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Governor Releases Depositors’ List

January 31, 1991

PROVIDENCE, R.I. (AP) _ Gov. Bruce G. Sundlun released a list of depositors with more than $100,000 in the state’s closed banks and credit unions as the Legislature worked on a bailout plan.

″We believe that the public interest in the present vigorous debate about legislation to provide public funds for the private benefit of the over $100,000 depositors justifies the release of this data,″ the administration said in a letter accompanying the list.

Sundlun has proposed the state guarantee depositors return of just $100,000, with anything above that returned only based on the sale of assets in the closed institutions. Legislative leaders proposed giving depositors all their money, save for a possible 10 percent loss.

There was enough disagreement late Wednesday to force a postponement of a planned House Finance Committee vote on the package.

Lack of a plan is causing anxiety among depositors. Citizens for Depositors’ Rights Organization planned a five-hour sit-in at the Statehouse today to make its case that depositors will settle for no less than all their money back, spokesman Jack Kayrouz said.

About $1.3 billion is tied up in the 300,000 accounts in the 14 closed banks and credit unions. The 972 people with deposits of more than $100,000 have a total of $193 million in the closed institutions, according to the list released by Sundlun.

One of the people who is listed is former Gov. Philip Noel, an attorney who has led the charge against Sundlun’s proposed bailout. He has $206,107 in two accounts at Rhode Island Central Credit Union.

Noel said he and other lawyers planned to sue the state for violation of privacy and interference in a business relationship.

A small group of angry depositors whose names also are on the list demonstrated outside the House chamber Wednesday. They said they want all their money back and charged Sundlun had invaded their privacy with the list’s release.

Angry shouts of ″burn the list″ echoed through the halls of the Statehouse.

Sundlun spokesman David Preston said the administration’s chief lawyer, Sheldon Whitehouse, researched case law and found precedent for releasing such a list when an issue of public policy such as using government money for a bailout was involved.

″The need for the public to know overrides the private interest here,″ Preston said.

The list shows how widely the banking crisis has affected the state, from businesses to retirees to churches. Fourteen banks and credit unions that cannot get federal deposit insurance remain closed, out of the 45 that Sundlun ordered shut Jan. 1 when their private deposit insurer failed.

The largest depositor is the state, with $9.6 million tied up in three institutions. Several labor unions are on the list, as are large and small businesses.

Sundlun wants to use the sale of assets from the closed institutions to finance his plan.

He compromised Tuesday when he agreed to some payback over $100,000.

But he has been adamant about avoiding a full payback because he says that will cost more than the $150 million price tag he has put on his plan, and the state can’t afford it.

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