Under the Spotlight

Since the SEC began probing Wall Street ten months ago, the hot glare of unfavorable publicity has focused almost entirely on the American Stock Exchange (TIME, May 26 et seq.). Last week the spotlight abruptly swung to the Amex's stern older brother, the New York Stock Exchange. After three weeks of deliberation, a federal grand jury indicted J. (for James) Truman Bidwell, 58, chairman of the board of governors of the Exchange, on the charge that he had "willfully and knowingly" evaded payment of $55,808.83 in income taxes for 1956-57. Within minutes of the announcement, Bidwell resigned his job (which carries little administrative power) in favor of Vice Chairman Henry M. Watts Jr., 57, St.

Paul's-and Harvard-educated scion of a family of Philadelphia brokers.

Bidwell, known to Wall Street friends as "Biddy," is a shy, much-respected Lehigh graduate who came to the Street shortly before the 1929 crash, bought his Exchange seat in 1941, and has since prospered as an independent floor broker. Unlike most men with large incomes, he filled out his own tax returns.

In the process, the Government alleges, he failed to mention some $15,500 in capital gains from stock transactions and claimed fraudulent deductions of $68,000 for travel and entertainment expenses, bonuses to employees and gifts to charity.

The case against Bidwell--who, if found guilty, could draw five years in jail, $20,000 in fines and a 50% fraud penalty on the unpaid taxes-- had one disquieting aspect. In sharp contrast to usual Department of Justice secrecy, word leaked out a month ago that the Government was seeking an indictment against Bidwell.

Bidwell partisans suggested that the leak was part of a concerted Administration drive to discredit Wall Street, and Bidwell himself in a bitter statement implied that the Government had deliberately waited until he became chairman of the Exchange to prosecute him.

The Justice Department retorted stiffly that Bidwell was not accused of misconduct as a broker, and that his case had been working its way routinely through the Internal Revenue Service machinery for three years. It may only have been pure coincidence that the tax evasion suit against so prominent a citizen was brought just as all America sits down to exercise its ingenuity on Form 1040.

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