Excerpts: Senators Find His ‘Conduct Was Improper, Repugnant’

Here are excerpts from the Senate Ethics Committee resolution reprimanding Sen. Alan Cranston (D-Calif.) for his dealings with Lincoln Savings & Loan owner Charles H. Keating Jr., and from statements made on the Senate floor:

COMMITTEE RESOLUTION: . . . The committee finds that Sen. Alan Cranston, personally or through Senate staff, made . . . contacts with federal officials regarding Lincoln Savings & Loan, a subsidiary of American Continental Corp., a company associated with Charles H. Keating Jr. . . .

The committee also finds that Sen. Cranston had substantial constituent interest in intervening with federal officials on behalf of Lincoln, including the facts that Lincoln employed hundreds of California residents and that thousands of California residents were Lincoln depositors and bond holders. The committee also finds that Sen. Cranston had information which reasonably caused concern about the regulation of Lincoln, including a letter from Jack D. Atchison with the accounting firm of Arthur Young and a report from Alan J. Greenspan relating to Lincoln.

Activities Not Illegal

The committee further finds that, when considered in and of themselves and without regard to any contribution or other benefit, none of Sen. Cranston’s aforementioned activities concerning Lincoln were illegal or improper and violated no law or Senate rule. . . .

Based on the available evidence, the committee concludes that contributions to Sen. Cranston’s presidential and Senate campaigns from Mr. Keating and his associates under the Federal Election Campaign Act were within the established legal limits, and were properly reported.

The committee also concludes . . . that Sen. Cranston’s solicitation or acceptance of contributions to state party organizations, political action committees, and voter registration organizations were, in and of themselves, not illegal or improper; nor did any such contribution constitute a personal gift to Sen. Cranston. . . .

The committee finds that, in and of themselves, none of the foregoing actions of Sen. Cranston violated any law or Senate rule.

The committee further finds by clear and convincing evidence that, based upon the totality of the circumstances, Sen. Cranston engaged in an impermissible pattern of conduct in which fund-raising and official activities were substantially linked in connection with Mr. Keating and Lincoln. . . .

Be it further resolved that the committee finds that:

--From early 1987 through April, 1989, Sen. Cranston personally or through Senate staff contacted the Federal Home Loan Bank Board on behalf of Lincoln during a period when Sen. Cranston, on behalf of organizations in whose success he had a deep concern, was soliciting and accepting substantial contributions from Mr. Keating. . . .

--Sen. Cranston’s Senate office practices further evidenced an impermissible pattern of conduct in which fund-raising and official activities were substantially linked.

It is further resolved:

--That Sen. Cranston’s impermissible pattern of conduct violated established norms of behavior in the Senate, and was improper conduct that reflects upon the Senate. . . .

--That Sen. Cranston’s conduct was improper and repugnant.

--In reviewing the evidence available to it, the committee finds that Sen. Cranston violated no law or specific Senate rule, acted without corrupt intent, and did not receive nor intend to receive personal financial benefit from any of the funds raised through Mr. Keating.

--Further, the committee finds that extenuating circumstances exist including . . . that Sen. Cranston is in poor health and that Sen. Cranston has announced his intention not to seek reelection to the Senate.

--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.

SEN. HOWELL HEFLIN (D-Ala.): In connection with his dealings with Charles Keating and Lincoln Savings & Loan, a failed California S&L;, Sen. Cranston has been “strongly and severely reprimanded” by the Ethics Committee for improper conduct which reflects upon the Senate. The reprimand did not come because Sen. Cranston violated any law, nor because he violated any specific Senate rule. The committee has found that he violated neither. Rather, the reprimand came as a result of “a pattern of conduct in which fund-raising and official activities were substantially linked.”

I want to focus for a moment on the committee’s finding that there was substantial linkage between Sen. Cranston’s fund-raising and his official duties, as it related to Mr. Keating and Lincoln Savings & Loan. At least two aspects of the committee’s reprimand deserve discussion.

First, a threshold matter. If, in all of his actions, Sen. Cranston violated no law and violated no specific Senate rule, why is he, nevertheless, being reprimanded by the Ethics Committee? As amended, Senate Resolution 38 of the 88th Congress authorizes the Ethics Committee to receive complaints and investigate allegations of violations of law, violations of the Senate Code of Official Conduct, violations of rules and regulations of the Senate, and “improper conduct that reflects upon the Senate,” and to make appropriate findings of fact and conclusions with respect thereto. . . .

The path to judgment is easy when a specific law or rule has been violated. But for those who believe in the “Rule of Law,” violations of unwritten ethical standards are far more difficult to resolve. Although a finding of “improper conduct that reflects upon the Senate” is subjective in nature, it must ultimately rest upon a violation of an existing and well-understood norm of behavior. Before making such a finding, Senate practices and customs and their interrelationships must be carefully evaluated. . . .

As in all cases of this nature, the committee’s decision in Sen. Cranston’s case was based upon the totality of the circumstances, and it was from this totality that the committee determined that Sen. Cranston engaged in an impermissible pattern of conduct in which fund-raising and official activities were substantially linked.

The pattern which the committee found so disturbing was unequivocally manifest through a series of activities and occurrences involving Sen. Cranston over a period of at least two years. Some of the actions which created the linkage were taken by Sen. Cranston personally, some by his staff, who often acted with his knowledge or permission and often under his direction or supervision.

Some Troubling Occurrences

Some of the occurrences which led the committee to conclude that “substantial linkage” existed between Sen. Cranston’s fund-raising and his official activities were included in the committee’s resolution, and I will not repeat them all. On their face, some acts or occurrences were obviously more troubling than others.

One notable example is the incident in November, 1987, where delivery of $250,000 in contributions from Charles Keating for voter registration groups took place at the same meeting in the Capitol where the senator agreed to contact a regulator on Keating’s behalf. The committee has not found that the events were causally connected, but the incident does indicate linkage. . . .

Members of the committee considered the state of Sen. Cranston’s health, and the fact that he will not seek reelection to the Senate, in reaching a conclusion as to the appropriate sanction in this case. For some members of the committee, his age was also considered, as well as his remarkable record of service to this nation over the last 23 years.

Having taken these extenuating circumstances into account, the committee determined that it was appropriate to issue the most severe sanction which could be imposed by the committee. . . .

SEN. WARREN B. RUDMAN (R-N.H.): At the outset, Mr. President, I would like to discuss what this case is not about. It is not about the merits or wisdom of Sen. Cranston’s intervention on behalf of Lincoln Savings & Loan Assn. The merits of a policy pursued by a senator is between the senator, his constituents and the American people. It is not a matter for the Ethics Committee.

The case before the committee was also not about the merits of the existing system for financing congressional campaigns. . . . This case is not about the propriety of assisting a person who happens to have been a campaign contributor or a political supporter. It is a routine, proper and necessary function of a United States senator to make inquiries of agencies on behalf of individuals and to intervene when the senator believes that justice or equity requires. . . .

The question then facing us was as follows: Is there a further standard of conduct governing a senator’s action on behalf of individuals, and did Sen. Cranston act improperly by violating that standard?

The cardinal principle governing senators relevant to today’s action is that a senator must make decisions on whether to intervene on behalf of an individual without regard to whether such individual has contributed or promised to contribute. In other words, official actions and contributions cannot be linked. In this case . . . the committee found that, quote, “Sen. Cranston engaged in an impermissible pattern of conduct in which fund-raising and official actions were substantially linked.”

Behavior Deviated From Norms

The committee did not reach this decision lightly. There was more to the linkage than simply coincidental timing between Sen. Cranston’s actions and those contributions. Moreover . . . Sen. Cranston is not being unfairly singled out for engaging in conduct routinely practiced by other members of this body. His behavior significantly deviated from the norms governing this body and from principles senators are expected to, and in my 11 years do, in fact, adhere to. . . .

I would now like to turn to some of the major events that caused the committee to reach its conclusion.

First, on Jan. 2, 1987, Joy Jacobson, Sen. Cranston’s chief fund-raiser, wrote him a memo stating, and I quote, “Cases/legislation. Now that we are back in the majority, there are a number of individuals who have been very helpful to you, who have cases or legislative matters pending with our office who will rightfully expect some kind of resolution.” With respect to Mr. Keating, the memo states, “Is continuing to have problems with the Bank Board and Ed Gray. Jim Grogan and the company’s chief legal counsel, Bob Kielty, are coming to see you on Friday at 1 p.m. to get your advice on how to handle the current problems.” . . .

The most disturbing example of linkage, I believe, to the committee came later that year. In July or August of 1987, Sen. Cranston called M. Danny Wall, the new chairman of the Federal Home Loan Bank Board, to urge that a prompt decision be made in the Lincoln examination. Chairman Wall testified that the senator did not state what the resolution ought to be. In early September, Chairman Wall agreed to postpone a scheduled field visit by the regulators to Lincoln and consider the matter at the Washington headquarters.

On Sept. 6, Jacobson wrote a memo to Sen. Cranston. A press clipping about Chairman Wall’s decision was attached. And the memo stated that his views are, quote, “obviously good news to Keating.” She added, quote, “You should ask Keating for $250,000.” . . . On Sept. 24, Mr. Keating met with Chairman Wall in the morning and Mr. Cranston later in the day. As a letter Sen. Cranston wrote two weeks later shows, he and Mr. Keating discussed the morning meeting, Sen. Cranston requested and received a commitment for a $250,000 contribution for the voter registration organizations he supported.

Checks Delivered

On Nov. 6, Mr. Grogan personally delivered $250,000 in checks to Sen. Cranston. . . .

It is important to note, however, in fairness to Sen. Cranston, that Mr. Grogan, who was testifying under grant of immunity and therefore had every reason to be truthful, flatly and persuasively denied the existence of any indication of a quid pro quo, a necessary element to establish bribery. . . .

These four incidents, in and of themselves, demonstrate that Sen. Cranston impermissibly linked through time and other circumstances contributions and official actions. That is a pattern of improper conduct which must be sanctioned by this institution, and it’s why we’re here on the floor of the Senate today.

My colleagues will note that I have not addressed either the merits of Sen. Cranston’s actions, nor their effect on the Federal Home Loan Bank Board. The reason is that the wisdom and effectiveness of a senator’s intervention on behalf of an individual is irrelevant as to whether that intervention was improperly linked to contributions. . . .

Mr. President, the committee unanimously agreed that Sen. Cranston’s conduct was improper and required an institutional response. Some members of the committee, including this senator, believe that Sen. Cranston’s conduct merited action by the full Senate. The question then arose as to what response the Senate should take. The committee’s debate over the last two months was not over whether to take action, but over what action to take. There are, indeed, mitigating factors, most notably the lack of any personal benefit and of any significant direct benefit to Sen. Cranston’s campaigns for the Senate or for the presidency.

I personally believe that the $49,000 contributed to those campaigns were not the major motivation for his actions. It was the $850,000 contributed to the voter registration groups, groups in which Sen. Cranston had a profound and appropriate interest. He received no personal benefits from these groups, and the political benefits were tangential at best. Moreover, regretfully, Sen. Cranston is seriously ill, and he has announced that he is not running for reelection. . . .

SEN. CRANSTON: I rise with deep remorse in my heart to accept the reprimand of the committee.

I deeply regret the pain all this has caused my family, my friends, my supporters and my constituents.

I’m proud of my 23-year record in the Senate. . . . I’m not proud of this moment.

My intentions were proper in all I did--as were the intentions of the other four senators who were involved. . . . The committee acknowledges that.

But, 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. . . .

So, yes, I accept the committee’s reprimand. . . .

First, I ask each of you--I ask everyone--to note that the committee found and acknowledged:

--That nothing I did violated any law or specific Senate rule.

--That I acted without corrupt intent.

--That none of the contributions constituted a personal gift to me, and that I did not receive or intend to receive any personal benefit from any of the funds I raised.

The committee found and acknowledged:

--That all my actions regarding Lincoln Savings & Loan were legal and proper and violated no law or Senate rule.

--That the money I raised was legal, proper and properly reported. . . .

Thus it is clear that I have not been reprimanded for doing anything improper for Mr. Keating. I have been reprimanded because there was, or appeared to be, a proximity in time between legitimate charitable donations I accepted--for bona fide charities--and legitimate official actions I took. . . .

In retrospect, nonetheless, I now realize that it looked improper.

But I differ and I differ deeply with the committee’s statement in the resolution that my conduct “violated established norms of behavior in the Senate.”

If I had chosen to fight, I would have challenged that statement even more forcefully than I now will.

There are no such established norms of behavior in the Senate.

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. . . .

I tell you all this, my colleagues, for several reasons.

A Warning to Senators

First, to demonstrate that I did not violate any established norm of Senate behavior.

Second, to warn every one of you who plays any part, direct or indirect, in fund-raising for a charity that you are in jeopardy if you ever do anything at any time to help a contributor to that charity--no matter how worthy the cause, no matter how proper the need for help, and no matter how proper the help you render. I stand before you as an illustration of that jeopardy.

Third, to suggest that reform is needed to protect yourselves and the Senate. I doubt that anything less will do than a ban on charitable fund-raising by senators or in their names. If you engage in such fund-raising, sooner or later some of those who help you will want your help. If they have a legitimate need you’ll be hard put to refuse their request simply because they responded to yours. And then you’re headed for trouble. On the other hand, how can you not help them? . . .

I ask you this: How can you rationally refuse to give legal and proper help at any time to someone who seems to have a reasonable grievance because he or she has contributed to your campaign?

Can you only help people who haven’t contributed?

Or can you only help people who haven’t contributed lately?

How lately?

And must you refrain from helping people who might contribute in the future?

How far in the future? . . .

Get Money Out of Politics

I believe the only remedy is to get money out of politics. Therein lies salvation for you, for the Senate, and most of all for the American people who are the ultimate losers until we end the role money plays or seems to play in our decision-making, and end the business of senators and would-be senators having to spend more and more of their time chasing the money needed to fund a successful campaign. . . .

I differ with the suggestion that the way I handle so-called “access” differs from the established norm in the Senate.

How many of you could stand up and declare you’ve never, ever decided to see or take a call from someone whose name you recognize, be it a friend, a prominent leader in your state or in the nation, a volunteer in your campaigns, or a contributor, while asking your staff to tend to someone you don’t recognize?

I doubt that any of you could do so. . . .

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. . . .

It’s been suggested that the committee should be revamped so that its members would consist not of sitting senators but instead of former senators, former judges and outstanding laymen. I endorse that concept, until and unless something wiser is proposed. . . .

For those of you who may feel that I should pay for my conduct, let me assure you that I have paid.

In terms of dollars, legal fees for myself and others for whom I feel a sense of responsibility approach $1 million. . . .

I am also more grateful than I can say to the people of California, who have so often honored me with their votes, and who have always let me fight for my beliefs even when they weren’t sure they agreed. . . .

These two years have taken much from me. The greatest cost is the anguish and uncertainty felt by my family and others who have stood with us.

May none of you ever have to battle cancer and something like this at the same time in your lives.

SEN. RUDMAN: I must say regretfully that after accepting this committee’s recommendation, what I have heard is a statement that I can only describe as arrogant, unrepentant and a smear on this institution. Everybody doesn’t do it. . . .

Everybody Doesn’t Do It

The linkage that this committee rested its case upon is not based only upon time. The report talks about linkage of money, time and other circumstances not present in any of the other four cases before us. Secondly, it is true that many members of this institution care deeply about charities for the public good and they in fact do raise money for those charities and many have come to the committee for advice on how they should proceed. Everybody doesn’t do it. . . .

I have found that to be the one unifying thread in this body, and for the senator from California to rise and give a speech on this floor after accepting this admonition, this serious reprimand, a reprimand because of circumstances he knows full well, rather than a vote, which I would have preferred, and blame it on campaign financing, everybody does it, and you should all be in fear of your lives and the Ethics Committee, is poppycock. . . .