Congressman Somers Asks Justice Dept. for Inquiry into Receivership Methods

The “New York World,” which is now conducting a survey into the bankruptcy situation in Manhattan and Brooklyn, made public Sunday a letter addressed by Congressman Andrew L. Somers of the 6th New York District to John G. Sargent, Attorney General of the United States, asking for an investigation by the Department of Justice into conditions in the two federal districts in Greater New York.

Congressman Somers alleges in his letter that during the last four years Judge Moscowitz has given forty important equity and bankruptcy receiverships to Sidney F. Strongin, a former law associate of Judge Moscowitz and a group of lawyers associated with him at 789 Montague Street, Brooklyn. It was asserted, as a result of the survey made by the “World” that twenty-four million of the seventy-two million dollars in bankruptcy assets have been spent in fees and costs in four years in the two New York districts.

Congressman Somers in his letter wrote:

“In my previous letter I mentioned that certain men had been so frequently appointed to receiverships that they had come to be known as “unofficial receivers” of these courts. In an investigation of conditions ‘The World’ found that many important receiverships in the Eastern District have been given to a group of lawyers occupying jointly a suite of offices at No. 789 Montague Street, Brooklyn. In the directory of that building United States Judge Grover M. Moscowitz is listed as an occupant of Rooms 505-507. The same directory gives the names of Sidney F. Strongin and Minnie Schwartz as occupants of the same office rooms. Milton Hertz is listed in the directory of that building as the occupant of Room 500, a room in the same suite of offices.

“May I call your attention to the fact that in the last three years Sidney F. Strongin, Minnie Schwartz and (Continued on Page 4)

Milton Hertz have been appointed to at least forty receiverships by Judge Moscowitz. It may be claimed that the efficiency of these persons made their appointment desirable in important cases. Nevertheless the statistics compiled by The New York World’ from your official reports fail to show that there was a high degree of efficiency evidenced in the conduct of bankruptcy affairs in general in this district.

“For your information I submit the following list of cases in which one or another of this group were appointed by Judge Moscowitz in bankruptcy.” Congressman Somers appended a list to his letter.