Magazine article The Nation

No Recall

Magazine article The Nation

No Recall

Article excerpt

* No Recall

Orrin Hatch is shocked that some politicians are indirectly linked to the scandalous Bank of Credit and Commerce International. The conservative Republican Senator recently released a report detailing contacts between members of Congress and a failed S&L, CenTrust Savings Bank of Miami. A substantial percentage of CenTrust's shares were owned by a B.C.C.I. front man, Ghaith Pharaon, and the bank itself obtained more than 5 percent of the voting shares in CenTrust. Hatch was certainly not influenced by the fact that most of the elected officials in touch with David Paul, CenTrust's chair, are Democrats. Paul was a fundraiser for the Democratic Senatorial Campaign Committee, which was chaired by B.C.C.I.busting Senator John Kerry. But to cover his bets Paul also donated-albeit on a smaller scale-to Republican causes. In 1989 the CenTrust political action committee gave $15,000 to the Democratic senatorial fund and $2,500 to the Republican Party of Florida.

Hatch has provided a public service. His report is a reminder of how Paul's S&L exploited Reagan-backed deregulation, engaged in risky (but taxpayer-insured) speculation, eluded asleep-at-the-wheel regulators and stayed afloat at least in part through a scam using funds from sleazy B.C.C.I., which also ducked the regulators. Clearly, the Senator believes the Paul affair offers some political capital to the G.O.P., though his staff could find no evidence that Paul's political pals applied pressure on the regulators regarding CenTrust. …

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