Brown Brothers Harriman

History of Brown Brothers Harriman

1 Founding and Early Years (1818–1931): ◦ Brown Brothers & Co. was established in 1818 in Philadelphia by Alexander Brown, an Irish immigrant who built a fortune in Baltimore’s linen and cotton trade. His sons—William, George, John, and James—expanded the firm to New York (1825), Boston, and Liverpool, financing the cotton trade, railroads, and transatlantic steamships. By the 1840s, the Browns owned plantations and enslaved people through foreclosures, despite later claims of abolitionism. ◦ The firm pioneered foreign exchange systems and paper currency, stabilizing U.S. finance during 19th-century panics (1819, 1837, 1857). It became a cornerstone of American capitalism, lending to textile, commodity, and transportation industries. ◦ Harriman Brothers & Co. and W.A. Harriman & Co. were founded in 1919 and 1927 by W. Averell Harriman and E. Roland Harriman, sons of railroad magnate E.H. Harriman. Their wealth, estimated at $75–100 million, bolstered the 1931 merger.

2 Merger and Growth (1931–1945): ◦ On January 2, 1931, the three firms merged to form Brown Brothers Harriman & Co., prompted by the Great Depression’s financial strain. The merger, facilitated by Yale and Skull and Bones ties (12 of 17 partners were Yale graduates, eight Skull and Bones members), created one of the four largest private banks in the U.S., with $10 million in capital. ◦ Key partners included Prescott Bush (father of George H.W. Bush), W. Averell Harriman (diplomat and governor), and Robert A. Lovett (future Defense Secretary). The firm focused on commercial banking after the Glass-Steagall Act, spinning off securities to Harriman, Ripley & Co., later Drexel Burnham Lambert. ◦ BBH navigated the Depression with conservative policies and Harriman capital infusions, stabilizing its $100 million in liabilities. It played a central role in the “American Establishment,” shaping U.S. economic and foreign policy.

3 World War II and Controversies (1930s–1945): ◦ BBH acted as a U.S. base for German industrialist Fritz Thyssen, who financed Adolf Hitler’s rise until 1938. Prescott Bush managed the Union Banking Corporation (UBC), a BBH asset that transferred funds and resources for Thyssen, continuing after World War II began. UBC’s assets were seized in 1942 under the Trading with the Enemy Act but returned postwar, with UBC dissolved in 1951. ◦ Despite this, BBH partners like W. Averell Harriman opposed Nazism, urging U.S. support for Britain in 1940, and Prescott Bush raised $33 million for the United Service Organizations. The firm’s 86 employees served in the war, two dying in action.

4 Postwar Influence and Modern Era (1945–Present): ◦ BBH partners shaped the postwar global order: Harriman was ambassador to the USSR and UK, Lovett served as Defense Secretary, and Robert Roosa (Treasury Undersecretary, 1961–1964) stabilized U.S. monetary policy. Alan Greenspan, a BBH consultant, later chaired the Federal Reserve. ◦ The firm expanded into wealth management, private equity, and investor services, with $2.8 billion in assets by 2000. It faced criticism for discriminatory lending practices post-WWII and investing in subprime mortgage securities, receiving $2.5 billion in Federal Reserve loans during the 2008 crisis. ◦ Today, BBH operates globally from 17 locations, serving high-net-worth clients and institutions with a focus on custody, investment management, and corporate advisory. It acknowledges its 19th-century slavery ties and promotes inclusivity, though critics demand reparative justice.

Alleged CIA Connections

BBH’s alleged CIA connections arise from its partners’ intelligence roles, recruitment networks, and geopolitical influence, particularly during the Cold War. Evidence is often circumstantial, tied to the firm’s elite networks and anti-communist activities. 1 Prescott Bush and George H.W. Bush: ◦ Prescott Bush, a BBH managing partner and Yale benefactor, was an Army Intelligence operative in World War I. His Yale ties, including the Skull and Bones society, made him a prime CIA recruitment target. Former CIA officials note that Yale’s athletic programs, where Bush was active, were a recruiting ground under coach Otto Waltz. ◦ A 1963 FBI memo by J. Edgar Hoover refers to a “Mr. George Bush of the Central Intelligence Agency” briefed after JFK’s assassination, raising speculation about George H.W. Bush, Prescott’s son and BBH partner. George H.W. Bush, later CIA Director (1976–1977), denied the memo referred to him, claiming it was George William Bush, a CIA analyst. However, the ambiguity fuels theories of early CIA ties, possibly facilitated by BBH’s networks. ◦ George H.W. Bush’s Zapata Oil, founded in 1953, was allegedly a CIA front for anti-Castro operations, overlapping with JM/WAVE’s activities (1961–1968). BBH’s financial networks could have supported such ventures, though no declassified evidence confirms this.

2 Anti-Communist Operations and Latin America: ◦ BBH partners’ geopolitical roles aligned with CIA objectives. W. Averell Harriman, ambassador to the USSR and UK during WWII, advised Democratic presidents on Cold War policy, including the 1963 Vietnam crisis. His BBH ties provided a conduit for U.S. intelligence influence.

Conclusion

Brown Brothers Harriman, formed in 1931, evolved from a 19th-century cotton and railroad financier to a pillar of U.S. finance, shaping global economic policy through partners like Prescott Bush and W. Averell Harriman. Its alleged CIA connections stem from Bush’s intelligence ties, George H.W. Bush’s disputed 1963 CIA link, and the firm’s alignment with anti-communist operations in Chile, Iran, and beyond