MR. WHITAKER WRIGHT.
HAD the conclusion of the Whitaker Wright case been what it was at first supposed to be, it would have been altogether outside the run of similar trials. From the opening of the pleadings to the return of the jury into Court, it differed in nothing, except the magnitude of the sums involved, from a hundred other examples of indignant shareholders and fraudulent directors. But the death of the defendant, coming, as it first seemed to come, as the direct consequence of the sentence, and within a few minutes of its passing, carried us into another region. We were at once confronted by the great commonplaces of tragedy,—the vanity of the things which make up earthly prosperity, the sudden reverses which hurl men from the topmost pinnacle of success to the lowest depth of deserved misfortune. The subject was hardly one for the journalist ; it belonged rather to the Hebrew prophet or the Greek chorus. Pity, which was hardly appealed to by the proper punishment of fraud, awoke in the presence of death, and we were no longer anxious to apportion the exact measure of well-merited blame. But these feelings depended upon the conclusion—which death from mental shock would have rendered probable—that Mr. Wright by some strange per- -version was half assured of his own innocence. These vanished when hewas seen in the far more ordinarycharacter of the convicted criminal who lacked the courage to face penal servitude. The case lost its exceptional distinction ; the tragedy became squalid and commonplace.
Mr. Lawson Walton's clever speech for the defence was ominous of coming defeat. It was possible, no doubt, that the jury might be led away from the real issue by such pleas as that you could not condemn Mr. Whitaker Wright without condemning Lord Dufferin or Lord Loch ; or that the prosecution was animated by vindictiveness rather than by a sense of justice ; or that Mr. Wright was no worse than dozens of men holding good financial positions; or that misrepresentations of fact which could not be altogether denied deserved no harsher name than that of "window-dressing,"—the putting in the least damaging light of facts which had to be explained just when they were least capable of explanation. The great advocate was only doing his duty by his client ; but the fact that he had to find the materials of his speech in directions so far removed from the plain issue of guilt or innocence showed plainly what his own estimate of his case was. For not one of them really served any purpose beyond that of exciting sympathy. It was quite possible to hold Mr. Wright guilty of fraud without extending the particular censure to Lord Dufferin. This does not mean that Lord Dufferin deserved no blame, nor did he himself ever maintain the contrary. He made the mistake of allowing his passion for work to lead him into concerns of the real character of which he knew no more than so much as Mr. Whitaker Wright chose to tell him. But this did not make Lord Dufferin Mr. Wright's accomplice; it only made him his first. and principal victim. It would be well, indeed, if for the future the duties of directors were discharged by men whose sole title to confidence is their financial reputation. No sooner, however, have we laid down this rule than we are reminded of conspicuous instances of successful management of great concerns by eminent politicians,—by the very class, indeed, of which Lord Dufferin was so distinguished a member. Ilut then the concerns in question have really nothing in common with Mr. Wright's enterprises, and Lord Dufferin's error lay in not realising this distinction. Mr. Wright realised it all along, and devoted a large part of his remarkable ability to preventing other people from realising it.
The plea that Mr. Wright was no worse than his neighbours may possibly be true. But it points to a different conclusion from that which Mr. Lawson Walton sought to found on it. That many men commit a particular offence, but that punishment only overtakes a very few of them, is really an argument for greater severity in the rare event of detection. If every case of company fraud met with its deserts, a comparatively slight penalty might answer the purpose of the legislator. But when the majority—perhaps the great majority—of such cases escape detection, the only means of forming a proper public opinion Is to inflict Ilia full penalty in the few cases that are brought to justice. Mr, Whitaker Wright will not close the list of company promoters whose zeal for the success of their enterprise makes them wholly indifferent to the devices which they employ to gain their end. But the story of his successes and his fall, and the tragic completeness of his punishment, will do more to emphasise his example than any number of con- victions followed by a few months' imprisonment. The level of professional opinion in the City is not so high that we can dispense with the salutary impression - which a sentence of seven years' penal servitude is calcu- lated to create. Whether Mr. Wright's conduct was only an example of the art of "window-dressing" is a question of no moment. The more this art is practised, the more necessary it becomes to subject it to severe scrutiny. Legiti- mate window-dressing is making the best of the materials actually in your possession. That, of course, is a natural, and even praiseworthy, process. No one expects a trader to run down his own wares, or to display his stock in such a fashion as to make it look less valuable than it really is. But suppose that a jeweller, wishing to borrow money on the security of the stock arranged in his shop window, borrows from a . neighbouring jeweller what is most valuable in his stock and mixes it up in the window with his own, we know exactly what to call him. He is a common swindler. What Mr. Wright did was precisely this. He made up his balance-sheet at critical periods by borrowing securities to be reckoned as his own while the balance-sheet was in preparation, and returned to their owners as soon as it was published. The presence or absence of a million of stock may make all the difference. to the solvency of a company, the probability of future' dividends, and the amount of inducement offered to intending purchasers of shares.
We entirely agree with the Tittles that it would be "only seemly for the Government to recoup fully to the prosecutors all costs which they have incurred in 'bringing to justice a culprit of a kind that under our laws fortune generally favours." When the Attorney-General declined to direct a prosecution—and his refusal was justified by the Solicitor-General on the ground that no one would "get up and say that a man can be prosecuted for publishing a false balance-sheet "—the public had no choice but to believe that Mr. Whitaker Wright had added the finishing touch to his remarkable cleverness by selecting from among the many varieties of fraud that one to which the law had omitted to affix a penalty. To decide what is and what is not a fit subject for a Government prosecution is the proper business of the Law Officers of the Crown, and the public has only to accept as gospel what the experts declare to be so. In this instance, however, the Attorney- General's decision was nothing short of a proclamation of impunity for one of the most gigantic of modern frauds. Other offenders on the same scale have been brought to justice, but for Mr. Whitaker Wright was reserved the distinction of having discovered and profited by the weakest spot in our company law. Ministers themselves were startled by the far-reaching consequences of this official exposition of the law, and fresh legislation was promised to make good so singular an omission. As it turns out, this legislation would have been a pure waste of time. The law has been shown to be quite stringent enough to deal with Mr. Wright without any addition whatever. It is matter for very great satis- faction that this should have been established, because the history of company legislation is one of the feeblest chapters in our legal history. Again and again Parlia- ment has sought to ensure the honesty of company pro- moters; again and again the Bill has had to be withdrawn at the end of the Session, or its really important provisions have been sacrificed in order to ensure the passing of the unimportant remainder. This is what but for the courage and persistence of the prosecution we might have seen in the present instance. We do not doubt the ability of the Law Officers to explain to Parliament the causes which led to their error. But the result of the trial is ample proof that they were in error, and as this mistake has had to be set right at a very great expenditure of private money, the Government are certainly bound to take on them- selves the whole cost of what, as we now know, ought to have been a Crown prosecution.
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