American Savings & Loan Assn. of Stockton was the nation's largest thrift when regulators granted it a chance to work its way out of trouble during the savings and loan crisis. But enormous losses on mortgage-backed securities and commercial mortgages in California and Texas proved impossible to overcome, and American failed in September 1988. The flamboyant L.A. financier Charles Knapp, pictured, had been ousted in 1984 as chief executive of American's parent company, Financial Corp. of America. But Knapp was later sentenced to 61/2 years in prison for defrauding another savings and loan in Phoenix. Cost: $5.4 billion.
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