"Aghast"

When Richard Whitney, onetime president of the New York Stock Exchange, was suspended from the Exchange last month for insolvency and theft of customers' securities, his older brother, Morgan Partner George Whitney, was in Florida on vacation. Wall Street took this as prima-facie evidence that George Whitney knew nothing of the pending debacle. Last week this view was considerably modified.

Testifying fortnight ago, Richard Whitney revealed that his brother had loaned him $1,082,000 in November, having already loaned him $2,000,000 several months before. Testifying last week, Richard Whitney was asked to recall their November conversation. His neck slowly flushing, the fallen financier took a deep breath and recounted: "The loan was made because I told him I had been using customers' securities improperly. He was aghast at the fact and terribly disturbed. He said he would see if he could arrange to lend me the money I needed and told me to find out what was necessary to clear up the situation. I did so and the next day the money was loaned. . . ."

Richard Whitney used his brother's $1,082,000 to return more than $900,000 in securities and cash belonging to the Stock Exchange Gratuity Fund, which he had had in his custody and had pledged for a personal loan. Had George Whitney known that there were several million dollars involved in other fraudulent deals? No, said Dick Whitney wearily, "So far as I know, he knew nothing about the rest until it all became public."

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