The Fejee mermaid came into Barnum’s possession via his Boston counterpart Moses Kimball, who brought it down to Barnum in late spring of 1842. On June 18, Barnum and Kimball entered into a written agreement to exploit this “curiosity supposed to be a mermaid.” Kimball would remain the creature’s sole owner and Barnum would lease it for $12.50 a week. Barnum christened his artifact “The Fejee Mermaid” and began to “puff” her to the skies. In Barnum’s exhibit, the mermaid was allegedly caught in 1842 by a “Dr. J. Griffin.” Griffin was actually Levi Lyman, one of Barnum’s close associates.
Barnum understoof the importance of promoting:
With all this publicity, anticipation to see the Fejee Mermaid (as it was now being called) became enormous. It was the main topic of conversation throughout the city. Everyone was talking about whether it was a real mermaid. They had to see it for themselves. So Dr. Griffin agreed to exhibit it for a week at Concert Hall on Broadway. Huge crowds showed up for the exhibit. Dr. Griffin lectured for these crowds about his experiences as an explorer and described his theories of natural history. These theories were a bit peculiar. For instance, his main argument was that mermaids must be real since all things on land have their counterpart in the ocean — sea-horses, sea-lions, sea-dogs, etc. So therefore, we should assume there are also sea-humans! Meanwhile, the press continued to lavish attention on the mermaid.
P.T. Barnum knew his mermaid wasn’t real, however:
Barnum realized that it wasn’t important whether or not the mermaid was real. All that was important was that the public be led to believe that it might be real. So he hired a phony naturalist (Dr. Griffin) to vouch for the creature’s authenticity, placed pictures of bare-breasted mermaids in the newspapers, and thereby manipulated the public into wanting to see it.(Museum of Hoaxes)
Here is quite an interesting archive on the Fejee mermaid and similar things