Two & Two

In Chicago on Oct. 2, after more than two years' preparation, the U. S. Government put Samuel Insull, Samuel Insull Jr., and 15 of their associates on trial for using the mails to defraud. In the courtroom a 22-ft. bookcase held two tons of Government exhibits. Two hundred Government witnesses were summoned. Two million words of testimony were taken in the two-month trial. After the first two weeks the jury had pretty well made up its mind. And last week the trial ended. For two hours and two minutes the jurymen deliberated, and then, filing back into the courtroom, two by two, they rendered their verdict: "Not Guilty."

The jury consisted of the president of the Peru, Ill. school board, a dealer in industrial diamonds, an insurance salesman, a young bookbinder, an unemployed telephone engineer, an automobile dealer, a coal salesman, a dairy farmer, the mayor of Millington, Ill., an employe of a grain and lumber company, an unemployed salesman of office supplies, a grocer. Two were in their 50's, six were in their 40's, two in their 30's, two in their 20's. They were a fairly representative cross-section of the middle class of U. S. business. Sitting in judgment on 17 representatives of the upper class of U. S. business, they took just three ballots to acquit them of dishonesty: 9 to 3, 11 to 1 and 12 to 0. Of all the two tons of government evidence they asked to see just three items during their secret deliberation: three letters exchanged between Insull officials and Arthur Young & Co., public accountants, as to whether stock dividends received by Insull's Corporation Securities Co. should be listed at their market value as income of Corporation Securities. The Government contended this form of bookkeeping was evidence of fraudulent intent. The jury decided it was not.

In his charge to the jury, Federal Judge Wilkerson declared: "Lack of good business judgment cannot be considered a basis for conviction. Simply because a defendant embarked upon a losing business venture is no grounds for supposition of guilt. . . . Erroneous judgment may be as consistent with good intent as with bad."

Not the distinguished character witnesses, who testified to the honesty of the defendants, not the tears and protestations of old Sam Insull and his associates, not all the evidence of good intention (and bad judgment) offered by the defense accounted for the Insull acquittal. During the first two weeks of the trial the case was lost by the prosecution, which tried to show by an elaborate analysis of the Insull books that statements sent through the mails in selling stock were unjustified. It triumphantly produced two difficult algebraic equations to prove that Corporation Securities stock was not worth what Mr. Insull had said it was. But the small businessmen of the jury did not believe that the laws against using the mails to defraud were framed to catch poor mathematicians. The prosecution's evidence was not the kind to convince the jurymen that Samuel Insull and friends were financial charlatans.

Said Dwight H. Green, Federal prosecutor: "We all gave the best we had."

Said Defendant Stanley Field, nephew of the late Marshall Field: "I am very happy."

Said Defendant Harold L. Stuart: "I am more than happy. . . . This verdict reaffirms my faith in American institutions."

Said Defendant Insull Jr.: "I appreciate the vindication."

Said Mrs. Insull Sr.: "I am so happy."

Old Sam Insull got out of his chair, crossed through the babbling crowd to the jury box, shook hands with the twelve men whom the Government was about to pay $162 each for 54 days of court service.

"This," said he, "is the start of my vindication."

Next week his brother, Martin Insull, is scheduled to go on trial in an Illinois court on charges of embezzling $344,000 from the Middle West Utilities Co. In January Samuel Sr. is also to stand trial in a State court charged with permitting $66,000 of the alleged embezzlements of his brother. Moreover, against Samuel Sr. and seven of his associates is still pending a Federal indictment charging violation of the Bankruptcy Act. Not unless and until he is freed on these other charges can he claim complete vindication.

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