Whiskey Men — From Booze to Banking

Foreword:  The numbers of distillers, liquor wholesalers and saloonkeepers who turned to banking sometime during their careers is legion.  But it should not be too surprising.  Selling alcohol could be a very lucrative profession and many whiskey men had ready cash for investment.   Banks proliferated during the latter half of the 1800s and these gents had ready money to take advantage of the opportunities.  Some continued their liquor interests while engaging in the financial world; others turned to it when prohibitionary forces shut down their liquid operations.  Out of the many I have profiled, four men have been selected to illustrate the various paths from booze to banking.

Charles Froeb, an immigrant to the United States as a teenager, founded a highly successful liquor business in Brooklyn and used it as a springboard to an equally successful career in banking.  While other whiskey men moved into banking once Prohibition forces shut them down,  Froeb, shown here, embarked entered the financial world as a parallel career.

Born in Germany in 1857 and brought to the United States as a youngster, settling in Brooklyn, Froeb spent eleven years working for a New York liquor house before striking out on his own, inn 1883 founding the Charles Froeb Co, wholesale liquor dealers.  Success came quickly. During the late 1880’s he engaged a well-known New York architect to build him a mansion in the Bedford Stuyvesant district of Brooklyn.  It is shown here.

Froeb’s flagship brand was “Blue Grass Rye” that he sold in ceramic jugs and glass bottles. He advertised it heavily, emphasizing its medicinal uses, asking “physicians and consumers” to note such qualities as “very digestible,” “very nourishing,” and “entirely natural.”  Like many of his competitors, Froeb issued color lithographed signs for saloon customers. Froeb’s depiction of Daniel Boone, advertising Blue Grass Rye stands out.

Even as he was prospering, Froeb perhaps anticipating Prohibition, was embarking on an alternative career. During the early 1900s he became a vice president of the German Savings Bank of Brooklyn.  By 1914 he had achieved the presidency.  This financial establishment merged several times and each time Froeb emerged at the top of bank management. He ultimately became president of the Lincoln Savings Bank, shown here, a post he held until retirement. 

Meanwhile the original source of his wealth and business prestige had been shut down by the dictates of National Prohibition.  When he died in 1946 at the ripe old age of 89, Froeb could look back on a career that brought him from a teenage immigrant, speaking only a foreign tongue, to the top of the New York City financial world, living in one of Brooklyn’s most elegant mansions.

The function of a “breaker boy” in mining was to break coal into pieces and sort those pieces into categories of nearly uniform size, a process known as “breaking."  The individual also chipped away any impurities that might be clinging to the coal.  It was hard, low-paying labor.  How Michael Bosak went from breaker boy in a Pennsylvania mine to proclaiming himself “The Richest Slovak in America”  is a story of brains and initiative.

Born in 1870 in Saris, a town now the Slovak Republic, Bosak immigrated to the U.S. about 1887, settling in Northeastern Pennsylvania.   After a few months he left mining and worked for several liquor merchants, taking orders and delivering merchandise.  Frugal in his habits, Bosak saved sufficient money to open his own liquor store in Hazelton in the 1890s.  When it prospered he opened a saloon called Glinsky’s Tavern in nearby Olyphant, Pennsylvania, and subsequently a branch liquor house in Scranton. 

Bosak's Growing wealth allowed him to pursue other business interests.  Early on he moved into  banking.  The force of his personality led other Slovak immigrants to trust him and seek his help in purchasing steamship tickets, exchanging foreign currency and making small loans. Bosak established  private bank in 1897 that grew into the Bosak State Bank of Scranton by 1915.  In time he also became president of the Miners Savings Bank of Olyphant and the Trust Company of Wilkes Barre.  Bosak's signature could be found on U.S. backed bank notes. 

Once the self-proclaimed “richest Slovak in America,” Bosak saw his business empire crumbling in 1929 with the advent of the Great Depression. His banks faltered and finally in 1931, failed and closed.   His earning of a lifetime were virtually wiped out.  Despite these setbacks, a biography of his life was entitled: “Michael Bosak:  An American Banker from Saris.” 

The Muehleisen, William Sr. and William Jr., father and son, were proprietors of one of Washington, D.C., best known and most prosperous liquor businesses until Congress in a fit of political correctness voted the District  “dry” and the son gravitated to running one of the more unusual banking institutions in the history of the Nation’s Capital.

About 1867, in the wake of the Civil War, Muehleisen Sr. struck out on his own, establishing himself as an importer and dealer in foreign and domestic wines and liquors at 918 Fifth Street, NW, in the District of Columbia.  The firm's flagship brand was Oakmont Whiskey.  For the next fifty years the Muehleisens ran a highly respected, very profitable, liquor house until William Jr. was forced out of business when Congress voted D.C. “dry” in 1917.

Muehleisen’s  transition from liquor to liquidity seems to have been an effortless one. He founded a bank.  A 1921 D.C. business directory listed him as president of the Mount Vernon Savings Bank, located in the International Machinists Building at 9th St. and Mount Vernon Place, N.W.. shown here.  As related in a historical account of D.C. banks, Muehleisen’s financial institution was the first U.S. bank in which a labor union owned a large bloc of the stock.  Known as a “labor bank,” with a mandate to benefit the working class,  this institution provided a higher return on worker money than other banks, namely, three percent on savings and four percent on certificates of deposit. The bank also worked closely with credit unions, holding their deposits and extending loans

to them.

Even after relinquishing the presidency of Mount Vernon Savings, Muehleisen Jr. stayed on as a director, listed as late as 1828 among their number.  The coming of the Great Depression, however, had a negative effect on this unusual financial institution when many small borrowers were forced to default on loans. The bank went out of business in the early 1930s.

Alexandria was a Virginia town with strong Confederate sympathies that greatly resented Union occupation during the Civil War. That animosity failed to deter a New Jersey lad of 23 who arrived in 1862 to sell whiskey to thirsty troops. Despite this problematic start, he became Alexandria’s mayor and a leading citizen while founding a liquor business that prospered until the advent of Prohibition.  His name was Emanuel Ethelbert (E. E.) Downham and his career ended in the financial sector.

After arriving in Alexandria, Downham quickly established himself as a wholesale liquor dealer with a profitable business.  His promise as an “up-and-comer” must have been evident very early. In 1865, despite being a Yankee, he married the daughter of a leading Alexandria merchant.  He also became politically active, in 1874 seeking and winning seats on the City Council and Board of Aldermen, eventually becoming mayor of Alexandria in 1887, an office he held for four years.

As Virginia came closer and closer to going “dry,” Downham changed direction and became a banker.  By the early 1910s his principal occupation had become president of the German Co-Operative Building Association, a financial organization located at 615 King Street.  This institution had been founded in 1890.  According to a local newspaper, the savings and loan association enjoyed “a steady patronage.”  The building, shown here, still stands in the city’s “Old Town” and is home to a bank.

Featured here are four whiskey men whose fortunes ultimately took them from operating liquor establishments to running financial institutions.  For some the onset of state and national Prohibition forced them into a new career.  For others the transition appears to have been a natural extension of their business interests.  In all cases their investments ultimately were fueled by money from selling whiskey.  

Note:  More complete profiles on each of the four whiskey men featured here can be found on other posts on this blog:  Charles Froeb, November 12, 2012;  Michael Bozak, August 23, 2013;  The Muehleisens, October 28, 2016; and E. E. Downham, May 26, 2011.  

E. J. Curley Turned Boone’s Knoll into a Distilling Marvel

Above is a photo postcard of a Kentucky landmark that is clearly delineated as Boone’s Knoll.  It appears to be a rather unremarkable rocky outcropping covered with trees and foliage above the Kentucky River.  But look closely.  Behind the hill is a tall structure emitting smoke.  Those billows have emerged from Edward J. Curley’s distillery, the enterprise that brought Boone’s Knoll to national whiskey prominence.

Curley had been born in Massachusetts in 1837 of Irish immigrant parents.  Although little is known of his early years, my research indicates that he likely was a Union soldier during the Civil War.  The national register of those serving in that conflict records an Edward Curley as a private in Company E of the First Regiment of Massachusetts Volunteer Cavalry, a unit raised early in the war.  He would have been 23 years old, a prime age for recruits.

His military service may hold the answer to how Curley got to Kentucky.  Union Forces held Lexington and the areas around it.  In Jessamine County on the Kentucky River not far from Lexington, the Union had constructed an installation called Camp Nelson.  Its purpose was to recruit emancipated blacks and train them to become soldiers.  With the Massachusetts Regiment stationed in nearby Virginia, it would not have been unusual for Curley to have been seconded to this operation.  

In any case, almost immediately after the Confederate surrender, Curley with two partners founded a distillery in the immediate vicinity of Camp Nelson.  The military connection is strengthened by the fact that one of the partners was Dwight A. Aiken, a Michigan resident and captain in the Commissary Department of the Union Army.  Beginning in 1863 Aiken was stationed at Camp Nelson.  It is my speculation that Curley and Aiken met there and decided to go into whiskey distilling after the war with a third partner named Campbell.

The spot they chose for their operations was not far from the camp and an excellent site.  The area had been important in pioneer days because a break in the palisades gave access to a ford across the Kentucky River below the mouth of Hickman Creek.  According to historians the ford was a favorite crossing for Daniel Boone.  Thus the name "Boone’s Knoll."  In the late 1860s the trio built a distillery on one side of the river at the Knoll, as shown right.  It would be called the Blue Grass Distillery and recorded in Federal revenue annals as Distillery #3 of the Eighth Kentucky District.  They marketed their product as “Blue Grass Whiskey,”  a name identified in government documents as having first been used in commerce in 1867.

This plant was built of iron with oak racks.  All the timbers were oak, sawed in a mill on the premises. The warehouses were reported to incorporate the latest technologies for light, ventilation and fire prevention.  The original wooden still later was torn down and a copper kettle substituted to insure better quality control.  The company also provided its own cooperage on premises using the abundant oaks in the area to supply staves.  

By 1874 the trio had dissolved.  Aiken had moved to Lexington and leased an existing distillery which he operated as D.A. Aiken & Company, Distillers, until 1882 when a fire and financial problems shut him down.  Campbell just disappeared from the scene.  Curley was now sole proprietor of the Blue Grass Distillery.  Already he was finding a national audience for his whiskey.  In June 1872 a Sacramento, California, newspaper carried an ad placed by Curley’s local sales agent.  It extolled the limited capacity of the distillery, declaring that:  “…More attention is given to the quality than the quantity of liquor produced….”  Curley’s whiskey was made the old fashioned way, the ad continued, in recipe known only to the proprietor:  “The water used in its manufacture is of a peculiar nature, from a spring in the cliff of the Kentucky River.”

About 1880 Curley decided to build a second distillery on the other side of the river, connected by a steel girder bridge.  It became Distillery #15 in Kentucky District Eight.   Shown here, Curley named it the “The Boone’s Knoll Distillery.”   He built the new plant on solid rock, which required blasting to set the structure.  The building, as seen above, was constructed of solid stone.  According to a contemporary account  “The mashing floor and fermenting room are admirably situated and the temperature of the latter does not vary 5 degrees from 72 degrees all year round. The piping and machinery are all new, and of the simplest and most efficient pattern”

The 1882 Bonfort’s Directory of wine and liquor producers in a lengthy article waxed poetic about the two facilities:  “The Blue Grass Distillery stands at the foot of a valley overlooked by a beautiful hill known to the countryside as Boone’s Knoll…In the spring the slopes on the other side of the river, which stretch away in terraces, vividly recalling the Roman amphitheater at Arles, are covered with fragrant wild flowers, which fill the air with perfume and make the little valley a perfect fairy-land.” 

Curley’s Boone’s Knoll Distillery also came in for praise: “This house is entitled to take its place among the  best distilleries in the world.  At the same time, Bonfort’s writer seemed to anguish at a decision the proprietor had made.   Curley was operating the two distilleries as a single entity.  The Blue Grass Distillery had a mashing capacity of 600 bushels of grain daily but never was operated up to its capacity, according to Bonfort’s.  The Boone’s Knoll facility added more capacity. bringing the total mashing capacity to 1,100 bushels a day and 100 barrels daily.  The publication reported that Curley, seeing a glut of whiskey coming to market, would make only enough whiskey the next year to fill his orders and nothing more.  While seemingly regretting the decision, Bonfort’s said:  “We should dislike to do anything to increase production, but probably no better investment could be made than 1883 sour mash.” 

For East Coast sales, Curley had turned over much of his limited production to the Froeb Company of New York City. (See my post on Charles Froeb in November 2012).  Responsible for the saloon sign of Daniel Boone above, Froeb advertised the Blue Grass Rye brand vigorously and may have taken a large portion of Curley’s production. He sold the whiskey in bottles and flask, as one shown here.  Froeb’s ads characterized the whiskey as “excellent in convalescence, as it is stimulating and not nauseating.  Its dryness is a prerequisite in diabetical maladies.”

Despite these marketing efforts and endorsements in the trade press, something was going wrong for E.J. Curley & Co.  As with other distillers of that time a combination of repressive federal tax laws and a downturn in the U.S. economy resulted in financial difficulties.  In 1889 Curley’s horses and wagons reportedly were impounded for non-payment of taxes, in what must have been a crushing blow to the proprietor.  The same year Curley sold out to the so-called “Whiskey Trust,”  a investor group that sought to spike upward profits from Kentucky whiskey by scooping up distilleries and creating a quasi-monopoly.

 

In Curley’s place, the Trust installed a new manager, August C. Gutzeit, a Lexington wholesale liquor broker. Shown left is one of Gutzeit’s jugs.  Unlike many of the properties obtained by the Trust and closed down, the Boone Knoll sites were kept in operation producing Curley’s brands — and labels with his signature — for almost 20 years until shuttered completely by the advent of National Prohibition.  The Boone’s Knoll distillery subsequently was turned into a hotel.  Successor organizations to the Trust were allowed to sell Curley’s product as “medicinal” whiskey throughout the dry era, obtained by a prescription from doctors who in many cases were glad to oblige a thirst.  

After Repeal in 1934 the distillery buildings were converted back to their original purpose, operating as the Kentucky River Distillery, becoming RD #45.  The plant was sold again sometime in the 1960s to Norton Simon who operated it to produce Canada Dry soft drinks until  the 1970s.  At some point the Boone’s Knoll distillery burned and the warehouses were leased to Seagrams to house production from other Kentucky plants.  Still standing, the stone structures more recently are said to have been leased to the producers of “Wild Turkey” bourbon. 

Apparently never having married and putting all his energy into his whiskey enterprises, Edward Curley was only 52 when he was forced to sell out.  Somewhere along the line Curley gained the title “Colonel,” given to many as an honorary distinction in Kentucky.  Subsequent to 1900 he does not appear in Kentucky census records.  What his future life may have held is shrouded in the mists of time.  Curley clearly had constructed his distilleries for the long run;  even today the ruins remain visible from U.S. Route 27 at Boone’s Knoll.  They create a lonely memorial to the vision and enterprise of this transplanted Boston Irish whiskey man. 

Charles Froeb: From Booze to Banking in Brooklyn

 Charles Froeb, an immigrant to the United States as a teenager, founded a highly successful liquor business in Brooklyn and used it as a springboard to an equally successful career in banking.  Other whiskey men moved into banking once Prohibition forces shut them down, but Froeb, shown here, must be accounted among the most notable.

Charles was the son of Peter, a barber, and Catherine (Becker) Froeb.  He was born in 1857 in the town of Waechtersbach, Hessen-Nassau, Germany.  The town, shown here,  lies between the Spessart and the Vogelsberg Mountains in the middle Kinzig valley at the edge of the Büdingen Forest. Waechtersbach is  famous for the brightly colored porcelain coffee cups and other dinnerware that are made there at the Waechtersbach Ceramic Factory, founded in 1832. Froeb received his early education in his home town and then was sent to secondary school in Frankfort-en-Main. 

In 1872 the Froeb family -- father, mother and five children -- emigrated to America, settling in Brooklyn.  Charles went to night school,  learned to speak and write English,  and early on went to work in a wholesale liquor house on Murray Street, New York City. He remained employed there for the next eleven years.   A 1917 biography of Froeb says:  “By that time the young clerk had fully acquired a thorough knowledge of the various features and details of the business and felt confident of his ability to manage the same class of business on his own account.”

As a result,  in 1883 the Charles Froeb Co., wholesale liquor dealers, first appeared in New York business directories, located in the Williamsburg District of Brooklyn. Meanwhile Charles had married in 1880. His wife was Alma Kirchuebel, two years his junior.  She too was the daughter of German immigrants,  Herman and Augusta Kirchuebel, who also lived in Brooklyn.   The Froebs would have a family of boys,  August born in 1883; Charles Jr., 1886; Frank, 1886, and Herman, 1890.  A fifth son, Robert, died in infancy in 1893.

Success came quickly to Froeb.   During the late 1880’s he engaged a well-known New York architect to build him a mansion in the Bedford Stuyvesant district of Brooklyn. The architect was Theobald Engelhardt, who was a member with Froeb of the Arion Singing Society, a very popular German social organization.   Shown here, the house was constructed at 671 Lafayette Street, between Marcy and Tompkins.  Upon completion the Froebs moved in and Charles and Alma lived there the remainder of their lives.  The house made news in 1904 when a lightning bolt struck it, dislodging one of the spheres at the top of a gable and slinging it against a neighboring brownstone.

Through the end of the 19th Century and the beginning of the 20th, Froeb’s business expanded.  His flagship brand was “Blue Grass Rye” which he sold in ceramic jugs and glass bottles.  He advertised it heavily, emphasizing its medicinal uses, asking “physicians and consumers” to note such qualities as “very digestible,”  “very nourishing,” and “entirely natural.”  One of the elegant establishments to feature Blue Grass Rye was the historic Everett House off Union Square, shown above. Froeb claimed a distillery in Camp Nelson, Kentucky, but that probably was a supplier relationship not a true ownership.   As seen in an ad here, by 1907 Feoeb had a store at 315 Fifth Avenue in Manhattan as well as his Brooklyn liquor house at 18-20 Tompkins.  Like many of his competitors,  Froeb issued color lithographed signs for saloon customers.  Froeb’s depiction of Daniel Boone stands out.  

Froeb was interested in German culture, supporting organizations like the Arion Club, of which he was several times president, and other groups that fostered German traditions and language.  In 1913 he was made honorary president of  the Brooklyn Turnverein and the Hanover Club.  He also found time to be active in Democratic Party politics.  In 1908, almost as a surprise  to the press,  Froeb was named a Democratic elector for the 1908 election.  The Democratic candidate was William Jennings Bryan, who lost.  This was ironic since Bryan was opposed to strong drink and the Republican winner, William Howard Taft, was a champion of the whiskey trade.

Over time Froeb prepared his sons to join him in business. August, Charles Junior, and Frank all were sent to the highly acclaimed Brooklyn Polytechnic High School.  As they matriculated they were brought into the company.  Froeb incorporated it in 1914 and renamed it Charles Froeb & Sons.  The three boys were given various clerking duties in the establishment.

Even as he was preparing a future in the whiskey trade for his sons,  Froeb himself, perhaps anticipating Prohibition, was embarking on an alternative career.  During the early 1900s he became a vice president of the German Savings Bank of Brooklyn.  By 1914 he had achieved the presidency.  This financial establishment merged several times and each time Froeb emerged at the top of the bank management.  He ended up as president of the Lincoln Savings Bank, shown here,  a post he held until retirement.  Meanwhile the original source of his wealth and business prestige had been shut down by the dictates of National Prohibition. 

When he died in 1946 at the ripe old age of 89,  Froeb could look back on a career that brought him from a teenage immigrant, speaking only a foreign tongue, to the top of the New York City financial world, living in one of Brooklyn’s most elegant mansions.  The Froeb home now serves as the First Corinthian Baptist Church, another irony given the Baptist view of strong drink.