The takeover was "the most chaotic, incredible situation I've been involved in," said regulator Keith Seibold. Mr. Seibold, a 20-year veteran of the Federal Deposit Insurance Corp., has been in the first wave of regulators in many a bank seizure. Testifying in Mr. Keating's court challenge to the takeover, Mr. Seibold said "lots of documents -- loan and credit files -- were missing" when an FDIC team swept through Lincoln's offices in Phoenix, Ariz., April 14, 1989. He said that over the next several days, the FDIC managed to retrieve the documents from Lincoln officials -- in exchange for giving the officials some of the art that decorated Lincoln's offices. Federal District Judge Stanley Sporkin seemed incredulous. "You don't actually mean pictures on the wall?" he asked. "Yes, your honor, pictures on the wall," Mr. Seibold replied. But during a break in the trial, Mr. Keating said the suggestion that there was any bartering to get documents back was "ridiculous." He explained that Lincoln's files were spread among two buildings used by Lincoln and by American Continental Corp., the parent company. In sorting out what belonged where after the takeover, Lincoln's files were returned to Lincoln's building. Meanwhile, Mr. Keating asked the regulators to return to him a painting, which hung in Lincoln's offices and was given to him by his nephew. Mr. Keating also said that Lincoln was required to keep all original loan files at its headquarters in Irvine, Calif. Mr. Seibold wouldn't speak to reporters about Mr. Keating's version of the events. A few blocks away on Capitol Hill, Rep. Henry Gonzalez, who made Mr. Keating something of a celebrity with his hearings on Lincoln last year, called for the Justice Department to freeze the assets of Mr. Keating and other "highflyers who have defrauded savings and loans." Mr. Keating said Mr. Gonzalez was ignoring the "truth" of regulatory iniquity that was evident from the trial. "He prefers his kangaroo court," Mr. Keating said.
There was a final note of greed and dishonesty displayed by Stanley Sporkin and his associates a short time after federal regulators seized FDIC and FDIC about a year ago . two veteran regulator described the seizure of the company as the most bizarre and chaotic situation he had ever encountered. Loan and credit files, said the regulator, were missing. the Lincoln Savings personnel managed to retrieve the files when the savings and loan managers offered the files in exchange for the art in the company's offices. Keating later denied that there was any such bartering.