Bush Discloses Anguish Over Son’s Troubles

President Bush, clearly bracing for the political fallout from allegations linking his son Neil to the collapse of Silverado Banking, Savings & Loan, said Wednesday that the case has caused him and his family a great deal of personal anguish.

“This is not easy for me as a father,” Bush told reporters at a nationally televised news conference at the close of the economic summit meeting in Houston. “ . . . We have great emotions that I share with Barbara, share with my sons and my daughter, that I won’t share with you . . . .”

The President grew visibly agitated as he discussed the conflict-of-interest allegations leveled at his son by the Office of Thrift Supervision. First Lady Barbara Bush sat nearby with a pained expression on her face.

Bush previously has responded tersely to questions about the allegations against his son, but Wednesday, for the first time, he discussed the pain that he and the entire Bush family are feeling. Until now, the case against his son has been viewed strictly as a political problem for the President because it ties him more closely to the multibillion-dollar collapse of the savings and loan industry.

Neil Bush, 34, has been accused by the Office of Thrift Supervision in an administrative action of failing to disclose his business ties with two big Silverado borrowers while he was serving on the board of directors of the Colorado thrift. In addition, the Treasury Department’s inspector general is looking into allegations that unnamed federal regulators intentionally delayed seizing Silverado for a month, until after the 1988 presidential election.

The President noted that he previously has vowed not to intervene in the government’s case against his son but he indicated that he sometimes is tempted to do so. In fact, he said, he frequently has to counsel his family to stay out of the fray.

His three other sons “want to go to the barricades” for Neil, he said, especially when they see him portrayed in cartoons either inaccurately or in a way “totally demeaning of the honor of their brother.”

Bush said he tells them: “You calm down now. We’re in a different role now. You can’t react like you would if your brother was picked on in a street fight. That’s not the way the system works.”

The President previously had acknowledged that he talked to his son about the Silverado case but only in “a broad, parental way.” In addition, according to sources, Barbara Bush played a pivotal role in her son’s legal strategy, persuading him not to sign the same kind of cease-and-desist order that other Silverado directors accepted to settle the government’s case against them.

Bush said that he continues to have confidence in his son’s “integrity and honor,” as well as in the American legal system. “If he’s done something wrong, the system will digest that,” the President added.

In Office of Thrift Supervision documents released recently, regulators allege that Neil Bush was “unqualified and untrained” for his position as a Silverado director.

“Certainly, he had no experience in managing a large corporation, especially a financial institution with almost $2 billion in assets,” they wrote. “Unfortunately, he was not cognizant of the conflict-of-interest situations he encountered as a director of Silverado.”

As he has in the past, the President expressed confidence in L. William Seidman, chairman of the Federal Deposit Insurance Corp., even though the White House has sought to persuade him to resign before his term ends in October, 1991. Some top Administration officials believe that Seidman has been too independent in directing the thrift industry cleanup.

On Capitol Hill, both Seidman and Timothy Ryan, director of the Office of Thrift Supervision, refused to discuss details of the Silverado case when testifying before a House Judiciary subcommittee.

Seidman is reported to be considering bringing a $200-million lawsuit against the former Silverado directors and officers, including Neil Bush. The suit would allege negligence, rather than outright fraud, sources say.

Rep. Charles E. Schumer (D-N.Y.) asked Seidman and Ryan: “How can you assure the American public you are going to judge (Neil Bush) on the facts--no more, no less? We don’t want a feeding frenzy because someone is in the public eye--but we do want the facts out.”

“We are treating the Silverado case the same way we treat every other case,” Seidman replied. Ryan echoed: “We are treating enforcement action regarding Mr. Bush the same way as we treat any enforcement action, and we will continue to do that.”

Seidman made it plain that the FDIC is likely to hold directors of all insolvent thrifts liable for unaccountable losses, if it should be proven that the directors failed to exercise any real discretion in approving loans or simply acted “like rubber stamps.”

In the Silverado case, Bush’s son has said that he abstained from votes in which directors acted on loan requests from clients who had privately lent him large sums of money. Seidman said that all thrift directors are sometimes placed in such compromising positions.

The subcommittee is considering a variety of legislative proposals to assure better regulation of savings and loans in the future. Among other things, the proposals would give regulators clear authority to freeze the assets of failed thrifts.

Some congressmen on both sides of the aisle want to create special strike forces to take on thrift fraud cases, as well as a new financial services crime division at the Justice Department. Administration officials oppose those proposals.

Meanwhile, Atty. Gen. Dick Thornburgh refused Wednesday to say whether he had discussed any investigation of Silverado or Neil Bush with the President or any White House staff member. He refused also to discuss the five cases involving Silverado that have been referred to the Justice Department by federal regulators since 1986 or whether any of them involved Neil Bush.

“I can’t help you,” Thornburgh replied to the questions about Silverado.

S&L; INDICTMENT: A former chairman of Sunbelt Savings Assn. in Texas was charged with bank fraud. D1