BLACK: No. Justice would skin us alive if we did. Those referrals are very confidential. We can’t prosecute anyone ourselves. All we can do is refer it to Justice.
DECONCINI: They make their own decision whether to prosecute?
BLACK: Yes. I also want to mention that we are already investigating Arthur Anderson because of their role in the file stuffing. We don’t know whether they knew the purpose for which they were preparing the materials. I don’t want to get harassed... no, that’s not the right word; I don’t want to get criticized if we Find out that Arthur Anderson was involved criminally and we have to make a referral on them. We don’t want them to claim retaliation. We’re in a tough spot. With regard to what you can say to Lincoln, you might want to simply have them call us. If you really want to talk to them you can say that it will take us 7 to 10 days to Finish the exam.
RIEGLE: Is this institution so far gone that it can’t be salvaged?
PATRIARCA: I don’t know. They’ve got enough risky assets on their books that a little bad luck could nail them. You can’t remove the risk of what they already have. You can reduce what new risks they would otherwise add on.
BLACK: They have huge holdings in Tucson and Phoenix. The. market there can’t absorb them for many years. You said earlier that ACC was extremely good but ACC has gotten out of its former primary activity, homebuilding. I’m not saying they’re bad businessmen but they had to get out of one homebuilding market after another. They had to get out of Colorado when they had bad models and soil problems. They also had to get out of their second leading activity, mortgage banking. They’re now down to Arizona. That’s not a bad market but no one knows how well it will do over the many years that it would take to absorb such huge holdings in Tucson and Phoenix.
DECONCINI: So you don’t know what you’d do with the property even if you took them over?
BLACK: Bill Black doesn’t. Bill Black is a lawyer. We hire experts to do this work. Our study of their Arizona holdings was done by top experts. Our study of below investment grade corporate debt securities – what folks usually call junk bonds, but I avoid it because I don’t know where you stand on such bonds – was done by top outside experts. I see in this Arthur Young letter that they criticize us for having an accountant with “only” eight years of experience. Well, I think... I don’t see how you can claim eight years as inexperienced. But we didn’t simply rely on him. We had... wasn’t it Kenneth...
SANCHEZ: Yes. Kenneth Laventhol.
BLACK: We had Kenneth Laventhol, outside accountants, work on this. These are also some of the reasons the exam took time.
PATRIARCA: I think my colleague Mr. Black put it right when he said that it’s like these guys put it all on 16-black in roulette. Maybe, they’ll win, but I can guarantee you that if an institution continues such behavior it will eventually go bankrupt.
RIEGLE: Well, I guess that’s pretty definitive.
DECONCINI: I’m sorry, but I really do have to leave now.
[The meeting broke up at this point, approximately at 8:20 P.M.]
( Editor's note: Now with the sub-prime, credit crunch, foreclosure crisis gutting both consumer and investment banking one can wonder how many meetings like this are going on today. I don't know. No one has sent me a transcript -- yet. )
Stephen Pizzo has been published everywhere from The New York Times to Mother Jones magazine. His book, Inside Job: The Looting of America's Savings and Loans, was nominated for a Pulitzer.
Why is it, whenever the "Keating Five" are mentioned, the fact that Neil Bush was a paid director of the Savings & Loan, and approved the $132 million in loans from Silverado to Bill Walters and Kenneth Good, is never mentioned. He received $550,000 in salaries from the company funded by Walters and Good, plus a $100,000 loan from Good that was subsequently forgiven. This was all hushed up until G.W. Bush's presidential campaign was successfully culminated. The "Five", in case you've forgotten, were Alan Cranston, Dennis DeConcini, John Glenn, Donald Riegle and JOHN McCAIN
by
lucydavis (0 articles, 0 quicklinks, 0 diaries, 88 comments)
on Friday, February 22, 2008 at 10:45:41 AM
The Keating Five/Lincoln S&L and Silverado/Neil Bush were two different cases entirely. Same variety of crookery tho. For a good overview of that case see"
You might want to check your facts a bit on that White House furniture thing a little bit. I am not going to waste my time refuting something proved false over six years ago, but either the OMB or the Auditor General did a thorough accounting of White House furnishings and alleged vandalism after the Bushies made those allegations and found no basis to the charges. As to your other claims, the Republicans had six years and a willing, highly funded special prosecutor to prove any of them, and the best he could do was unearth a minor sexual escapade unworthy of any mention in any other time than ours. The Clintons are the most investigated people on the planet Earth, and your claims at this late date are absurd. Not that I like the Clintons, because I do not. NAFTA sold this nation out.
by
W.M.L. (0 articles, 0 quicklinks, 0 diaries, 323 comments)
on Friday, February 22, 2008 at 5:10:09 PM
Deadender conservatives have fed off this kind of nonsense for nearly 14 years now, beginning with Gingrich et al. When their own misconduct/mistakes/mismanagement/corruption become known they resort to "look over there, not over here" and "they're even worse" tactics.
Hopefully come Jan 2009 they and their bankrupt ideologies will join Communism on the trash heap of history -- where it so richly deserves to be. And with it the knuckle-dragging intellects of folks like this guy.
Steve
by
Stephen Pizzo (91 articles, 0 quicklinks, 1 diaries, 27 comments)
on Friday, February 22, 2008 at 5:15:54 PM
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