Sun S&L; Holder Urges Director to Resign

A dissident Sun Savings & Loan shareholder on Wednesday called for the resignation of director Tad Fujita after he learned that Fujita, while a city planning commissioner of Westminster, was convicted of two felonies in 1973 as part of a $10,000 payoff for an agricultural lease in Orange County.

Dissident shareholder Robert Blake sent a telegram to Sun officials requesting a special board meeting to “immediately remove Fujita and investigate other members of the board who may have known about this.”

Federal regulations state that “a person cannot serve as a director, officer or employee of (a federally) insured institution who has been convicted . . . of a crime involving dishonesty or breach of trust.” State law is similar except that it does not prohibit such persons from becoming employees of the company.

Fujita, owner of Fujita Farms in Westminster, would not comment on Blake’s call for his resignation or on his criminal records.

However, Al Stokke, the attorney who defended Fujita during a 16-day trial in May and June, 1973, said Fujita completed a questionnaire for regulators that dealt only with convictions “in the past five years . . . and he answered that truthfully.”

Moreover, Stokke said, Fujita’s criminal record has been expunged. He did not elaborate.

Neither federal nor state regulators place a five-year limit on the conviction disclosures, authorities said Wednesday.

In fact, the ninth question on the state’s biographical form reads: “Have you ever been convicted or entered a plea of nolo contendere for any violation of law (other than a minor traffic violation)?”

“The code doesn’t mention a five-year limitation or expungement,” said one state savings and loan regulator. “We’re very interested in this case and how it got by us.”

Fujita joined the board of Seaside Savings & Loan in Mission Viejo in 1982. Later that year, Seaside was merged into San Diego-based Sun, with Fujita and two other Seaside directors becoming board members.

Stokke did not specify which questionnaire Fujita completed, although state authorities said he might have filed a “biographical form” when Seaside merged with Sun in late 1982.

Typically, federal regulators require such questionnaires only from founding directors. Until last month, state authorities also usually asked for “biographical sketches” only from founding directors. But in June, State Savings & Loan Commissioner William J. Crawford amended that rule and ordered that new directors of existing S&Ls; also be required to complete such questionnaires.

Blake said that he met last week with federal regulators about the status of Fujita’s directorship and that he plans to inform the U.S. Justice Department and the state attorney general’s office.

State regulators and prosecutors already are investigating Sun and allegations of financial improprieties by ousted Chairman and Chief Executive Daniel W. Dierdorff.

Sun officials said late Wednesday that they had not yet seen Blake’s telegram but that they “consider this a serious matter.”

The board “will give it the attention it merits, and Sun will cooperate with regulatory agencies in this matter and take those actions which we deem . . . appropriate,” according to John Grosvenor, Sun’s executive vice president and general counsel.

Technically, only shareholders can remove a director, he said.

Fujita was city planning commissioner in Westminster in 1973 when he and a former mayor were indicted on counts of conspiracy to commit grand theft, attempted grand theft, conspiracy to offer a bribe and two counts of soliciting a person to offer a bribe in connection with an agricultural lease of Orange County land in 1972.

Authorities accused Fujita and Derek McWhinney of trying to obtain $10,000 from a farmer in exchange for a renewal of his lease on 213 acres in Mile Square Regional Park in Fountain Valley.

They were convicted only on the first two counts. Fujita served 80 days in an Orange County Jail work furlough program and was placed on three years’ probation. McWhinney served 10 months in state prison.

In the last two weeks, Sun, with four offices in San Diego and one in Mission Viejo, has announced two bold efforts to boost its sagging net worth and return to profitability--a $12-million loan swap with a Seattle S&L; as well as a $7.2-million capital infusion from a public stock offering and from a local developer.