Michael Meehan’s Curb Stock Manipulation of RCA, Good Humor Ice Cream and Bellanca Aircraft
Michael J. Meehan (1891–1948) was a stock trader on Wall Street during the 1920s and 1930s. Meehan used his connections to get him 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.
At one time, Meehan’s firm had $2.4 million invested in eight stock exchange seats and had nine branch offices.
Meehan was the stock specialist who manipulated the “Buy of the Decade” — pumping RCA from $2.50 a share up to a peak of over $570 a share (before stock splits) — making millions for the few who were in on the deal. It was speculated that Meehan profited between $5 million to $25 million on his trades.
Four days in March of 1928, RCA jumped $61.75 in value because of Meehan — it was called the most dramatic four days in the history of the bull market. Meehan’s firm was making $15,000 per day churning RCA stock.
During the Great Depression he purchased a controlling stake 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.
In 1935, Meehan planned to manipulate the stock price of Bellanca Aircraft. 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 per share to $5.50 per share. After Meehan completed his manipulation and sold the stock, the shares fell to their original price.
The Securities and Exchange Commission (SEC) forced him out of trading in 1935 as the first individual they prosecuted under the new Securities Exchange Act because of the stock manipulation of Bellanca Aircraft. The commission expelled Meehan from his seats on the NYSE and also on the Curb Exchange and Chicago Board of Trade.
Michael Meehan transferred his enterprises to his sons. Two years later, 21-year-old Joseph A. Meehan became the youngest broker with a seat on the New York Stock Exchange and chairman of Good Humor Corporation, a position he held until 1961.
The Milwaukee Journal – August 1937
Tags: Bellanca Aircraft, Chicago Board of Trade, Curb Exchange, Good Humor, Good Humor Ice Cream Company, Great Depression, New York Curb Exchange, NYSE, RCA, SEC, Securities and Exchange Commission, Stock Splits