David Saperstein (SEC official)

David Saperstein (June 14, 1901 – December 28, 1990) was an American lawyer and government regulator who helped create the Securities and Exchange Commission (SEC) and directed its Division of Trading and Exchange under Chairman Joseph P. Kennedy Sr.. He served earlier as associate counsel to the Pecora Commission, contributing to the drafting of the Securities Exchange Act of 1934.^[1][2]

Saperstein was born June 14, 1901, in Hoboken, New Jersey.^[1] His father, Samuel Saperstein, worked for Prudential Insurance in Hudson County.^[1] He attended Weehawken public schools, graduated from Hoboken High School, and earned degrees from New York University in 1921 and from Columbia Law School in 1923.^[1][3] He began practice in Union City specializing in banking and municipal law before entering federal service.^[1]

During 1933–1934, Saperstein served as associate counsel ^[4] to the Senate Banking and Currency Committee under chief counsel Ferdinand Pecora. Hearing transcripts list “Julius Silver and David Saperstein, associate counsel to the committee.” ^[5] He helped draft the Securities Exchange Act of 1934 and supervised staff investigations that exposed abuses on Wall Street. The Times later wrote that “the committee set out to write the Act that created the Commission; Mr. Saperstein helped draft the legislation and was at the center of the hearings and investigations.” ^[1]

When President Franklin D. Roosevelt created the SEC in 1934, Chairman Joseph P. Kennedy Sr. appointed Saperstein, as Director of the Division of Trading and Exchange.^[6] A resident of Cliffside Park, New Jersey, he commuted by train to his offices in Washington, D.C.^[3] His division was charged with monitoring trading nationwide and drafting the first rules for over-the-counter markets. He was responsible for interpreting the new law and establishing registration standards for brokers and dealers. By 1935 he had compiled a “rogues’ gallery” of 30,000 suspected stock promoters and salesmen to root out fraudulent operators from the industry.^[1]

His interpretations of SEC rules and regulations “deeply affected those activities,” according to the Times. He also oversaw hearings on broker-dealer registration and prepared policy studies on the separation of broker and dealer functions.^[7]

In 1937 Saperstein issued a formal interpretation of the Exchange Act governing specialists on the New York Stock Exchange, later known as the "Saperstein Interpretation." It required that each specialist trade for his own account be "reasonably necessary to permit him to maintain a fair and orderly market," aiming to reduce conflicts of interest between brokerage and dealer functions.^[8] Though never repealed, later SEC practice loosened enforcement, and legal scholars have argued that its neglect contributed to specialist abuses during the 1963 and 1987 market breaks.^[8][9]

Saperstein was mentioned in 1937 as a candidate for Commissioner but chose to return to private practice for family reasons.^[1]

After leaving government service he joined the New York firm Silver, Saperstein & Barnett (later Silver, Saperstein, Barnett & Solomon). He represented Polaroid Corporation in federal litigation including Polaroid Corp. v. Casselman (1962), in which he was listed as counsel of record.^[10] He remained a corporate lawyer until retiring in 1982.^[1]

Saperstein died December 28, 1990, at Palisades General Hospital in North Bergen, New Jersey, aged 89. He lived in Weehawken, New Jersey. He was survived by his wife, Louise Lederer; two children, Sue Bernstein and Roy Saperstein; a sister, six grandchildren, and two great-grandchildren.^[1]

Historians of financial regulation cite Saperstein as a foundational figure in modern U.S. market oversight.^[1][8] The Times described him as a “corporate lawyer who helped put together the SEC and then fought questionable market practices.”^[1] Professor Norman S. Poser later urged that “the wisdom of the Saperstein Interpretation has been demonstrated again and again.”^[8]

• Polaroid Corporation