African Americans in Finance: A Long History Still Being Written | Benaree “Bennie” P. Wiley

July 9, 2021

African Americans in Finance

A Long History Still Being Written

Left: Depiction of the slave auction house at the foot of Wall Street, New York City, c. 1715

Right: Philip M. Jenkins in front of the New York Stock Exchange on Wall Street, c. 1955

Slavery was the first “big financial business” in America, transforming a small collection of colonies into a leading global economy in less than a century, and making those enslaved the country’s largest financial asset.[1] The history of African Americans in finance is all the more interesting when viewed in this light.

Anthony Johnson (left), undated; and founders of the New York African Mutual Relief Society, Reverend Peter Williams (center) and Reverend James Varick (right), undated

As early as the seventeenth century, there were some African Americans participated in and profited from the U.S. economy. One of the earliest examples is that of Anthony Johnson, who was brought to the American colonies from Angola as an indentured servant. He gained his freedom by 1645, and as a successful farmer, amassed “250 acres of land stretched along the Pungoteague Creek on the eastern shore of Virginia."[2] But after Johnson’s death in 1670, the courts took the land from his family. The seizure of their land and wealth would be a commonplace theme for African Americans, yet many continued to thrive and prosper. In 1808, almost 150 years later, the New York African Society for Mutual Relief was established to serve several functions, including “as a brokerage house to buy real estate… By 1860, the Society had assets of $15,000 and was the only black organization in the United States whose financial success could be attributed to real estate investment.”[3]

Advertisement for Alonzo Herndon’s barbershop, the Crystal Palace, Atlanta, Georgia, undated

In the era following Emancipation, black business expanded. Alonzo Herndon got his start with a barbershop, as explained by archivist Herman "Skip" Mason: “Herndon… was this former slave, born in Social Circle, Georgia, who walked to Atlanta [Georgia] on foot, who started this barber shop, saved his money, invested in real estate, became very wealthy, he acquired this fledging benevolent insurance company from a church, created Atlanta Life [Insurance Company], and became one of Atlanta's first black millionaires,”[4] owning over 100 properties throughout Atlanta and Florida.

Early proprietors in Greenwood, Tulsa, Oklahoma, including O.W. Gurley (bottom, second from left),

c. 1921

As has been much reported this year, the Greenwood neighborhood of Tulsa, Oklahoma, nicknamed “Black Wall Street,” 100 years ago witnessed the horrific tragedy of the Tulsa Massacre. Before the riots, “serial entrepreneur” O.W. Gurley moved south of Tulsa after oil had been discovered and “bought roughly 40 acres on the northeast side of the city… and resolved to sell those plots solely to Black settlers.”[5]

A.G. Gaston (right) with R.A. Hester (left), outside of the newly opened A.G. Gaston Motel, Birmingham, Alabama, 1954

Three years after the Tulsa Massacre in 1921, millionaire A.G. Gaston established “the Booker T. Washington Insurance Co. with $500. Building on the insurance company, Gaston developed a business empire estimated at more than $35 million, which included the Smith and Gaston Funeral Home, the Gaston Motel, and the Citizens Federal Savings and Loan.”[6] Comer Joseph Cottrell, Jr. (1931 - 2014), cofounder of Pro-Line hair products, told of how his father, Comer Joseph Cottrell, Sr., served as an important advisor and mentor to A.G. Gaston: “My dad… [worked] for Atlanta Life Insurance Company… he met A.G. Gaston, who had a funeral home… he told him… that in the State of Alabama… you weren't required to have a certain capitalization to start… a burial insurance company. All you had to have is a funeral home with the ability to bury the people. So my dad talked him into setting up… Booker T. Washington Insurance.”[7] Upon his death in 1996 at age 103, Gaston, who had bailed Reverend Martin Luther King, Jr. out of a Birmingham jail in 1963, left behind a financial empire that included the Booker T. Washington Insurance Company, the A.G. Gaston Construction Company, Smith and Gaston Funeral Home, and a financial institution, CFS Bancshares.

Left: Edward (left) and George (center) Jones, undated

Right: Norman McGhee, undated

At the time that A.G. Gaston launched his insurance company, “African American financial speculators began to carve their niche on Wall Street… [Speculator] H.R. George… established offices in Harlem as well as Wall Street; Edward and George Jones… owned over a half million dollars of stock in such trademark companies as General Motors and AT&T.”[8] Then, in 1949, Thorvald McGregor and Lawrence L. Lewis became the first black registered stockbrokers on Wall Street. Three years later, Georgia native, Norman McGhee’s firm McGhee & Company became the first black-owned firm licensed by the National Association of Securities Dealers. That was followed in 1955 by the founding of Special Markets, Inc. by Philip M. Jenkins’, becoming the first black-owned and

-operated brokerage housed on Wall Street.

Russell Goings (left), New York City, c. late 1960s; and Travers J. Bell (right), c. 1971

Russell Goings got his start in finance in the 1960s, first serving as an over-the-counter trader at J.W. Kaufmann & Co. and later joining Shearson Hammill in 1968 as its first African American branch manager. In his 2019 HistoryMakers interview, Goings recalled opening a Shearson Hammill branch in Harlem: “Black people, many of them said, ‘Well, you’re coming to take the money out of Harlem.’ And, I said, ‘You couldn’t be so far wrong… We are generating from all over the world… capital into Harlem… we are taking people who were disenfranchised and we were opening up career opportunities for people in every aspect of brokering that had been closed.’”[9] In 1971, Goings bought the branch, renamed it First Harlem Securities, and purchased a seat on the New York Stock Exchange, the second African American-owned business to do so. The first had been Travers J. Bell, who, earlier in 1971, bought a seat on the New York Stock Exchange for his upstart firm Daniels & Bell.

Left: John Rogers, Jr., Mayor Richard Daley, and HistoryMaker Mellody Hobson, c. 1990s

Right: Eddie C. Brown

In the 1980s, more African American money management firms emerged. Among these was HistoryMaker John Rogers, Jr.’s Ariel Investments, founded in 1983. In his 2002 interview, he explained: “Being here in Chicago [Illinois], you… saw all these great entrepreneurs… So I said, well, I've got this expertise. So I'll do this in the investment world… [But] there wasn't a lot of precedent.”[10] Rogers successfully paved his own way, and continues to serve as chairman, Co-CEO and Chief Investment Officer of Ariel Investments, the nation’s largest minority-run mutual fund firm. Rogers also launched the career of his Co-CEO and Ariel Investments President Mellody Hobson, a business titan in her own right. Millionaire entrepreneur Eddie C. Brown got his start the same year, establishing Brown Capital Management which now manages $14 billion in assets, “including the $5.9 billion Brown Capital Management Small Company fund (ticker: BCSIX), which is up an average of 14.3% over the past 15 years, better than 99% of its small-cap growth peers.”[11]

Reginald F. Lewis, c. 1980s

It was Reginald F. Lewis, though, who closed a historic deal in the 1980s. Lawyer and political campaign manager George Russell explained: “Reginald F. Lewis, he was born on the East Side [Baltimore, Maryland]… he worked his way through Virginia State, he went to Harvard Law School. And then he joined a big New York [New York] law firm. And then later he formed his own firm. And the rest is history. He ultimately acquired Beatrice Foods [Company; TLC Beatrice International] and became a billionaire.”[12] When the company reported revenue of $1.8 billion in 1987, it became the first black-owned company to have more than $1 billion in annual sales. It reached its peak in 1996, with sales of $2.2 billion, listing at 512 on Fortune magazine's list of 1,000 largest companies.

Commissioner Aulana Peters, 1987 (left) and Clifton Wharton, Jr. (right), undated

African Americans made other significant moves in the world of finance during this time. In 1984, attorney Aulana L. Peters made history as the first African American to serve as a commissioner of the Securities Exchange Commission, the third woman to do so. HistoryMaker Clifton Wharton, Jr. became the first African American CEO of a major Fortune 500 company—TIAA-CREF—in 1987 after having served as the first African American president of Michigan State University. He reflected upon his pioneering roles in his 2006 HistoryMakers interview: “In every one of the pioneering positions that I've been in, I've always been very conscious of the fact that you're the first and you want to… not do something wrong… that leads to that not happening again. That's why I always say, I wanna see twos, threes, fours and fives.”[13]

U.S. Supreme Court building

A 1989 U.S. Supreme Court decision would have a somewhat chilling effect on African American progress. Journalist Hazel Trice Edney described: “That was Croson v. City of Richmond [sic. City of Richmond v. J.A. Croson Company, 1989], in which they challenged a 30 percent minority set aside that Richmond had… black contractors were doing much, much better at that time, since 1983 when it had first gotten started. But then the Supreme Court said that set asides were unconstitutional… And that ended a whole lot of participation that we're still struggling to retain and to regain.”[14]

Left: A Black Enterprise article covering the founding of Utendahl Capital Partners by John Utendahl (left) and Ronald Blaylock’s (right) Blaylock & Company, c. 1990s.

Right: Robert F. Smith

In response, many African Americans turned from municipal finance to corporate finance, like John Utendahl, who initially worked with financial giant Merrill Lynch, before starting his own firm, Utendahl Capital Partners, in 1992 in partnership with Merrill Lynch: “The arrangement ushers in a second generation of black investment banks that gain access to corporate bond and equity transactions.”[15] HistoryMaker Robert F. Smith, CEO of Vista Equity Partners, credits Utendahl with bringing him into this investment scene: “There's this guy by the name of John Utendahl… he pulls me over and said, ‘Hey, you got an interesting background. Have you ever thought about a career in investment banking? …Why don't you come down and have some lunch with me some time?’ I said, ‘great.’”[16] Of course, Robert Smith, the nation’s second black billionaire, would eventually launch Vista Partners, one of the best-performing private equity firms, with $50 billion in assets.

Jesse Jackson’s 24^th Annual Wall Street Project Economic Summit, March 30-31, 2021

Not to be left out is the critically important role played by the Reverend Jesse Jackson, Sr. and his powerfully effective Wall Street Project, launched in 1996, which “challenge[d] Corporate America to end the multi-billion dollar trade deficit with minority vendors and consumers, while working to ensure equal opportunities for culturally diverse employees, entrepreneurs and consumers.”[17] Emma Chappell (1941 - 2021), who headed one of the Wall Street Project divisions after founding her own bank recalled: “People… do not have an idea of the many businesses that… exist because of him [Jesse Jackson]. And… are successful because of him… And [he can] sit down with the CEOs and talk to them about seeing our neighborhoods as emerging markets as opposed to… third world countries.”[18] The work of The Wall Street Project continues as the financial industry still lacks diversity: of the 551,000 personal financial advisers in 2019, 82.2% were white, 8.6% were Asian, 6.9% were black and 6.3% were Hispanic. Of the nearly 2 million accountants and auditors, 77.1% were white, 12% Asian, 8.9% Hispanic and 8.5% black, and less than 5% of certified financial planners are black.[19]

Top, left to right: William M. Lewis, Jr., Raymond McGuire, Richard Parsons, and Franklin Raines

Bottom, left to right: Roger W. Ferguson, Jr., Carla Harris, JoAnn Price, and Laurence C. Morse

There is a lot more to this story than meets the eye. There are many standouts, including HistoryMakers William M. Lewis, Jr., managing director and co-chairman of investment banking with Lazard; Raymond McGuire, former vice chairman at Citigroup; Richard Parsons, former chairman of Citigroup; Franklin Raines, former chairman and CEO of the Federal National Mortgage Association under President Bill Clinton; Roger W. Ferguson, Jr., former vice chairman of the Board of Governors of the U.S. Federal Reserve System and former president and CEO of TIAA; Carla Harris, vice chairman of global wealth management and senior client advisor at Morgan Stanley; and JoAnn Price and Laurence C. Morse, founders of Fairview Capital Partners.

Top, left to right: Rodney M. Miller, Gerald B. Smith, Dmitri L. Stockton, Deborah C. Wright, and

Frederick Terrell

Bottom, left to right: Lloyd G. Trotter, Ronald Blaylock, Barbara Alleyne, Christopher J. Williams, and Suzanne Shank

Rodney M. Miller, vice chairman in JPMorgan’s Mergers and Acquisitions Group; Gerald B. Smith, chairman and CEO of Smith Graham & Co. Investment Advisors; Dmitri L. Stockton, former CEO for GE Capital Bank in Switzerland; Deborah C. Wright, former chairman, president and CEO of Carver Bancorp; Frederick Terrell, former executive vice chairman of investment banking and capital markets at Credit Suisse; Lloyd G. Trotter, founder of GenNx360 Management Company with Ronald Blaylock; David J. Grain, founder and CEO of Grain Management; Barbara Alleyne, former managing director in global fixed income at Citigroup; and Christopher J. Williams, chairman, CEO and founder of The Williams Capital Group and Williams Capital Management, which merged with Suzanne Shank’s Siebert Cisneros Shank & Co., forming Siebert Williams Shank & Co., where Shank serves as CEO and Williams as chairman, among others, should also be mentioned.

In summary, the history of blacks in finance is one that is still very much being written.

Blacks in Finance: A Rich History

Blacks in Finance: A Rich History features a moderated discussion hosted by CNBC’s Sharon Epperson. Epperson is joined by a panel of successful leaders and entrepreneurs including the founder of Smith Graham, Gerald Smith; co-founder of Fairview Capital Partners, Laurence Morse; the founder, chairman, and CEO of Ariel Investments, John Rogers, Jr.; and Black Enterprises’ Editor in Chief, Derek Dingle. The discussion also features a Q&A session with questions from The HistoryMakers BusinessMakers Advisory Committee.

BusinessMakers: Breakout Leaders

Benaree “Bennie” P. Wiley

Founder & CEO Bennie Wiley speaks about MIT professor Frank Jones

In honor of BusinessMakers: Breakout Leaders July, we salute founder and CEO Benaree “Bennie” P. Wiley. Click the video above to hear her speak about her career and mentor, the first black tenured professor at MIT, Frank Jones.

One of twenty-eight women out of 800 Harvard Business School graduates in 1972, Benaree Wiley is Principal of The Wiley Group, a firm specializing in strategy, talent management, and leadership development, primarily for global insurance and consulting firms. In 1991, prior to the Wiley Group, she founded and became President and CEO of The Partnership, Inc. where she worked to assist Boston-area businesses attract, retain, and develop professionals of color and increase the number of black professionals at all levels of leadership. Under Wiley’s leadership, The Partnership became a major force in Boston’s corporate world working with more than 300 corporate partners and helping over 4,000 African Americans integrate themselves into the corporate community. Her son, Pratt Wiley, took over as President and CEO of the Partnership in 2019.

Prior to joining The Partnership, Wiley served as a management consultant with such corporations as Abt Associates, Contract Research Corporation and Urban Systems Research & Engineering, Inc. She is currently a Director on the board of the Dreyfus/Laurel Funds, the Pepsi African American Advisory Board and Blue Cross Blue Shield of Massachusetts. She is also the Vice Chair of Howard University and is on the boards of Boston College, the Greater Boston Chamber of Commerce, Harvard Business School Alumni Board, the Boston Foundation, the National Association of Corporate Directors, the Efficacy Institute and the Commonwealth Institute.

To learn more about Bennie Wiley, click HERE.

[1] P.R. Lockhart. “How slavery became America’s first big business,” Vox, August 16, 2019, accessed July 5, 2021. https://www.vox.com/identities/2019/8/16/20806069/slavery-economy-capitalism-violence-cotton-edward-baptist.

[2] “Race and Belonging in Colonial America: The Story of Anthony Johnson,” Facing History, accessed July 5, 2021. https://www.facinghistory.org/reconstruction-era/anthony-johnson-man-control-his-own

[3] James Sullivan. “THE NEW YORK AFRICAN SOCIETY FOR MUTUAL RELIEF (1808-1860),” Black Past, January 22, 2011, accessed July 5, 2021. https://www.blackpast.org/african-american-history/new-york-african-society-mutual-relief-1808-1860/

[4] Herman "Skip" Mason (The HistoryMakers A2011.037), interviewed by Julieanna L. Richardson, June 20, 2011, The HistoryMakers Digital Archive. Session 1, tape 3, story 8, Herman "Skip" Mason recalls joining the staff of the Herndon Home Museum in Atlanta, Georgia.

[5] Brooke Henderson. “Meet the Entrepreneur Who Created the First 'Black Wall Street',” Inc., accessed July 5, 2021. https://www.inc.com/magazine/202011/brooke-henderson/o-w-gurley-tulsa-oklahoma-business-black-wall-street.html

[6] “Gaston, Arthur George,” King Encyclopedia, Stanford University, accessed July 5, 2021. https://kinginstitute.stanford.edu/encyclopedia/gaston-arthur-george

[7] Comer Joseph Cottrell (The HistoryMakers A2004.218), interviewed by Larry Crowe, October 27, 2004, The HistoryMakers Digital Archive. Session 1, tape 1, story 9, Comer Joseph Cottrell talks about his father's founding of Booker T. Washington Insurance Company in Birmingham, Alabama.

[8] Steven Malik Shelton. “Wall Street: An American Dynasty,” Timbooktu, accessed July 5, 2021. http://www.timbooktu.com/shelton/wallst.htm

[9] Russell Goings (The HistoryMakers A2019.029), interviewed by Harriette Cole, April 12, 2019, The HistoryMakers Digital Archive. Session 1, tape 4.

[10] John Rogers, Jr. (The HistoryMakers A1993.003), interviewed by Julieanna L. Richardson, July 17, 2002, The HistoryMakers Digital Archive. Session 1, tape 3, story 5, John Rogers, Jr. explains branching off and starting his own company.

[11] Sarah Max. “Eddie Brown’s Fund Beat 99% of Its Peers by Picking Exceptional Stocks — and Employees,” Barron’s, July 2, 2020, accessed July 5, 2021. https://www.barrons.com/articles/like-many-black-owned-firms-brown-capital-doesnt-get-the-respect-it-deserves-51593713443

[12] George Russell (The HistoryMakers A2004.094), interviewed by Racine Tucker Hamilton, August 19, 2004, The HistoryMakers Digital Archive. Session 2, tape 4, story 7, George Russell describes the background of Reginald F. Lewis, the namesake of the Reginald F. Lewis Museum of Maryland African American History & Culture.

[13] Clifton R. Wharton, Jr. (The HistoryMakers A2006.077), interviewed by Shawn Wilson, May 12, 2006, The HistoryMakers Digital Archive. Session 2, tape 8, story 6, Clifton R. Wharton, Jr. talks about being an African American leader and pioneer.

[14] Hazel Trice Edney (The HistoryMakers A2013.339), interviewed by Larry Crowe, December 3, 2013, The HistoryMakers Digital Archive. Session 1, tape 4, story 4, Hazel Trice Edney talks about her success as a political news reporter.

[15] Derek T. Dingle. “45 GREAT MOMENTS IN BLACK BUSINESS – NO. 32: BLACK-OWNED INVESTMENT BANK SMASHES MULTIBILLION-DOLLAR CORPORATE FINANCE BARRIER,” Black Enterprise, August 18, 2017, accessed July 6, 2021. https://www.blackenterprise.com/45-great-moments-in-black-business-no-32-john-utendahls-partnership-creates-access-to-billion-dollar-corporate-bond-and-equity-deals/

[16] Robert F. Smith (The HistoryMakers A2015.002), interviewed by Julieanna L. Richardson, August 10, 2015, The HistoryMakers Digital Archive. Session 1, tape 5, story 2, Robert F. Smith describes meeting John Utendahl and transitioning into investment banking.

[17] “About the Wall Street Project,” Rainbow PUSH Wall Street Project, accessed July 6, 2021. https://rainbowpushwallstreetproject.org/about.html

[18] Emma Chappell (The HistoryMakers A2001.013), interviewed by Julieanna L. Richardson, May 16, 2001, The HistoryMakers Digital Archive. Session 1, tape 4, story 3, Emma Chappell discusses Rainbow/PUSH's Wall Street Project.

[19] Alessandra Malito. “Three reasons you don’t see many people of color in the financial services industry — and how to fix it,” Market Watch, July 8, 2020, accessed July 6, 2021. https://www.marketwatch.com/story/three-reasons-you-dont-see-many-people-of-color-in-the-financial-services-industry-and-how-to-fix-it-2020-06-11