Conviction of Counsel

In Manhattan's gloomy Criminal Courts Building one day last September Lawyer John William Davis uprose to outline to a jury the defense of one of the most complex cases the onetime presidential nominee had ever handled. He began by setting out eight paper cups and a tumbler of water on a table. While he described the involved dealings of defunct Bank of United States, he poured the water from tumbler to cup, from cup to cup and finally from cup to tumbler. "When it is all over," smiled elderly, benign Mr. Davis, ''you see that not a drop is spilled in the transaction, not even a dollar gained or a penny lost." His client, Isidor Kresel. a lawyer who was also a past master of trial technique, smiled too.

This was more than a trial of Isidor Jacob Kresel, the sad-faced, gnomish little attorney who had been a director and general counsel of Bank of United States when it crashed three years ago. He had been tripped by the same deal which had sent to Sing Sing Bernard K. Marcus and Saul Singer, president and vice president respectively of the bank. This particular deal was but an infinitesimal segment of a ring-around-a-rosy scheme to have certain affiliates pay off loans to the parent bank, involving five distinct series of transactions among six subsidiaries and two dummy corporations in various combinations and andry permutations. Two questions were involved: 1) Was the deal a crime? 2) If so, had Counsel Kresel willfully aided & abetted the deal?

To Isidor Kresel there was a more important question involved. Once during the trial when the prosecutor fired questions so fast that he had no time to amplify his answers, Kresel had started from the witness chair with tears in his eyes. "Give me a chance. I'm fighting for my life,'' he almost sobbed.

Austrian Jew, Lawyer Kresel had been an assistant to Crusader William Travers Jerome, a special Federal Attorney in the post-War "Beef Trust" probe, an inquisitor of Manhattan's ambulance-chasing racket, and one of the most brilliant trial lawyers in the U. S. As inquisitor in the judicial investigation of New York City's magistrates' courts in 1930 he had achieved nationwide fame. The very day Bank of United States was closing its doors, Manhattan newspapers were calling Isidor Kresel "the swift sword of public conscience." Few weeks later, indicted along with seven other Bank of United States officers and their relatives, Counsel Kresel was fingerprinted at police headquarters. The special prosecutor who secured the indictments was another Austrian-born Jew, slick little Max D. Steuer, whom Isidor Kresel had once tried to disbar. Since that time, Lawyer Steuer and Lawyer Kresel had purred vitriolic asides at each other in nearly every court in the State. Their feud became a great legend in the law.

Lawyer Kresel was not tried with the other officers because of illness, but he recovered sufficiently to testify at their trial. Hoping to confound his old enemy Steuer, he repudiated his grand jury testimony, was promptly indicted for perjury, tried, acquitted. Last week after eight weeks of trial on the original indictment, after the judge had read a nine-hour charge and after six hours deliberation, the jury pronounced Isidor Jacob Kresel guilty of "abetting the misapplication of funds." Suffering from shock, the little lawyer was too ill to appear in court a few days later, and his sentence was postponed.

Many a bank counsel felt last week that Isidor Kresel's part in the affairs of Bank of United States was not unique. During the roaring 1920's they had without a qualm furnished their clients with the same type of advice on shuffling bank funds among affiliates. Only when the bank failed did such shufflings come to light as criminal acts.

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