South America in the 1790s was a smuggler’s dream. If you were a clever operator with a swift boat it afforded tremendous opportunities, and Oliver Putnam was definitely clever.
The Spanish government maintained an embargo on shipping silver bullion to anywhere but back to Spain. With European alliances in a constant state of flux and regular wars breaking out, however, the country was constantly in need of materials. A clever trader might find a friendly individual willing to part with some silver coinage.
Putnam was born in 1777 in Newburyport. At age 14 or 15 he joined the imports firm of Farris & Stocker as confidential clerk. There he learned the shipping business, and in the 1790s he would make several journeys to South America, which made him a wealthy man able to retire by 1802.
Sarah Anna Emery's mother remembered the day one of his ships returned to the city. It would have been difficult to forget. While successful smugglers were always clever, it wasn’t every day that one of them decided to hollow out the boards on the hull of his ship to slip out of a country with his illegal goods.
Father and Uncle Enoch returned one night from town, declaring that they had that day witnessed a sight that never had been seen before and never would be again. A vessel belonging to the then flourishing firm of Farris & Stocker had arrived from South America, and their supercargo, Mr. Oliver Putnam (since the founder of the Putnam Free School), had brought by it a large sum of money. The Spanish government had prohibited the exportation of bullion, and Mr. Putnam had concealed the silver in the sides of the vessel. Carpenters were set to work to tear off the sheathing, and the Spanish dollars, turned as black as ink, were taken in bushel baskets and carried between two men, to be cleansed in a large cauldron, borrowed from a soap boiler's establishment, which was placed over a fire kindled for that purpose in Market square.
Putnam became a great benefactor for Newburyport. When he died in 1826, he left money to establish the Putnam Free School, which opened in 1848.
Source: Recollections of a Nonagenarian, Sarah Anna Emery