Cranston Harshly Rebuked, Shows Little Remorse : Ethics: Panel calls ‘linkage’ of contributions to aid for Lincoln Savings’ Keating ‘improper and repugnant.’ But the senator says his colleagues do the same thing.

Sen. Alan Cranston (D-Calif.) was harshly reprimanded by the Senate Ethics Committee on Wednesday for “improper and repugnant” behavior in his relationship with former savings and loan owner Charles H. Keating Jr.

But, showing little remorse, Cranston declared that most senators do exactly what he did.

During a somber, two-hour session in the Senate chamber, Cranston, 77, listened to a detailed explanation of offenses that were uncovered by Ethics Committee investigators during a two-year inquiry into his relationship with Keating, who headed the now-failed Lincoln Savings & Loan Assn.

Reading directly from the complaint, Sen. Howell Heflin (D-Ala.) said the panel found “clear and convincing evidence that, based upon the totality of the circumstances, Sen. Cranston engaged in an impermissible pattern of conduct.”

Acknowledging that Cranston had broken no law and no specific Senate rule, Heflin--who headed the ethics panel during most of its investigation of Cranston--cited four instances considered by the committee to be improper “linkage” between Cranston’s solicitation of contributions from Keating and his inquiries with federal regulators on behalf of Lincoln Savings.

For the Senate, which endured a barrage of criticism for its handling of the confirmation of Supreme Court Justice Clarence Thomas earlier this fall, the reprimand of Cranston was a way of demonstrating to critics that Congress does not wink at misconduct--even within its own ranks.

Throughout Heflin’s speech, Cranston sat impassively, with criminal-defense lawyer Alan M. Dershowitz occasionally whispering legal advice in his ear. The experience was obviously a painful one for the onetime presidential candidate and former assistant majority leader.

Cranston then rose in his own defense. Although apologizing for his behavior and agreeing to accept the reprimand, he made it clear that he disagrees strongly with the committee’s findings that his behavior was a radical departure from the Senate norm.

“How many of you,” he asked, “after really thinking about it, could rise and declare you’ve never, ever helped--or agreed to help--a contributor close in time to a solicitation or receipt of a contribution? I don’t believe any of you could say never.”

Then Cranston stunned his colleagues by saying that he--with Dershowitz’s help--had investigated the conduct of other senators and had found many examples of similar behavior on their part. He did not name any of the senators to whom he referred and he flatly refused later to identify them.

Cranston’s defense of himself was so strident that Sen. Warren B. Rudman (R-N.H.), vice chairman of the Ethics Committee, immediately jumped to his feet and condemned the senator’s speech as “arrogant, unrepentant and a smear on this institution.”

“Everybody doesn’t do it,” Rudman insisted.

Afterward, several Republican senators charged that Cranston’s statements violated the spirit of an agreement under which the Ethics Committee had said it would not call for a full Senate vote on the censure if he accepted the reprimand. Some senators even threatened to move for a vote condemning Cranston in the near future.

The floor proceedings culminated an intensive investigation of a complaint brought more than two years ago by citizens’ lobby Common Cause. It alleged that Cranston and four other senators--Dennis DeConcini (D-Ariz.), Donald W. Riegle Jr. (D-Mich.), John Glenn (D-Ohio) and John McCain (R-Ariz.)--had acted improperly by accepting contributions from Keating while interfering in a Federal Home Loan Bank Board investigation of Lincoln Savings.

Last February, after months of public hearings, the committee dropped its investigation of the other four senators. DeConcini and Riegle were severely chastised; Glenn and McCain received only mild criticism.

But Cranston’s behavior was viewed as much more egregious by the committee members. They emphasized in their final report that they would have recommended censure for the California senator had he not already announced plans to retire at the end of 1992 and had he not been under treatment for prostate cancer.

During months of behind-the-scenes negotiations with the committee, Cranston even authorized his physician to detail his condition for Heflin and Rudman in an effort to persuade them to drop the case. “May none of you ever have to battle cancer and something like this at the same time in your lives,” he told the Senate.

But Cranston used an even more powerful bargaining chip in months of talks with the committee. In his floor speech, he confirmed previous reports that he had threatened to implicate other senators in wrongdoing if the panel sought to censure him.

“I was prepared, on the advice of Prof. Dershowitz, to demonstrate to the Senate and to the nation, through example after example of comparable conduct, that my behavior did not violate established norms,” he said.

The committee’s solution to the dilemma Cranston’s threats created was unprecedented. Never before in Senate history had a member been merely reprimanded in such a trial-like atmosphere. In the past, they have either been reprimanded in a statement issued by the committee or forced to stand trial in the Senate with a verdict rendered by vote at the end of the proceeding.

Although the six-member committee had long been deadlocked, 3 to 3, on the question of whether Cranston should be censured by the full Senate, there was no equivocation in their findings. In essence, the panel found that he and his staff engaged in a persistent pattern of behavior in which they viewed Keating’s contributions as reason to assist the flamboyant thrift executive in fighting a federal bank board investigation of Lincoln Savings.

In all, Cranston solicited nearly $1 million in contributions from Keating for his 1984 presidential campaign, his 1986 reelection campaign, the California Democratic Party and several voter registration groups founded by Cranston. By the committee’s count, he also contacted federal officials 13 times on Lincoln’s behalf.

”. . . Sen. Cranston’s conduct was improper and repugnant,” the findings said. “. . . Sen. Cranston’s improper conduct deserves the fullest, strongest and most severe sanction which the committee has the authority to impose. Therefore, the Senate Select Committee on Ethics, on behalf of and in the name of the United States Senate, does hereby strongly and severely reprimand Sen. Alan Cranston.”

None of Cranston’s actions--taken separately--was improper, Heflin said. Furthermore, he said, the panel found no evidence that Cranston’s misconduct was intentional or that Cranston personally benefited from any of the money he solicited from Keating.

Instead, Heflin said, Cranston was found guilty of violating a subjective standard known to all members. “Members of the committee unanimously concluded that commonly understood and well-established norms of behavior in the Senate do not permit linkage between official actions and fund raising,” he said.

Although there was no evidence that Cranston ever promised to do a favor for Keating in response to a contribution, Heflin said, the two were clearly linked. Paraphrasing former Supreme Court Justice Potter Stewart’s oft-quoted remarks about obscenity--”I know it when I see it”--Heflin said “linkage” could not easily be defined, but senators knew it when they saw it.

Heflin said the worst example of such linkage occurred in November, 1987, when Keating lobbyist James Grogin delivered $250,000 in checks for voter registration to Cranston at his office in the Capitol, and the senator--in a telephone call to Keating while Grogin was still present--agreed to ask Federal Home Loan Bank Board Chairman M. Danny Wall to meet with the Lincoln owner.

But Cranston asserted that the mere juxtaposition of solicitations of Keating and his intervention with federal regulators was no sufficient proof of linkage.

“There was no quid pro quo,” Dershowitz said after the Senate debate, during which he was prohibited by the rules from speaking. “We can prove that other senators engaged in similar linkage but simply did a better job of covering up their tracks.”

Dershowitz also asserted that it was the first time in history that the Senate had ever reprimanded any member for the appearance of impropriety instead of an actual infraction. He said the committee’s allegations would never have stood up in a court of law.

Cranston, who has long had a reputation as perhaps the best fund-raiser in the Senate, argued that there are no established norms in the Senate prohibiting what he did.

“There is no precedent and there is no rule establishing that it is unethical for a senator to engage in legitimate constituent service on behalf of a constituent because it was close in time to a lawful contribution to the senator’s campaign or to a charity that the senator supports,” he said.

In addition, he said that by accepting the committee’s findings, the Senate was setting a new standard that would ensnare many other senators in the future. He noted that all senators give greater access to big contributors than to small ones and said:

“So let me ask: Since I have been singled out for a reprimand on access today, who among you can be sure you will not be singled out for a reprimand on access tomorrow? Here, but for the grace of God, stand you.”

At the same time, Cranston expressed some regret for the actions that had marred his final year in the Senate.

“I’m not proud of this moment,” he said. “I deeply regret the pain all this has caused my family, my friends, my supporters and my constituents . . . . In retrospect, I grant that I should not have solicited and received--even though it was on behalf of others--charitable donations close in time to official actions . . . . For that I apologize.”

Cranston said he intervened on Lincoln’s behalf not because of contributions but because of his concern for employees and depositors of the Irvine-based thrift and because such notable economists as now-Federal Reserve Board Chairman Alan Greenspan had vouched for the thrift’s financial soundness. He said his contacts did not cause Lincoln’s failure.

The senators initially investigated by the committee in the Keating case began contacting bank board officials as early as 1987, when the agency was first looking into evidence of fraud and mismanagement at the institution. But the thrift was not seized by federal regulators until April, 1989, after it had piled up more than $2 billion in taxpayer-insured losses.

Cranston also made a pitch for campaign finance reform, public financing of elections and abolition of the Senate Ethics Committee. He endorsed a proposal to establish a panel of former senators, former judges and others to sit in judgment in Senate ethics cases.

He noted that the committee’s deliberations had taken place in a politically charged atmosphere, which was exacerbated by the criticism received by the Senate for its handling of the nomination of Thomas to the high court. In fact, that criticism persuaded the committee to find a compromise in the Cranston case.

Although many fellow Democrats swarmed around Cranston to shake his hand after the Senate session, none of them objected to the reprimand. And Rudman clearly struck a chord with Democrats and Republicans alike when he defended the reputation of the Senate against the allegations that Cranston had leveled against unnamed senators.

“Members of this body attempt by word and deed to take great care with their personal conduct as it might be perceived by the American people,” Rudman said.

In explaining the case against Cranston, Rudman and Heflin cited these instances--among others--to demonstrate what they viewed as a pattern of improper conduct:

--On Jan. 2, 1987, Joy Jacobson, Cranston’s chief fund-raiser, wrote a memo to the senator in which she listed Keating among several big contributors who had matters pending before the federal government and--in her words--”will rightfully expect” some help from Cranston. Such a direct connection between money and assistance is unusual in the Senate, Rudman said.

“While I know of cases where political supporters expect help, I have never heard a senator or a person working for a senator express the view that there is any legitimacy to such an expectation,” Rudman said.

--In July or August, 1987, Cranston called Wall to urge prompt action in the Lincoln investigation. Later, after Wall rejected a proposal to seize Lincoln, Jacobson wrote to Cranston saying that the decision was “obviously good news to Keating” and adding: “You should ask Keating for $250,000.”

--On Jan. 8, 1988, Cranston and his son, Kim, had dinner with Keating at a restaurant in Los Angeles and discussed Keating’s problems with the government and Cranston’s fund raising for voter registration. Keating, who is now on trial in Los Angeles, then asked Cranston to set up a meeting with Wall, after which Cranston and his son received $500,000 for voter registration.

Despite Cranston’s bravado on the Senate floor, he acknowledged that he had suffered personal anguish as a result of the case. He also noted that, even though Dershowitz was representing him without charge, he owed nearly $1 million in legal fees to the lawyer who had represented him earlier in the case.

Finally, Cranston asked for forgiveness from the people of California.

“Surely, I have not done everything right,” he said. “But I hope that, when my public life is weighed in the balance, it will not be found wanting.”