Library of Congress. New York World-Telegram & Sun Collection.

By Ramon Vasconcellos

A crowd of recently defrauded customers packed the hallways of the New York County Court of General Sessions in late June 1931. They eagerly awaited Judge George L. Donnellan’ s sentencing decision for Barnard Marcus, Saul Singer and Singer’ s son, Herbert Singer, all former executives of the now defunct Bank of United States. The bank served as a private entity and was in no way affiliated with the quasi central Bank of the United States, which operated during the late 18th and early 19th centuries. As the sentences were announced, the gathering cheered in approval: three to six years at Sing- Sing Prison for Marcus and Saul Singer; Herbert Singer would receive up to three years imprisonment. Judge Donnellan

A crowd of depositors gathers in the rain outside the Bank of United States after its failure. commented that their“ personal greed” caused the downfall of the bank and the“ hardship thus brought upon its 400,000 depositors.”

By late 1930, many of New York City’ s depositors, despite current financial unrest created by depressed stock prices and the recent failure of a major regional investment bank, believed their deposits held at the Bank of United States remained liquid. Furthermore, many had mistakenly presumed that the name alone— Bank of United States— implied it was a government-run institution with safeguards in place to maintain its solvency. Until that time, the bank not only held adequate reserves, but it sold bank shares to its customers for subsequent repurchase by directors. Moreover, like several other New York City banks, Bank of United States was a member of the Federal Reserve system, giving its customer base even greater confidence in the institution.

However, refusal to repurchase stock from depositors, combined with other fiscally imprudent decisions, led Governor

Franklin D. Roosevelt to order the bank’ s closure on December 11, 1930. At the time, it was the largest bank collapse in US history.

Until December 1930, the Bank of United States had operated as the nation’ s largest commercial bank. At its peak, it held savings deposits of $ 228 million and serviced a customer base of 440,000. However, the public’ s confidence in financial institutions, already shaken by the stock market collapse one year prior and the closing of 1,352 banks in 1930 alone, further eroded with its collapse. Across New York City, branches of the bank began closing that December. Queues formed outside several of its 57 branches. At one branch alone, 15,000 customers waited outside in the hopes of acquiring their funds.

Police officers were called in to monitor the behavior of the crowds, but according to some reports, they were a bit aggressive. Eyewitness accounts claimed several members of the NYPD beat and arrested individuals and even charged the crowds

42 FINANCIAL HISTORY | Spring / Summer 2026 | www. MoAF. org