. Anyone here a chemist or something that would know?
Still it is an interesting process.
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