Keating Walks Free from Courtroom

LOS ANGELES-A Superior Court judge here has helped to write perhaps the final chapter of the book on the nation’s 1980s savings and loan scandal, permitting once high-flying S&L chief Charles H. Keating to walk free from a Downtown courtroom.

After a brief hearing, Superior Court Judge Lance A Ito–best-known for presiding over the trial that found O.J. Simpson innocent of slashing to death his wife and one of her male friends–allowed prosecutors to formally withdraw their securities-fraud charges against Keating. Now 76 years old, Keating’s role as chief of the defunct Lincoln Savings and Loan in Irvine and its parent American Continental Corp. eventually became the “poster boy” for the thrift industry’s greed and near-collapse.

Thousands of investors, many of them seniors who lived in Southern California, lost an estimated $285 million when Keating’s financial empire finally buckled in 1989. The government’s resulting bailout of Lincoln Savings, at $3 billion, was one of the most costly ever.

Government prosecutors had accused Keating of overseeing–and sometimes even orchestrating–several shady multimillion-dollar real estate deals, as well as nefarious investments in currency trading and corporate takeovers. Though Federal prosecutors had won an earlier conviction against Keating, it was overturned on appeal because the jury had heard about an earlier state court conviction and discussed the verdict as they deliberated over the Federal charges.

Looking tan and fit, Keating left the LA courtroom with a broad smile on his face. Though saying that his series of court ordeals taught him not to “mess with regulators,” he also had some words for investors who pressed for prosecution after their deals turned sour.

“If they’d have left me alone, they’d all have been rich,” Keating told reporters.