Financial History Issue 128 (Winter 2019) | Page 38

never went, through, and in 1974 the firm declared bankruptcy. Before it went out of business, New- burger, Loeb & Co. made its mark on Wall Street history when it admitted Joseph Louis Searles III as a partner in 1970 and proposed him as a NYSE member, making Searles the first African American member in the history of the Exchange. (At the time, the NYSE had one African American allied member, Clarence B. Jones, who was a member of Cogan, Berlind, Weill & Levitt, Inc.) A native of Ford Hood, Texas, and the son of a “career Army man,” Searles was a 1963 graduate of Kansas State University, where he was a football star. He played for the New York Giants and then went to work as an aide for New York Mayor John Lindsay in 1967 before resigning to join the Newburger firm at the age of 30. According to The New York Times, Robert Newburger said that “his firm wasn’t attempting to make a racial break- through on the 178-year-old exchange. ‘This is strictly an economic thing,’ he declared, praising Searles for intelligence and sincerity.” Searles told the press “he was proud of the opportunity to ‘penetrate a bastion of the white financial structure.’” At the time, Searles also said, “I don’t believe I’ll become a token black. I think there will be more black members at the exchange. Hopefully, my presence will increase the credibility of the financial community, as far as blacks are concerned.” In 2014, Searles told the Wall Street Journal, “I didn’t try make myself unique; I just wanted to be a friend and another fellow broker that the other brokers would respect and want to do business with.” When Searles first joined, however, he said that the Exchange confronted a particular problem having to do with “the second most important place in the Stock Exchange…the luncheon club.” The Exchange gave Searles his own table because they did not know how to seat him. Searles remembered that this meant he was served more quickly, allowing him to get back on the floor, which later made his table more attractive to other brokers. Searles was only a member of the NYSE for about nine months, however, before he resigned after Newburger Loeb & Co. ran into trouble and later sold his seat. He then went into business for himself. According to The New York Times, “Sear- les said that at times he detected some ‘built in prejudices against blacks, since 90% of the members have no social con- tacts with blacks.’ But the big dividing line, he came to feel, was not skin color but money.” Searles went on to work with Manufacturers Hanover Trust Co. The Philadelphia house of Newburger & Co. also ran into problems of its own in the early 1970s. In February 1970, New- burger & Co. was suspended after the SEC charged the firm with “engaging in alleg- edly illegal types of reciprocal arrange- ments with Porteous & Co…. a broker- age affiliate of the Provident Fund for Income, Inc.” Several partners including Frank Jr. and Richard Newburger were suspended. The outcome of these difficul- ties was not bankruptcy, however, but a merger. Later that month, Newburger & Co. announced that it was consolidating with the Advest Company of Hartford. (Advest was founded in 1967 when the firms of Doolittle & Co. and Putnam, Coffin & Co. merged. Putnam, Coffin & Co. was the descendant of a merger between Putnam & Co., a Hartford firm, with the Boston firm of Coffin & Burr in 1964. According to The New York Times, the merger was unusual in that the firms picked another name to act as the survi- vor firm rather than picking one of the merging firm’s names, as was tradition in securities mergers). With the Advest merger, the name of Newburger & Co. was lost to history, but the individual members of the firm con- tinued in business. Frank Newburger Jr. joined Advest Group Inc. as managing partner of a Newburger & Co. division. He became senior vice president of the divi- sion in 1977 and remained until 1984; he died in 1998. Richard Newburger became a senior vice president of Advest Inc.; he died in 1979. Allen Weintraub, Richard’s son-in-law, who had been a member of Newburger & Co. since 1955, went on to become the chairman, president and chief executive officer of The Advest Group, 36    FINANCIAL HISTORY  |  Winter 2019  | www.MoAF.org Inc. (Weintraub married Linda Hano, the daughter of Mrs. Richard Newburger and Lester Hano, in 1958). Nicholas G. Hano, Linda’s brother, who was a member of Newburger & Co., also joined Advest & Co. Despite the passing of their firms, the generations of Newburger bankers who were active in the original firms continued to work on Wall Street. When Newburger, Loeb & Co. closed, Robert Newburger joined the Wheeling, West Virginia firm of Hazlett, Burt & Watson as a broker. He continued to work on the NYSE floor until 1995, when he retired from trading and joined the Alliance of Floor Brokers. In 2009, Newburger told The New York Times that the demise of his family firm showed him, “All you really have [is] the ability to be able to cope with whatever is presented to you.” He was thankful for the support of his friends, including those who had been his competitors on the Exchange. He said, “The New York Stock Exchange is not a cold, heartless organization. It isn’t eighths and quarters or decimal points—it’s people. There are so many people that I love, and that I dare say love me.” In 2013, when he turned 100 years old, he rang the NYSE closing bell. He died two years later at the age of 102.  Susie J. Pak is an Associate Professor in the Department of History at St. John’s University (New York). A graduate of Dartmouth College and Cornell Uni- versity, she is the author of Gentlemen Bankers: The World of J.P. Morgan (Harvard University Press), a Trustee of the Business History Conference, co-chair of the Columbia University Economic History Seminar and a member of the editorial advisory board of the Business History Review. She is also a member of the Financial History editorial board. About Where Are They Now?  The “Where Are They Now?” Series traces the origins and histories of 207 of the under- writers of the 1956 Ford Motor Company IPO. The research for this series has been generously funded by Charles Royce of The Royce Funds.