Banking-Fraud Convictions Nearly Double
WASHINGTON - The Justice Department said Wednesday that convictions of people it charged with major fraud at financial institutions nearly doubled in the first nine months of fiscal year 1991.
Of the 896 people charged from last Oct. 1 through June 30, 681 or 76% have been convicted, the agency said. And 665 have gone to prison. All had been charged in bank, thrift, or credit union fraud cases involving losses of at least $100,000.
"This has been a priority of the department, and that perseverance is now showing results," Attorney General Dick Thornburgh said.
He released the results to the Senior Interagency Group, a 12-member panel that coordinates the federal government's investigation and prosecution of financial-institution fraud.
Fraud has drained $4.3 billion from savings and loans, $1.9 billion from banks, and $62 million from credit unions, the agency said. In all, $6.6 million in fines were levied by courts, and $147 million in restitution was ordered.
Ira Raphaelson, who heads the Justice Department's Office of Special Counsel for Financial Institution Fraud, said the number of defendants charged in S&L fraud prosecutions involving more than $100,000 surged by 93%, to 378, from fiscal year figures compiled in 1988 and 1990. Meantime, S&L convictions rose by 257, or 81%.
Mr. Raphaelson, who briefed reporters, said that, of the 378 people charged, 27% to 30% were in top management.