Evening star., 1938-03-11


The immediate rearrest of Richard
Whitney on new charge of grand
larceny was ordered today by State
Attorney General John j. Ben
nett, jr.
By the Associated Press.
NEW YORK. March 1l.-Investiga-
ton into the tangled financial affairs
of Richard Whitney, former president
Of the New York Stock Exchange,
centered today on the pending Federal
grand jury probe and State Attorney
General John J. Bennett, jr.'s broad
inquiry.
Mr.. Whitney, through his counsel,
Charles H. Tuttle, Republican leader,
asked and obtained a stay until Mon
day OF his arraignment on a first de-
gree grand larceny indictment OBJ
talned in record time late yesterday
by District Attorney Thomas E. Dewey.
He is accused of taking $l05,O 900 from
family trust fund.
Postponement of today's scheduled
arralgnment, was announced just be-
fore court opened by a Dewey assist
ant. Mondays arraignment may also
be a mere formality, since the Dewey
aide said the prosecutor had no OBJ
lection to granting the weeks delay
asked by counsel. He said he did not
Know what plea Whitney would make.
The heavy-set, grave Whitney, five
times president of the stock exchange
and Wall Street leader through the
critical years of the depression, was
charged with appropriating securities
OF IAN aggregate value of about Sl05.-
o0O' for personal loans, from fund
established by his father-in-law. the
late George R. Sheldon. leaving in the
fund only single share of Bethlehem
Steel Co. stock with a market value
of $55.
While Mr.. Whitney silently went
through the police routine of being
booked and fingerprinted and posted
bail, inquiries into the collapse of
Richard Whitney & Co, went ahead
on five other fronts, with at least two
OF them holding possibility of addi-
tional criminal action.
These two were in charge of Gregory
F. Noonan. assistant United States
attorney, and Ambrose V. Mccall the
State attorney generals assistant.
Mr. Noonan was ordered into the
case by Brien Mcmahon, Assistant
United States Attorney General, with
instructions to check for evidence of
Federal law violation.
MIR. Mccall had started an inquiry
under the State Securities Act on
Wednesday. the day after the Whitney
firm had announced inability to meet
its obligations.
In addition, the stock exchange, the
Securities and Exchange Commission
and Irwin Kurtz, referee in bank
ruptcy. were looking into the rapidly
expanding ramifcaticns of the case
Most of the testimony thus far made
public came from the Mccall investiga-
ton. Witnesses there testified that
Mr. Whitney:
Did not tell his partner, Edwin D.
Morgan, jr., until last Sunday that
bankruptcy threatened their firm.
Transferred to the firm a personal
debt on an old note held by certain"
j. P. Morgan Co. partners, and having
a present face value of S4740O0.
Took into his personal custody from
the firms custody s798376 CT securi-
ties, a large portion belonging 10 GUS
toners.
Transferred to his personal custody
$125.000 of securities belonging to the
exclusive New YORK Yacht Clur. of
which he had been treasurer, without
notice to the club
Silent During Police Routine.
Mr.. Whitney went through the mill
OF police routine in the silence ne has
maintained since 8 statement Tuesday
In which he look upon himself full
responsibility for the firms failure
During the 10 minutes recesMry
for his formal surrender in the court
OF General Sessions, he stood tc one
side, lonely, -notionless figure, hands
clasped behind his back, his ruddy
face grim, his head slightly bowed
Then he was taken to the nearest
police station for the arrest to be regis
tered, as local police regulations re-
qulre- This happened to be the Eliza
beth street station.
There, far down in the n.urSy East
Side-on the border of Chinatown. a
short distance north of the glittering
towers of Wall Street, where he had
once been the youngest man ,ver to
be elected president of the Stock Ex-
change-the arresting officer answered
the desk lieutenant's routine questions
before taking his prisoner to the main
desk at police headquarters.
Name? Richard P. Whitney. Age?
Forty-nine. Married? Yes. Address,
lis East Seventy-third street. Occu-
patton Broker.
1t. Simon P. Breen, on the desk.
asked a question: Has he been
searched?"
Sergt. Grasenecker, of Dewey's de-
tect1ve squad, looked shocked. but
managed to stutter out. mo, not yet"
A detective turned sheep!shly to
Whitney, who smiled and orened his
overcoat. Still smiling. he shook his
mead to the question Have you got
any knives?" The officer delyeG into
pockets, patted hips and announced
mo property"
Mr.. Whitneys only words during
the proceeding were surprised thank
yous' to 1t. Breen, who shook his
hand after the booking with the COM
ment. "Mr. Whitney, I'm sorry to see
you in this trouble and wish you the
best of luck" and then "the Whitneys
have always had good name"
Mr.. Whitney was then photographed
and f1ngerprinted at police headquar-
ters. Shortly after, he posted $4,000
bond at the home Of Judge William
Allen.
The trust fund which Mr.. Whitney
was accused of misappropriating was
established by Mr.. Sheldon, naming
Whitney's wife, Gertrude, whom he
married In 1919. his cictar- in Ia N, NRre