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S & L Convictions

February 09, 1992

The Times printed a commentary headlined "Why the S&L Gang Isn't in Jail" (Feb. 3). It begins with the totally false assertion that ". . . there have been few other criminal indictments and convictions in this fiasco. . . ."

Between Oct. 1, 1988, and Dec. 31, 1991, the Justice Department prosecuted 2,654 persons for major financial institution crimes, involving almost $13.3 billion in losses to federally insured institutions--banks, S&Ls and credit unions. In that same time period, 2,041 defendants have been convicted (96.1% conviction rate) and 77.3% of those convicted have been sent to jail for terms as long as 40 years. In S & L cases alone, the department has charged 992 defendants in major cases in that same time period and achieved convictions against 723 defendants (92.7% conviction rate). Overall, approximately 30% of those charged in our major financial institution fraud cases are the presidents, CEOs, board chairmen, officers and directors of the institutions.

Los Angeles enjoys a U.S. attorney's office under U.S. Atty. Lourdes Baird with one of the top financial institutions fraud units in the country. Two recent examples of cases brought by that office undercut the major premises of the commentary. Michael Goland is serving jail time for lying to regulators in an effort to take over the now-defunct Viking Savings in your area. Janet Faye McKinzie is serving a 20-year jail term and the government recovered $13 million in restitution from her for her role in defrauding North American Savings and Loan.

The authors got the facts wrong. The facts about financial institution fraud prosecutions can be seen in the numbers above and those numbers speak volumes.

IRA H. RAPHAELSON, Special Counsel, Financial Institutions Fraud, Office of the Deputy Attorney General, U.S. Department of Justice

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