Ugly entanglements

October 22, 1990|By Los Angeles Times

THE LONGER Senate investigators examine the relations between five senators and the failed savings empire of Charles H. Keating, the cozier they begin to look.

After nine months of examination, the Senate Ethics Committee has yet to authorize a formal study that could lead to charges of unethical conduct. But what committee staff has turned up so far seems to show that at least three of the five who took campaign contributions from Keating then did whatever they could to help get government regulators off his back.

One of those three, Sen. Donald W. Riegle, D-Mich., is actively involved in rewriting the laws regulating American banks as chairman of the Senate Banking Committee. The others are senators Dennis DeConcini, D-Ariz., and Alan Cranston, D-Calif.

It is now clear that they were working at least around the edges of a financial hurricane that is going to blow billions of dollars out of the pockets of American taxpayers. Keating, alone, accounted for $2 billion of the losses at hundreds of incompetent or outright fraudulent S&Ls around the country. The total bill, which American taxpayers will pay to protect innocent depositors, will be at least $500 billion.

Some documents that have turned up so far were passed around to Washington reporters last week. As isolated incidents, phone calls the documents chronicle from DeConcini and Cranston to the unlisted number of a savings regulator may seem small. So may the fact that Riegle had his staff keep in close touch with Keating. But overall the pattern they portray is immensely ugly.

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