Charles H. Keating Jr. (born 1923 in Cincinnati, Ohio) is an American lawyer and banker convicted of fraud in the Savings and Loan scandal of 1989. A conservative Catholic active in the Republican Party, he was formerly involved in anti-pornography efforts.

Table of contents
1 Anti-pornography efforts
2 Failure of Saving & Loan, the Keating Five
3 Legal consequences
4 External links

Anti-pornography efforts

In the late 1950s, Keating founded the Cincinnati anti-pornography organization Citizens for Decent Literature, later Citizens for Decency through Law. In 1960 he testified against pornography before Congress. In 1964-1965, he produced the movie Perversion for Profit featuring announcer George Putnam. It is a survey of then-available pornography, and attempt to link pornography to the decline of culture and to the depravity of the youth.

In 1969, president Richard Nixon appointed Keating to the President's commission on pornography; he unsuccessfully attempted to stop publication of the commission's rather liberal recommendations with a restraining order. He then filed a dissenting report, stating "One can consult all the experts he chooses, can write reports, make studies, etc., but the fact that obscenity corrupts lies within the common sense, the reason, and the logic of every man."

Keating was also instrumental in the (rather ineffective) obscenity prosecution of Larry Flynt in 1976 in Cincinnati.

Failure of Saving & Loan, the Keating Five

Keating received his law degree in 1948 from the University of Cincinnati and started to work for American Financial Corp Around 1980 he moved to Phoenix, Arizona where he ran the real estate firm American Continental Corporation. In 1984, American Continental Corporation bought the Californian Lincoln Savings. Such saving-and-loan organizations had been deregulated in the early 1980s, allowing them to make highly risky investments with their customer's money. Some regulators noted the danger and pushed for more oversight, but Congress refused. Some of this may be due to the Keating Five, five Senators (Dennis DeConcini, John McCain, Alan Cranston, John Glenn, Don Riegle) who had received some $300,000 from Keating in the 1980s. They later met twice with regulators who were investigating American Continental Corp. in an attempting to end the investigation. In 1990, they would be rebuked to various degrees by the Senate Ethics Committee.

American Continental Corporation, the parent of Lincold Savings, went bankrupt in 1989; more than 21,000 mostly elderly investors lost their life savings, in total about $285 million. The federal government then covered almost $3 billion of Lincoln's losses.

Legal consequences

In September 1990, Keating was charged with having duped Lincoln's customers into buying worthless junk bonds of American Continental Corporation; he was convicted in state court in 1992 of fraud, racketeering and conspiracy and received a 10 year prison sentence. In January 1993, a federal conviction followed, with a 12 and a half year sentence. He spent four and a half years in prison, but both sentences were eventually overturned.

In the 1980s, Keating had donated some $1,250,000 to Mother Teresa; during his state trial, she wrote a letter on his behalf to presiding Judge Lance Ito, saying that she was not informed about his business but she knew him as a man who was generous towards the poor.

In 1999, the 9th US Circuit Court of Appeals in San Francisco ruled that the state trial judge had mistakenly allowed the jury to convict Keating without determining whether he intended to defraud investors. Thus the conviction was overturned; the U.S. Supreme Court refused to hear the government's appeal in October 2000, and state prosecutors declined to move for a retrial.

In 1998, the same Court of Appeals had ruled that some of the jurors in the federal case might have been influenced by their knowledge of the state case and ordered the trial judge to investigate the matter; the trial judge then granted a new trial.

In 1999, on the eve of the retrial of the federal case, Keating entered a plea agreement: he admitted to having committed bankruptcy fraud by extracting $1 million from American Financial Corp. while already anticipating the collapse that happened weeks later; in return, the federal prosecutors dropped all other charges against him and his son. He was sentenced to the four years he had already served.

Add the civil suits and judgements against him.

Keating remains unrepentant, maintaining that not his mistakes but regulator's actions were ultimately responsible for the losses.

External links