Newspaper article THE JOURNAL RECORD

Bush to Raise Fraud Investigation Funding for S&ls by $25 Million

Newspaper article THE JOURNAL RECORD

Bush to Raise Fraud Investigation Funding for S&ls by $25 Million

Article excerpt

WASHINGTON (AP) - President Bush, prodded by Congress, will seek to increase spending for savings and loan fraud investigation and prosecution by $25 million this year, White House officials said Thursday.

Bush was to announce today that he is asking Congress to pass appropriate the money in addition to $50 million already being spent for the crackdown, said the officials, who spoke on condition of anonymity.

Congress had initially authorized $75 million for the enforcement part of the S&L package it passed Aug. 9. But the administration later asked for and received only $50 million to rescue the savings and loan industry.

In the wake of mounting congressional criticism about the pace of the S&L enforcement, the president decided to use the extra $25 million that Congress initially offered.

Bush's request comes a week after members of Congress accused the White House of bungling bailout efforts so far and moving too slowly to prosecute people involved in fraudulent S&L practices.

Among those being investigated is Bush's son, Neil Bush of Denver, who was a director of Silverado Banking, Savings and Loan, one of the failed associations under investigation by government regulators.

White House press secretary Marlin Fitzwater on Thursday defended the administration's anti-fraud efforts. He said there were 791 convictions for financial institution fraud in 1989 involving losses of $100,000 each.

Since 1987, he said, the government has issued 184 major S&L indictments with 159 convictions.

The Justice Department has 530 failed institutions under investigation, up from 282 three years ago, Fitzwater said.

With the $50 million it requested from Congress, the Justice Department is hiring 368 new employees, including 202 FBI agents and 120 prosecutors. …

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