‘Keating Five’ to Go Before Ethics Panel Today : Thrifts: Never before has the Senate witnessed such a proceeding as the S&L; hearings. Allegations of misconduct usually focus on only one senator.

For the first time in the 200-year history of the U.S. Senate, five senators will be summoned before a public tribunal of their peers today to answer serious allegations of official misconduct.

Known as the “Keating Five,” the senators--Alan Cranston (D-Calif.), Donald W. Riegle Jr.(D-Mich.), Dennis DeConcini (D-Ariz.), John Glenn (D-Ohio) and John McCain (R-Ariz.)--have been called to defend themselves against charges pending before the Senate Ethics Committee. They are accused of intervening improperly with federal regulators on behalf of a major campaign contributor, Lincoln Savings & Loan owner Charles H. Keating Jr.

Already, these five senators have become national symbols of government shortsightedness that allowed the savings and loan industry to pile up perhaps as much as $500 billion in debts to U.S. taxpayers. Indeed, the enormous publicity surrounding the case has been sufficient to alter their political careers.

Cranston, who recently discovered that he has prostate cancer, announced last week that he will not seek reelection in 1992. His decision was clearly influenced by a precipitous drop in his popularity among California Democratic voters who were disillusioned by his role in the scandal.

But until now, the American public has not had an opportunity to hear all of the evidence against the five senators--evidence that prompted the committee’s special investigator, Robert S. Bennett, to conclude that at least three of them may have violated Senate ethical standards.

That is the basic issue--whether any of them broke Senate rules against exerting improper influence in return for compensation.

Each of the five denies any wrongdoing, and none is accused of breaking the law.

Bennett’s public presentation of the evidence, which he collected during a year-long investigation, is expected to provide many new details about the relationships of these senators with Keating. Keating has been indicted in California on charges of fraud in connection with the $2-billion collapse of his Irvine-based thrift. Although Bennett submitted a 350-page report to the committee last Sept. 10, it has never been made public.

After opening statements on both sides, Bennett will present his case, including witnesses. The five senators and their attorneys will get an opportunity to respond. However, Cranston has already announced that his radiation treatments for cancer will prevent him from attending the proceedings after Friday. Instead, he has offered to submit to an oral deposition in California, where he will be receiving his treatments.

The hearings are expected to continue for at least 10 days, and the committee has pledged to make its judgment in the case by the end of the year. It is considered likely that the panel will recommend that the full Senate go on record condemning some, if not all, of the five senators for their conduct.

Never before has the Senate witnessed such a proceeding as these Keating Five hearings. Donald A. Ritchie, associate Senate historian, said that it is the first time in the 15-year history of the Senate Ethics Committee that it has conducted hearings focusing on the allegations of misconduct of more than one senator. In fact, according to Ritchie, there has been no scandal in Senate history that has tarred as many senators at one time as the Keating affair.

At issue is a question that extends beyond the fate of the five senators, namely: Is it proper for a senator to use his influence with federal regulators on behalf of a major contributor to his campaign? Most senators say that they are looking to the committee to resolve this question in a way that will set a firm precedent for their future conduct.

Until now, it has been up to each senator individually to decide how to respond to a contributor’s request for assistance in dealing with a regulatory agency. Although Senate rules prohibit senators from using their influence improperly, they do not explicitly address the question raised by the Keating scandal. Many senators adhere to a self-imposed rule that says it is proper to ask a regulatory agency to expedite an investigation but improper to advocate what the outcome should be.

Fred Wertheimer, president of Common Cause, the citizens lobbying group, said that Americans watching the hearings should ask themselves whether they would be able to get five senators to intervene on their behalf if they were being investigated by a regulatory agency, as Keating did.

The five senators, meanwhile, note that the Supreme Court has expressly upheld the obligation of elected representatives to act upon requests for assistance from constituents who are encountering difficulties in dealing with the federal government. Furthermore, they flatly deny that they advocated any special treatment for Keating.

At the heart of the case are two meetings in April, 1987, between the five senators and Edwin J. Gray. At the time, Gray was chairman of the Federal Home Loan Bank Board, which was investigating allegations of mismanagement of Lincoln. Gray has said that the senators pledged that Keating would alter his operating procedures if the bank board would revoke a regulation that Lincoln was challenging in the courts.

In his report to the committee summing up his investigation, Bennett recommended that the panel press charges against Cranston, DeConcini and Riegle and drop them against Glenn and McCain. The panel rejected this recommendation on a 3-3 party line vote.

A summary of the evidence already known about each of the five senators:

CRANSTON--The 76-year-old Californian solicited the most money from Keating. He persuaded the savings and loan owner to contribute $39,000 to Cranston’s 1986 reelection campaign, $85,000 to the California Democratic Party and $850,000 to several voter registration organizations.

Cranston attended a meeting between the senators and Gray on April 2, 1987, and made only a brief appearance at a subsequent meeting on April 9 between the senators and San Francisco bank board examiners.

Keating and Cranston met at least nine times between 1984 and early 1989. This included one trip by the California senator to Keating’s corporate headquarters in Phoenix.

Cranston also tried to persuade Gray’s successor, M. Danny Wall, to allow Keating to sell Lincoln in late 1988. When the thrift was seized on April 11, 1989, Cranston told Wall that the FHLBB had made “a serious mistake.”

DECONCINI--According to Gray, it was DeConcini who made an improper proposal in the April meetings. Although DeConcini denies it, one of the documents in front of the senator during the meetings with Gray was a staff memo entitled: “What ACC (American Continental Corp., the parent company of Lincoln Savings) wants from Gray in return for concessions.”

DeConcini, who received $48,000 for his 1988 campaign and $33,000 for his 1982 campaign from Keating, gave the money back after the allegations surfaced. Two of his campaign aides, Earl Katz and Ron Ober, got $50 million in real estate loans from Lincoln.

RIEGLE--After meeting with Lincoln’s auditor to discuss the problems the thrift was having with federal regulators, Riegle, chairman of the Senate Banking, Housing and Urban Affairs Committee, asked Gray to meet with the senators on April 2, 1987. Although he did not attend that meeting, he did sit in on the subsequent session between the senators and the San Francisco examiners on April 9.

He has returned all of the $78,250 he received from Keating for his 1988 campaign.

McCAIN--A personal friend of Keating, the Arizona Republican took nine trips to the Bahamas on Keating’s plane before he was elected to the Senate in 1986. He and his wife stayed at Keating’s vacation home during three of the trips and his wife invested money in a Keating venture.

McCain has since reimbursed Keating $13,433 for the trips and has said that he would return $112,000 in campaign donations if they are found to be improper.

GLENN--Like DeConcini and McCain, Glenn attended both meetings in April, 1987. The former astronaut received $34,000 in campaign contributions from Keating, who also gave $200,000 to a political action committee associated with the Ohio senator. Three former Glenn associates, including his 1984 presidential campaign manager, became Keating lobbyists.