Keating Blames Regulators for S&L; Woes

Lincoln Savings & Loan Assn. owner Charles H. Keating Jr. said today that Congress and the “conniving” of federal regulators are to blame for the multibillion-dollar failure of his thrift.

Keating claimed that Lincoln showed a profit until it was taken over by federal regulators.

“We had $700-million excess assets over liabilities in our subsidiary,” Keating said on ABC’s “Good Morning America.”

Regulators say the failed Irvine savings and loan is expected to cost taxpayers a record $2.5 billion.

“The numbers they come by are numbers that are arbitrarily written-down assets, by their conniving,” Keating said of the regulators.

“It’s a ridiculous situation, and it’s causing a loss unprecedented in the history of the United States. It’s the regulators.”

Keating is appearing on a series of talk shows to defend his point of view, even though he took the Fifth Amendment and refused to answer the questions of a congressional committee investigating Lincoln’s failure.

Former top S&L; regulator Ed Gray testified before Congress last year that he turned down the request of five senators to ease investment rules affecting Lincoln.

Those five senators are under investigation by the Senate Ethics Committee for improperly attempting to interfere with federal regulation in return for $1.3 million in campaign contributions.

On CNN Thursday, Keating said he made donations to the senators, Alan Cranston (D-Calif.), Donald W. Riegle Jr. (D-Mich.), John Glenn (D-Ohio), Dennis DeConcini (D-Ariz.) and John McCain (R-Ariz.) because he liked their views on the savings and loan industry.