Ex-Illinois Gov. to Plead Guilty to Fraud

Former Gov. Dan Walker was indicted today on charges of bank fraud, misapplication of bank funds and perjury, and has agreed to plead guilty, U.S. Atty. Anton Valukas said.

Walker is a former chairman of the board and chief executive officer of First American Savings & Loan in Oak Brook, Ill. The Oak Brook savings and loan was declared insolvent in April, 1986, by the Federal Home Loan Bank Board.

Walker, a Democrat, was governor from 1973 to 1977 but failed to win renomination.

According to the indictments, Walker directed his son, Dan Jr., and an associate to get loans in their own names when in fact the money was intended for the former governor’s personal use.

The perjury charge stems from statements the senior Walker made to the bank board in April, 1986, when he denied he had received the money.

Last July, Walker said he did nothing wrong in funding the expansion of a chain of quick-oil-change franchises with deposits from the savings and loan association he owned with his wife, Roberta.

Walker achieved national prominence when he was elected governor for overcoming the political machine of the late Chicago Mayor Richard J. Daley.

Earlier, he had written a report critical of Chicago police conduct during the violent confrontations between police and anti-war demonstrators at the National Democratic Convention in 1968.

At least two other former Illinois governors have run into legal troubles.

Otto Kerner, a Democrat who was governor from 1961 to 1968, was convicted in 1973 of bribery, tax evasion and perjury. Prosecutors said he was allowed to buy race-track stock at a bargain-basement price in return for favorable action on legislation affecting the racing industry. He was sentenced to three years in prison but was paroled because of ill health in 1975 after serving seven months.

Kerner’s predecessor, Republican William G. Stratton, was indicted in 1964 on charges he failed to pay federal income tax on nearly $94,000 in unreported income while in office. He was acquitted in March, 1965.