Corporate Raider Charles Hurwitz Settles for $206,000 in S & L Case Maxxam and Hurwitz Slither Out of Financial Responsibilities Once Again

A year after a Texas administrative law judge dashed hopes for a just resolve to a years-long campaign to hold corporate raider Charles Hurwitz responsible for the collapse of a Savings and Loan he controlled, Hurwitz has been billed $206,000 in restitution. Charges against Hurwitz and his Maxxam Corporation outlined a junk bond and fraud scheme that resulted in the 1988 crash of United Savings Association of Texas that enriched his coffers but cost the taxpayers $1.6 billion in bail out funds. The original case, filed in 1995, brought charges against Hurwitz and Maxxam for misconduct leading to the S&L's failure, including reckless disregard for the law, self-enrichment, making false and misleading statements and making unsafe investments, and sought over $800 million, reflecting costs to the public. Though the $206,000 figure is fractional pennies on the dollar of what those who have watched the case claim is just restitution, Hurwitz has spent at least $30 million fighting the case. He is also restricted from future activities with any federally insured depository institution, as is Maxxam and the Hurwitz-controlled Federated Development Company. Noted long-time Hurwitz opponent and Earth First! activist Darryl Cherney, "As small as this settlement is, there would be no restitution or an S & L stay-away order if there wasn't wrong-doing. At least this keeps Charles Hurwitz off the financial streets for a time." In his long fight against being held accountable for one of the largest savings and loan failures at the time, Maxxam and Hurwitz rallied their friends in Congress and brought considerable pressure to bear against the agencies bringing the claims forward: the Office of Thrift Supervision (OTS) and the Federal Deposit Insurance Corp. (FDIC), agencies not used to political fights. Hurwitz ally right-wing Alaska Republican Don Young even convened a special Congressional task force that harassed citizen groups by subpoenaeing records of any communications with activists and organizations who supported a Debt For Nature swap to resolve the issue. Many civil liberty activists believe the actions of the Task Force were a clear abuse of Congressional subpoena authority and a heavy-handed attempt to dissuade citizens from exercising their constitutional right to petition the government regarding issues of concern. In addition, the Task Force released confidential and privileged documents to Hurwitz and his counsel. "Though the taxpayers are still stuck with the $1.6 billion bail-out bill, through disclosure of Maxxam's junk bond schemes, Hurwitz' wrong-doing has been widely recognized, including by those government agencies that regulate Savings and Loan institutions." remarked Karen Pickett of the Bay Area Coalition for Headwaters. HOME