The Bombing of Greytown

In 1854, Naval forces bombarded and burned San Juan del Norte (Greytown) to avenge an insult to the American Minister to Nicaragua and Cornelius Vanderbilt.
An American Account:

In July of 1854 occurred an event in Central America which created a considerable excitement in the United States. A band of about 300 adventurers, mainly negroes from Jamaica, had occupied the port of San Juan del Norte, and began to commit depredations upon an adjacent settlement of Americans known as Punta Arenas. Finally they organised a strong force to demolish tho little colony at Punta Arenas, but their design was defeated by the interposition of an American warship which happened to be in the harbor. In May of 1854 matters were further complicated by the attempt of a body of men from Greytown to arrest in Punta Arenas the captain of one of the boats of the Accessory Transit Company of Nicaragua on a charge of murder. Solon Borland, the American minister to powers, Central Ammica, happened to be present on this occasion, and, believing that the captain of the steamboat was innocent and that the intruding party had no jurisdiction, interposed effectually to prevent violence and bloodshed. Borland afterward visited Grey town and, while there, was subjected to insult by a mob. On receiving offical accounts of these occurences, the sloop of war Cyane was sent to enforce the demands of the American government—that the people of Greytown make reparation for injuries to our citizens and due-apology for their insult to Borland. But the Greytown people evinced no disposition to comply, so on July 9, 1854, after 24 hours' notice had been given, the Cyane opened fire on the town. Before much injury had been done the Cyane suspended fire in order to afford opportunity of complying with the demands which had been made. As nothing was heard from the town authorities, however, the Cyane continued the bombardment until the town was laid in ashes. No lives were lost and most of the buildings destroyed were of little value."This transaction," said the President, "has been the subject of complaint on the part of some foreign powers and has been characterized with more of harshness than of justice." (From The United States: its beginnings, progress and modern development, Volume 7 by Jesse Ames Spencer; 1913)

What was the insult?
Borland was held captive after going ashore and threatened with arrest by the Jamaicans, but after being held 48 hours was not, due to his diplomatic immunity. While arguing with local Jamaican officials, someone threw a bottle in his face leaving a scar on his forehead. This incident, along with the continuing activities against the Vanderbilt operation were reported to the Pierce administration by Borland on return to Washington city, who then dispatched an American naval ship to the area demanding them to apologize to the minister and to stop illegal harassment of and confiscation of property, correct other illegal activities against the Vanderbilt interests, and to make reparation or restitution for property stolen from American citizens. After a warning, with nothing forthcoming, the American ship and marines bombarded and burned the unoccupied British city Greytown.