In 1934 he was convicted of bank fraud and sent to Lewisburg Federal Penitentiary,[2] where he served 25 months of his 4+1⁄2 year sentence before receiving parole.

[17][20] On May 18, 1933, as his federal trial was about to begin, he walked away from a Manhattan nursing home where he claimed to have been undergoing treatment for a nervous breakdown,[22] leaving behind a set of suicide notes.

[23] After he was found the next evening in a Roslyn, New York, hotel, pretending to be someone else,[24] he stabbed himself in the neck and breast in an apparent suicide attempt.

[6][25] Doctors treating his injuries concluded that his heart was in "perfectly normal condition" for a man of his age.

[27] He reappeared two days later, dripping wet and claiming to have lived in Central Park, and was then confined behind bars in Bellevue Hospital.

[28] Donovon retained as his chief psychiatric expert Dr. Smith Ely Jelliffe, whose testimony had assisted Harry K. Thaw to avoid capital punishment for the killing of Stanford White, and Bianca de Saulles to avoid conviction for murdering her husband John de Saulles.

Victims of the alleged fraud, including movie stars Constance Talmadge and Peggy Hopkins Joyce, appeared to testify that they had not consented to the withdrawals from their accounts that the defendants arranged.

[33][34] After five weeks of testimony, the jury deliberated only two hours before finding Harriman guilty on all sixteen counts (and acquitting Austin).

[35][36] Judge John C. Knox sentenced Harriman to 4½ years on each count, but allowed him to serve them concurrently rather than consecutively.

[40] Following his release, Harriman worked at the Long Island auto sales business that his son Alan had established before his death.