Regulator Let IndyMac Backdate Infusion [OTS]

The Wall Street Journal ^ | 2008-12-23 | Michael M. Phillips & Jessica Holzer

[rabscuttle385]

A senior bank regulator was removed from his job after being accused of helping mortgage lender IndyMac Bancorp alter its records so it appeared to be in better shape -- weeks before it was seized by the government.

The Office of Thrift Supervision has reassigned its top West Coast official, Darrel Dochow, who was also a controversial figure in the regulatory lapses surrounding the savings-and-loan crisis of the late 1980s.

In a letter sent Monday to Sen. Charles Grassley, the senior Republican on the Senate Finance Committee, the Treasury Department's inspector general wrote that the federal OTS allowed the bank to backdate records of capital infusions last spring. That leeway made IndyMac appear more solid than was actually the case, shortly before federal regulators seized the bank in July -- at a cost of $8.9 billion to the government's deposit-insurance fund.

[rabscuttle385]

Your tax dollars at work.

[rabscuttle385]

*Ping!*

[rabscuttle385]

Government is the problem, not the solution!

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[rabscuttle385]

Mr. Thorson said in the letter that his investigators had also uncovered other incidents in which OTS supervisors had allowed banks to backdate capital infusions. The letter didn't specify which banks those incidents involved.

[Pontiac]

The Office of Thrift Supervision has reassigned its top West Coast official, Darrel Dochow, who was also a controversial figure in the regulatory lapses surrounding the savings-and-loan crisis of the late 1980s.

Reassigned? He should be indicted!

[rabscuttle385]

FYI:

Mr. Dochow played a central role in the savings-and-loan scandal of the 1980s, overriding a recommendation by federal bank examiners in San Francisco to seize Lincoln Savings, the giant savings and loan owned by Charles Keating. Lincoln became one of the biggest institutions to collapse. Mr. Keating served four and a half years in prison before his fraud and racketeering convictions were overturned. He later pleaded guilty to more limited charges, and was sentenced to the time already served.

http://www.nytimes.com/2008/12/23/business/23thrift.html?ref=business

Keating Five redux!

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[GOPJ]

The Office of Thrift Supervision has reassigned its top West Coast official...

Should be called: "Office of Theft Supervision"...

[Darteaus94025]

Don’t worry!

No Federal Employees will lose theirs jobs; only the tax-paying plebeians will suffer.

[PAR35]

The letter didn't specify which banks those incidents involved.

They would all have to be S&Ls. And unless the problem was more widespread, likely to be in the Western Region.

[4Liberty]

[kcvl]

allowed Indymac Bank to backdate $50 million transaction

http://tinyurl.com/96escr

Ex-Official Concedes Lapses in Savings Collapse
E-MAIL Print Reprints Save Share

Published: November 14, 1990

A former senior official responsible for overseeing savings and loans as the industry was collapsing in the late 1980’s conceded today that the Government had failed to respond adequately to auditors’ concerns about pervasive regulatory problems.

“Surely there is more that could have been done,” said the former official, Darrel W. Dochow, who passed auditors’ reviews in early 1988 to his superior, M. Danny Wall, the former chairman of the Federal Home Loan Bank Board.

The reviews, some of which were described at a Congressional hearing today, had been kept confidential, and the auditors who prepared them said they were virtually ignored. Congressional investigators have said the failure to take action added billions to the bailout cost.

http://tinyurl.com/8r53ba

[GOPJ]

Don’t worry! No Federal Employees will lose theirs jobs; only the tax-paying plebeians will suffer.

Oh, great. Now I feel better. (NOT)

[ken21]

unbelievable.