Word: mellone
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Dates: during 1930-1939
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...pretext that they constituted evidence of fraud, Counsel Jackson dragged into the first week's spotlight two sets of facts which had small bearing on the case at hand, large bearing on Mr. Mellon's reputation. One was that in 1931 Mr. Mellon had twice sold stocks short-an entirely legitimate operation except that the Secretary of the Treasury was simultaneously trying to bolster a falling securities market. Private Secretary Johnson explained that, while they were not on deposit with his broker, Mr. Mellon held more than enough shares in his portfolio to cover his short position...
Inestimably more serious was the Government's charge that for eleven years Mr. Mellon had violated his public trust by owning bank stocks while serving as Secretary of the Treasury. As an ex-officio member of the Federal Reserve Board, the Secretary of the Treasury is forbidden by law to own bank stocks. Over Counsel Hogan's repeated objections, Counsel Jackson last week drew the following story from pale, quavery Mr. Johnson...
Just before taking office in March 1921 Andrew Mellon turned over to his late Brother Richard his 3,300 shares in Union Trust. In return he took his brother's note for $10,500,000 at 5½% interest, approximately the amount of Union Trust's dividends. Never did Brother Richard attempt to pay off the principal of his note. And as Union Trust's dividends jumped through the prosperous 1920's Brother Richard's interest payments rose with them, until finally the original 5½% had become 8%. In 1930 Brother Richard transferred...
Explained Private Secretary Johnson: "Mr. R. B. Mellon said he did not want to profit at the expense of his brother's children on a transaction which had been one purely of accommodation for his brother, who had taken a public trust." In 1929 Secretary Mellon assured the Senate Judiciary Committee that he had "sold every share of stock" in any bank before taking office. After last week's revelations it seemed fair to assume that obliging Brother Richard, who evidently considered himself merely a trustee, had also delicately declined to infringe on the voting rights...
Also brought out to Taxpayer Mellon's detriment was the fact that on each of six occasions during this period when R. B. Mellon bought bank stocks, the amount of his expenditure was credited to him on Brother Andrew's books. When he sold bank stocks his receipts were debited on the account. To Government counsel that meant just one thing: Andrew Mellon, while Secretary of the Treasury, was trading in bank stocks under his brother's name...