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Cranston Says Punishing Him in S&L; Case Would Be Unfair : Keating 5: Statement from the ailing senator insists he did nothing unethical.

TIMES STAFF WRITER

Sen. Alan Cranston, in an impassioned message to the Senate Ethics Committee, said Tuesday that it would be “monumentally unfair” to punish him or his four colleagues for their dealings with savings and loan executive Charles Keating Jr.

“None of us did anything unethical,” said Cranston’s statement, which was read to the committee by one of his attorneys just before the panel ended its formal consideration of evidence.

“More than one senator has told me, ‘There, but for the grace of God, go I,’ ” Cranston’s message said. Cranston said he is being pilloried for doing what senators are elected to do--fight for citizens against an overbearing government.

“Senators should never be fearful of intervening on behalf of aggrieved constituents.”

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The California Democrat’s statement was read to the committee by Leslie Berger, one of his attorneys. Cranston is resting in California from five weeks of radiation treatment for advanced prostate cancer. He is also preparing for surgery later this month in which the tumor will be attacked through the direct implant of radioactive material.

In defending his repeated inquiries to regulators about the fate of Lincoln Savings & Loan, owned by Keating, Cranston said: “If we act only when no one will criticize us, we will not serve the people who put us there.”

Ethics Committee members are sitting in judgment of five senators, trying to decide if Cranston and the others behaved in a way that brought discredit on the Senate. Keating provided $1.3 million to the campaigns and political causes of the five senators, and sought to enlist their aid in his battles with S&L; regulators.

After hearing Cranston’s statement, committee counsel Robert S. Bennett offered his closing arguments. He told the committee that since the nation could be at war in a matter of hours, “It is all the more important the American people have confidence in you. . . . (This is) a time for leadership in ethics as in other things.”

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After the failing Lincoln Savings was seized by the government in April, 1989--at an expected cost to taxpayers of $2 billion--Keating and his ties to politicians became a symbol of the massive collapse that staggered the S&L; industry.

“This case has somehow captured the imagination of the American people,” Bennett said. “You are holding in your collective hands the political heart and soul of this country. Whatever decision you make . . . (the Senate) is going to be stronger or weaker. The American people are either going to have more or less respect for this institution.”

Bennett reminded the three Democrats and three Republicans on the Ethics Committee that they must go “eyeball to eyeball” with their colleagues under investigation: Sens. Cranston, Dennis DeConcini (D-Ariz.), Donald Riegle (D-Mich.), John Glenn (D-Ohio), and John McCain (R-Ariz.).

“If a senator says, ‘I’ll take this money and do this act,’ you’re talking bribery,” Bennett said. "(But) this is a case of ethics.” Senators must avoid not only wrongdoing, but also the appearance of impropriety, he argued.

The day offered directly contrasting views of senatorial ethics. “For us, serving the proper demands of those who put us here is our job, our duty, our obligation,” Cranston said in his statement. This is “the way every senator operates . . . the way every senator is compelled to operate,” he said.

But Bennett described Cranston in more pedestrian terms as a man using his “clout” in making contacts with S&L; regulators on behalf of Lincoln. He criticized Cranston for discussing Lincoln’s problems with Keating, and later in the same meeting, arranging a $300,000 line of credit for his election campaign.

“There is overwhelming evidence” that on four occasions, Cranston solicited or accepted contributions to voter education campaigns knowing that Keating recently requested or received help for Lincoln S&L;, Bennett said.

In his statement, Cranston argued: “None of us used our office, or abused it, for personal gain. None of us accepted contributions to political campaigns or charities with any expectation, implied or expressed, that we would do anything in return.”

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In his closing oration, Bennett also chastised DeConcini and Riegle for “giving shape to Keating’s plan to get relief for Lincoln.”

Four senators, including Cranston, attended a meeting with chief S&L; regulator Edwin Gray on April 2, 1987, to complain about the lengthy financial audit of Lincoln. All of the “Keating Five” senators met a week later with several of Gray’s subordinates.

The American people are wondering, “If (senators) are so busy, . . . how is it” Keating can get so many to intervene on his behalf, Bennett said.


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