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Michael J. Meehan (1891–1948) was a
stock trader A stock trader or equity trader or share trader, also called a stock investor, is a person or company involved in trading equity securities and attempting to profit from the purchase and sale of those securities. Stock traders may be an inves ...
on
Wall St Wall Street is an eight-block-long street in the Financial District of Lower Manhattan in New York City. It runs between Broadway in the west to South Street and the East River in the east. The term "Wall Street" has become a metonym for th ...
during the 1920s and 1930s. The
Securities and Exchange Commission The U.S. Securities and Exchange Commission (SEC) is an independent agencies of the United States government, independent agency of the United States federal government, created in the aftermath of the Wall Street Crash of 1929. The primary pu ...
(SEC) forced him out of trading in 1935 as the first individual they prosecuted. During the
Great Depression The Great Depression (19291939) was an economic shock that impacted most countries across the world. It was a period of economic depression that became evident after a major fall in stock prices in the United States. The economic contagion ...
he purchased a controlling stake in the
Good Humor Good Humor is a Good Humor-Breyers brand of ice cream started in Youngstown, Ohio, US, in the early 1920s with the Good Humor bar, a chocolate-coated ice cream bar on a stick sold from ice cream trucks and retail outlets. It was a fixture in Am ...
ice cream company.


Background

Meehan was born in
Blackburn Blackburn () is an industrial town and the administrative centre of the Blackburn with Darwen borough in Lancashire, England. The town is north of the West Pennine Moors on the southern edge of the Ribble Valley, east of Preston and north- ...
, England in 1892, but grew up in
Manhattan Manhattan (), known regionally as the City, is the most densely populated and geographically smallest of the five boroughs of New York City. The borough is also coextensive with New York County, one of the List of counties in New York, origin ...
. After attending public schools in New York, he became a theater ticket seller on Wall Street. As a ticket broker in New York's financial district, brokers requested the best
Broadway Broadway may refer to: Theatre * Broadway Theatre (disambiguation) * Broadway theatre, theatrical productions in professional theatres near Broadway, Manhattan, New York City, U.S. ** Broadway (Manhattan), the street **Broadway Theatre (53rd Stree ...
seats available. After six years as a ticket broker, Meehan used his connections to get himself a seat on the New York Curb Exchange. Three years later he had saved $90,000 to purchase a seat on the
New York Stock Exchange The New York Stock Exchange (NYSE, nicknamed "The Big Board") is an American stock exchange in the Financial District of Lower Manhattan in New York City. It is by far the world's largest stock exchange by market capitalization of its listed co ...
(NYSE).


Good Humor

Meehan was an early investor in the Good Humor ice cream company. In what some call nothing more than a favor, he invested in the company as a favor to an old friend, the father-in-law of the franchise own, Tom Brimer. During the stock market Crash of 1929, when most other stocks lost their value, Good Humor paid high
dividends A dividend is a distribution of profits by a corporation to its shareholders. When a corporation earns a profit or surplus, it is able to pay a portion of the profit as a dividend to shareholders. Any amount not distributed is taken to be re-inv ...
. This brought the company to the attention of Meehan and he purchased a controlling stake in the company.


SEC fraud

In 1935, Meehan planned to manipulate the stock price of
Bellanca Aircraft AviaBellanca Aircraft Corporation was an American aircraft design and manufacturing company. Prior to 1983, it was known as the Bellanca Aircraft Company. The company was founded in 1927 by Giuseppe Mario Bellanca, although it was preceded by p ...
. Meehan used the strategy of 'matched orders' which had him manipulating the volume of the stock by frequently buying and selling the issue. By increasing the volume, Meehan believed he could generate interest in the company. Within a few months, the public had followed Meehan into Bellanca and pushed the share price up from $1.75 to $5.50. After Meehan completed his manipulation and sold the stock, the shares fell to their original price. The Securities and Exchange Commission (SEC) decided to prosecute Meehan under the new
Securities Exchange Act The Securities Exchange Act of 1934 (also called the Exchange Act, '34 Act, or 1934 Act) (, codified at et seq.) is a law governing the secondary trading of securities (stocks, bonds, and debentures) in the United States of America. A landma ...
. This would be the first punitive action taken by the SEC. The commission expelled Meehan from his seats on the NYSE, and also on the Curb Exchange and
Chicago Board of Trade The Chicago Board of Trade (CBOT), established on April 3, 1848, is one of the world's oldest futures and options exchanges. On July 12, 2007, the CBOT merged with the Chicago Mercantile Exchange (CME) to form CME Group. CBOT and three other excha ...
.


References

{{DEFAULTSORT:Meehan, Michael J. 1892 births 1948 deaths People from Blackburn Businesspeople from New York City American stock traders British emigrants to the United States 20th-century American businesspeople