Financial History Issue 133 (Spring 2020) | Page 38

WHERE ARE
THEY NOW?
E.F. Hutton & Co.
Founded in New York in 1904
By Susie J. Pak
The grandson of an Ohio farmer,
Edward Francis Hutton was born in Man-
hattan in 1876. His father, James Laws
Hutton, was a New York stockbroker who
died when Hutton was about 10 years old.
When he was 15, Hutton started working
as an office boy in a mortgage firm. In
1898, he became a partner in Parmalee &
Hutton, a member of the Consolidated
Stock Exchange. In 1900, Hutton created
Harris, Hutton & Co. with partner James
and Thomas Harris, who had been own-
ers of a biscuit company that they sold to
National Biscuit.
Parmalee & Hutton (1898)
Harris, Hutton & Co. (f. 1900, New York)
E.F. Hutton & Co. (f. 1904, New York)
In 1901, Harris, Hutton & Co. was dis-
solved, and Hutton opened a New York
branch office of W.E. Hutton & Co., a
Cincinnati firm whose senior partner was
his uncle, William E. Hutton. In 1904,
Edward Hutton went into business for
himself and founded the firm of E.F.
“When E.F. Hutton talks, people listen,” was the
company’s slogan, so when Shearson Lehman
announced it would buy E.F. Hutton for nearly
$1 billion, Shearson Lehman CEO Peter A. Cohen
cupped his ear to listen to E.F. Hutton CEO
Robert P. Rittereiser.
Hutton & Co. with his brothers, Franklyn
L. Hutton and William D. Hutton, and his
friend, George A.E. Ellis, Jr. Founded in
New York but based in San Francisco, it
became “the first Stock Exchange firm to
run a single wire across the continent to
California.”
As his firm and reputation grew, Hut-
ton experienced personal tragedy with the
death of his first wife, the former Blanche
Horton, who died from pneumonia in
1917. In 1920, their son, Halcourt Hutton,
died in a horseback riding accident at the
age of 18. In 1920, he married Marjorie
Post Close, the daughter of Charles W.
Post, an Illinois native and the son of a
farm-implement dealer, who became an
entrepreneur and founded the Postum
Cereal Co. of Michigan. Hutton became
chairman of Postum and led the merger
of 15 companies into what became Gen-
eral Foods Corporation. He remained
the senior partner of his firm until 1921,
when he became a limited partner. He
died in 1962, the year the firm became a
corporation.
E.F. Hutton & Co., Inc. (1962)
E.F. Hutton Group (1974)
In 1974, the firm was renamed E.F. Hut-
ton Group in which E.F. Hutton & Co.
became a subsidiary. By that time, the
head of the firm was Robert M. Fomon.
36    FINANCIAL HISTORY  |  Spring 2020  | www.MoAF.org
Born in Chicago in 1925, Fomon was
raised in Wisconsin. Both of his parents
were doctors. When he was four years
old, his mother died of cancer, and he
was raised by his maternal aunt. After
graduating from the University of South-
ern California in 1947, Fomon joined E.F.
Hutton’s Los Angeles office in 1951. He
became the mentee of a partner, Alec F.
Jack, a Scotsman who became the head
of the firm’s southern California region
in 1967. Fomon worked his way through
the ranks of the firm, becoming head of
the corporate finance unit on the West
Coast. In 1970, he became CEO when Jack
became chairman of the board. Fomon
took over the firm at a difficult time, but
the firm survived as other firms went out
of business. Fomon said, “We were bailed
out by the good market in 1972.”
According to The New York Times,
“Under Mr. Fomon’s leadership in the
1970s and 1980s, E.F. Hutton went public
and grew rapidly into a securities firm
with a household name. For most of those
years, the firm attracted customers with
one of the first and most memorable
television advertising campaigns for a bro-
kerage firm, using the slogan ‘When E.F.
Hutton talks, people listen.’”
After the firm went public in 1972, it
“had $405 million in assets, 3,700 employ-
ees, 1,400 brokers, 82 offices spread out
over 21 states and 300,000 customers.” In