Gossip Corner: Keating Five
The Keating Five were five United States Senators accused of corruption in 1989, igniting a major political scandal as part of the larger Savings and Loan crisis of the late 1980s and early 1990s.
McCain was one of the so-called “Keating Five” senators.
McCain, Cranston, DeConcini, Glenn, and Riegle became known as the Keating Five.
As promised, the Obama camp has just posted the McCain Keating Five video.
McCain was one of the “Keating Five,” congressmen investigated on ethics charges for strenuously helping convicted racketeer Charles Keating after he gave them large campaign contributions and vacation trips.
For too long, McCain has been given a free pass by the media, which promotes campaign-finance reform to silence other voices, and by his Republican colleagues, who are concerned about alienating McCain given the GOP’s tenuous majority in the Senate.
McCain went from Republican front runner to 3rd or 4th in various polls, spent all of his huge pile of cash and lost most of his staff, and worked his way back to win the nomination and lead for president at the beginning of September.
Federal auditors were investigating Keating’s banking practices, and Keating, fearful that the government would seize his S&L, sought intervention from a number of U.S. senators.
Lincoln Savings and Loan collapsed in 1989, at a cost of $2 billion to the federal government.
John McCain is a maverick senator, Vietnam veteran and former prisoner of war for 5 years in North Vietnam.
He also is known for crafting bipartisan approaches to issues such as smoking and campaign reform.
He was investigated by the Senate Select Committee on Ethics in 1991 regarding the acceptance of favors from Lincoln Savings & Loan Association and its owner, Charles H. Keating, Jr. Simply put, the issue was whether McCain and the other senators used their official positions to attempt to pressure Federal Home Loan Bank Board officials to go easy on the troubled institution.
Those four senators and Sen. Don Riegle, D-Mich., attended a second meeting at Keating’s behest on April 9 with bank regulators in San Francisco.
McCain has said if he is elected president that he will appoint Gramm to a cabinet position, likely as Secretary of the Treasury.
The Committee finds that Senator McCain had a basis for each of these actions independent of the contributions and benefits he received from Mr. Keating, his associates and friends.
Mr. Keating also provided his corporate plane and/or arranged for payment for the use of commercial or private aircraft on several occasions for travel by Senator McCain and his family, for which Senator McCain ultimately provided reimbursement when called upon to do so.
The Senate Ethics Committee probe of the Keating Five began in November 1990, and committee Special Counsel Robert Bennett recommended that McCain and Glenn be dropped from the investigation.
At Keating’s behest, four senators-McCain and Democrats Dennis DeConcini of Arizona, Alan Cranston of California, and John Glenn of Ohio-met with Ed Gray, chairman of the Federal Home Loan Bank Board, on April 2.
Regulators did not seize Lincoln Savings and Loan until two years later.
The Committee concludes that, given the personal benefits and campaign contributions he had received from Mr. Keating, Senator McCain exercised poor judgment in intervening with the regulators without first inquiring as to the Bank Board’s position in the case in a more routine manner.
In 2000, he nearly beat George W. Bush by being an outspoken, even honest politician, which stunned everybody.
Federal investigators had gotten tipped off that Keating was running the Lincoln Savings and Loan as his personal piggy bank giving himself and friends multi-million dollar loans and not repaying them.
Keating and DeConcini were asking McCain to travel to San Francisco to meet with regulators regarding Lincoln Savings; McCain refused.
In this connection one must always remember Keating’s reply to the question of whether he thought his campaign contributions influenced the recipients.
Politico is reporting that on Monday afternoon the Obama campaign will launch a “multimedia attack” on John McCain’s ties to the Keating Five Scandal!
In John McCain’s America, any politician who accepts a large contribution or gift from a donor, and then takes steps consistent with the donor’s interests — even though there is no legal quid pro quo — is corrupt.
“Mr. Keating, his associates, and his friends contributed $56,000 for Senator McCain’s two House races in 1982 and 1984, and $54,000 for his 1986 Senate race.
“Senator McCain has violated no law of the United States or specific Rule of the United States Senate; therefore, the Committee concludes that no further action is warranted with respect to Senator McCain on the matters investigated during the preliminary inquiry.”
A few years later, McCain moved to the U.S. Senate, and shortly after Charles Keating contacted McCain and four other U.S. Senators for help.
His convictions were overturned on technicalities; for example, the federal conviction was overturned because jurors had heard about his state conviction, and his state charges because Judge Lance Ito screwed up jury instructions.
