Developer Pleads Guilty to Charges in Bank’s Failure

Covina real estate developer William E. Crowder pleaded guilty Wednesday to criminal charges stemming from the 1986 failure of Irvine-based Consolidated Savings Bank.

Crowder, 42, pleaded guilty to one count each of loan fraud and aiding and abetting the misapplication of savings and loan funds. He faces up to 10 years in prison and fines of $500,000 for his role in Consolidated Savings’ collapse. Crowder is the fifth person to plead guilty in a federal investigation of the thrift failure, which is expected to cost taxpayers more than $30 million.

Prosecutors say Crowder diverted $4.3 million in fraudulent loans from Consolidated to an Oklahoma company, C.B. Financial, which functioned as a straw borrower.

In June, 1985, Crowder sought up to $9 million in loans to purchase 400 acres of land near Austin, Tex. Because he already owed Consolidated Savings more than $4 million from previous loans, federal lending limitations would have prevented him from getting an additional $9 million.

To circumvent those limits, prosecutors claim, Crowder had the thrift loan $6 million to C.B. Financial. About $4.3 million of that total ended up in Crowder’s Texas development, prosecutors said.

Crowder, who has agreed to cooperate in the prosecution of others, could testify against Robert A. Ferrante, Consolidated Savings’ sole owner and the main target of prosecutors.

The Newport Beach developer and eight associates were indicted in February. He was charged with 17 offenses, including mail and wire fraud for allegedly making insider loans to family, friends and related businesses.

Ferrante, 41, has denied the charges.

The Consolidated Savings case, one of the FBI’s priority S&L; investigations, is scheduled to go to trial Jan. 14.