Two Orange County businessmen convicted of causing the collapse of Ramona Savings & Loan in Santa Ana received severe prison sentences Tuesday in federal court in Los Angeles and were ordered to pay millions of dollars in restitution to the government.
Donald P. Mangano Sr., 53, of Huntington Beach, was sentenced to 15 years in prison, and John L. Molinaro, 49, of San Jose, received a 12-year sentence on charges of fraud and conspiracy that led to the thrift's 1986 collapse. They were also ordered to pay $6.8 million in restitution to the Federal Deposit Insurance Corp.
The two men were convicted in October on more than 30 counts of bank fraud and conspiracy.
"There is an element in this whole thing of cynicism and ruthlessness and deceit," said U.S. District Court Judge David V. Kenyon in announcing the sentences.
Neither man showed any reaction as Kenyon read the sentences. Molinaro, dressed in a wrinkled blue work shirt and prison fatigues, leaned back in his chair. Mangano looked down at a note pad. The men will be eligible for parole in four to five years.
The prosecution said it was pleased with Kenyon's decision.
"We regard this as a significant victory for the government in its efforts to punish those responsible for the savings and loan crisis," said Asst. U.S. Attorney Steven E. Zipperstein. "The sentence will send a message to other savings and loan owners that white-collar crime doesn't pay."
Defense attorneys expressed little surprise at the length of the sentences, claiming that Kenyon was under pressure from regulators to set an example.
Kenyon had received letters from the nation's top banking regulators, including FDIC Chairman L. William Seidman, appealing for long prison terms for both men.
The Ramona case has attracted a great deal of attention because Molinaro and Mangano were the first owners of a failed thrift in Southern California to face criminal charges since the nation's thrift debacle began to unfold in the late 1980s.
The 2 1/2-hour sentencing proceeding became rather delicate when the subject became Mangano's deteriorating health. He is a quadriplegic--the victim of a bout with polio more than 30 years ago--and his attorneys have claimed that any kind of incarceration could result in his death.
Mangano's attorneys pleaded with Kenyon on Tuesday to place him on probation.