Federal regulators said the government has initiated action seeking retribution and civil penalties of $24 million from the former chief executive of Columbia Savings and Loan Association of Beverly Hills, Calif.
OTS Director Timothy Ryan said Thursday the administrative action requires Thomas Spiegel to repay Columbia $18.9 million for alleged misuse of corporate funds and thrift property.The government is seeking an additional $5 million in civil penalties and an order to prohibit Spiegel from ever participating in a federally insured financial institution.
Ryan said this is the largest retribution ever sought by the agency against an individual.
"This is a landmark action by OTS in more than sheer magnitude," he said at a news conference. "It exemplifies just how seriously we intend to pursue violations of fiduciary responsibilities to protect the taxpayer."
Regulators said Spiegel used the thrift's money for a variety of personal expenses, including $7,000 worth of tickets to concerts by Michael Jackson and Steve Winwood, $2,000 for a French wine tasting course and several thousands of dollars for a 55-piece gun collection.
The government order also seeks to force Spiegel to repay Columbia $2.8 million for a bonus that regulators have deemed unauthorized; $463,000 for personal travel expenses and entertainment costs and $6.4 million for maintaining aircraft and a luxury aircraft hangar for his personal benefit in a partnership with Michael Milken, the former junk bond guru of the now bankrupt brokerage Drexel Burnham Lambert Inc.
Other expenses for which retribution is sought include $5.7 million for losses suffered by the thrift from $28 million in loans to Howard Schneider, a luxury car dealer and friend of Spiegel's, and $1.1 million for Spiegel's "unjust personal enrichment" stemming from his personal use of condominiums in Jackson Hole, Wyo., Indian Wells, Calif., and Park City, Utah.
In related action, savings and loan regulators are ordering President Bush's son, Neil, to answer conflict-of-interest charges in public, despite objections from the younger Bush's attorney.
Regulators said Neil Bush, as an officer of a Denver thrift institution, voted to approve millions of dollars in loans from the S&L to one of his business partners.
The administrative charges, filed in February, were released Thursday as part of a new policy at the Treasury Department's Office of Thrift Supervision. The agency scheduled a public hearing for Sept. 25 before a Denver judge.
"I think it's unfortunate if it creates a political sideshow or a media sideshow," said James Nesland, a lawyer for Neil Bush. "But I'm still confident the administrative law judge will decide the case on its merits."
The judge will make a recommendation to Ryan.