The Trail to Jail
1984
Feb. 22 -- Keating uses his American Continental Corp. real estate development company to acquire 58-year-old Lincoln Savings & Loan for $51 million.
1985
Feb. 28 -- Keating testifies before Congress in bid to block regulators from imposing new industry restrictions.
1986
March 12 -- Federal thrift regulators begin routine audit of Lincoln. It turns into long, bitterly fought examination over costly, luxurious Phoenician resort and other issues.
Nov. 3 -- American Continental wins state approval to sell $200 million in corporate bonds. Sales begin early December out of Lincoln’s Southern California branches.
1987
April 2 -- At Keating’s behest, four U.S. Senators, including Alan Cranston (D-Calif.), meet in private with top federal regulator Edwin J. Gray to discuss length of Lincoln’s audit.
April 9 -- At Gray’s suggestion, the senators, plus Donald W. Riegle Jr. (D-Mich.), meet with federal thrift executives from San Francisco to discuss Lincoln’s audit.
May 1 -- Federal agents in San Francisco recommend to superiors in Washington that Lincoln be seized or be subjected to stiff regulatory orders.
1988
May 20 -- Regulators and Lincoln sign memorandum of understanding, aimed at wiping slate clean for new examination.
May 26 -- American Continental wins approval to sell $300 million more in bonds.
Nov. 15 -- American Continental reports $36-million loss for third quarter and reveals regulatory restrictions.
1989
April 13 -- American Continental and 11 Lincoln subsidiaries file for bankruptcy protection.
April 14 -- Regulators seize Lincoln. It becomes nation’s biggest thrift failure, costing taxpayers $2.6 billion.
Sept. 15 -- Resolution Trust Corp, the federal agency managing Lincoln, files fraud and racketeering charges against Keating and others. The action is later amended to seek $2.6 billion in damages.
1990
Aug. 23 -- A federal judge, accusing Keating of “looting” Lincoln, rejects Keating’s claim that regulators unlawfully seized the S&L.;
Sept. 18 -- A 42-count indictment charges Keating and three others with violating state securities laws by defrauding bondholders. Keating spends 33 days in jail, unable to post bail until it is reduced from $5 million to $300,000.
1991
Feb. 27 -- Senate Ethics Committee chastises four U.S. senators for aiding Keating in battles with regulators while soliciting political contributions from him. Decisions on fifth senator and Cranston is delayed until Nov. 20, when Cranston is reprimanded.
Aug. 2 -- Trial on state fraud charges begins with pretrial motions and jury selection. Elderly bondholder accosts Keating in courtroom.
Dec. 4 -- After 53 prosecution witnesses testify, defense rests without calling witnesses; Keating is convicted.
Dec. 12 -- Marking the culmination of an intense, 2 1/2-year federal investigation, Keating and four associates are indicted in Los Angeles on 77 criminal counts of racketeering, securities fraud, bank fraud, conspiracy, misapplication of funds and interstate transportation of stolen money. In a separate action, the SEC files a civil suit against Keating and nine others, alleging securities fraud and insider trading.
1992
Jan. 15 -- In a complaint similar to the one filed in Los Angeles, Keating and his associates are indicted by a federal grand jury in Phoenix on five criminal counts of wire fraud, bankruptcy fraud and conspiracy. The suits are eventually consolidated. The trial is expected to begin in federal court in Los Angeles on Aug. 4.
March 17 -- Testimony begins in Tucson in the suit brought by the 23,000 small investors who bought more than $250 million in risky bonds.
April 10 -- Despite positive letters from retired actress Loretta Young and Mother Teresa, Judge Lance A. Ito sentences Keating to 10 years in prison and fined him $250,000.
