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Richard Whitney | Lionbliss Research

Overview

Richard Whitney (August 1, 1888 – December 5, 1974) was an American financier, president of the New York Stock Exchange from 1930 to 1935. He was later convicted of embezzlement and imprisoned. Whitney was born on August 1, 1888 in Boston, Massachusetts. He was a son of Elizabeth Whitney, a daughter of William M. Whitney, and George Whitney Sr. His father, a descendant of John Whitney,[1][2] was president of North National Union Bank.[3] Richard and his older brother George Whitney Jr. (who later married Martha Beatrix Bacon, daughter of U.S. Secretary of State and Ambassador to France Robert Bacon) were educated at Groton School (where he was captain of the baseball team and school prefect) and Harvard University (where he was tapped for membership in the Porcellian Club).[4]


Notable

  • At the same time that Richard Whitney was achieving great success, his brother George had also prospered at Morgan bank and by 1930 had been anointed as the likely successor to bank president, Thomas W. Lamont. While Richard Whitney was assumed to be a brilliant financier, he in fact had personally been involved with speculative investments in a variety of businesses and had sustained considerable losses. To stay afloat, he began borrowing heavily from his brother George as well as other wealthy friends, and after obtaining loans from as many people as he could, turned to embezzlement to cover his mounting business losses and maintain his extravagant lifestyle. He stole funds from the New York Stock Exchange Gratuity Fund, the New York Yacht Club (where he served as the Treasurer), and $800,000 worth of bonds from his father-in-law's estate.[9]

  • Having retired as president of the New York Stock Exchange in 1935, Whitney remained on the board of governors, but in early March 1938, his past began to catch up with him when the comptroller of the exchange reported to his superiors that he had established absolute proof that Richard Whitney was an embezzler and that his company was insolvent. Within days, events snowballed, and Whitney and his company would both declare bankruptcy. An astonished public learned of his misdeeds on March 10 when he was officially charged with embezzlement by New York County District Attorney Thomas E. Dewey. Following his indictment by a grand jury, Whitney was arrested and eventually pleaded guilty. He was sentenced to a term of five to ten years in Sing Sing prison.[10] On April 12, 1938, six thousand people turned up at Grand Central Terminal to watch as a scion of the Wall Street Establishment was escorted in handcuffs by armed guards onto a train that delivered him to prison.[11]

  • A model prisoner, Richard Whitney was released on parole in August 1941 after serving three years and four months in Sing Sing.[12] He became the manager of a dairy farm, supervising three farmhands and twenty-five cows. In 1946, he went back into business when he became president of a textile company that made yarns from the ramie plant, which grew in Florida.[13]

Family

In 1916, Whitney was married to Gertrude Alison (née Sheldon) Sands (1888–1969). Gertrude, a daughter of Mary Seney Sheldon and George R. Sheldon of Brooklyn, New York, was the widow of S.S. Sands & Co. banker Samuel Steven Sands III (a son of Anne Harriman Vanderbilt and step-son of William Kissam Vanderbilt), and from her first marriage. His father-in-law had served as president of the powerful Union League Club, and Whitney became a member of a number of the city's elite social clubs and was appointed treasurer of the New York Yacht Club. In addition to her son from her first marriage, Samuel Stevens Sands IV (1911–1976), Richard and Gertrude were the parents of two daughters together:


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