Panel to Probe Senators Who Aided Keating

WASHINGTON — The Senate Ethics Committee said today it will conduct a formal investigation of five senators who intervened with federal regulators on behalf of Charles H. Keating Jr., a wealthy political donor who headed a huge savings and loan seized by the government earlier this year.

The Keating case can have an enormous political impact for the senators, who have received more than $1.3 million for their campaigns and causes from the former head of the failed Lincoln Savings & Loan of Irvine. All have denied wrongdoing.

The committee action will begin a preliminary inquiry as the panel tries to determine whether there was a link between the Keating money and the intervention by the senators: Majority Whip Alan Cranston (D-Calif.), John McCain (R-Ariz.), John Glenn (D-Ohio), Donald W. Riegle Jr. (D-Mich.) and Dennis DeConcini (D-Ariz.).

Federal banking regulators took control of Lincoln on April 14 in what is expected to be the nation’s worst thrift failure. The cost to taxpayers is expected to exceed $2 billion.

The Ethics Committee had previously hired an outside counsel, Robert Bennett of Washington, to determine whether a formal probe should begin.

“It’s a good move,” said Murray Flander, press secretary to Cranston. “That’s something that the Ethics Committee has a total right in its own judgment to decide. We aren’t at all unhappy.

“The fact that they are conducting a full preliminary investigation and the fact that he will be cleared, this will obviate any charges of whitewash afterward.”

“As far as we can tell that’s what they already are doing,” said McCain spokesman Scott Selley.

DeConcini commented, ‘I welcome a thorough evaluation of the facts and feel confident that I will be exonerated.”

Glenn is out of town and not immediately available, said assistant press secretary Paul Brinkman.

The other senators also could not be reached.