People v. Banker

Jan. 6, 1931 was a proud day for upstanding President James Arthur House of Cleveland's Guardian Trust Co. On that day he was chosen one of the twelve leading bankers and businessmen of the country to advise the Federal Reserve Board in Washington. Behind him lay a 14-year term as president, during which his bank's assets had more than trebled.

Last week came a sorry day for Banker House. In a U. S. District Court in Cleveland he was being tried by seven women and five men on 16 charges of misapplication of Guardian's funds, and ten charges of false entry to cover up the misapplication. Question was whether Banker House had acted in good faith when, a scant 18 months after his Washington appointment, he had dipped into his bank's pension fund for money to bolster Guardian stock in a ''distress" market. Prosecution claimed that he had not, that the transaction was illegal, that Banker House had acted to save his own 1,500 shares. After three hours deliberation the jury agreed with the people, found Banker House guilty on all 26 counts. Between him and a six-year jail term, a $10,400 fine was, however, an appeal.

As the tense courtroom cleared, a prosecuting attorney walked over to Banker House and, with hand outstretched, said: "I am sorry."

"What else,' said Banker House, "could be expected?''

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