Ferdinand Pecora

Ferdinand Pecora (January 6, 1882 – December 7, 1971) was an American lawyer and New York State Supreme Court judge who became famous in the 1930s as Chief Counsel to the United States Senate Committee on Banking and Currency during its investigation of Wall Street banking and stock brokerage practices.

Ferdinand Pecora, circa 1933

Background

Ferdinand Pecora was born in Nicosia, Sicily, the son of Louis Pecora and Rosa Messina, who emigrated to the United States in 1886. He grew up in Chelsea on the west side of Manhattan. After briefly studying for the Episcopal ministry, Pecora was forced to leave school as a teenager when his father was injured in an industrial accident.

Career

After securing a job as a clerk in a Wall Street law firm, Pecora eventually attended New York Law School and became a member of the New York bar in 1911.

New York City public prosecution

Originally a Progressive Republican, he became a member of the Democratic Party and Tammany Hall in 1916. In 1918, he was appointed as an assistant district attorney in New York City. Over the next twelve years, he earned a reputation in the city as an honest and talented prosecutor. Although he had little experience with Wall Street, he helped shut down more than 100 bucket shops.

In 1922, Pecora was named chief assistant district attorney, the number-two man in the office under the newly elected Joab H. Banton. In 1929, Banton chose Pecora as his heir apparent, but Tammany Hall refused to nominate him, fearing that the honest Pecora might bring prosecutions against its members. Pecora left the district attorney's office for private practice, where he remained until 1933.

Senate

Ferdinand Pecora was appointed chief counsel to the U.S. Senate's Committee on Banking and Currency in January 1933, in the last months of the Herbert Hoover presidency, by the committee's outgoing Republican chairman, Peter Norbeck, and continued under Democratic chairman Duncan Fletcher, following the 1932 election that swept Franklin D. Roosevelt into the U.S. presidency and gave the Democratic Party control of the Senate.

The Senate committee hearings that Pecora led probed the causes of the Wall Street Crash of 1929 that launched a major reform of the American financial system. Pecora, aided by John T. Flynn, a journalist, and Max Lowenthal, a lawyer, personally undertook many of the interrogations during the hearings, including such Wall Street personalities as Richard Whitney, president of the New York Stock Exchange, George Whitney (a partner in J.P. Morgan & Co.) and investment bankers Thomas W. Lamont, Otto H. Kahn, Albert H. Wiggin of Chase National Bank, and Charles E. Mitchell of National City Bank (now Citibank). Because of Pecora's work, the hearings soon acquired the popular name the Pecora Commission, and Time magazine featured Pecora on the cover of its June 12, 1933, issue.[1][2]

Pecora's investigation unearthed evidence of irregular practices in the financial markets that benefited the rich at the expense of ordinary investors, including exposure of Morgan's "preferred list" by which the bank's influential friends (including Calvin Coolidge, the former president, and Owen J. Roberts, a justice of Supreme Court of the United States) participated in stock offerings at steeply discounted rates. He also revealed that National City sold off bad loans to Latin American countries by packing them into securities and selling them to unsuspecting investors, that Wiggin had shorted Chase shares during the crash, profiting from falling prices, and that Mitchell and top officers at National City had received $2.4 million in interest-free loans from the bank's coffers.

Spurred by these revelations, the United States Congress enacted the Glass–Steagall Act, the Securities Act of 1933 and the Securities Exchange Act of 1934. With the United States in the grips of the Great Depression, Pecora's investigations highlighted the contrast between the lives of millions of Americans in abject poverty and the lives of such financiers as J.P. Morgan, Jr.; under Pecora's questioning, Morgan and many of his partners admitted that they had paid no income tax in 1931 and 1932; they explained their failure to pay taxes by reference to their losses in the stock market's decline.

SEC

After Pecora closed his investigations, on July 2, 1934, President Roosevelt appointed him a Commissioner of the newly formed U.S. Securities and Exchange Commission (SEC).

New York State Supreme Court

On January 21, 1935, Pecora resigned from the SEC and became a judge of the New York State Supreme Court, a position he held until 1950, when he ran unsuccessfully against Vincent R. Impellitteri for Mayor of New York City.

On October 17, 1950, Judge Pecora and US Senator Herbert H. Lehman (D-NY) gave radio addresses on behalf of the CIO-PAC during prime (10:30-11:15 P.M.).[3]

National Lawyers Guild

In 1937, Pecora was a founding member of the National Lawyers Guild (NLG).[4] On March 1, 1938, Pecora become NLG president, noted as a "forceful speaker."[5] Pecora resigned from the NLG during its third annual convention in 1939 after the vote against his resolution disavowing communists failed to carry in the national vote.[4]

Private practice

Returning to the practice of law, Pecora represented such major clients as Warner Bros. Pictures Distributing Corporation, et al. as respondents before the United States Supreme Court in the 1954 case, Theatre Enterprises v. Paramount, 346 U.S. 537.

Death

Ferdinand Pecora died aged 89 on December 7, 1971.

Works

In 1939, Pecora wrote a book about the Senate investigations titled Wall Street Under Oath: The Story of Our Modern Money Changers, which has been reprinted twice:

  • Wall Street Under Oath: The Story of Our Modern Money Changers (1939)[6][7][8]
gollark: How?
gollark: Ban cars. All must travel using personal helicopters.
gollark: Sadly, even if it wasn't for those stupid "international treaties" and "laws", nukes are expensive!
gollark: Something something correlation causation again.
gollark: Some gun control is probably reasonable, some laws good.

References
  1. Moyers, Bill.: Pecora Part II?, "Bill Moyers Journal", Retrieved April 25, 2009.
  2. Cover of the Time magazine, June 12, 1933. Accessed November 19, 2010.
  3. "CIO Political Action Committee 1950-10-17 [sound recording]". Library of Congress. 17 October 1950. Retrieved 20 May 2020.
  4. "Pecora Part walks out". National Lawyers Guild. Archived from the original on 2012-03-27.
  5. Harris & Ewing (1 March 1938). "Forceful speaker: A new informal photograph of Justice Ferdinand Pecora of the New York Supreme Court, who was recently elected President of the National Lawyers Guild, 3/1/38 [graphic]" (photograph). Retrieved 20 May 2020.
  6. Pecora, Ferdinand (1939). Wall Street Under Oath: The Story of Our Modern Money Changers. Simon and Schuster. Retrieved 20 May 2020.
  7. Pecora, Ferdinand (1968). Wall Street Under Oath: The Story of Our Modern Money Changers. A.M. Kelley. Retrieved 20 May 2020.
  8. Pecora, Ferdinand (1973). Wall Street Under Oath: The Story of Our Modern Money Changers. A.M. Kelley. Retrieved 20 May 2020.

Further reading

There is a brief entry for Pecora in the Dictionary of American National Biography (Oxford University Press, 1999).

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