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McCain- Haunted by Ghosts of the S&L Scandal?

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RedEagle Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 12:29 AM
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McCain- Haunted by Ghosts of the S&L Scandal?
I'm going to give this its own post. Can't vouch for the site but the story on McCain appears to have come from the media.
(Scroll down)

February 29, 2000

Pluck, leaks helped McCain to overcome S&L scandal

By Walter V. Robinson, Globe Staff

A decade ago, Senator John McCain's role in the most politically corrosive episode of the $150 billion savings and loan debacle threatened to end a political career that now holds some promise of concluding instead with a McCain presidency.


He was a close friend and early congressional ally of Charles H. Keating Jr. - the figure at the core of scandal - and one of the leading beneficiaries of Keating's political and personal largesse. Yet, he benefited from decisions by the Senate Ethics Committee that minimized his culpability and the resulting sanction.

And there is evidence that McCain averted major damage to his public image with well-choreographed news leaks from his office that undermined three of the four other senators caught up in the controversy. In 1992, McCain denied under oath that he or his aides had anything to do with the leaks.


But in an interview this month, Clark B. Hall, a former FBI agent and congressional investigator who led the GAO investigation, told the Globe he had no doubt, after doing scores of interviews and obtaining documentary evidence, that McCain was one of the principal leakers. But Hall said the Ethics Committee ''smoothed it over.''

''You don't betray other people to protect yourself, and that's what he was doing,'' Hall said. ''And he was breaking Senate rules to do it.'' The targets of the leaks were Democrats Dennis DeConcini of Arizona, Alan Cranston of California, and Donald Riegle of Michigan. (In the end, DeConcini and Riegle would be sharply criticized by the committee; Cranston drew a formal reprimand.) ...


During the Ethics Committee investigation, one of the leaked stories that benefited McCain reported that DeConcini and Riegle, at Keating's behest, had lobbied the White House for Henkel's appointment. But in a little noticed finding in its final report, the committee reported that McCain had, too.

Alone among the five senators, McCain counted Keating as a personal friend; their families vacationed together from 1983 to 1986 - the four years McCain served in the House - flying to Keating's private retreat in the Bahamas aboard corporate aircraft paid for by Keating's company.

In 1986, McCain's wife, Cindy, and her father, James W. Hensley, also invested $359,100 in a Phoenix shopping mall developed by a subsidiary of Keating's American Continental Corp.

But the Senate Ethics Committee decided that the vacation subsidies were House matters - outside its jurisdiction. The committee did not consider the mall investment germane. Nor was it troubled by McCain's lobbying for Henkel.

With public hearings looming, the bipartisan panel - three members from each party - split over whether to follow the urging of its counsel, Robert M. Bennett, that the case against McCain and Glenn be dropped. The committee Democrats resisted, and McCain has long insisted they did so because he was the sole Republican among the five and they feared that a pared-down ''Keating Three'' would be recast as a Democratic scandal.


''The meetings themselves were wrong and should not have occurred. The five senators involved put undue and inappropriate pressure on regulators,'' Wertheimer said. The meetings, Common Cause argued in 1990, were ''seemingly designed to put the maximum senatorial pressure on the board to accede to Keating's wishes.''


But at both meetings, first with Gray and then with thrift regulators flown in from San Francisco, McCain looked on as DeConcini pushed the regulators to give Lincoln a dispensation on a board regulation that barred further risky investments - a ban that Lincoln had already exceeded by $600 million.

Two years later, Gray told a House committee that the meetings were an attempt to ''subvert'' the regulatory process.


But Dowd, McCain's attorney, said McCain ''did nothing improper, and he didn't know that...DeConcini was going to misbehave.''...

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progressivebydesign Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 12:38 AM
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1. Fascinating reading..
.. my head is about to explode after living through these past few weeks. I'm almost informationed out; However, I do find this really interesting. Just like the Bushes, seems McCain is all over the S&L thing. Some people think McCain is just a saint... he got royally screwed by Rove in the last election, but I'm not ready to embrace the guy as a V.P. choice. I have zero respect for the man in regard to his rolling over and playing nice-nice with Bush, after what they did to him. Perhaps he has to play nice, or they'll make sure everyone remembers his role in the Keating S&L scandal. Food for thought.. though I'm almost full.
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izzie Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 05:31 AM
Response to Reply #1
2. I think McCain is like us all. He fights to do the right thing.
He does not always win. I feel he is sorry for the Sand L thing. I do like a man who when he thinks he does wrong will try to re think it and do right. Things are never black and white in my thinking.
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RedEagle Donating Member (1000+ posts) Send PM | Profile | Ignore Sat May-15-04 11:13 AM
Response to Reply #2
3. McCain Didn't Do Right
McCain kept quiet, quite willing to let others take most of the heat, got out of any oversight when he went to the Senate because what happened before was a "House matter."

If McCain is everything people think he is, he could have blown the whole scam wide apart right then. Instead, like every other politician caught with his hand in an illegal cookie jar, he shut up and hopped the posse wouldn't see him.

One of the reasons we are in the mess we are in is because people like McCain won't stand up and admit wrongdoing, especially when admitting it could change how "business" is done as SOP in Congress.
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