The former lobbyist for savings and loan executive Charles H. Keating Jr. told the Senate ethics committee yesterday he never got "even a hint" from Keating that Keating's large contributions to five senators were made to buy access to the senators or their intervention with regulators on his behalf.
James J. Grogan, who was Keating's chief liaison with the senators, also testified he was unaware at the time that Keating was creating an appearance of impropriety by contributing more than $1.3 million to the senators while he was seeking their help in his fight with federal thrift regulators.
But Grogan acknowledged, in hindsight, that Keating's contributions and solicitation of help from the senators "could give rise" to an appearance of wrongdoing.
Grogan's second day of public testimony under a grant of limited immunity from prosecution for what he told the committee concluded the panel's deliberations for this year in what has become one of the most closely watched ethics trials in the Senate history.
The panel is investigating whether Sens. Alan Cranston (D-Calif.), Dennis DeConcini (D-Ariz.), John Glenn (D-Ohio), John McCain (R-Ariz.) and Donald W. Riegle Jr. (D-Mich.) intervened improperly on behalf of Keating's Lincoln Savings and Loan Association in return for his contributions to their political campaigns and causes.
After the rare Saturday session in the nearly deserted Hart Office Building, the committee recessed until Jan. 2, when it is scheduled to begin what it hopes will be the final four or five days of hearings, including presentations by the senators with the probable exception of Cranston, who is undergoing treatment for prostate cancer in California.
In its questioning of Grogan and earlier witnesses, the panel appeared far from a consensus. When the hearings conclude, the committee will meet to decide whether to recommend sanctions by the Senate, which could include censure or expulsion.
Robert S. Bennett, special counsel to the Select Committee on Ethics, recommended earlier that it take no action against McCain and Glenn but intensify its probe of Cranston, DeConcini and Riegle. Instead, the committee decided to hold public hearings, which have lasted 20 days so far, including two days of closed-door interviews with Grogan on Wednesday and Thursday.
In response to generally mild questioning yesterday from defense attorneys, Grogan stuck by his testimony Friday that appeared to ascribe key roles to Riegle and Cranston in intervening with federal regulators to help Keating, who had business interests in all the senators' states.
Under questioning from Riegle's attorney, Thomas C. Green, Grogan conceded his memory was faulty on some details of timing but insisted that Riegle set up an April 2, 1987, meeting between the other four senators and Edwin J. Gray, then chairman of the Federal Home Loan Bank Board. Gray has testified, amid denials by the senators, that they improperly pressured him to go easy on Lincoln and appeared to acquiesce to suggestions of a deal by DeConcini.
After noting several points on which the recollection of Grogan and other witnesses has differed, Green asked if Grogan might have been mistaken in saying that Riegle suggested the meeting during a trip to Keating's parent company, American Continental Corp. in Phoenix. "Not about setting up the meeting, I do not believe that," Grogan responded.
Questioned by Cranston's attorney, William Taylor III, Grogan reiterated that Cranston agreed to a request from Keating to call M. Danny Wall, Gray's successor as chief thrift regulator, to set up a meeting between Keating and Wall. He said he did not know if the conversation resulted in a meeting.
But Grogan also appeared to help the senators' causes by indicating that they did not always please Keating. In response to Taylor, he said there were times when Cranston turned down Keating's requests for help. And, responding to a question from committee member David Pryor (D-Ark.), he said Keating was angered when Riegle returned nearly $80,000 that Keating raised for his 1988 campaign after news reports of the donations.
Under questioning from committee member Terry Sanford (D-N.C.), who, like Pryor, asked a series of questions that appeared helpful to the senators' defense, Grogan said the five lawmakers did what they did for Keating for reasons other than contributions. Sanford cited senators, including himself, who did not receive contributions from Keating but granted access to Grogan. "Did my secretary ask if you paid the access fee?" Sanford asked. Grogan said no.
Clarifying observations earlier in the week that contributions can "buy access" to senators but not necessarily influence with them, Grogan said he did not mean that Keating bought access to the "Keating Five." In none of the cases did he or Keating regard contributions as buying access, Grogan said.