• Line of men and uniformed guard outside building with sign reading war veteran loans handled here

Serving veterans

Posted on November 9, 2021

In 1927, hundreds of World War I veterans received loans from Wells Fargo, using a government program promising bonus pay to those who served.

Giving war vets their due

After World War I ended in 1918, millions of veterans resumed civilian lives and careers. Veterans groups began lobbying for bonus pay for former soldiers and sailors to match pay raises given to civilian workers who kept America’s arsenal of democracy humming during the war. After years of public debate Congress passed the World War Adjusted Compensation Act over the veto of President Coolidge in May, 1924. It provided for bonus pay awards for war veterans who served between April, 1917 and July, 1919. Veterans were to receive a bonus of $1 per day of service within the United States, or $1.25 per day if they served overseas. The bonus would be conveyed through Adjusted Service Certificates.

These Adjusted Service Certificates represented a significant sum, but the bonus was not immediately available. Instead, payment was promised in 20 years by the federal treasury. Adjusted Service Certificates worked like an insurance policy with a set value plus interest, payable at maturity in 1945. Veterans could begin signing up for their certificates in January, 1925, and a provision of the Act allowed recipients to take out bank loans using their certificates as collateral starting January 1, 1927.

Lining up for loans

On Monday, January 3, 1927, the first banking day of the year, lines of veterans formed outside of banks, eager to apply for cash loans on their certificates. Wells Fargo Bank & Union Trust Company in San Francisco hung signs announcing “War Veterans Loans Handled Here” and welcomed hundreds of veterans into its ground floor safe deposit department, now transformed into a makeshift veteran loan service center. A local newspaper reported the following Wednesday that Wells Fargo was one of the few city financial institutions accommodating loans to veterans, and that in two days the bank had granted 500 loans with an average value of around $100.

A number of banks at first declined to consider these loans, or limited them to existing customers, since this bonus payment and loan program promised low interest rates, little profit, and robust reporting requirements. With terms of the veterans bonus strictly set by legislation and the federal Veteran’s Bureau, loans came wrapped in lots of ‘red tape’. For loans as little as $20, many bankers considered the clerical requirements too cumbersome.

Seated man hands off cash to second man.

Banker Parker Jackson hands loan cash to veteran Andrew S. Bybokas.

Despite bankers’ hesitation, millions of World War I veterans were eager for cash from their certificates. Dozens of veterans lined up along the sidewalk of Wells Fargo’s branch at Market Street and Grant Avenue in San Francisco that Monday morning, waiting for the guard to open the bank door. Veteran and customer Andrew S. Bybokas was first in line, an in short order received a handful of loan cash from bank assistant cashier Parker Jackson. To obtain his loan, Bybokas had to present his Adjusted Service Certificate and military discharge papers. The Lithuanian-born Bybokas would serve his adopted country not just once, but twice, in both world wars. As a veteran and as a valued Wells Fargo customer, Bybokas was just one of many who received needed funds and due respect that day. After Federal Reserve districts around the country issued assurances to hesitant banks that it would guarantee the certificate loans, more banks participated, but Wells Fargo had determined at the earliest possible opportunity to offer loans to needy veterans who applied.

Hard times are a heavy hand

At Wells Fargo that week and elsewhere around the country, banks clerks and cashiers worked furiously to accommodate crowds of veterans. It seemed that the majority of over two million World War I veterans were eager to cash in with their certificates, even at a fraction of their ultimate worth. Although the stunning crash of the Great Depression still loomed in the future; in fact, hard times had already hit for many workers and farmers. With the collapse of the worldwide economy in the early 1930s, workers grew even more desperate. Unemployed veterans demanded that the federal government pay off the bonus certificates early, not in 1945 as promised. While Congress debated this issue, in the summer of 1932 thousands of destitute veterans, the “Bonus Army,” descended on Washington, D.C. and set up camp on government property. They lobbied legislators, paraded to the U.S. Capitol, and won much public sympathy. Army troops led by General Douglas MacArthur drove the veterans from federal land and burned their camps. Congress finally acquiesced to early redemption for veterans’ bonus certificates in 1936.

Groups of men huddle in wood huts and tents beneath an American flag

Encampment of destitute veterans of the Bonus Army in Washington, 1932. Photo credit: Library of Congress.

Still serving those who serve

Wells Fargo welcoming veterans and providing solutions to them in the post-World War I era continued a long legacy of service to military personnel and veterans that endures to this day.

Today’s military initiatives expand our outreach to members of the military, veterans, and their families to provide supportive tools and resources. Throughout the years, Wells Fargo has supported military service members and veterans through initiatives to hire and retain veterans, and through foundation donations, financial health resources, and event sponsorship.

We remain committed to empowering military communities to effectively navigate life’s transitions to achieve ongoing career and financial success while impacting their community.


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