FDIC will use ombudsmen to field complaints at liquidation offices.

WASHINGTON - The acting chairman of the Federal Deposit Insurance Corp. told New England lawmakers on Thursday that he plans to place ombudsmen in each of the agency's liquidation offices to handle complaints from the public.

The first would be installed in New England, probably in Boston, Andrew C. Hove Jr. said.

In time, each of the agency's 18 offices will have an official charged with facilitating action on complaints and questions from borrowers, lenders, Congress members, and other public officials, added John Bovenzi, director of liquidations.

Where the Action Is

The effort will start in New England, "because that's where all the action is," Mr. Bovenzi said.

New England officials have long accused the bank regulatory agencies of worsening their region's recession by cracking down on bank lending.

In addition, the FDIC has come under sharp criticism for the way it has handled failed banks.

Mr. Bovenzi said the ombudsmen would have no authority on their own to make changes or to force action on any issue. But the ombudsman in each office would be "a senior-level person," who would "have direct access to the person in charge."

Legislators attending the meeting seemed particularly pleased to have a designated official in charge of complaints.

Legacy of Keating Five

Several lawmakers said their colleagues had shied away from regualtory contacts in recent years because of the Keating Five episode, in which five Senators were accused of improperly intervening with regulators on behalf of thrift owner Charles Keating.

"There's absolutely no question it made it more difficult for legislators to deal with the credit crunch problem," said Rep. Nancy Johnson, R-Conn.

"Before that, everybody expected you to help your constituents," she added. Afterward, "a lot of people wouldn't think of intervening."

Ethical Risk Eliminated

Rep. Joseph P. Kennedy 2d, D-Mass., who chaired Thursday's meeting of the New England caucus, also hailed the new program.

"Of course it was Keating," he said of his colleagues' reluctance to confront regulators.

Mr. Bovenzi said the ombudsman would offer lawmakers a forum in which to voice their constituents' concerns without worrying about whether they were violating ethical standards.

A Far Cry from Lobbying

"There are certain kinds of communication that are perfectly acceptable," he said. "If you have a constituent with a concern, passing it along to someone is very different from lobbying for it."

Rep. Kennedy, who has played a key role in focusing attention on the New England credit contraction, said Thursday's meeting was useful in that it gave lawmakers a forum to vent "the tremendous pent-up frustration that every member feels."

That frustration, he said, has been fueled by the "sheer number of complaints that come into all our offices" about the bank regulatory agencies.

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