http://en.wikipedia.org/wiki/Charles_Keating
Charles Humphrey Keating Jr. (born
December 4, 1923 in Cincinnati, Ohio) is a retired American lawyer, politician, and banker - best known for his involvement in the savings and loan scandal of the late 1980s. His association with, and financial contributions to, five US senators (Alan Cranston (D-CA), Dennis DeConcini (D-AZ), John Glenn (D-OH), John McCain (R-AZ), and Donald W. Riegle (D-MI) - to whom he had made substantial financial contributions) to argue for preferential treatment from regulators led to those politicians being dubbed the Keating Five
in reference to him
Legal consequences
Keating blamed government regulators for the failure of Lincoln Savings and filed suit in order to regain control over the bank. The suit was dismissed in August 1990, with the judge calling the seizure fully justified because of the looting of the institution by Keating and his associates.
In September 1990, Keating was criminally charged with having duped Lincoln's customers into buying worthless
junk bonds of American Continental Corporation; he was convicted in state court in 1992 of fraud, racketeering, and conspiracy
and received a 10-year prison sentence. In January 1993, a federal conviction followed, with a 12-and-a-half year sentence. He spent four-and-a-half years in prison, but convictions were eventually overturned. Thereafter, on the eve of the retrial on the federal charges, Keating pleaded guilty to several felony charges in return for a sentence of time served.
In the 1980s, Keating donated approximately $1,250,000 to
Mother Teresa. During his state trial, she wrote a letter on his behalf to presiding Judge Lance Ito
, saying that she had not been informed about his business, but she knew him as a man who was generous toward the poor.
Various government agencies and private parties initiated civil lawsuits against Keating. One federal
class action
case involving 20,000 plaintiffs resulted in a $3.3-billion judgment (later reduced to $1.6 billion) against him, and his former companies, for having defrauded investors.
Another case filed by the
U.S. Securities and Exchange Commission was settled in 1994. Keating claimed to be bankrupt but agreed to repay millions should any hidden assets be discovered. A third case filed by the Resolution Trust Corporation resulted in a summary judgment
of $4.3 billion against Keating and his wife in 1994, the largest judgment ever against a private person. The judgment was overturned on appeal in 1996.
Also in 1996, the
9th U.S. Circuit Court of Appeals in San Francisco ruled that the state trial judge Lance Ito had mistakenly allowed the jury to convict Keating without instructing them to determine whether he intended to defraud investors. Thus, the conviction was overturned; the U.S. Supreme Court
refused to hear the government's appeal in October 2000, and state prosecutors declined to move for a retrial.
In 1996, the same Court of Appeals ruled that some of the
jurors
in the federal case might have been influenced by their knowledge of the state case and ordered the trial judge to investigate the matter. The trial judge then granted a new trial.
In 1996, on the eve of the retrial of the federal case, Keating entered a
plea agreement --- he admitted to having committed bankruptcy fraud by extracting $1 million from American Continental Corp. while already anticipating the collapse that happened weeks later. In return, the federal prosecutors dropped all other charges against him and his son, Charles Keating III. He was sentenced to the four years he had already served.[6]
Keating remains unrepentant, maintaining that it was not his mistakes or criminal deeds but regulators' actions that were responsible for the major losses. He repeated these claims in an interview in 2006