Ex-Owners of Ramona Savings Accused : Jury Selection Starts in S&L; Fraud Case

Jury selection began Tuesday in U.S. District Court in Los Angeles in the criminal trial of John L. Molinaro and Donald P. Mangano Sr., former owners of Orange-based Ramona Savings & Loan.

The two men are the first owners of a Southern California thrift to face criminal prosecution since the national S&L; disaster began to unfold in the early 1980s, according to government officials.

Molinaro and Mangano each face more than 30 criminal charges, including bank fraud and conspiracy.

Both men have pleaded innocent, and their lawyers said they did not know whether either man would testify in the criminal trial.

“Maybe yes, maybe no,” said Gerald V. Scotti, Molinaro’s attorney. “Depends on what the evidence shows.”

If convicted, Molinaro could receive a maximum prison sentence of 165 years and $8.3 million in fines; Mangano could receive up to 155 years in prison and $7.8 million in fines.

The Federal Savings and Loan Insurance Corp. alleges in a separate civil suit--which will go to trial when the criminal proceeding is completed--that Molinaro and Mangano systematically drained the institution of its assets once they gained control of it in April, 1984.

Ramona collapsed in September, 1986, and required a $65.5-million federal bailout of depositors.

Unlike the civil suit, the criminal trial focuses solely on the two men’s involvement in a condominium project in Palm Springs, which prosecutors say was used to defraud Ramona. They are expected to lead the jury through a complicated series of transactions in an effort to prove that Molinaro and Mangano were knowingly carrying out the alleged scheme.

Opening arguments could begin as early as this afternoon.

U.S. District Judge David V. Kenyon said the criminal trial would take four to six weeks.