WASHINGTON — The Office of Thrift Supervision improperly allowed the backdating of capital infusions for six thrifts, according to a report released Thursday by the Treasury Department's Office of Inspector General.

The report is sharply critical of the agency, saying the backdating allowed the thrifts to appear in better condition than they really were. It named only one thrift - IndyMac Bancorp., which failed last year - but sources have identified Florida-based BankUnited as another institution where backdating occurred. The identities of the other four thrifts are unknown.

"We consider these matters very serious and find it alarming that such high level OTS officials were not only aware of the backdating at two thrifts, but either directed or authorized the thrifts to backdate the capital contribution," the IG wrote. "Approving or directing the thrifts to backdate these contributions is inappropriate as the accounting treatment is not in accordance with generally accepted accounting principles and allows for misleading financial reporting by the thrifts."

Although the OTS explicitly permitted the backdating to occur at some thrifts, such as IndyMac and BankUnited, that was not the case for every institution where backdating occurred. The IG said that a thrift in the Southeast thrift asked permission to backdate, was denied by the agency, and then proceeded to do so anyway. After the OTS discovered the thrift had engaged in backdating, it did not take any enforcement action.

The OTS also uncovered evidence of backdating at thrifts in its Western and Northeastern regions - but did not take corrective action at either institution, the report said.

The agency did require a Southeast thrift to restate its financial reports after it uncovered backdating there, the IG said.

Even before its release, the report had already put one senior OTS executive in jeopardy. Scott Polakoff, the senior deputy director and formerly acting director of the agency, was put on suspension after the IG began investigating him for allowing a thrift to backdate a capital injection.

The report said that on a conference call held Aug. 4, 2008, Polakoff directed OTS regional officials to backdate a capital infusion so it would be recognized as of June 30. The capital was actually received on Aug. 5, the IG said. Though the IG report identified the thrift as "Thrift #2," sources have said it was BankUnited.

In the report, the IG criticized the OTS for directing backdating in some thrifts and not taking corrective action against others.

"Allowing thrifts, and in one case directing a thrift, to backdate contributions is inappropriate," the IG wrote. "In addition, with the exception of the thrift that OTS directed to reverse the transaction and the thrift complied, OTS did not take appropriate action to address the other instances of backdating once the examiners became aware of such transactions."

In several cases, the IG said that the backdating allowed thrifts to appear well capitalized when they were not. Such was the case at $30 billion-asset IndyMac, the most expensive failure of this crisis, which is expected to cost the Deposit Insurance Fund $11 billion. The IG found that OTS officials authorized IndyMac to book a capital infusion received on May 9, 2008, for the first quarter. The accounting change allowed the thrift to maintain its "well-capitalized" status and not face restrictions on its brokered deposits by the Federal Deposit Insurance Corp.

The IG noted the OTS has issued guidance on accounting standards for capital injections, but said additional guidance is needed to outline steps for OTS examiners to identify and address backdating of capital contributions if and when they occur. The IG also directed the OTS to determine if there have been any additional backdating capital contributions.

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