Leniency Sought for Keating Associates : Courts: Prosecutors say four former executives should get probation or light terms for helping convict their boss.

LOS ANGELES — Federal prosecutors are recommending lenient sentences for five former executives in Charles H. Keating Jr.’s fraud-ridden real estate and financial empire, saying the one-time associates helped convict the former operator of Lincoln Savings & Loan.

The defendants include Robin S. Symes and Raymond C. Fidel, who were chairman and president, respectively, of the Irvine-based thrift before it collapsed in April, 1989.

In sentencing memos filed in U.S. District Court this month, prosecutors seek probation or terms of only three months for four of the defendants.

They want the fifth, Mark S. Sauter, to be sentenced to three years in prison, mainly because the former in-house lawyer for Lincoln’s parent company failed to reveal at first that besides helping Keating alter loan files, he also embezzled $1.6 million himself.

The cost to taxpayers of Lincoln’s collapse is estimated at $3.4 billion, making it the nation’s costliest thrift failure ever.

The information the five provided as part of their plea bargains helped convict Keating, 70, and his son, Charles H. Keating III, 38, last January on charges of racketeering, conspiracy and fraud. The elder Keating was sentenced to 12 years, seven months in prison, while his son was given a term of eight years, one month. The father also is serving a 10-year term for his 1991 state court conviction on California securities fraud charges.

“In each of the five cases, we are recommending more lenient sentences than they otherwise would have received because of their cooperation,” said Asst. U.S. Atty. David A. Sklansky, who helped to prosecute the Keatings.

“But even without their assistance, they should get lenient sentences because of the minor roles some played and the remorse they have shown,” he said.

Defense attorneys said they will seek probation for their clients.

Sauter’s lawyer, Gordon Greenberg, said his client was never asked about the embezzlement at his interviews with investigators in 1991. But when asked about missing funds later by federal thrift regulators, he acknowledged the embezzlement and then told prosecutors about it. Sauter’s information also helped regulators recover $112 million from three law firms they accused of aiding Keating’s frauds.

One of the defendants, Bruce F. Dickson of Phoenix, is scheduled to be sentenced Thursday by U.S. District Judge Mariana R. Pfaelzer, who presided over the Keatings’ trial. Dickson, 40, was a senior vice president at Lincoln’s parent company, American Continental Corp. in Phoenix, and also served briefly as Lincoln’s president.

Prosecutors recommend that Dickson, who pleaded guilty to one count of bank fraud, serve three months in prison or at a halfway house.

Prosecutors also recommend that:

* Fidel, 36, of Newport Beach, serve three months in prison or at “alternative confinement” for his guilty plea to two counts of securities fraud. His lawyer, David W. Weichert, said he will seek probation or at-home confinement for Fidel. The lawyer otherwise concurs with the prosecution’s report that Fidel provided “substantial” aid by giving prosecutors an “invaluable road map” to Keating’s operations early in the investigation and testifying at both state and federal criminal trials of Keating.

* Symes, 41, of Malvern, Ohio, serve an unspecified probation term. Though he pleaded guilty to two counts of securities fraud, prosecutors said he had a low “level of culpability” yet provided substantial help in testifying against Keating in both state and federal courts.

* Ernest C. Garcia II, 36, of Tucson, Ariz., serve a five-year probation term for his guilty plea to bank fraud. Garcia, a major Lincoln borrower, was the first to enter a plea bargain and testified how he helped act as a straw purchaser for Lincoln’s overpriced desert land.

Fidel, Sauter and Garcia are scheduled to be sentenced on Monday. Symes’ sentencing is set tentatively for Jan. 3.

Last week, Keating son-in-law Robert M. Wurzelbacher Jr., 39, an American Continental executive vice president, was sentenced to 40 months in prison for pleading guilty to three counts of misapplying $13.9 million in Lincoln deposits.

No sentencing date has been set yet for the only remaining criminal defendant, Judy J. Wischer, 45. The former American Continental president was the key witness against Keating at his federal trial and is continuing to help prosecutors in an ongoing probe.

Wischer, Fidel and Symes also had pleaded guilty to state securities fraud charges, but the state has agreed to impose no greater sentence than Pfaelzer imposes.