Wife Doesn’t Recall Source of $784,000 Deposit : Courts: An attorney for a bankruptcy trustee says bank records indicate S&L; figure Bill Walters transferred the funds into his wife’s account.

Jacqueline Walters, the wife of Silverado Banking Savings & Loan figure Bill Walters, had $784,000 transferred into her New York bank account within a year of her husband’s 1990 bankruptcy filing but has testified that she doesn’t remember where the money came from, it was disclosed in federal court here Wednesday.

Bill Walters is accused in a lawsuit of concealing about $14 million in assets from creditors by putting many of his assets in his wife’s name. The trustee presiding over Walters’ personal bankruptcy case filed the suit last November.

On Wednesday, one of the trustee’s attorneys claimed that bank deposit papers indicate Bill Walters deposited $784,000 into his wife’s account at Barclays Bank in New York.

Jacqueline Walters has testified under oath that she doesn’t know where the money came from.

“She couldn’t recall what those (funds) were,” said Joel S. Miliband, the trustee’s attorney.

Bill Walters gained national attention last summer after he told Congress that he was broke even though he was dividing his time between a $1.9-million Newport Beach home, a $1-million desert retreat in Indian Wells and a $250,000-mobile home in Laguna Beach. The properties are held in his wife’s name or in a trust that lists her as the beneficiary.

The disclosure of close to $800,000 in bank transfers came during a hearing before U.S. Bankruptcy Judge John J. Wilson to consider Jacqueline Walters’ motion to dismiss the case against her and several of her husband’s associates.

Although the lawsuit accuses Bill Walters of concealing assets, Jacqueline Walters is the lead defendant because those assets are listed in her name.

Wilson refused to dismiss the case.

“It was Mr. Walters who created this bankruptcy proceeding, and he is not going to get any different treatment than any other debtor,” Wilson said.

Jacqueline Walters’ attorneys Wednesday lashed out at the trustee and his attorneys, saying there weren’t any facts to substantiate their claims that Bill Walters defrauded creditors by transferring property to his wife.

Robert G. Steiner, one of Jacqueline Walters’ lawyers, said the trustee filed the action just to get some publicity.

“Both the trustee and opposing counsel went to the press to seek aggrandizement over Bill Walters’ demise,” Steiner said. Margaret Mann, another Walters’ attorney, argued that the transfers were legitimate and were done to comply with a prenuptial agreement that she said was drawn up at the suggestion of Bill Walters’ attorneys.

“This lawsuit should be over today,” Mann said.

Miliband, however, recited a list of the Walters’ residences and automobiles and said he didn’t know of too many bankrupt men living in such splendor.

“There is an inference here that something is not right,” Miliband said. “The creditors got taken.”

Bill Walters has listed at least $279 million in liabilities in his personal bankruptcy.

The former business partner of Neil Bush, the President’s son, Walters defaulted on about $100 million in loans from Silverado. Neil Bush was a director of the Denver thrift from 1985 to 1988. Walters’ bad loans contributed to Silverado’s failure, which is expected to cost taxpayers more than $1 billion.