Herbert Hoover photo

The President's News Conference

February 26, 1932


THE PRESIDENT. I understand the Glass-Steagall bill has passed the House, but I haven't had it yet. I will be signing it tomorrow and will give you a statement about it then.


I am sending to Congress early next week a message on the subject of reform of the bankruptcy laws and procedure of the Federal courts in criminal cases.

Two years ago I directed a searching investigation by the Department of Justice and the Department of Commerce into the whole condition in bankruptcy administration. As you will recollect, that is a Federal function. That investigation has disclosed that the number of cases in bankruptcy steadily increased from 23,000 in 1921 to 53,000 in 1928 and to 65,000 in 1931. The losses to creditors increased in that period from $144 million in 1921 to $740 million in 1928 and to $900 million in 1931. Those increases are, therefore, not the result of the economic situation, as by far the major portion of them came during the time of prosperity and from far deeper causes than the economic situation. We are trying to reach those causes in some proposed legislation.

The Bankruptcy Act has proved to be defective and to allow a great many loopholes for exploitation of both the bankrupt and the creditors-a great deal of injustice on both sides.

In the matter of criminal procedure in the Federal courts, we had an investigation by the Department of Justice and the Law Enforcement Commission and the different bar associations, and they all combine on certain recommendations as to the reforms in criminal procedure, in the matter of permitting accused persons to waive indictment by grand juries if they wish to plead guilty, to overcome technicalities in the constitution of grand juries, to simplify procedure in the district courts and in procedure in appealing cases to the higher courts. The object of all of these reforms being to expedite criminal trials and appeals and thus add a deterrent to crime by diminishing the technicalities of which convicted can take advantage to delay ultimate decision.

The message will also contain some recommendations on diversity of citizenship in the Federal courts and some recommendations for the relief of congestion in some of the courts by the addition of certain judges as recommended by the judicial council.

These reforms ought to result, if enacted, in the saving of a good many million of dollars of creditors and bankrupts and in a great deal of direct economies in the administration of justice. Otherwise than that I have no news today.

Note: President Hoover's two hundred and thirty-sixth news conference was held in the White House at 4 p.m. on Friday, February 26, 1932.

On the same day, the White House issued a text of the President's statement on bankruptcy law and judicial reform (see Item 64).

Herbert Hoover, The President's News Conference Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/208351

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