Alien Property Custodian

The Office of Alien Property Custodian was an office within the Government of the United States during World War I and again during World War II, serving as a Custodian of Enemy Property to property that belonged to US enemies.

President Woodrow Wilson appointed A. Mitchell Palmer, a political ally and former Congressman, Alien Property Custodian in October 1917. Palmer held the position from October 22, 1917, until March 4, 1919. A wartime agency, the Custodian had responsibility for the seizure, administration, and sometimes the sale of enemy property in the United States. Under the Trading with the Enemy Act, Palmer was allowed take control of property that might hinder the war effort, including all property belonging to interned immigrants, whether they had been charged with a crime or not. Palmer's background in law and banking qualified him for the position, along with his party loyalty and intimate knowledge of political patronage. Under Palmer's leadership, the Office of the Alien Property Custodian employed hundreds of officials.

The size of the assets the Custodian controlled only became clear over the next year. Late in 1918, Palmer reported he was managing almost 30,000 trusts with assets worth half a billion dollars. He estimated that another 9,000 trusts worth $300,000,000 dollars awaited evaluation. Many of the enterprises in question produced materials significant to the war effort, such as medicines, glycerin for explosives, charcoal for gas masks. Others included mines, brewing, and newspaper publishing. Palmer built a team of professionals with banking expertise as well as an investigative bureau to track down well-hidden assets. Below the top-level positions, he distributed jobs as patronage. Always thinking like a politician, he made sure his group's efforts were well publicized. For example, he appointed one of his fellow members of the Democratic National Committee to serve as counsel for a textile company and another the vice-president of a shipping line.

In September 1918, Palmer testified at hearings held by the U.S. Senate's Overman Committee that the United States Brewers Association (USBA) and the rest of the overwhelmingly German liquor industry harbored pro-German sentiments. He stated that "German brewers of America, in association with the United States Brewers' Association" had attempted "to buy a great newspaper" and "control the government of State and Nation", had generally been "unpatriotic", and had "pro-German sympathies".

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