Federal Charges Filed Against Former President of Lincoln Savings With AM-Lincoln S&L
Mar. 09, 1991
LOS ANGELES (AP) _ A former president of Lincoln Savings & Loan was charged Friday with two counts of federal securities fraud stemming from the closed thrift's sale of more than $200 million in junk bonds.
Raymond Fidel, who already faces fraud charges on the state level, was tentatively set for arraignment Monday before a U.S. Magistrate.
Assistant U.S. Attorney David Sklansky, one of the prosecutors probing the collapse of the Irvine-based Lincoln and its former chief Charles H. Keating Jr., refused to comment on the case against Fidel, 33.
Fidel's attorney, David Wiechert, did not return a phone call placed to his office after business hours.
The charges allege that Fidel and others sold more than $200 million in high-risk junk bonds issued by Lincoln's parent company, American Continental Corp., as a ''safe, conservative investment.''
The charges came as federal regulators late Friday dissolved Lincoln Savings, closing out the saga of the nation's most notorious and most expensive failed thrift.
The Resolution Trust Corp. transferred the 28 branches and $2.1 billion of deposits to Great Western Bank of Beverly Hills.
The agency estimated the ultimate cost of the rescue at $2.6 billion, making it the costliest ever to taxpayers.
Phoenix-based American Continental sold more than $200 million worth of the high-yield junk bonds to more than 17,000 investors, many of them elderly.
Keating, Fidel, former Lincoln president Robin Symes and ex-American Continental president Judy Wischer have been charged in state court with violating state securities laws in connection with the unsecured bonds.