The chairman of Empire Savings and Loan Association of Texas -- the first federally insured S&L in that state to fail -- and six other Texas executives were indicted by a federal grand jury yesterday on 88 counts of fraud and conspiracy to steal more than $100 million from five savings and loans in the Southwest.

The alleged fraud forced federal regulators to close four S&Ls in Texas, the Justice Department said. The fifth association allegedly victimized, which is still operating, is in Arkansas.

The S&L executives indicted were Spencer H. Blain Jr., chairman of Empire, and Paul Arlin Jensen, chairman of Lancaster First Federal Savings and Loan Association in Lancaster, Texas.

Blain and Jensen illegally pocketed $20 million each from the alleged scheme, Justice officials said.

Three real estate developers and two land appraisers for the S&Ls also were indicted. Two of the developers received $35 million each from the failed associations and the third got $10 million, Justice officials said.

The appraisers were paid more than five times the normal fees for their part in the fraud, the department said.

The scheme collapsed in 1984 when federal regulators closed Empire and exposed the fraudulent terms Empire and other S&Ls had used to make loans and inflate their balance sheets, the department said.

Since then the Justice Department has launched a major investigation of what federal officials say is widespread fraud and mismanagement among Texas S&Ls.

The Empire scam has been dubbed the "I-30 condo scandal" because many of the projects financed by the failed associations were apartments along Interstate 30 in Dallas.

The indictments allege that the seven defendants conspired to inflate land values on property on which the S&Ls made loans. The loans allowed the S&Ls to report inflated assets and earnings.

The Justice Department said that two of the accused developers, David Faulkner and James Toler, helped Blain buy stock in Empire and become chairman and chief executive.

Faulkner, Toler and another of the indicted developers, Kenneth Cansler, corruptly rewarded Blain, Jensen and other S&L officers in Texas and Arkansas by arranging for them to get money and property in exchange for the fraudulent loans, the indictment said.

The false land values were supported in S&L association files with fraudulent appraisals allegedly prepared by two of the defendants, Arthur Formann and Paul Tannehill, the Justice Department said.

All seven defendants were charged with conspiracy and all except the appraisers were charged with violating the Racketeer Influence and Corrupt Organization law.

Other charges filed against the defendants include wire fraud, making false statements to financial institutions and misapplying funds of a financial institution.