Officials of Failed Texas Thrift Aided Cranston : S&Ls;: The owner’s lawyer tells a court the lawmaker asked for money. The senator denies any quid pro quo.

Executives of a now-defunct Texas savings and loan contributed at least $3,500 to the 1986 reelection campaign of Sen. Alan Cranston (D-Calif.) after an oceanside meeting at which Cranston sought money from the thrift’s flamboyant owner, federal records show.

Donald R. Dixon, the former owner of Vernon Savings & Loan, is on trial in Dallas on charges that he used money from the thrift to make illegal payments to prostitutes and to 13 politicians, including Cranston.

Prosecutors have charged that the political contributions were illegal because the executives were reimbursed with S&L; funds after filing false expense vouchers. They said there is no evidence that Cranston or other recipients of such contributions knew they were illegal.

Cranston and four other senators are under investigation by the Senate Ethics Committee because of their intervention with federal regulators on behalf of another savings and loan industry executive and campaign contributor, Charles H. Keating Jr.

The Cranston-Dixon meeting was disclosed in court in Dallas on Thursday when Dixon’s lawyer described it to jurors as an example of politicians’ coming to Dixon with their hands “open and outstretched.”

Defense lawyer Billy Ravkind said Dixon entered his oceanfront home in Solana Beach, Calif., one day in 1985 and found Cranston sitting on a couch.

“Don had never met Mr. Cranston,” Ravkind said. “But there he sat like an old friend. Cranston listened to Mr. Dixon talk about problems in the industry, and he cocked his head and said he was so sorry. But he (Cranston) could certainly use $20,000 to $30,000.”

At the time, Dixon’s savings and loan was under orders from regulators to clean up its operations. Cranston was and remains a member of the Senate Banking, Housing and Urban Affairs Committee, which oversees S&L; regulation.

Cranston’s press secretary, Murray S. Flander, quoted the senator Friday as calling Ravkind’s description of the meeting “a blatant lie.” Flander asserted that Cranston never contacted regulators on behalf of Dixon or Vernon Savings & Loan.

Flander acknowledged that Cranston met with Dixon to seek a campaign contribution, but he said there was no quid pro quo. He said Cranston did not listen to Dixon talk about the savings and loan industry and did not ask for $20,000 or $30,000.

Although Flander said that Cranston did not recall asking Dixon for money at the meeting, he added: “But I can say he probably did. Cranston was told that Dixon was a possible contributor and he should go talk to him. I deduce that he did ask for money and Alan just doesn’t recall that. He was asking a lot of people for money.”

Flander refused to say who had suggested to Cranston that Dixon was a likely contributor. “It was another politician,” he said. “I’d rather not drag this other guy’s name into it.”

When asked if the similarity of the allegation to the Keating charges could further damage Cranston’s image, Flander said: “(Everybody) now thinks that Cranston is so vulnerable that they could beat up on him and say anything about him to their own personal advantage and do it with impugnity. You could say anything about Cranston, and somebody would believe you.”

Flander said Cranston never saw Dixon after the meeting, and there is no record that Dixon contributed to Cranston’s campaign.

But Federal Election Commission records show that five executives of Vernon Savings & Loan contributed a total of $3,500 to Cranston’s reelection campaign.

Similar contributions were made to 12 other politicians, including Rep. Bill Lowery (R-San Diego), Sen. Jake Garn (R-Utah), former House Speaker Jim Wright (D-Tex.) and former House Majority Whip Tony Coelho (D-Merced). Wright and Coelho did try to assist Dixon in his troubles with regulators, according to congressional reports.

Although Dixon’s thrift was based in Vernon, Tex., he spent considerable time and money in the San Diego area. He held a fund-raiser for Lowery and allowed other politicians to use a yacht and fleet of airplanes paid for with money from Vernon Savings & Loan.

The Vernon thrift was seized by regulators in 1987, and officials have estimated that its losses will cost taxpayers $1.3 billion.

Eight former Vernon executives, including three who contributed to Cranston, have been convicted of various charges in connection with the failure of the thrift.