Fraud and other criminal conduct played an important role in the collapse of about 40 percent of the approximately 450 thrift institutions now under the control of the government's Resolution Trust Corp., and there was misconduct of some form in more than half of them, RTC officials said yesterday.
In addition, accountants, lawyers, brokers and other professionals may be guilty of malpractice in about 20 percent of the failed thrifts, said James R. Dudine, RTC assistant director for investigations.
Despite the size of the caseload, Dudine and other law enforcement officials said they are optimistic that the government will be able both to work its way through the huge collection of failed institutions and the land, buildings, mortgages and other assets they own, and to bring to justice those savings and loan officials guilty of criminal acts.
"We can say that progress has been made to put the crooks out of business and into jail," said Treasury Secretary Nicholas F. Brady, chairman of the RTC's Oversight Board.
The Oversight Board yesterday listened to a series of representatives of the Justice Department, the Federal Deposit Insurance Corp., the Office of Thrift Supervision and the RTC itself present an upbeat picture of the rate at which bankrupt thrifts are being "resolved," their assets disposed of and their officials prosecuted.
RTC President Peter Monroe said the agency has received $1 billion from banks and other investors that have bought thrift institutions.
Monroe said that the losses incurred by the government on such disposals have declined to 32 cents on the dollar from 54 cents in the three months just ended and will likely decline to 24 cents on the dollar in the next three months.
After estimating the number of thrifts that have not yet failed but may be expected to, Monroe said that the RTC has "completed 24 percent of the resolutions we are likely to see" and disposed of "17 percent of all the assets that will ultimately move through the system."
Among the data presented to the Oversight Board:
Since Oct. 1, 1988, 329 individuals involved with 243 thrifts whose losses are estimated to total $2.5 billion have been prosecuted. A total of 213 have been convicted and have been fined $975,700 and ordered to make restitutions amounting to $56.6 million.
However, Justice Department special counsel James G. Richmond conceded that in many cases "assets have been dissipated" and recoveries are unlikely.
The RTC has more than 500 civil suits pending and in the first six months of 1990 has recovered more than $200 million.
The government has received more than 18,000 referrals of suspected criminal activity, most of which stemmed from the activities of about 3,200 institutions.
From these referrals, authorities have compiled a list of 100 institutions to pursue.
Charges of wrongdoing have been leveled against some individual thrift regulatory employees who may have played a part in allowing the thrift debacle to occur, according to OTS director Timothy Ryan.
Ryan refused to discuss the allegations in public but said that some cases have been referred to the Justice Department for investigation.