January 1, 1874, Freedman’s Bank Closes

Mismanagement and outright fraud by white senior leaders weakened the bank significantly. Politician Henry D. Cooke approved unsecured loans to his own business while on the bank’s board; he ultimately could not pay back the loans, went bankrupt, and the bank was devastated.

In 1872 U.S. Congress voted to permanently close the Freedman’s Bureau. The Bank however remained operational and in March of 1874 Frederick Douglass became the last president of the Freedman’s Savings and Trust Company.

In a desperate attempt to stabilize the Bank, Douglass invested $10,000 of his own money. Still, in June of 1874 the bank failed against the backdrop of the racially motivated political forces that undermined Reconstruction.

The 61,000 people who had deposited $3 million (over $63 million in today’s dollars) into the system lost what they had when the bank closed.

On January 7, 2016, the Treasury Annex Building in Washington DC was publicly renamed The Freedman’s Bank Building by Secretary of the Treasury, Jack Lew, in honor of the site where the Freedman’s Saving Bank once stood.

“The failure of this bank has done more to harm the future of freed black slaves than 10 additional years of slavery.”

Frederick Douglass, African-American social reformer, abolitionist, orator, writer, statesman and President of the Freedmans Savings and Trust co

by IFHCIdaho August 18, 2021