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The Federal Reserve
Bank and the Relocation

of the Japanese in 1942


"THANK YOU FOR HELPING US," wrote Mary Tsukamoto, Secretary of the Florin chapter of the Japanese American Citizen's

League, to the San Francisco Federal Reserve Bank's Evacuee

Property Division. As she and her family joined 12,000 other Japanese being evacuated from the Sacramento area in late May of
1942, she expressed her gratitude to the Wartime Civil Control
Authority (WCCA) with unintentional irony: "Ever since the be-

ginning of our preparation for evacuation, we have felt the
kindly hands of the army.... The wonderful sincerity with

which the WCCA worked has won the complete trust and faith

of thousands of bewildered, frightened Japanese."'1 Mrs.

1. Letter from Mary Tsukamoto to the Sacramento office, files of the Evacuee
Property Division, Federal Reserve Bank of San Francisco, May 22, 1942. (Hereafter
referred to as FRB Files.)

The Public Historian, Vol. 5, No. 1 (Winter 1983)
? 1983 by the Regents of the University of California



Tsukamoto thanked the many "fine Americans"
dled the evacuation program, but offered special
Federal Reserve, whose field agents in Sacramen

other cities and small towns on the West Coast had assisted the

evacuees in disposing of their property in a manner intended to
be consistent with American traditions of justice, fair play, and
free enterprise.2

That the Federal Reserve Bank (FRB) played a role at all in
the human drama of evacuation and resettlement of 110,000
Japanese, 60 percent of them American citizens, may come as a
surprise. Studies of this shameful episode in American history,
condoned and justified on very loose grounds of "military necessity," have focused mainly on the victims' incarceration in such
internment camps as Manzanar and Tule Lake for the duration
of the war. Yet the uprooting must also be studied in terms of
the bureaucracies responsible for implementing the decision. It
was perhaps paradoxical that the same bureaucrats capable of

arriving at such a basically inhumane decision as relocation

should be concerned about its humane implementation. They
assumed, however, that the evacuees would resume normal lives
at some future time somewhere in America, where they would
need material goods to reestablish themselves. Even the army
recognized that they were entitled to compensation for their
possessions and that they should be protected from profiteers
seeking to take advantage of the situation. That they would suffer some economic loss was assumed, but the government sought

to minimize it. The question of how well the bureaucracy

charged with protecting the economic interests of the evacuees
did its task is the subject of this paper, which is based on an

examination of hitherto-unavailable records of the San Francisco Federal Reserve Bank on the relocation.3

2. The author is indebted to Professors Roger Daniels and Geoffrey S. Smith, who

critiqued an earlier version of this paper presented at the annual meeting of the
Association for Asian Studies, Toronto, March 4, 1981. That paper was included in
the Testimony of the Japanese American Citizens League National Committee for
Redress, presented to the Commission on Wartime Relocation and Internment of
Civilians, 1981. Funds for the study were provided by the Research Committee of

the University of Utah.

3. The data for this study consisted of original interview records, correspondence, and official communications of the Evacuee Property Division of the Federal
Reserve Bank, San Francisco. The author wishes to thank Dr. Kent Sims of the
Federal Reserve, who facilitated access to this material for purposes of scholarly



Executive Order 9066, which gave the army a
evacuate everyone of Japanese ancestry from the

was signed on February 19, 1942.4 The decisi

reached slowly during the two-and-a-half month
Harbor. Since that attack, the military command o
Coast had been convinced that some form of "s
ment" of the Japanese was necessary for security,
the secret Munson Report to the State Departme

cated in November of 1941 that there was no real li

their committing sabotage.5 Secretary of the Trea

Morgenthau, Jr. discussed possible evacuation as

cember 11,6 but the enormous dimensions of such

signed the idea to limbo, for the outbreak of the w
more immediate problems to the executive's atte
from the freezing of their assets, which did cause
the 60,000 issei, who were ineligible for citizens
Japanese to suffer from governmental actions durin
were the 5,000 issei and nisei picked up in the F
raids for interrogation by the Alien Enemy Hearin
possible subversives. Two thousand were held in

camps for the duration of the war.7 The decisio
everyone of Japanese ancestry was made despite th
of hard evidence of sabotage; in fact, the very
provocative acts became justification for action.8

cracy then had to divide up tasks to carry out the d

4. Roger Daniels, The Decision to Relocate the Japanese Ameri
Hyman, ed. (Philadelphia and New York, 1975).
5. Curtis B. Munson, "Report on Japanese on the West Coast of the United
States," in Hearings, 79th Congress, 1st Session, Joint Committee on the Investigation of Pearl Harbor Attack (Washington, 1946) vol. S811, Pt. 6, p. 2684.
6. Diary of Henry Morgenthau, Jr., vol. 470, Franklin D. Roosevelt Library, Hyde
Park, New York, p. 2684.
7. Michie Weglyn, Years of Infamy (New York, 1976), p. 46. Issei are first generation, born in Japan; nisei are second generation Japanese-Americans.
8. See the statements of Walter Lippman as cited in Dillon S. Myer, Uprooted
Americans (Tucson, Ariz., 1971), p. 22. Basic works on the history of the relocation

include Dorothy Swaine Thomas and Richard Nishimoto, The Spoilage (Berkeley
and Los Angeles, 1946); Jacobus tenBroek, Edward N. Barnhart, and Floyd W Matson, Prejudice, War and the Constitution (Berkeley and Los Angeles, 1954); Roger

Daniels, Concentration Camps, U.S.A.: Japanese Americans and World War II

(New York, 1972); Morton Grodzins, Americans Betrayed: Politics and the Japanese
Evacuation (Chicago, 1949); Audrie Girdner and Anne Loftis, The Great Betrayal:

The Evacuation of the Japanese Americans During World War II (New York and
London, 1969); Weglyn, Years of Infamy; and Bill Hosokawa, Nisei: The Quiet

Americans (New York, 1969).


Lawrence Hewes, who was appointed to head the F
Administration, soon realized, implementation, no
guments about the wisdom of the program, was th

The army, whose West Coast leadership had been so instrumental in obtaining the fateful decision, was placed in charge of
evacuating the Japanese to assembly centers and from there to

permanent relocation camps. General John L. DeWitt headed
the Western Defense Command; Colonel Karl R. Bendetsen,
head of the WDC's civilian affairs board, the Wartime Civil
Control Authority, handled actual removal. That agency assisted
the evacuees with their social and economic problems.
The WCCA divided the task of assisting the evacuees in preparing for relocation among four existing federal agencies. The
U.S. Employment Service's assignment was job relocation (for
the initial assumption was that evacuees would be moved to another area and allowed to resettle freely among the local popu-

lation). The Federal Security Agency was charged with

providing social welfare services such as unemployment compensation. The Farm Security Administration was to oversee
and administer the transfer of farm properties to new owners or

tenants, and, most importantly, to see that crops were tended.
The Federal Reserve Bank, in its capacity as fiscal agent of the
United States, was asked to provide assistance to evacuees desiring help in equitably disposing of their property.
As the bank's "Final Report" stated, the purpose of its assignment was to "forestall action by unscrupulous creditors who

would take advantage of the situation," and to minimize the
evacuees' losses.'0 The bank's authority stemmed from two
sources: The president's Executive Order 9066, and his delegation of power to the Treasury Department. That agency clearly

did not "want to bother with these little businesses and all of

these properties on the West Coast," as Morgenthau put it on
9. Lawrence Hewes, Boxcar in the Sand (New York, 1957), Chapter 14. Milton
Eisenhower similarly opposed the decision but had to implement it when he was
appointed to head the War Relocation Authority; he soon resigned. Daniels, Concentration Camps, U.S.A., p. 91. See also Milton Eisenhower, The President is Call-

ing (Garden City, N.Y., 1974).

10. "Report of the Federal Reserve Bank of San Francisco: Fiscal Agent of the
U.S. on the Operations of the Evacuee Property Division as of May 22, 1942."
(Hereafter cited as FRB, "Final Report,"), pp. 1-5.


February 27, 1942," and shifted the burden to t

serve Bank of San Francisco. In addition, the

custodian delegated his authority on this issue to
serve Bank and the Treasury Department in ord
plication of services.'2 Thus from the outset the
tasks somewhat at odds with each other: to prote
of the evacuees, but also to aid the war effort b

quickly as possible the transfer of properties

could be moved with minimal disruption of the
The Federal Reserve's Role in Relocation

The operation at the Federal Reserve Bank was set up in great
haste during the next two weeks. An Evacuee Property Depart-

ment (EPD) was created, headed by Vice President William

Hale and supervised by Assistant Cashier R. E. Everson. Branch
offices opened in San Francisco, Los Angeles, Portland, and Seattle. When most of the states of Washington, Oregon, and California and part of western Arizona were designated on March 2
as Military District 1,13 field offices were established throughout
the region. The bank representatives, who numbered 184 at the
height of the program, were to operate as a team with the other

agencies in cases where problems were interrelated, and they
often shared facilities. They viewed their assignment as just another task, albeit an extraordinary one, and the officials responsible did not pass judgment on its wisdom.
As time was short, the procedure for working with the evacuees was only sketched out. Anyone seeking help would be referred first to a Federal Security Agency representative, who

would assist with welfare and job-related problems. Then the
client would be turned over to a bank or Farm Security agent,
depending on the nature of his or her problem.14 These officials
11. Morgenthau Diaries, February 27, 1942.
12. War Relocation Authority, First Quarterly Report: March 18 to June 30,
1942 (Washington, D.C., 1942), p. 6.
13. Military District 1 included the coast and interior sections of Washington,
Oregon, and California and part of western Arizona. Military District 2 consisted of
areas further inland in those states, and was not originally designated to be evacuated. The "prohibited" zone of Military District 1 was along the coast and the Mexican border. Daniels, Concentration Camps, U.S.A., pp. 83-84.
14. Vader Report, Office Operations, March 16, 1942, San Francisco Office, FRB



would give advice or refer the evacuee to others f
cific assistance. In practice, however, cases were r
so smoothly. Although the number who actually

was relatively small-the bank conducted about
views-the agents were soon overworked. There w
for follow-up investigations to measure the su

efforts at assistance, for most evacuees had only two
tween the announcement of the decision and their removal.

The ability of the bank agents to solve the evacuee's financial
and property problems depended largely on their expertise in
fiscal and real estate matters and their ability to persuade the
Anglo community to cooperate. Although the bank could freeze

property in dispute if necessary, this weapon remained

sheathed. On March 27, Vice President Hale informed Everson
that the freezing power was to be used only if the evacuation
would be delayed otherwise, or if it appeared that the evacuee
was being victimized due to his imminent departure. Freezing
was "seldom if ever justified," especially if litigation had been
instituted, as it would be "prejudging the rights of the litigant."'5 Instead, much was made of the powers of moral persuasion. On March 20, Tom Clark, then chief of the civilian staff of

the WCCA, issued a stern warning that "any person taking advantage of the confused state of mind of the Japanese to defraud them will be prosecuted by the Department of Justice."
He called such miscreants "un-American, unfair, and deserving

of severest censure."16 To "table" a difficult case would have

meant lawsuits and delay, and perhaps would have required the
complainant's return from the camps, yet haste in settling led to

quick decisions that often came undone or were later regretted,
while unresolved problems later became a legacy for the War
Relocation Authority (WRA).
The Federal Reserve officials had their work cut out for them,

for exploitation of the Japanese had begun months before the
evacuation order was issued. Since December 7, 1941, JapaneseAmericans had lived in a climate of fear, bombarded with
rumors and misinformation, as a suspicious and frightened citi15. Memo from Hale to Everson, March 27, 1942, San Francisco Office, FRB


16. Memo from Evacuee Property Department, March 30, 1942, San Francisco

Office, FRB files.


zenry conditioned by years of prejudice and racia
was over-quick to identify them with the enemy.
nent incarceration or deportation coupled with the
of jobs and a lack of ready cash due to the freezi
assets and closing of Japanese-owned banks thoro
the Japanese minority, who were unsure whom to
to do. Some moved quickly from areas designated

because of their proximity to defense installa

tempted, often in vain, to find more secure locati
very vagueness of Roosevelt's Executive Order and

niteness of plans made for its implementation

their confusion. For example, the military first a
encouraged voluntary migration, and then, on Ma
hibited that in favor of a plan freezing movement
ninety-nine designated areas in Military Zone 1 w
in turn. This turnabout exacerbated an already
Meanwhile, the Federal Reserve turned to the ta

field agents to interview and advise those requ

sistance. Neither San Francisco nor the branch of
a job description for this position. Some records in
attempt was made to exercise "exceptional care
the highest type individuals available for the work
recommendations from other bankers or leading
community17 However, the work was to be of lim
approximately two to six months, and there was
to hire people and begin immediately. Reports fr
offices make clear that the usual procedure was to
hire retired bankers, federal employees, real esta
people with some business experience who were w
a temporary job. Their feelings toward the Japan
edge of their culture or native language were not
In short, they appear to have been quite typical r

of the prevailing climate of opinion in their c

white, middle class, and at least moderately racist
after all, the products of California's "politics o
None doubted the morality of the task they were t
fication appeared self-evident.

17. Report from the Assistant Manager, Los Angeles Office, to
San Francisco, May 30, 1942, San Francisco Office, FRB Files.
18. See Roger Daniels, The Politics of Prejudice (Berkeley, 1962


The selection of the head field agent for Sacramento,

Reid, is a case in point. Dallas Gray was sent from
Office in San Francisco in mid-March, 1942, to hire
the position. He reported that none of the people
he obtained from the U.S. Employment Bureau pro
the "type of personality" required. Following a few
tained from acquaintances in the city, he found a su

date, but the man declined the job for more pe

employment. Gray reported that he then interview

hired him on the spot. The new head of the Sacrament

the Evacuee Property Division reported for wor

morning to meet his colleagues, Wayne Phelps of th
curity Administration, Patricia Thayer of Federal S
Ray Donnally of the U.S. Employment Service (the

as coordinator of the WCCA operation in Sacram

Gray spent the rest of the day meeting with leaders
anese-American community to explain procedures
vices the agencies could render the evacuees, Reid r
instructions. Nowhere in his report did Gray men
qualifications for the position.19 It would appear, f
port and others, that sheer availability was one of t
requisites for the job.

The Federal Reserve Operation in Sacramento

The manner in which the bank agents helped the
prepare for relocation can best be understood by s
some detail the experience of the City of Sacrament
in that city served Japanese from a nine-county ar
ern California. The city was of medium size and lo
heart of the rich Sacramento valley; Japanese had
since 1883. Although that minority probably made
10 percent of the city's population in 1942, Sacrame
had the third densest Japanese population on the W
While most of them were involved in agriculture, o
urban residents of the city's lively Japan Town, wh

19. Report from Dallas H. Gray to Head Office, March 24, 194

Office, FRB Files.


banks, churches, restaurants, groceries, hotels, an
barber shops.20
Sacramento Japanese had about two months in w
pare for relocation: more time than the unfortuna
Terminal Island in Los Angeles harbor, who were s
rooted within twenty-four hours, but still not eno
office was set up in mid-March, and headed by R

hired five subordinates. As Henry Taketa (a pr

lawyer in the city) stated, the Federal Reserve Ba

intentions, but it didn't go out asking people

help."21 Taketa estimated that only one family in
asked for assistance from bank agents. The remain
ing the government for good reason, preferred t
own problems. The agents attempted to dissemi
tion through the local chapters of the Japanese A

izen's League (JACL), whose leaders together

community spokesmen met with Gray during h
urged a rapid dissemination of information throu
and Japanese organizations, so that people, "dis
confused" as they were, would be prepared, and n
removed by the Army en masse.22 The Buddhist
to keep people informed, and throughout March

local newspapers urged people to prepare for

April 4, for example, the Bee reported a "final wa
Coast Japanese to be ready to move, stating "no e
be made."23 In the week prior to evacuation, the J

distributed a mimeographed newsletter, includ
note reminding people to take their pets to the

Society, which promised to find them good homes

Such general pronouncements left many que
answered. When Gray met with community lea
mento, he was asked to provide specific infor

20. Cheryl L. Cole, A History of the Japanese Community
1833-1972: Organizations, Businesses, and Generational Respo
Domination and Stereotypes (San Francisco and Saratoga, Ca.,
and Sacramento Bee, May 7-8, 1942.
21. Interview with Henry Taketa, June 21, 1980, Sacramento,

anese Community, p. 46.

22. Gray Report, FRB Files.
23. FRB Files, and the Sacramento Bee, April. 4, 1942.


would aid a family whose head had been arrested
How could a family sell its car if the legal owner
carcerated? What about the property problems of
armed forces? Should families sell household go
them? Would they ever be able to return?24 Beca

gram had not been thoroughly conceptualized

reigned supreme and bank agents could do little to

As bank agents in Sacramento conducted inte

those Japanese who did come in for assistance, the

total of 625 forms to be sent to the San Francisco off

at these forms, we can analyze the way in which t

cials operated. Approximately half of the forms dealt

the disposal of an automobile. Others recorded int
Anglos or minority groups anxious to acquire the
Japanese had to leave behind. Of the remainder,
contained sufficient information to make the pr
solution comprehensible were analyzed by compu

comparable data was a difficult task, for the ca

tremely varied. The results of this study provide a
ing at the economic loss of the Japanese, as well
operation of the Federal Reserve's Evacuee Proper
The Sacramento office served Japanese from a n

area in Northern California. One-hundred-fourteen of the 230

were residents of the city or had a rural address in Sacramento,
while eighty-two came from small towns in the county and its
valley neighbors. Twelve cases involved people who had already
relocated once from areas in the "prohibited" district along the
coast. Most, 157 of 230, represented only themselves, although
about 10 percent represented others: their issei parents or other
relatives, or on occasion an organization. The vast majority were
males and 149 were American citizens. (The form solicited all
this information, including a question asking if they had ever
visited Japan. Ninety-five had; ninety-one had not.)
The cases covered a wide variety of topics, ranging from ur-

ban small businesses (approximately 25 percent of the cases)
such as hotels, groceries, dry cleaning establishments, and nurseries, to agriculture (another 25 percent). The Sacramento City
Directory listed a total of 238 Japanese businesses in the city in
24. Gray Report, FRB Files.


1940.25 Never did an individual present the bank
totality of his economic situation; instead, evacu

only with the few problems they had been un


Uprooting the Japanese was not a simple task. Vagueness regarding the final disposition of the cases makes an evaluation of
the effectiveness of the bank's program in Sacramento difficult.
Settlement prior to evacuation was apparent in ninety-seven of
the cases, or 42 percent; the remainder were handed over to the

WRA. In each relocation camp there was an Office of Evacuee
Property, which attempted the follow-up that the Federal Reserve's limited program could not offer. It is difficult to deter-

mine if the settlements facilitated by the bank agents were
"fair"; they do appear to have been satisfactory from the
agent's point of view, which was the only perspective recorded.
In one-third of the Sacramento cases no information was provided as to outcome, and only one case required extensive legal
research.26 In six cases it appeared that the evacuee had been
pressured into accepting an offer lower than he desired; occasionally the irritation of the bank agent surfaced in a remark
about recalcitrance or stubbornness. Reid noted in one case,
"This man has not put his best efforts forward to liquidate his
affairs."'27 The vast majority accepted the bank officers' suggestions, and occasionally recorded their gratitude in touching
letters of thanks sent later from the camps.28 There was for most

no time to argue, no sense that resistance could achieve anything, and the need for haste was all-pervasive. The bank's as-

sistance was accepted for what it was-better than no help at
all, and many people were very grateful for it.

25. As listed in Cole, Japanese Community, p. 144.
26. The Ishino-Kercheval case was the most troublesome Sacramento case, and
was used as an example in the bank's "Final Report."
27. March 24, 1942, Sacramento Office, FRB Files.
28. The case of Dr. George Iki was exceptional. A prominent Sacramento physician, he cooperated fully with the officials, and even evacuated to Walerga a week
ahead of the others in order to set up a 150-bed hospital. As the time of evacuation

drew near, he wrote Reid asking help with his own affairs in order that he could take

his office equipment with him. He received no answer, and later wrote from Tule
Lake asking for references so he could borrow money to re-equip. He received the
reference together with a personal note wishing him well, and suggesting that he

might be able to do some fishing and hunting now that he was relocated! Sacramento
Bee, May 7, 1942, and FRB Files.


It is unclear whether the people who called on
Reserve Bank were representative in terms of the
status in the community. Based on internal evid
peared that eighteen were prosperous property ow
eleven were in desperate financial straits. Evacuees
little information about their overall situations. T
community in Sacramento was certainly not prosp
years immediately preceding the war; hard-hit by
sion, it had not recovered by 1942. Most Japanese
farmers unable to own land due to the Alien Prop
California, and the majority leased their homes
business.29 Only 20 percent owned either urban or
erty.30 In one county, 205 of the 416 Japanese far
were owners, and only thirty-seven had disposed of
erty prior to 1945.31 The prosperous Japanese farm

unfairly with white labor-the "yellow peril" st

publicized by Sacramento publisher V. S. McClatch
migration controversies of the early 1920s-was co
his absence in 1942. The Japanese farmers did work
on marginal lands, and they were willing to do th
required to raise such truck crops as strawberries a

but this had not made them rich.32 In fact, it only ad
problems in 1942, for no one else wished to lease su

and do that kind of work. The case of the Japanese
of Florin, located twenty miles south of Sacramento
demonstrated their problems, and its fate was an ex
worst that could happen.,

When the agents encountered a complicated a
29. Cole, Japanese Community, Chapter 2.

30. War Relocation Authority, Final Report, Sacramento District,
31. War Relocation Authority, People in Motion: The Postwar Adju
Evacuated Japanese-Americans (Washington, D.C., 1947), reprinted
p. 67.
32. The Bee reported a week after evacuation that most of the strawberry crop
would be lost, as no one was available to harvest it. May 27, 1942.
33. The Japanese of Florin raised grapes and strawberries. As the land was poor,
no whites wanted to purchase or lease it, and corporations finally took over large
tracts. The property stored in Florin was vandalized even as the former residents
were leaving, and this continued through the war with little effort exerted by law
enforcement agencies to prevent it. By the time the former owners began to return
in March, 1945, the community was devastated, and many of the farms had been
partially abandoned. War Relocation Authority, The Wartime Handling of Evacuee
Property (Washington, D.C., 1946, Reprinted 1975), pp. 93-96.


case, they conferred with the Farm Security A
(FSA), whose stated purpose put harvesting of the

with protecting the property interests of the farmer

policy was to encourage farmers to plant in sprin

the expense of seed and fertilizer, even though

would be unable to harvest their crops. Those who

agricultural production, so necessary in warti

charged with sabotage.35 In fact, one Sacramento
arrested for destroying his four acres of lettuce.36
Evacuees with complicated urban holdings wer
real estate agents, commercial banks, and attorne

two Japanese attorneys in Sacramento, Taketa

Tsukamoto). Often the only solution to a real pro
was to give power of attorney to a commercial ag
friend and hope that a satisfactory solution could
after the owner's departure. Sixty-five gave such

torney, approximately 30 percent of the cases

thirds of the Sacramento cases involved real estat
owners were advised either to sell, sublet, engage

manager, or, if all else failed, to give someone

Farm equipment generally went with the land, and the ultimate disposition of the crops was the new proprietor's concern.
The Federal Reserve was quite successful in preventing credi-

tors from repossessing tractors or household equipment on

which the purchaser was paying installments; when evacuation
was announced, many creditors refused to accept any further
payments from Japanese, instead demanding repossession of the
goods. This was clearly illegal as well as unfair, and the agents
stopped such harassment.
Throughout, bank agents assumed that the evacuees should
follow normal procedures in a free enterprise economy: advertise and sell for what the market would bear, and accept as a
consequence of their haste some economic loss. Many white ad-

vocates of evacuation believed that the Japanese Americans

were being asked to make a normal wartime sacrifice, if any34. Farm Security Administration, "Final Report," December, 1942, Japanese-

American Research Project, Bancroft Library, University of California.
35. Interview with John Tateishi, JACL, San Francisco, June 24, 1980.
36. Sacramento Bee, March 5, 11, and 26, 1942.


thing a lighter one than that required of draftees
time circumstances, why argue about a few dolla
shown by the interview records, the agents shared
tions. Certainly the irritation that arose when th
sional Japanese protested the economic fate being
him would support such a conclusion.

Automobiles, unlike household possessions, co

stored indefinitely without loss. While the Sacram
statistics do not reflect the total number of cases i
vehicle problems represented as much as a third o
the EPD throughout Military Districts 1 and 2. Di
complicated by a frequently changing policy. At
appeared that evacuees would be permitted to dri
sembly centers; Sacramento Japanese first were to
take their cars to nearby Walerga, but were disco
doing so, for the vehicles would be left in open f
nonetheless, hoped they might recover their cars
found work near the relocation centers, so they
with the government. But under pressure from th
bank changed its policy, first encouraging, then de
Not only was it impossible to maintain vehicles lef
for indefinite periods of time, but such items we
both civilian and military use. The bank ultimate
appraisals of a stored vehicle's worth, and then p
evacuee to sell to the army. By the end of 1942 the
in storage, about one hundred, had been requisiti

More than 20 percent of the people intervie
Federal Reserve in Sacramento had financial pr

people lost their jobs when firms acted on the prev
of hostility and dismissed them. The California St
Board fired all of its Japanese-American employee
claiming that they "disrupted morale" and were p
tors due to their dual citizenship.38 Others were p
the federal government closed enemy-owned ban
Eleanor Roosevelt's intercession, that order was m

week after Pearl Harbor so that Japanese Americ
$100 a month from their bank accounts if they h

37. Evacuee Property Division, p. 4, San Francisco Office, FRB F
38. Sacramento Bee, April 3, 1942.


A Japanese-American woman working at the Tule Lake, California cam
courtesy of Special Collections, Western Americana Division, Marriott


sources of income.39 However, twenty-one people reported
hardships due to the freezing of their bank accounts, and another six tenants or agricultural laborers complained of their inability to collect pay due them at harvest time. Federal Security

provided temporary assistance for indigents. The Sacramento
office encouraged city banks to loan money on blocked ac-

counts, but took no action when the local Bank of America at
first refused cooperation. The FRB did make provisions for the
need for funds en route to the camps, urging evacuees to retain
their local bank accounts and to carry a small sum in traveler's
checks. Temporary branch banks were also opened near the assembly centers.
In other financial matters the field agents reminded evacuees
of ongoing obligations. Insurance premiums should not be allowed to lapse, and taxes could not be forgotten. The agents endeavored to protect the evacuees' equity if they defaulted on a
sales contract, but rarely did the owner gain more than the can39. Daniels, Decision to Relocate, p. 11.


cellation of the remaining obligation upon retur

The responsibility of the field agents to protect e
victimization was a source of concern and criticism from the

outset. Vice President Hale advised them on April 10 that a fol-

low-up to the initial interview was imperative. The agents
should even seek out Japanese who might need help, and assist
them with their problems. He stressed, "It is not sufficient just to
advise the evacuee to settle his affairs. You should go sufficiently

into details of the problem to satisfy yourself ... and then fol-

low through until you have definite knowledge that it has
reached a satisfactory conclusion." Instructing the agents to
keep a complete history of each case, he emphasized, "Remember, undoubtedly cases will be found in the future in which we
shall be called upon to defend our actions." The very fact that
the bank had not received any so-called "critical" cases seemed
to indicate to Hale that the treatment given advice-seekers was
superficial, and a reading of the interview records themselves

bears out this concern.40

Hale's warnings were echoed a month later when the Tolan
Committee reported the results of a two months' investigation
of national defense migration to the United States House of
Representatives. The committee members held hearings on relocation on the West Coast between February 21 and March 12,
1942. While they upheld the need for evacuation because of
what they considered convincing evidence of sabotage, they
were not laudatory regarding the actions of the Federal Reserve.41 They charged that the bank's property program was deficient on two counts. First, it dispensed erroneous information;
evacuees were urged not to store, but to sell needed property,
especially household goods, which they would be unable later to
replace. The committee also castigated the bank for being "cautious in the extreme," in stipulating that goods were to be stored

at the owner's risk, which created a "bad psychological factor"

in the minds of the evacuees.42

The Tolan Committee's criticism singled out an important
40. Instruction Letter No. 19, from William Hale to Field Representatives, April
10, 1942, San Francisco Office, FRB Files.
41. U.S. Department of the Interior, Wartime Exile: The Exclusion of Japanese
Americans from the West Coast (Washington, n.d.), p. 143.
42. Tolan Committee Report, Associated Press News Release, May 13, 1942, San

Francisco Office, FRB Files.


concern-storage. The Federal Reserve files are f
sive documentation as to the number of fire ex

chased for the warehouses it provided, but t

problem: the facilities were poorly guarded and

ally vandalized. The suspicions the Japanese
ment-provided services were fully justified

evacuees were as financially secure as Henry Tak
his goods with the reputable Bekin Van Lines. M
their goods with friends, in churches, in private
cilities, or with the government, risky or not.43
could not provide insurance, however, is an u
tion; probably it would have required federal au
it certainly would have cost money.

The Federal Reserve was not unresponsive t

established its own investigative unit, headed b
On May 4 Vader reported to John W Pehle, Assi
retary of the Treasury, that corrective action h
The field representatives were now conducting
investigations, and the information they provid
was more specific and useful. Offices which had

lax in recording complete case information o

sheets seemed to have improved. The office Vad
most deficient in this respect was Sacramento
procedures improved, time ran out. The Fede
are replete with thousands of form letters mai
who were interviewed once, requesting them to
to the solution of their problems. Few of the
sponse, and those that did usually provided such
mation as "I sold my farm (tractor, car)." Th

"case closed."

An examination of the data drawn from the interview records

of Sacramento reveals no clear pattern. Citizens, far more likely

to own land, appear to have sold more often than aliens, although the sample is probably too small to be significant. The

Federal Reserve representatives inquired of most evacuees if

they had ever been to Japan, but this information elicited noth43. Weglyn reports that an unidentified postwar survey found that 80 percent of
the goods privately stored were pilfered, rifled, or stolen during the relocation; Days
of Infamy, p. 77.

44. Rae Vader to John Pehle, May 4, 1942, San Francisco Office, FRB Files.


ing of any real relevance, nor did it appear to h
the handling of the cases. The cases were too
themselves to more detailed statistical analysis, a
pear that Sacramento's Japanese, whether citizen
treated much the same.45

The bank agents did protect people from the more obvious
forms of victimization and tried to prevent others from reaping
a windfall from their calamity46 Federal Reserve representatives

had many contacts among local real estate agents and bankers,
but no one firm seems to have profited unduly from the business

it received. An examination of the most complicated case that
the Sacramento office handled also shows no particular attempt
to influence the settlement.47 The agents in Sacramento appear
to have been as interested in an equitable solution as anyone,
but in this, as in everything, external variables set the outer lim-

its. A case was settled within two months: haste and the perceived need to cooperate with the military overrode everything.
When on May 7 the order was finally issued to evacuate the
city of Sacramento, bank representatives were on hand to help
the Japanese settle last-minute concerns. During the next three

days evacuees were processed in the municipal auditorium.

They were registered by the agents of the U.S. Employment
Service, and could confer once again with the bank, Federal Security, and Farm Security representatives. Five days later they
reported at the appointed time, tagged and with bundles in
hand, to board buses for the assembly center at Walerga. The
evacuation of the city took three days and was completed on
45. As the land cases demonstrate, citizens and issei shared a common fate. Of
forty-two landowners, thirty-three were citizens, seven issei, the remainder not
identified. Twenty-two percent of the Japanese Americans interviewed owned land,
16 percent of the issei. Thirteen citizens (10 percent) and one issei sold, while 11
percent of the nisei and 9 percent of the issei leased.
46. On a complaint from one woman, Agent Reid investigated two men who

were soliciting powers of attorney from the Japanese, implying that they were government agents. Reid warned the FSA of this, and asked the FBI to warn them off.

FRB Files.

47. Ishino-Kercheval case, Sacramento office, FRB Files. The case, involving a
dispute between a landlord and a Japanese asparagus farmer, reached such an impasse that both sides hired attorneys. The Japanese farmer, untypically, utilized a
leading non-Japanese firm. The Federal Reserve office was unable to arbitrate the
dispute, and asked San Francisco for assistance. The out-of-court settlement appeared to be a compromise of the differences, probably an inevitable outcome since

the contract was primarily verbal and not specific.


May 16; the county was evacuated two weeks lat
Military District 1 had been completely cleared o
The Federal Reserve in Retrospect

Though the operation of the Federal Reserve B
mento was typical of the procedure used elsewh
had its own specific problems. In Seattle, for
Japanese owned small residential hotels where tr

men stayed. Finding new owners for real esta
doned ghetto was difficult, particularly for marginally
profitable enterprises requiring the labor of all family members.

In the Los Angeles area, where the largest percentage of Japanese resided, problems were primarily agriculture-related.
While most truck farms were saleable to other minorities willing
to perform stoop labor, luxury goods enterprises like a cut-flower
business were harder to unload. Everywhere disposition of vehicles was difficult because of time payment contracts, and tales
of human misery filled the files.

The question of whether the Federal Reserve Bank helped
evacuees prepare for their uprooting in the best manner possible
can be assessed on several levels. Much can be learned from the

criticisms it received at the time, first from the Tolan Commit-

tee and second from the WRA, which inherited the Japanese
and their problems once they had been removed to the camps.

The Tolan Committee issued a report in May 1942, part of

which dealt with the actions of the Federal Reserve. While the

bank appeared to have done its utmost "to prevent injustice and
hardship to the evacuees, within an established framework," the
committee, as noted earlier, faulted several aspects of its procedure.49 Although the bank's officers tended to discount its observations since the committee had visited San Francisco shortly
before the Evacuee Property Division was operational and had
stayed in the city only a few days, its complaints appear to have

been valid.

The WRA also criticized the actions of the Federal Reserve.

In its Final Report, it listed six basic complaints. Although
48. Sacramento Bee, May 8, 1942.
49. Tolan Committee Report, ibid.


admitted that some economic loss was inevitable, i
damental problem in that procedures for safeguar

were established so slowly. Much victimization

tween the time of Roosevelt's proclamation on Fe
the granting of authority to the Federal Reserv
This interval provided "a golden opportunity for
tricksters." In the interim the federal governmen
correctly, that existing social agencies could han

lems. When the government did establish a p

provisions were inadequate to remedy initial loss
ongoing victimization. Each agency's role in the
limited, and responsibility for safeguarding evac

"bounded from agency to agency."'5 The Fed

Bank's San Francisco office was in charge for a m
while people were evacuated from their homes to
centers, a task completed by August 7. The WRA
trol of the operation in the fall, when the evacu
relocated into the "concentration" camps that ho

them for the duration of the war. It was too late by

vent abuses. The bank's Evacuee Property Divis
its operation on December 31, 1942.
The initial losses suffered by the evacuees were
by the indifference of local officials to the need to

goods. These authorities closed their eyes to vand
arson, and were unenthusiastic about prosecuting
army, primarily interested in getting the Japan
cated its responsibility for safeguarding their pro
Federal Reserve could offer little help. The WRA
cluded that "wartime handling of evacuee proper
part of the war record."5'
In a major study of relocation undertaken by th
of California in 1942, the role of the Federal Rese
attention. Sociologist Dorothy Swaine Thomas con
the policies of the bank resulted in "something cl
for virtually every Japanese-American businessm
safely be concluded that every evacuee incurred s

50. United States Department of the Interior, The Wartime Han
Property (Washington, 1946, reprinted 1975), RG210-F6/2, Nati


51. Ibid.


many of them suffered severe and irreparable los
ble and intangible, and that the burden fell mor

the small owner than the large."52 Her evalu

sharply with the official report issued by the ban
1942, which noted with some pride that the pro

implemented successfully: "The evacuees were
the Japanese-American Citizen's League expres

for the bank's help.53
The program might have been carried out succe
the bureaucrat's perspective, but for the Japanese
nomic disaster. Most later estimates put their pro
$400 million, citing the Federal Reserve as the so
terview records were clearly not the basis for th
was anything else the bank published on the subje
order to keep detailed interview records, few ag
only rarely did dollar amounts even appear in th
Since individuals only brought to the bank agents
could not solve themselves, the records contain n

on the property people disposed of privately. T

tained detailed records on the number of interviews conducted

at each field office every week, and it kept a careful accounting
52. Thomas and Nishimoto, The Spoilage, p. 16.
53. FRB, "Final Report," p. 21.
54. The $400 million figure is cited in many secondary sources, such as Weglyn,
Years of Infamy, p. 276; Girdner and Loftis, Great Betrayal, pp. 436-37; Hosokawa,
Nisei, p. 440; Daniels, Concentration Camps, p. 168. All cite the Federal Reserve
with no specific reference. Mike Masaoka, Washington Representative of the JACL,

attributed the figure to the FRB in a statement made at the Hearings of Subcommittee No. 5 of the Committee on the Judiciary, House of Representatives, 83rd Congress, 2nd Session, 1954, pp. 15-16, but he himself first mentioned it in his "Final
Report" from Camp Shelby, Mississippi, dated April 22, 1944; Letter to the author
from Roger Daniels, March 27, 1982. Helene Briggs, corporate services manager and
former archivist, Federal Reserve Bank, San Francisco, in a letter to the author May

12, 1981, acknowledged that neither she nor the research librarians at the bank

could find the source of the figure. The JACL used the $400 million figure in its work

on the redress issue; see The Japanese American Incarceration: A Case for Redress
(San Francisco, 1978), p. 22; and the figure came up again in the Washington hear-

ings of the Commission on Redress, July, 1981. Although some sources mention other
figures, ranging from $250 to $385 million-the latter is in Leonard Bloom and Ruth

Riemer, Removal and Return: The Social-Economic Effects of the War on Japanese-Americans (Berkeley, 1949)-the $400 million is the most common. It has

now reached the status of folk wisdom.

55. A count of the Sacramento cases reveals that only about one-third of the cases
mention any specific figures. Of those, approximately one-fourth give sufficient de-

tails to estimate the actual loss. A more intensive study of the entire body of the

27,000 cases will be necessary before this author can draw any hypothesis as to total

economic loss based on this data.


of the funds it expended to run the entire opera
694.47 as of December 31, 1942).56 But the econom
fered by the Japanese themselves appears not to
primary concern, despite the bank's stated charge.
goal soon became the preparation of the Japanese
parture. It was concerned more with speed than w
Time lends additional weight to the critics of t

gram, which was hastily-devised, ill-conceive

cedurally sloppy. The bank had no experience with

and while its agents gave advice well suited to
move, it was inadequate given the magnitude of
The white community, for the most part anxious to

unwelcome neighbors, was quick to victimize the
agents could only prevent the grossest abuses, and
a few of the thousands uprooted. Had they dealt w
community they would have gained a better persp
dimensions of the problem. Hampered by inadequ
inability or unwillingness to apprehend or punish

the agents failed, and in their failure they too becam

a misguided policy. Through its intervention the

sumed some responsibility for the tragic policy failu

tion. Eugene Rostow called it, in 1945, "our wo

mistake."58 One can only conclude that the mean
that dubious end were inept as well.

56. FRB, "Final Report," p. 20.

57. For example, the article, "Work in Evacuees' Interests in the
Bank of San Francisco," Federal Reserve Bulletin, April 1, 1943,

with the economic impact of the removal of the Japanese f


58. Eugene V Rostow, "Our Worst Wartime Mistake," Harper's Magazine 191
(September 1945): 194-201.