Chapter Eight: THE JEKYL ISLAND CONSPIRACY: The Federal Reserve Conspiracy by Antony C. Sutton from archive.org

Chapter Eight: 
THE JEKYL ISLAND CONSPIRACY 



In 1910 six prominent Wall Street financial men met on 
Jekyl Island to map plans for a central banking system in the 
United States. The Federal Reserve System originated in a 
conspiracy. A "conspiracy" is defined legally as a secret meeting 
for an illegal purpose. The meeting was secret, it involved six 
persons and it was illegal.. .as we shall show later. 

The six conspirators were: 

Senator Nelson Aldrich, father-in-law of John D. 
Rockefeller, Jr. 

German banker Paul Warburg, of the German bankers MM 
Warburg of Hamburg and Kuhn Loeb in the United States; 

Henry P. Davison, partner in J. P. Morgan and Chairman of 
Bankers Trust Company; 

Benjamin Strong, Vice President of Bankers Trust; 

Frank Vanderlip, Chairman of National City Bank; 

Charles D. Norton, President of First National Bank. 

The last three banks were in the Morgan group; Warburg 
represented Kuhn-Loeb and Aldrich represented Rockefeller 
interests and the "Standard Oil crowd." The Harriman interest in 
Guaranty Trust had been absorbed into the Morgan group after 
the death of Harriman. 



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The Federal Reserve Conspiracy 

These six dominated wealth and financial power and had 
considerable political influence. 

The secret Jekyl Island meeting was actually described in 
conspiratorial terms by one of the participants: 

Despite my views about the value to society of greater publicity 
for the affairs of corporations, there was an occasion, near the 
close of 1910, when I was as secretive, indeed as furtive, as any 
conspirator. None of us who participated felt that we were 
conspirators; on the contrary we felt we were engaged in a 
patriotic work. We were trying to plan a mechanism that would 
correct the weaknesses of our banking system as revealed under 
the strains and pressures of the panic of 1907. I do not feel it is 
any exaggeration to speak of our secret expedition to Jekyl Island 
as the occasion of the actual conception of what eventually 
became the Federal Reserve System. (1) 

After the 1907 panic plans were formulated to convince the public 
of a "need" for a central bank. The key at this point was Senator Nelson 
Aldrich, a wealthy businessman linked to the Rockefeller family 
through marriage of his daughter Abby to John D. Rockefeller Jr. 
Former Vice President Nelson Rockefeller was a direct descendent of 
this branch of the Rockefeller family. 

In the post-1907 panic era, Senator Aldrich headed a Senate 
Monetary Commission which toured Europe to discuss and study 
European central banks and especially the German Reichsbank system. 
From this junket Aldrich emerged as the Congressional expert on bank 
planning. Few spotted his close links with the banking interests. (2) 
Herbert L. Satterlee was Morgan's son-in-law and, from the inside, 
comments on Aldrich's close relations with the Money Trust 



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The Jekyl Island Conspiracy 

and planning for the Federal Reserve System. Aldrich, according to 
Satterlee, 

...turned to Mr. Morgan for advice and then during the next 
two years they were to spend many hours together working out an 
orderly pattern for the banking world of this country from coast to 
coastP 

Again, according to Satterlee, J. P. Morgan "lent him (Aldrich) 
Harry Davison (Morgan partner) to help with details while Paul M. 
Warburg, the Kuhn Loeb partner, also "put his service at Senator 
Aldrich's disposal. " (4) This triad -Morgan- Aldrich-Warburg - was the 
focal point for planning the introduction of central banking to the 
United States. 

The remaining Jekyl Island conspirators came on the scene later. 
Frank Vanderlip (whom we have already quoted) of National City Bank 
was linked to the Rockefeller family by marriage and came into the 
group in early 1910 after receiving a letter from Stillman, founder and 
chairman of National City Bank. This letter referred to a meeting 
between Stillman and Aldrich in Europe on the central bank question. 
From this letter we learn that the conspirators used a code and that 
Aldrich's code name was "Zivil." In his book, Vanderlip states: 

Mr. Stillman wrote me that I should make everything else 
subservient to giving my whole time 
and thought to a thorough consideration of the subject (i.e., the 
currency plan) and to draft a bill for the new Congress without a 
Wall Street tag. (5) 

Above all the conspirators knew they had to maintain 
absolute secrecy. If any Wall Street name ever became attached to a 
central banking Federal Reserve bill it would be the kiss of death. Not 
only were code names adopted but individuals went to great lengths to 
avoid public knowledge of their meetings and discussions. 



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The Federal Reserve Conspiracy 

Without any question if the public in 1913 had known what we 
know today the Federal Reserve Act would have no possibility at all of 
becoming law. On the question of public suspicions of the close family 
links in the group, for which the group claimed disinterested 
impartiality, Vanderlip noted: 

But would the electorate have believed that? I question their 
ability to do so. Just to give you a faint idea: Senator Aldrich was 
the father-in-law of John D. Rockefeller, Jr., and himself a very 
rich man.Once I had written to Woodrow Wilson at Princeton, 
inviting him to speak at a dinner. Wishing to impress him with the 
importance of the occasion, I had mentioned that Senator Aldrich 
also had been invited to speak. My friend Dr. Wilson had 
astonished me by replying that he could not bring himself to speak 
on the same platform with Senator Aldrich. He did come and make 
a speech, however, after I had reported that Mr. Aldrich 's health 
would prevent him from appearing. Now then, fancy what sort of 
head-lines might have appeared over a story that Aldrich was 
conferring about new money legislation with a Morgan partner 
(Davison) and the president of the biggest bank (Vanderlip). (6) 

The National City Bank founded by Stillman is significant 
because one of its directors was Cleveland Dodge, the financial 
powerhouse and influence behind Woodrow Wilson. 

Woodrow Wilson, who was to sign the Federal Reserve Act into 
law, was a deliberate creation of the Money Power, who was approved 
in the spring of 1912 at a weekend meeting at Beechwood, the 
Vanderlip estate at Scarborough on Hudson. According to one observer, 
Wilson passed the test because Vanderlip and William Rockefeller 
discussed the 



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The Jekyl Island Conspiracy 

role of American capital abroad in front of Wilson. (7) This we shall 
describe in more detail later. 

The central intellectual figure in the creation of the Federal 
Reserve System was not an American but a German banker - Paul 
Moritz Warburg, a banker born in 1868 into the Hamburg Oppenheim 
family. Warburg's father was a partner in the M. M. Warburg banking 
house founded in 1798. Warburg's early career was with Samuel 
Montagu & Co. in London and the Banque Russe Pour he Commerce 
Etranger in Paris. In 1891 Warburg went to work at the family bank in 
Hamburg and became a partner in 1895. In 1902 he came to the United 
States as a partner in Kuhn Loeb, and in spite of defective English, 
began a campaign for a Federal Reserve System. The plan may be 
found in his pamphlets, "Defects and Needs of our Banking System 
since 1907" and "A plan for a modified central bank" (1907). In 1910 
Warburg proposed a plan for a United Reserve Bank and much of this 
plan was embodied in the Federal Reserve System. 

These were the men who met in secret on Jekyl Island to put 
together the initial draft of the Federal Reserve Act. 

The secret meeting was recorded by Frank Vanderlip: 

Since it would be fatal to Senator Aldrich's plan to have it 
known that he was calling on anybody from Wall Street to help him 
in preparing his report and bill, precautions were taken that would 
have delighted the heart of James Stillman. We were told to leave 
our last names behind us. ..that we should avoid dining together on 
the night of our departure to come one at a time and as unobtru- 
sively as possible to the railroad terminal on the New Jersey 
littoral of the Hudson, where Senator Aldrich's private car would 
be in readiness, attached to the rear end of a train for the South. 



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The Federal Reserve Conspiracy 

When I came to that car the blinds were down and only 
slender threads of amber light showed the shape of the windows. 
Once aboard the private car we began to observe the taboo that 
had been fixed on last names. We addressed each other as "Ben, " 
"Paul, " "Nelson, " and "Abe. " Davison and I adopted even deeper 
disguises, abandoning our own first names. On the theory that we 
were always right, he became Wilbur and I became Orville, after 
those two aviation pioneers, the Wright brothers. 

The servants and the train crew may have known the 
identities of one or two of us, but they did not know all, and it was 
the names of all printed together that would have made our 
mysterious journey significant in Washington, in Wall Street, even 
in London. Discovery, we knew, simply must not happen, or else 
all our time and effort would be wasted. If it were to be exposed 
publicly that our particular group had gotten together and written 
a banking bill, that bill would have no chance whatever of 
passage by Congress. (8) 

The last sentence says it all from the vantage point of an insider - 
this was a planned conspiracy. The American public would never hand 
over a monopoly of the money supply to a small group. After all, the 
Sherman Antitrust Act had just made monopoly in restraint of trade 
illegal and a money monopoly was even less acceptable. 

To avoid public knowledge, these bankers went skulking off to a 
remote island in the dead of night using code names and disguises! 

Vanderlip goes on to describe the secret meeting itself and that 
Vanderlip and Strong actually wrote the so-called Aldrich report and the 
bill presented to the Senate. What is interesting is the utter assurance on 
the part of Vanderlip 



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The Jekyl Island Conspiracy 

that the bankers were acting in the interests of the country as a whole 
rather than in their own selfish interests. 

What this group proposed to do - and actually did do in 1913 - was 
replace gold and silver with a paper factory which they controlled. How 
this could be presented as a public-spirited act is probably beyond most 
readers. 

We were taken by boat from the mainland to Jekyl Island and 
for a week or ten days were completely secluded, without any 
contact by telephone or telegraph with the outside. We had 
disappeared from the world onto a deserted island. There were 
plenty of colored servants but they had no idea who Ben and Paul 
and Nelson were; even Vanderlip, or Davison, or Andrew, would 
have meant less than nothing to them. 

There we worked in the club-house - We returned to the 
North as secretly as we had gone South. It was agreed that Senator 
Aldrich would present the bill we had drafted to the Senate. It 
became known to the country as the Aldrich Plan. Aldrich and 
Andrew left us at Washington,and Warburg, Davison, Strong, and I 
returned to New York. 

Congress was about to meet; but on a Saturday we got word 
in New York that Senator Aldrich was ill, too ill to write an 
appropriate document to accompany his plan. Ben Strong and I 
went on to Washington and together we prepared that report. If 
what we had done then had been made known publicly, the effort 
would have been denounced as a piece of Wall Street chicanery, 
which it certainly was not. Aldrich never was a man to be a mere 
servant of the so-called money-interests. He was a con- 



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The Federal Reserve Conspiracy _ 



scientious, public -spirited man. He had called on the four of us 
who had Wall Street addresses because he knew that we had for 
years been studying aspects of the problem with which it was his 
public duty to deal. 

The Aldrich plan written by Vanderlip and Strong did not get 
through Congress. It was shot down. An ailing Senator Aldrich retired 
and the Money Trust was forced to look elsewhere to get its plans 
through Congress. 

National City Bank director Cleveland Dodge was a classmate 
(1879, Princeton) of Woodrow Wilson. McCormick of the Harvester 
Trust was in the same Princeton Class. By the early 1900s, Wilson, with 
help from Cleveland Dodge, had become President of Princeton 
University and Dodge let it be known that Wall Street considered 
Wilson "presidential material." 

A flattered Woodrow Wilson wrote journalist George Harvey in 
December, 1906 to identify "the influential men who considered him as 
presidential material." Harvey replied, "naming some of the most 
influential bankers, utility executives and conservative journalists in the 
country."' 9 ' 

Wilson, for all his public image of a teetering, owlish professor, 
had one lesson down by heart, that to get along, one has to go along. In 
March, 1907 George Harvey introduced Wilson to Thomas Fortune 
Ryan, member of the copper trust and a prominent financier. After this 
meeting, Wilson wrote a brief for the Wall Street establishment in 
which he provided academic support for the Trusts -incidentally, in total 
contradiction to his public statements. 

This Wall Street cabal, with the aid of New Jersey political bosses, 
pushed for Woodrow Wilson to become Governor of New Jersey in 
November, 1910. 

Within a few months, Cleveland Dodge opened a bank account in 
New York and an office at 42 Broadway to boom 



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The Jekyl Island Conspiracy 

Wilson into the Presidency. The campaign bank account was opened 
with a check for $1,000 from Cleveland Dodge. Dodge then provided 
funds to mail out the True American of Trenton, New Jersey to 40,000 
subscribers throughout the United States, followed by a regular two 
pages a week of promotional material on Wilson For President. 

Two-thirds of Wilson's campaign funds for the presidency came 
from just seven individuals, all Wall Streeters and linked to the very 
trusts Wilson was publicly denouncing. Wilson's election slogans 
promoted him as a man of peace and against trusts and monopoly. 
These were the very sources financing his campaign: (10) 

Cleveland H. Dodge $51,300 

(Director: National City Bank, etc.); 

Henry Morgenthau (financier) $20,000 

Cyrus PL McCormick (Harvester Trust) $12,500 

Abram I. Elkus (Wall Street lawyer) $12,500 

Frederick C. Penfield $12,000 

(Philadelphia real estate) 

William F. McCombs $11,000 

Charles R. Crane (Crane Co., Chicago) $10,000 

Wilson received the nomination and wrote to "dear Cleve" 
(Dodge) to exult, "I am so happy I can hardly think! " (11) Wilson's 
acceptance speech was written on board the Corona, Dodge's yacht, 
while they planned strategy for the coming campaign. (12) 

In brief, Woodrow Wilson was in the hands of the Money Trust, 
had lied to the American public about his true position on the trusts and 
Wall Street and betrayed the Jef-fersonian-Jacksonian tradition of the 
Democratic Party. 

Wilson was elected President. And the ballots had hardly been 
counted when Wall Street bustled about to arrange "currency reform." 
By early December, 1912, Colonel House had already talked with key 
members of Congress to 



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The Federal Reserve Conspiracy 

get them behind Wilson, and when Paul Warburg telephoned House on 
December 12, 1912, the Colonel told him that the plan was ready. 
Added House in his memoirs: "I knew the President-elect thought 
straight concerning the issue. " (13) 

In March, Frank Vanderlip talked with House, and two weeks 
later a group of bankers arrived at the White House with a printed 
"currency reform" bill for Wilson to present to Congress. House 
suggested that it would not be wise to flaunt the power of the House of 
Morgan with a pre-printed reform bill - so the Federal Reserve Act was 
taken back to Wall Street and a typewritten copy made from the printed 
plan. (14) It now only remained to get the Federal Reserve Bill through 
Congress. 



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The Jekyl Island Conspiracy 



Endnotes to Chapter Eight 



(1) Frank A. Vanderlip, President, First National City Bank, From 
Farm Boy to Financier (New York: Appleton, 1935), p. 210. 

(2) See Ferdinand Lundberg, America's 60 Families (New York: 
Vanguard Press, 1937). 

(3) Herbert L. Satterlee, J. Pierpont Morgan: An Intimate 
Portrait (New York: Macmillan, 1939), p. 493. 

(4) Ibid., p. 550. 

(5) Frank Vanderlip, op. cit., p. 211. 

(6) Ibid., p. 212. 

(7) John K. Winkler, The First Billion, (New York: Vanguard Press, 
1934), pp. 209-211. 

(8) Frank Vanderlip, op. cit., p. 213. 

(9) Ray Baker, Woodrow Wilson: Life and Letters (New York, 
Doubleday, Page & Co., 1927-39) vol 3, p. 365. 

(10) Louise Overacker, Money in Elections (New York: Macmillan, 
1932). 

(11) Ray Baker, Ibid. 

(12) op cit. p. 372. 



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The Federal Reserve Conspiracy 

(13) Charles Seymour, The Intimate Papers of Colonel House (Boston, 
New York: Houghton Mifflin Co., 1926-28), vol. I, p. 161. 

(14) Seymour, op cit. p. 161. 



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Chapter Nine 
THE MONEY TRUST CONS CONGRESS