American Continental Altered Lincoln Data

American Continental Corp. officials prepared for the first major federal examination of Irvine, Calif.-based Lincoln Savings and Loan in 1986 by rewriting thousands of pages of corporate documents and falsifying directors’ signatures, a newspaper reported Sunday.

Officials of the Phoenix-based American Continental, run by financier Charles H. Keating Jr., destroyed the original documents, according to the Arizona Republic.

Investigators have long alleged that forgery and back-dating of files and documents were common throughout much of American Continental’s ownership of Lincoln Savings.

The newspaper said it obtained copies of Lincoln’s board of directors’ minutes and resolutions dated from Feb. 22, 1984, when Keating bought Lincoln, through Dec. 30, 1985. The newspaper hired James Hale, a certified questioned-documents examiner, to examine the signatures on the documents.

Hale concluded that 1,080 of 1,822 signatures were falsified. He said that all of the signatures on 235 of 432 of the documents were falsified and that only 78 documents contained all authentic signatures, according to the newspaper.

The newspaper said that a former attorney for Lincoln Savings and Loan, Mark Sauter, and a former American Continental paralegal, Sherry Blixt Smith, admitted that the documents were rewritten and the signatures faked, but they called the changes technical. They said the alterations were neither significant nor deceitful.

American Continental filed for protection from creditors in Bankruptcy Court in April 1989. The government subsequently took control of Lincoln.

Keating is the target of federal and congressional probes and on Friday was named in accusations by California state authorities.

Employees said the documents were rewritten during an effort before the start of a seven-month-long examination of the thrift’s books by the San Francisco office of the Federal Home Loan Bank Board in March 1986.