Office of Strategic Services Created, Wall Street Lawyers Build Intelligence Apparatus

President Franklin D. Roosevelt issues a military order on June 13, 1942, establishing the Office of Strategic Services (OSS) under William “Wild Bill” Donovan, a Wall Street lawyer, Medal of Honor recipient, and well-connected Republican. The OSS becomes America’s first centralized intelligence agency, recruiting heavily from Ivy League universities, Wall Street law firms, and elite social networks that would shape the CIA for decades to come.

Donovan, a partner at Donovan, Leisure, Newton & Lumbard, draws extensively on his connections to staff the new agency. Allen Dulles, future CIA Director and partner at the powerful law firm Sullivan & Cromwell, heads OSS operations in Switzerland. Arthur Schlesinger Jr., later a Kennedy administration advisor, works for the Research and Analysis Branch. The agency draws from the Council on Foreign Relations, major banks, and elite universities, establishing an institutional culture that views intelligence work as an extension of the Eastern Establishment’s global interests.

The OSS conducts espionage, sabotage, and propaganda operations worldwide. It parachutes agents behind enemy lines, coordinates with resistance movements, and gathers intelligence on Axis powers. However, the agency also begins developing covert action capabilities that extend beyond military necessity into political manipulation.

In Italy, OSS officers establish relationships with Mafia figures and conservative Catholic networks to counter leftist resistance movements. In Greece, they support right-wing monarchists against leftist partisans. These patterns of allying with local elites against popular movements, regardless of those elites’ wartime allegiances, establish templates for postwar CIA operations.

When the OSS is dissolved in October 1945, its personnel, methods, and institutional culture transfer directly to the Strategic Services Unit and subsequently to the Central Intelligence Agency. The OSS legacy, intelligence as the province of a self-selected elite operating beyond democratic accountability, shapes American covert operations for the remainder of the century.