Senator Acknowledges Discussing Lincoln S&L; Deal With Regulator

PHOENIX —  U.S. Sen. Dennis DeConcini, who has maintained that his efforts to aid Lincoln Savings & Loan were limited to talks with federal regulators, now acknowledges that he approached a state regulator about the deal, an aide said.

DeConcini spokesman Bob Maynes said Tuesday that the senator now recalls telephoning John Geoghegan, secretary of California’s Business Transportation and Housing Agency, in April to ask whether he would oppose the sale of Lincoln. Lincoln is chartered under state and federal thrift laws.

Maynes said DeConcini (D-Ariz.) may have simply forgotten he had called Geoghegan.

DeConcini has said his efforts at having the sale approved were limited to discussions with L. William Seidman, chairman of the Federal Deposit Insurance Corp., and M. Danny Wall, then-chairman of the Federal Home Loan Bank Board.

DeConcini also has said he wanted to see the thrift sold to a group of investors rather than liquidated because he believed that the sale would save taxpayers money.

The sale did not go through, and Lincoln was seized by the federal government April 14, the day after its parent company, Phoenix-based American Continental Corp., filed for protection under Chapter 11 of the U.S. Bankruptcy Code.

DeConcini has been at the center of criticism over Lincoln primarily because of two meetings in his Washington office in April, 1987, with federal regulators. Others attending the meetings included Sens. John McCain (R-Ariz.); Alan Cranston (D-Calif.); John Glenn (D-Ohio) and Senate Banking Committee Chairman Donald W. Riegel Jr. (D-Mich).

The senators maintain that they weren’t trying to pressure the regulators into going easy in their investigation of Lincoln, as some critics have said.

Meanwhile, the U.S. House Banking committee plans to consider today whether to subpoena witnesses for its investigation into the Lincoln affair.

The committee, which originally had invited witnesses to appear, may issue subpoenas because several prospective witnesses balked at appearing without being forced to testify, said committee Chairman Henry Gonzalez (D-Texas).

A. Melvin McDonald, attorney for American Continental, said he did not know whether company Chairman Charles H. Keating Jr. would agree to appear without a subpoena. Keating, the subject of a $1.1-billion civil fraud suit brought by the federal government, is one of two witnesses invited to testify Nov. 7, the final day in the four-week series of hearings.