Wall Street’s Hellhound Exposes Citigroup’s Greedy Past: Books
Oct. 26 (Bloomberg) -- If you search Citigroup Inc.’s website, a former chairman named Charles E. Mitchell pops up under the heading “Our Legacy.”
What the page doesn’t mention is Mitchell’s reputation for greed, stock manipulation, tax avoidance and abusing customers and shareholders at what was then called National City Bank.
During Mitchell’s heyday in the 1920s, City Bank and its securities-trading arm luxuriated in unsavory dealings, as Michael Perino writes in his page-turning history, “The Hellhound of Wall Street.” The attack dog was Ferdinand Pecora, a former New York prosecutor who shamed Mitchell in 10 days of Senate hearings in 1933.
In singling out City, the largest bank in the land, Pecora sought to illustrate how widespread such practices were -- and why the government, which had assumed a laissez-faire attitude to Wall Street, needed to police it.
The history of finance
How Ferdinand Pecora won the blame game
FINANCIAL crises have many causes and multiple actors. Sometimes, though, a single, electrifying interpretation emerges to capture the public imagination and dominate the political response. It has yet to happen with the current crisis. But for the Depression it struck dramatically over a mere ten days in early 1933, just before Franklin Roosevelt took office.
In the years after the 1929 crash, Wall Street, except for a few scoundrels, had largely escaped broad condemnation, portraying itself guilty of nothing more than the same irrational exuberance that had seized ordinary investors. In his entertaining new book, “The Hellhound of Wall Street”, Michael Perino recounts how Ferdinand Pecora, the tenacious and theatrical chief counsel to the Senate Committee on Banking and Currency, altered that impression. By the time Pecora was finished, the public saw Wall Street’s finest not as bystanders but as malicious purveyors of the misfortune that had affected millions. His campaign turned the political tide decisively against Wall Street, paving the way for the Glass-Steagall act, which split commercial from investment banking, and the Securities Exchange Act, which created the Securities and Exchange Commission.