The last time Charlie Keating was hustling money, he was selling $200 million in now-worthless junk bonds, hoping the influx of cash would rescue his faltering Lincoln Savings and Loan.
Keating is looking for money again -- this time to help fund his legal defense -- and his daughters are the ones passing the tin cup.
Keating's family has been soliciting funds from friends and associates to defend him against fraud charges in connection with the junk bond sales. In a personalized letter obtained by our associates Michael Binstein and Tim Warner, four of Keating's daughters tell Daddy's sob story.
They blame federal thrift regulators for the downfall of the Keating empire, claiming that the U.S. government "illegally confiscated all of our wealth."
It must be a grim holiday season at chez Keating. The daughters say in their letter that, "In March of 1986, the federal regulators came into our lives and never left, making life miserable. We labored under their endless involvement in operations day by day, week by week, until the months became years. The smiles of our employees faded."
The Keating daughters hark back to the good old days before thrift regulators darkened the door. "During the mid-1980s, Congress encouraged successful entrepreneurs to help revitalize the savings and loan industry and bring it out of the dinosaur age." The big, bad regulators kept Keating from realizing that goal, according to his daughters.
The dinosaur age sounds pretty good, and considerably less expensive, now that Congress and President Bush have begun a $500 billion taxpayer bailout of the savings and loan industry. The rescue of Lincoln Savings and Loan will cost taxpayers more than $2 billion. Now there's some news that can fade the smile from your face.
The Keating daughters are beside themselves with worry about dear old Dad in particular and the American people in general. "The thought of what is being done to our father, our families and America is sickening," they write. "Our credibility has been wrongfully destroyed. Our father is constantly being attacked from all sides. He is being tried and convicted without being given a fair trial where his side of the story can be told and where he can be judged on the evidence, not rumors and innuendo."
So if taxpayers have any money left after paying for their share of Keating's squandered assets, they can chip in some money to make sure he gets a good lawyer so he can explain why we're all in debt.
There are more than a few people who won't be making a contribution to Keating's favorite charity this year. They are the customers who bought his now-worthless junk bonds, and they have troubles enough of their own.
Keating and his sales staff sold American Continental Corp. bonds out of the lobbies of Lincoln Savings and Loan branches to people that Keating and his minions considered easy targets. In a memo to Keating's junk bond sales corps, one ACC official reminded them to look for "the meek, the weak and the ignorant." One of them was a woman who was technically blind and was unable to get to the branch office to buy her bonds, so Lincoln Savings and Loan sent a car to pick her up.
In all, 20,000 investors believed the sales pitch and lost $200 million.
One of them, Anthony Elliot, 89, of Burbank, Calif., committed suicide last month. A retired accountant, he had lost his life savings investing in Keating's junk bonds and was despondent over his financial problems. "There's nothing left for me of things that used to be," he wrote in his suicide note. "Government is supposed to serve and protect, but who? Those who can gather the most savings from retired people."
Keating continues to blame the government for stopping him when he was on a roll. Now he is awaiting trial in Los Angeles while his daughters scramble for money to pay for his defense.
They end their solicitation for money with a quote from French philosopher Francois Marie Arouet Voltaire: "It is dangerous to be right when the government is wrong."
Had the Keatings read further in their Voltaire quote book, they would have found something more appropriate: "If we believe absurdities, we shall commit atrocities."