
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: THURSDAY, March 15, 1990                   TAG: 9003152304
SECTION: BUSINESS                    PAGE: B6   EDITION: METRO 
SOURCE: Associated Press
DATELINE: WASHINGTON                                 LENGTH: Medium

S&L PROSECUTIONS LAG; NO FUNDS

The Bush administration has delayed prosecuting thousands of fraud cases by turning down some of the money Congress offered to pursue savings and loan crooks, a House subcommittee chairman contended Wednesday.

Rep. Doug Barnard Jr., D-Ga., said 2,327 financial institution fraud and embezzlement cases are inactive, meaning they are open but are not being pursued because of a lack of investigators or prosecutors.

Of those, 1,298 involve alleged losses of $100,000 or more, he said.

S&L legislation enacted in August authorized $75 million for pursuing bank and thrift fraud this year but the Justice Department sought and received only $50 million, Barnard said at a hearing of his House Government Operations subcommittee on commerce, consumer and monetary affairs.

The department devoted an additional 557 employees to pursuing fraud - 201 FBI agents, 118 attorneys and 238 clerks and other support staff. But that was only a bit more than half of the 1,036 additional employees that field offices had said were needed to handle the backlog, he said.

"Our analysis raises the question whether or not the Justice Department will investigate and prosecute the thousand or more major cases now on the back burner," Barnard said

FBI divisions and U.S. attorney's offices in several areas, including San Diego and Pittsburgh, asked for more employees but received none, he said.

"Other areas did receive a large increase, but not nearly enough to respond to the problem," he said. These included Houston; Chicago; New Orleans; San Antonio, Texas; Miami and Boston, he said.

Robert J. Wortham, U.S. attorney for the Eastern District of Texas, said S&L and bank failures in his region are going uninvestigated.

"There's no one to go out and do the work," he said. "We have asked for resources and not received them."

Doug Tillett, a spokesman for the Justice Department, said while the S&L law authorized $75 million in spending, Congress actually appropriated only $49.2 million. Justice Department officials are scheduled to appear before the panel Thursday.

by CNB