Banker Linked to Moriarty Indicted by U.S. Grand Jury

A former high-ranking executive of the California Canadian Bank, accused of taking $230,000 in kickbacks from Orange County businessman W. Patrick Moriarty, was indicted Thursday by a federal grand jury in Los Angeles on mail fraud and income tax evasion charges.

The indictment returned in Los Angeles charges that Floyd A. Walden received cash payments from Moriarty in exchange for the banker’s assistance in obtaining loans submitted by Moriarty but failed to pay income taxes totaling $115,238 owed for the years 1980 and 1981.

The mail fraud charges in the indictment stem from Walden’s alleged use of the U.S. Postal Service to transmit real estate appraisals and other documents connected with Moriarty’s loans from the bank.

Walden, 46, is scheduled to be arraigned April 29 before a U.S. magistrate in Los Angeles. He could not immediately be reached for comment.

Charges Detailed

The indictment says that when Moriarty helped other companies obtain loans through Walden, Moriarty had the companies pay commissions to his associate, Richard Raymond Keith. Keith, in turn, paid Walden after converting checks into cash, according to the indictment. Keith has pleaded guilty to income tax evasion charged in an earlier indictment and is scheduled to testify at future trials.

Moriarty also has pleaded guilty to charges relating to bank loans obtained through Walden and is cooperating with the government in an investigation being conducted jointly by the U.S. attorney’s office, the Orange County district attorney’s office, the FBI and the Internal Revenue Service.

Over a period of several years, Walden was directly or indirectly involved in approving millions of dollars in loans to Moriarty and his various businesses, an investigation by The Times determined. Approximately $20 million in Moriarty loans from California Canadian Bank now are in default.

Walden’s name first surfaced in connection with Moriarty when The Times reported that property records showed Moriarty as the owner of the $350,000 Menlo Park home where Walden lives.

Veteran Banker

A veteran of 20 years in the banking industry, Walden managed branches for California Canadian in Los Angeles and the city of Orange before being transferred to the bank’s San Francisco headquarters, where he was promoted to vice president in charge of commercial loans.

After he left California Canadian in April of 1982, bank investigators began scrutinizing the Moriarty loans that Walden allegedly had approved. Suspecting that crimes had been committed, officials of the bank turned over information to the Orange County district attorney’s office.

Walden had been with California Canadian since the early 1970s after working for San Diego financier C. Arnholt Smith’s U.S. National Bank, which collapsed in a scandal in 1973. His relationship with Moriarty apparently began in 1976 when Walden, as manager of California Canadian’s Los Angeles Wilshire branch, authorized a $250,000 loan for Moriarty and his wife, Doreen.

The following year, Walden signed a California Canadian Bank letter of credit that Moriarty used in applying for a $520,000 state loan from the California Pollution Control Financing Authority. That loan was to be used for improving air pollution control at Moriarty’s Panamint Marketing Co., a Kern County firm which mines material used for cat litter. Moriarty later sold the firm and the loan was transferred to the new owners.