Inouye Defends Integrity, Acts of ‘Keating Five’

Sen. Daniel K. Inouye (D-Hawaii) today defended the integrity and actions of the ‘Keating Five’ senators who tried to help savings and loan owner Charles H. Keating Jr., saying they did not exceed normal Senate conduct.

“Sir, I believe what is on trial here is not the five colleagues of mine but the U.S. Senate, and for that matter the Congress of the United States,” Inouye said.

The testimony came as federal law enforcement sources confirmed that the FBI is examining the conduct of the five senators in connection with its ongoing investigation of alleged bank fraud by Keating.

But it could not be determined whether the FBI has found any evidence of criminal wrongdoing by the five senators. The wide-ranging investigation is being coordinated with federal prosecutors in Los Angeles and Phoenix, said the sources, who spoke on condition of anonymity.

Inouye appeared as a character witness for Sen. Dennis DeConcini (D-Ariz.) and argued that the actions he and the four other senators took for Keating were a part of normal congressional service for constituents.

“They are men of unimpeachable character,” he said.

“If everything turned out well, if we did not have this S&L; crisis, if Mr. Keating was once again able to revive (his savings and loans), these men would be heroes to their constituents, they were able to save jobs,” he said.

“Today they are damned because the endeavor failed, so I think we are on trial here, the U.S. Senate.”

Inouye, a veteran of the Senate committees that investigated the Watergate and Iran-Contra scandals, said his reading of evidence leads him to believe that DeConcini did not try to negotiate for Keating in a meeting with federal banking regulators in 1987.