From: tut@cairo.Eng.Sun.COM (Bill "Bill" Tuthill)
Newsgroups: misc.invest
Subject: good book on S&L scandal
Date: 25 Jul 1992 01:41:20 GMT
Organization: Sun Microsystems Inc., Mountain View, CA
NNTP-Posting-Host: cairo

			Book Review
			-----------
	In$ide Job: The Looting of America's Savings & Loans
		by Pizzo, Fricker & Muolo

This is probably the best book written so far on the S&L scandal.
Not only does it appear to be balanced and accurate, it is also a
real page-turner that often reads like a mystery novel.  I would
highly recommend it to anyone interested in the S&L crisis, which
is the biggest financial scandal in the history of the USA, and
probably in the history of the world.

For people who don't have time, here is the book's own summary of
what went wrong:

	"The S&L industry was deregulated by the Garn/St.Germain
	act of 1982...  Swindlers, mobsters, politicians, greedy
	S&L executives, and con men capitalized on regulatory
	weaknesses created by deregulation and thoroughly fleeced
	the thrift industry.  Then, after exhausting the capital
	there, they made their way right into the national treasury
	itself.  While it is certainly true that economic factors
	(like plummeting oil prices in Texas and surrounding states)
	contributed to the crisis, S&Ls would not be in the mess
	they are today but for rampant fraud."

There are many surprises in the book.  The authors "never once
examined a failed thrift-- no matter how random the choice-- without
finding someone whom [they] already knew from another failed S&L."
Another surprise is that Ed Gray (chairman of the FHLBB 1983-1987)
was a good guy, despite being a friend of Ed Meese.  Gray tried to
eliminate FSLIC insurance for thrifts having more than 5% brokered
deposits, which would have included all the failed S&Ls.  Bad guy
Don Regan (then Treasury Secretary) shot down this regulation and
constantly tried to get rid of Ed Gray.  If the 5% rule and others
had been implemented, taxpayers wouldn't be on the hook now for over
$500 billion.  Yet another surpise is how stupid and slimy Jim Wright
(speaker of the House) was.  Almost single-handedly he prevented the
closing of Vernon S&L, the 2nd biggest loss after Lincoln S&L.  The
last surprise I'll mention is that Charles Keating (of Lincoln fame)
was a devout Catholic and gave lots of money to Mother Theresa.

Was the Mafia involved?  Yes, but this is a misleading term because
it implies Italian ethnicity.  Mobsters were also Jewish, Armenian,
Anglo, Iranian, Colombian, etc.  Was the CIA involved?  Definitely,
as a means of funding covert aid for the Contras.  It's difficult to
say whether the CIA was more or less than 20% responsible, in final
dollar terms.  Several CIA agents indicted for direct looting of S&Ls
received Presidential pardons.

Where did the money go?  Offshore bank accounts, lavish spending,
Mafia coffers, arms for the Contras, into future tax writeoffs for
Perelman and others who purchased S&Ls as tax deals, etc.  Little
of this money will ever be recovered because of the difficulty of
tracking, and reluctance to prosecute, white-collar crime.

Finally, misc.investors may be interested in reading about various
financial scams, some of which-- land flips, cash for trash-- they
could use to great advantage.  If you learn enough, you won't have
to sit here reading this stupid news group, you'll be rich!!!

Newsgroups: misc.invest