$1-Billion Judgment Against Charles Keating Associate Upheld
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A federal appeals court upheld a $1-billion judgment against a former Arizona developer and business associate of Charles H. Keating Jr., but it is unlikely that investors in Keating’s real estate and financial empire who won the verdict will collect anything.
The U.S. 9th Circuit Court of Appeals in San Francisco upheld the award against Conley D. Wolfswinkel for his role in the 1989 collapse of Lincoln Savings & Loan in Irvine and its parent company, American Continental Corp.
Wolfswinkel, a Tempe entrepreneur who lost a fortune when the Arizona real estate market fell, has filed a bankruptcy petition to reorganize his debts and may be unable to pay much of the judgment, said Leonard B. Simon, a San Diego lawyer for American Continental investors.
The appeals court said Wolfswinkel acted as a straw borrower who took part in sham real estate deals that generated artificial profits for American Continental and Lincoln. The S&L; is the second most expensive thrift failure.
Keating, American Continental’s chairman, is serving state and federal prison terms.
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