Joseph Wright Harriman
Encyclopedia
Joseph Wright Harriman was the longtime president of Harriman National Bank and Trust Company, nephew of railroad tycoon Edward H. Harriman and cousin of diplomat, statesman and future New York Governor W. Averell Harriman
. In 1934 he was convicted of bank fraud
and sent to Lewisburg Federal Penitentiary
, where he served 25 months of his 4 1/2 year sentence before receiving parole. Between his arraignment and the start of his trial, Harriman twice walked away from care facilities, and his attorneys tried, without success, to establish that he was incompetent to stand trial.
, the son of John Nielson Harriman (older brother of New York railroad tycoon Edward Henry Harriman) and his wife, Elizabeth Grainger Hancox Harriman. In 1885, after graduating from the Charlier Institute (a preparatory school for boys in New York City), then from the Stevens Institute of Technology
, he joined the United States National Bank, where he became an assistant cashier. In 1894 he left that position to accept the same title with the Merchants' National Bank of New York. After being promoted to cashier of that bank in 1896, he left the bank in 1901 to join Harriman & Co., the investment banking firm established in 1869 by his uncle Oliver Harriman, and which was at the time owned by his cousins J. Borden Harriman
and Oliver Harriman Jr.
He served in the Seventh Regiment of the New York National Guard from 1887 to 1892.
He married Augusta Barney on November 21, 1892. They had a son, Alan, and a daughter, Miriam. Their son died from complications of an auto accident on Long Island, New York on January 7, 1928. Miriam wed Wall Street attorney Boykin Cabell Wright, future name partner in Shearman, Sterling & Wright
, in September 1926.
He maintained an estate in Brookville, New York
, on Long Island known as "Avondale Farms."
, the Harriman Bank was part of a clearing house committee of nine New York banks that vowed to provide each other with financial support. In July 1932, as the condition of the Harriman bank deteriorated, Joseph Harriman was eased out of his position as the bank’s president, but remained chairman of the board.
While most other banks were given licenses from the Federal Reserve Bank
to re-open after the “bank holiday
” of 1933, Harriman’s bank was not so fortunate. In October 1933, the U.S. Department of Treasury placed the Harriman Bank in a receivership. The bank’s liabilities, including to depositors, exceeded its assets by $3.3 million to $5 million. The federal government would sue banks that were members of the clearing house committee, in an attempt to recover on behalf of depositors the Harriman Bank's losses.
) so that he could finance his own purchases of the bank’s stock. His motive, it was alleged, was to maintain the value of the bank's stock at the same level it had achieved before the stock market crash of 1929, even as earnings plummeted. Without leaving his bed, Harriman signed a $25,000 bail bond, and thereby remained out of custody.
Harriman retained as his lead trial attorney former U.S. Attorney (and future spymaster) William “Wild Bill” Donovan
.
.” On May 18, 1933, as his federal trial was about to begin, he walked away from a Manhattan
nursing home where he claimed to have been undergoing treatment for a nervous breakdown, leaving behind a set of suicide notes. After he was found the next evening in a Roslyn, New York
, hotel, pretending to be someone else, he stabbed himself in the neck and breast in an apparent suicide attempt. Doctors treating his injuries concluded that his heart was in “perfectly normal condition” for a man of his age.
Before the jury trial could begin, Donovan requested and received a hearing before Judge Francis Gordon Caffey
regarding his client’s competency to stand trial. Less than a week into that hearing, however, Harriman again disappeared from his nursing home. He reappeared two days later, dripping wet and claiming to have lived in Central Park
, and was then confined behind bars in Bellevue Hospital. Donovon retained as his chief psychiatric expert Dr. Smith Ely Jelliffe
, whose testimony had assisted Harry K. Thaw
to avoid capital punishment for the killing of Sanford White, and Bianca de Saulles
to avoid conviction for murdering her husband John de Saulles
. U.S. Attorney George Medalie’s
cross-examination of Dr. Jelliffe is considered a masterpiece, and is the subject of a chapter of the revised edition of Francis Wellman’s book “The Art of Cross-Examination.” On November 24, 1933, Judge Caffey found Harriman competent to stand trial.
and Peggy Hopkins Joyce
, appeared to testify that they had not consented to the withdrawals from their accounts that the defendants arranged.
After five weeks of testimony, the jury deliberated only two hours before finding Harriman guilty on all sixteen counts (and acquitting Austin). Judge John C. Knox
sentenced Harriman to 4½ years on each count, but allowed him to serve them concurrently rather than consecutively.
began on July 9, 1934. Working in the prison as a library clerk, Harriman was a “model prisoner,” according to the warden. Harriman was paroled on August 27, 1936, after more than two years in jail.
W. Averell Harriman
William Averell Harriman was an American Democratic Party politician, businessman, and diplomat. He was the son of railroad baron E. H. Harriman. He served as Secretary of Commerce under President Harry S. Truman and later as the 48th Governor of New York...
. In 1934 he was convicted of bank fraud
Bank fraud
Bank fraud is the use of fraudulent means to obtain money, assets, or other property owned or held by a financial institution, or to obtain money from depositors by fraudulently representing to be a bank or financial institution. In many instances, bank fraud is a criminal offense...
and sent to Lewisburg Federal Penitentiary
Lewisburg Federal Penitentiary
The United States Penitentiary in Lewisburg is a male inmate high security federal penitentiary and satellite minimum security prison camp housing some 1,000 and 500 respectively, just outside Lewisburg, Pennsylvania. The Lewisburg Penitentiary was opened in 1932...
, where he served 25 months of his 4 1/2 year sentence before receiving parole. Between his arraignment and the start of his trial, Harriman twice walked away from care facilities, and his attorneys tried, without success, to establish that he was incompetent to stand trial.
Personal background and family
He was born on January 31, 1867 in Belleville, New JerseyBelleville, New Jersey
Belleville is a Township in Essex County, New Jersey, United States. As of the 2010 United States Census, the township population was 35,926.-History:...
, the son of John Nielson Harriman (older brother of New York railroad tycoon Edward Henry Harriman) and his wife, Elizabeth Grainger Hancox Harriman. In 1885, after graduating from the Charlier Institute (a preparatory school for boys in New York City), then from the Stevens Institute of Technology
Stevens Institute of Technology
Stevens Institute of Technology is a technological university located on a campus in Hoboken, New Jersey, USA – founded in 1870 with an 1868 bequest from Edwin A. Stevens. It is known for its engineering, science, and technological management curricula.The institute has produced leading...
, he joined the United States National Bank, where he became an assistant cashier. In 1894 he left that position to accept the same title with the Merchants' National Bank of New York. After being promoted to cashier of that bank in 1896, he left the bank in 1901 to join Harriman & Co., the investment banking firm established in 1869 by his uncle Oliver Harriman, and which was at the time owned by his cousins J. Borden Harriman
J. Borden Harriman
Jefferson Borden Harriman was a New York financier and member of the Gilded Age’s “hunting set.” He was best known as the supportive husband of Florence Jaffray Harriman, a socialite who became a progressive social activist and a United States Ambassador to Norway during the administration of...
and Oliver Harriman Jr.
He served in the Seventh Regiment of the New York National Guard from 1887 to 1892.
He married Augusta Barney on November 21, 1892. They had a son, Alan, and a daughter, Miriam. Their son died from complications of an auto accident on Long Island, New York on January 7, 1928. Miriam wed Wall Street attorney Boykin Cabell Wright, future name partner in Shearman, Sterling & Wright
Shearman & Sterling
Shearman & Sterling LLP is a law firm headquartered in New York City with 20 offices located in major financial centers around the world founded in 1873. It is well known for both its litigation and transactional capabilities, especially in International Arbitration, Capital Markets, Finance, and...
, in September 1926.
He maintained an estate in Brookville, New York
Brookville, New York
The Village of Brookville is a village located within the town of Oyster Bay in Nassau County, New York. As of the 2010 United States Census, the village population was 3,465....
, on Long Island known as "Avondale Farms."
The Harriman National Bank's origins
The Day and Night Bank, the world's first 24-hour bank, was founded in 1906 as a state-chartered bank, with substantial involvement of J.W. Harriman (its initial vice-president) and other members of the Harriman family. In 1911, after the Day and Night Bank began to restrict its hours, it was renamed and rechartered as the Harriman National Bank, and reorganized with an increased involvement of Merchants' National Bank. The new board elected Joseph as the Bank's president, a position he would hold until 1932.Collapse of the Harriman bank
During the first years of the Great DepressionGreat Depression
The Great Depression was a severe worldwide economic depression in the decade preceding World War II. The timing of the Great Depression varied across nations, but in most countries it started in about 1929 and lasted until the late 1930s or early 1940s...
, the Harriman Bank was part of a clearing house committee of nine New York banks that vowed to provide each other with financial support. In July 1932, as the condition of the Harriman bank deteriorated, Joseph Harriman was eased out of his position as the bank’s president, but remained chairman of the board.
While most other banks were given licenses from the Federal Reserve Bank
Federal Reserve Bank
The twelve Federal Reserve Banks form a major part of the Federal Reserve System, the central banking system of the United States. The twelve federal reserve banks together divide the nation into twelve Federal Reserve Districts, the twelve banking districts created by the Federal Reserve Act of...
to re-open after the “bank holiday
Emergency Banking Act
The Emergency Banking Act was an act of the United States Congress spearheaded by President Franklin D. Roosevelt during the Great Depression. It was passed on March 9, 1933...
” of 1933, Harriman’s bank was not so fortunate. In October 1933, the U.S. Department of Treasury placed the Harriman Bank in a receivership. The bank’s liabilities, including to depositors, exceeded its assets by $3.3 million to $5 million. The federal government would sue banks that were members of the clearing house committee, in an attempt to recover on behalf of depositors the Harriman Bank's losses.
Arraignment
Harriman was arraigned in his home on March 14, 1933, just as the bank holiday came to an end. He was charged with causing falsification of the bank’s books, making unauthorized charges against the accounts of depositors (such as the owners of the New York Giants baseball teamHistory of the New York Giants (NL)
The history of the New York Giants, before the franchise moved to San Francisco, lasted from 1883 to 1957. It featured five of the franchise's six World Series wins and 17 of its 21 National League pennants...
) so that he could finance his own purchases of the bank’s stock. His motive, it was alleged, was to maintain the value of the bank's stock at the same level it had achieved before the stock market crash of 1929, even as earnings plummeted. Without leaving his bed, Harriman signed a $25,000 bail bond, and thereby remained out of custody.
Harriman retained as his lead trial attorney former U.S. Attorney (and future spymaster) William “Wild Bill” Donovan
William Joseph Donovan
William Joseph Donovan was a United States soldier, lawyer and intelligence officer, best remembered as the wartime head of the Office of Strategic Services...
.
Flights
At the time of his arraignment, Harriman was said to be “critically ill with coronary thrombosisCoronary thrombosis
Coronary thrombosis is a form of thrombosis affecting the coronary circulation. It is associated with stenosis subsequent to clotting. The condition is considered as a type of ischaemic heart disease.It can lead to a myocardial infarction...
.” On May 18, 1933, as his federal trial was about to begin, he walked away from a Manhattan
Manhattan
Manhattan is the oldest and the most densely populated of the five boroughs of New York City. Located primarily on the island of Manhattan at the mouth of the Hudson River, the boundaries of the borough are identical to those of New York County, an original county of the state of New York...
nursing home where he claimed to have been undergoing treatment for a nervous breakdown, leaving behind a set of suicide notes. After he was found the next evening in a Roslyn, New York
Roslyn, New York
Roslyn is a village in Nassau County, New York, on the North Shore of Long Island. As of the United States 2010 Census, the village population was 2,770...
, hotel, pretending to be someone else, he stabbed himself in the neck and breast in an apparent suicide attempt. Doctors treating his injuries concluded that his heart was in “perfectly normal condition” for a man of his age.
Before the jury trial could begin, Donovan requested and received a hearing before Judge Francis Gordon Caffey
Francis Gordon Caffey
Francis Gordon Caffey was a United States federal judge.Born in Gordonsville, Alabama, Caffey received an M.A. from Howard College, Alabama in 1887, an A.B. from Harvard University in 1891, and another M.A. from Harvard University in 1892...
regarding his client’s competency to stand trial. Less than a week into that hearing, however, Harriman again disappeared from his nursing home. He reappeared two days later, dripping wet and claiming to have lived in Central Park
Central Park
Central Park is a public park in the center of Manhattan in New York City, United States. The park initially opened in 1857, on of city-owned land. In 1858, Frederick Law Olmsted and Calvert Vaux won a design competition to improve and expand the park with a plan they entitled the Greensward Plan...
, and was then confined behind bars in Bellevue Hospital. Donovon retained as his chief psychiatric expert Dr. Smith Ely Jelliffe
Smith Ely Jelliffe
Smith Ely Jelliffe . American neurologist, psychiatrist, and psychoanalyst who lived and practiced in New York City nearly his entire life. Originally trained in botany and pharmacy, Jelliffe switched first to neurology in the mid-1890s then to psychiatry, neuropsychiatry, and ultimately to...
, whose testimony had assisted Harry K. Thaw
Harry K. Thaw
Harry Kendall Thaw was the son of coal and railroad baron William Thaw. He is best known for murdering the architect Stanford White at Madison Square Garden in 1906 in a jealous rage.- Early life:...
to avoid capital punishment for the killing of Sanford White, and Bianca de Saulles
Blanca Errázuriz
Blanca Elena Errázuriz Vergara , also known as Bianca de Saulles was accused and later acquitted of killing her first husband, John de Saulles.-Early life and marriage:...
to avoid conviction for murdering her husband John de Saulles
John de Saulles
John Gerard Longer de Saulles was an American athlete, real estate broker, and businessman whose murder by his millionaire wife led to a widely-reported trial.-Early life:...
. U.S. Attorney George Medalie’s
George Z. Medalie
George Zerdin Medalie was an American lawyer and politician.-Life:He graduated from Columbia Law School in 1907, and practiced law in New York City...
cross-examination of Dr. Jelliffe is considered a masterpiece, and is the subject of a chapter of the revised edition of Francis Wellman’s book “The Art of Cross-Examination.” On November 24, 1933, Judge Caffey found Harriman competent to stand trial.
Trial
The jury trial did not begin until May 1934. Harriman and a co-defendant, Harriman Bank vice-president Albert M. Austin, were tried together. Victims of the alleged fraud, including movie stars Constance TalmadgeConstance Talmadge
Constance Talmadge was a silent movie star born in Brooklyn, New York, USA, and was the sister of fellow actresses Norma Talmadge and Natalie Talmadge.-Early life:...
and Peggy Hopkins Joyce
Peggy Hopkins Joyce
Peggy Hopkins Joyce was an American actress and celebrity, famed as much for her several marriages to wealthy men, colorful divorces, scandalous affairs, her diamonds and generally lavish lifestyle as for her work on stage or screen.-Brief Biography:Born Marguerite Upton in Berkley, Virginia, she...
, appeared to testify that they had not consented to the withdrawals from their accounts that the defendants arranged.
After five weeks of testimony, the jury deliberated only two hours before finding Harriman guilty on all sixteen counts (and acquitting Austin). Judge John C. Knox
John C. Knox
John Clark Knox was a Judge of the United States District Court for the Southern District of New York.-Biography:...
sentenced Harriman to 4½ years on each count, but allowed him to serve them concurrently rather than consecutively.
Imprisonment
His imprisonment at the federal prison at Lewisburg, PennsylvaniaLewisburg, Pennsylvania
Lewisburg is a borough in Union County, Pennsylvania, United States, south by southeast of Williamsport and north of Harrisburg. In the past, it was the commercial center for a fertile grain and general farming region. The population was 5,620 at the 2000 census. It is the county seat of Union...
began on July 9, 1934. Working in the prison as a library clerk, Harriman was a “model prisoner,” according to the warden. Harriman was paroled on August 27, 1936, after more than two years in jail.