Bill Walters, S&L; Figure, Denies He Hid Money : Trial: Former developer says no wrongdoing was involved in bankruptcy filing for protection from creditors who claim he owes them $279 million.

A former developer who was an associate in failed Silverado Banking, Savings & Loan testified Tuesday that he was not guilty of hiding millions of dollars in assets when he declared bankruptcy almost two years ago.

Bill L. Walters, once one of Denver’s leading real estate developers, is charged with lying to federal officials when he told Congress in 1990 that he was broke.

In a three-day trial in U.S. Bankruptcy Court in Santa Ana, Walters is trying to persuade bankruptcy Judge John J. Wilson to approve a Chapter 7 liquidation petition, filed in November, 1990. If the filing is approved, Walters would be protected from creditors who say he owes them $279 million.

In fighting the bankruptcy application, an attorney for both the Resolution Trust Corp. and the Federal Deposit Insurance Corp.--the plaintiffs in the case--is trying to prove that Walters is not entitled to bankruptcy protection.

“If you are an honest man, you are entitled to wipe the slate clean,” the plaintiffs’ Los Angeles lawyer, Herbert A. Bernhard, said during a break in the court proceedings. “But he is not.”

Under examination, Walters remained composed and repeatedly denied any wrongdoing.

During one round of questioning, Walters referred to the intense scrutiny he underwent when federal officials first charged him with transferring his assets to business partners and his wife, Jacqueline Walters.

With helicopters hovering over his house, he said, and with private investigators and Congress watching him, “I believed everybody knew my business. It never occurred to me to hide anything.”

Federal officials say that Walters, while pleading poverty, continued to maintain three homes: a $1.9-million Newport Beach estate, a $1.8-million Indian Wells desert house and a $250,000 Laguna Beach mobile home.

The trial, which is expected to continue through Thursday, is being held in Santa Ana because Walters is an Orange County resident.

Federal officials also allege that Walters “embarked on a series of schemes to transfer, remove and conceal his property from his numerous creditors.”

Walters’ default on $100 million in loans from Silverado is considered one of the key reasons for the thrift’s downfall. Silverado’s 1988 failure could cost taxpayers as much as $1 billion.

Among other things, the government charges, Walters transferred $20 million in assets to a business associate’s bank account on Jersey island in the English Channel and turned over another $20 million in cash, real estate and other property to his wife.

The charges followed a congressional hearing on the failure of Silverado Banking, Savings & Loan. President Bush’s son, Neil Bush, also was connected to the thrift’s failure.

Walters’ attorney, George Manning, defended his client in his opening statements by saying that federal authorities falsely claimed that Walters was involved in a “Machiavellian plot to defraud creditors.”

He said the allegation that Walters hid many of his assets by transferring them to his wife through a 1986 prenuptial agreement is ludicrous, for it occurred four years before Walters filed for bankruptcy.

“There was no creditor pressure” at that time, Manning said. Of the allegations, he added: “I am confused by them. I am distressed by them.”