McCain revisiting “Keating 5” scandal amid questions

Since the McCain campaign has pulled out all the stops on the Obama campaign, it appears Obama is doing the same in bringing up the “Keating 5” scandal McCain was involved with back in the late 1980s, early 1990s. For me personally, this took some researching as I was not entirely aware of all the facts in this case.

Report on this scandal coming to light from the AP:

WASHINGTON (AP) — Nearly two decades later, John McCain is still haunted by his role in the Keating Five scandal.

His role in the 1980s banking scandal is featured in a new Barack Obama attack video. McCain’s presidential campaign quickly moved to limit any damage.

The Republican senator’s lawyer in the case, John Dowd, told reporters in a conference call Monday that McCain had been the victim of “a political smear job” by Senate Democrats.

When a reporter noted that McCain himself has spoken contritely about his role, Dowd responded, “I’m his lawyer and I have a different view of it.”

McCain said his reputation was so tarnished by the Keating case that he compared his ordeal — in some ways — to the torture he suffered as a prisoner of war.

“I faced in Vietnam, at times, very real threats to life and limb,” McCain told The Associated Press in a written statement last March. “But while my sense of honor was tested in prison, it was not questioned. During the Keating inquiry, it was, and I regretted that very much.”

The Obama video was released after Alaska Gov. Sarah Palin, McCain’s running mate, criticized Obama’s association with Bill Ayers, a founder of the Vietnam-era radical group the Weather Underground.

The Keating Five were four Democratic senators, and Republican McCain, who accepted contributions from Charles Keating Jr., a real estate speculator and savings and loan owner. His institution failed and cost many investors in uninsured financial products their life savings.

The Chicago Sun-Times breaks it down:

Here are the truths and falsehoods regarding Sen. John McCain’s role in the Keating Five savings and loan scandal:

1) John McCain was “exonerated” of any role in the scandal.


The Senate Ethics committee censured McCain, saying he “exercised poor judgment in intervening with the regulators.”

Bob Bennett, the high-powered Democratic attorney who headed the investigation, said he recommended McCain and Democratic Sen. John Glenn be dropped from the inquiry because he found them far less culpable than the other three senators. But the Senate’s Democratic majority refused his recommendation because it would have taken the only Republican out of the inquiry.

2) McCain’s actions in meeting with federal regulators cost Americans $2 billion.

Partially True

After McCain and the other senators met twice with regulators, they backed off their plans to close Keating’s savings and loan. Former regulator William Black, one of the people in on that meeting, said the cost to taxpayers of that biggest-ever failure of a savings-and-loan grew from $1 billion to $3.4 billion during those two years. Bennett said the other senators were more culpable than McCain and kept up the pressure on regulators even after that second meeting, while McCain dropped the effort.

3) McCain paid back the $13,433 to Keating for nine corporate and charter jet flights McCain and his family took to Keating’s home in the Bahamas, among other places, from 1984 to 1986 but which McCain initially failed to disclose as required.


4) McCain was the only one of the five senators to “throw Keating out of his office.”

True, but that was before the two meetings.

5) Keating and friends donated $112,000 to McCain’s campaigns over the years.


6) McCain’s wife and father’s company invested $359,000 in a Keating shopping center

True. In a conference call Monday, McCain’s attorney John Dowd said McCain was not aware of his wife’s investment. But the Washington Post reported that McCain admitted knowing about the investment during Senate hearings on the issue.

6) When told federal regulators were preparing to recommend criminal charges against Lincoln Savings and Loan, McCain backed off his pressuring of regulators. McCain expressed contrition about his role and became an advocate for campaign finance reform.


McCain has since apologized for his role and recognized his failures. Still, this issue has come back to light as of recent with the Obama campaign making sure voters are informed about his role. As you can see, similar to Ayres and ACORN for Obama, both candidates to have their baggage.

Obama has launched a website called which states the following:

The current economic crisis demands that we understand John McCain’s attitudes about economic oversight and corporate influence in federal regulation. Nothing illustrates the danger of his approach more clearly than his central role in the savings and loan scandal of the late ’80s and early ’90s.

John McCain was accused of improperly aiding his political patron, Charles Keating, chairman of the Lincoln Savings and Loan Association. The bipartisan Senate Ethics Committee launched investigations and formally reprimanded Senator McCain for his role in the scandal. Today, John McCain is the only major party presidential nominee in US history to have been rebuked, censured or otherwise admonished after a Congressional ethics investigation.

The site also features a 13 minute documentary about the issue. I cannot vouch for the accuracy of the video so I didn’t post it with the story, but you can go watch it for yourself.

Whether or not this is a problem for his campaign, considering it is such old news, will be up to the voters.

  • JD

    My personal Opinion is that this site should post more stories like this and less stories about Obama….

    lol. Sorry, I couldn’t resist.

    I wonder why Babs hasn’t reported on this thread? Might be Nap time for her.

  • Babs

    The funny part to this is that John Glenn was also involved, and John Glenn is on the campaign trail with………you guessed it, Barack Obama.

    This article pretty much debunks Obama’s website, I’d say, so thanks for posting it, Nate. Now everyone can read the truth and shut up. 😉

  • JD

    Oh, Hi Babs… I didn’t know you were here.

    What was that, you are saying McCain is innocent? Of course, McCain has 20+ years in washington and his hands are still clean.

    What a Maverick! We need to take him out of the Senate and put that Maverick in the white house. That is what you have to do with Mavericks… You move them around.

    Like the Maverick in Alaska. We need to just move her to the white house too. Man, we need more mavericks but I am afraid they are the last of the Mavericks in the US.

    Mavericks are Mavericks and you can’t blame a Maverick for being a Maverick or for their involvement in said scandles. 😉


  • Odonata28

    LOL. Glad I wasn’t playing a drinking game.

  • So that’s all the dirt on McCain, well that’s not bad at all compared to that terrorist associating Obama. Hey that one was for you JD.


    WOW, AFTER ALL OF THIS ALL YOU CAN SAY (CONSERVTIVE GAL) IS (So that’s all the dirt on McCain, well that’s not bad at all compared to that terrorist associating Obama)…NO WORDS!!!

  • Dreadsen


    Since Obama is a terrorist associate.

    Why did McCain not bring this up until he was losing in the polls?

    I mean since we have a U.S. Congressmen who is associated with a Terrorist and this is something which we should be scared of why didn’t McCain alert us Americans about this potential boogeyman after it was first brought to our attention back in March?

    I mean someone has got to explain this to me because this should scare a McCain supporter that he would only mention this now.
    What if McCain was winning by a landslide? Would he have not figured that the American’s need to know that a man who almost got into the white house is spooky scary figure we should be afraid of? And that this guy is now still a U.S. Congressman.
    Hell! IN Guatanamo they have a 7/11 owner who they thought was connected to terrorist. It wasn’t that this guy WAS a terrorist. They thought he was associating with one and they arrested him. I know you all have heard that story.

    So shouldn’t McCain have proposed that Obama get treated the same way? After all he is supposed to be protecting us right?

  • Bill Hedges

    McCain involvement was given the light of day in hearing. Article was fair..May be Obama will allow the release of his University records to Nate, so the records can be seen in the light of day . Only facts I know coming from University is Obama, for 5 years, handed out funds from grant the known terrorist got for education.

  • Bill Hedges

    Okay now i’m getting lost in how desperate the attempts are at creating a connection.
    I think the general public can see through this too. This is why the poll numbers have actually gone up since this fiasco happened.

    Why is the government giving a known terrorist grants?
    Would that mean that our tax paying dollars were given to a known terrorist?

    Or would KNOWN terrorist imply that this man is still an active terrorist?

    And if he is an active terrorist then we have all kinds of things to be angry about. We have an active terrorist who is a professor at U.I.C. So an attack should be launched on U.I.C.
    This known terrorist got an award on his education work from chicago.

    The outrage should be pointed at the government, city of chicago, and the U.I.C. as well.

    I’m sure the independents who have followed the primaries have already taken this into consideration.

    Why is it no one is talking about our government giving money to a known terrorist? (known meaning active)

    I mean we know what the implications are here. Why hasn’t someone connected the dots that if U.I.C. has employed a known terrorist that they just might employ members of Al Qeida or they might already be working there! ( play spooky music)

    Just goes to show how stupid this is. This is just people using some false accusation as another reason to channel their hate for another reason.

  • Babs

    Dreadsen, if you’ve been listening to McCain at all (which I doubt), you would know he doesn’t care about Ayers. He cares about Obama’s honesty and candor over the relationship, and he lied. So what else has he lied about? Look at his record, not his rhetoric. That’s what McCain is saying.

    Obama won his senate seat on the promise of going to Washington and cutting taxes, just like he’s promising now. But in all the time he’s been there, he’s NEVER INTRODUCED ONE PIECE OF LEGISLATURE TO FULFILL HIS CAMPAIGN PROMISE. So why should we believe he’ll do it as President? He didn’t even try as a Senator.

  • Bruce

    Hello people,

    Can we Please remember that the WORLD MARKETS CRASHED! Our Own Market Crashing AGAIN! *** Edited by Admin *** And wants to talk about anything but the Economy. Please Lets Stick to REAL ISSUES.

    Note from Admin: Please refrain from excessive profanity, thanks!

  • Bruce

    If this is Where the McCain Camp wants to go This IS what it is breeding.

    Please Get back on the REAL issues and Dont have Smoke Blown up your Arse about Guilt by association. Stop the Hate mongering McCain

    Bruce Stipanovich

  • Babs

    If you believe that i am surprised. You honestly believe that out of all the things which Obama may have not been truthful about he decided to pick Ayers to prove a point? There are things which Obama has promised which he has fulfilled as well. The ethics reform he promised which he did in the Illinois senate and on Congress.There are things which mccain has promised which he has done and not done. WE can just focus on what mccain hasn’t done and then say “Hey look he is a liar” First it was look at his voting record. The problem is his voting record actually reflected his campaign rhetoric now. So now that didn’t work so now it’s look he didn’t introduce any legislation. If you want to dig up all the things BOTH of these guys promised and didn’t keep or have changed since they became candidates you will see both of these guys are bad. I didn’t want to get into this kind of stuff but look up gun owners And see how they grade and have been tracking McCain’s anti gun history and how he has tried to suppress the protest of his efforts ( oops same thing you wrote about Obama)
    Why do they have Palin saying that he is palling around with terrorists (plural). And when people yell kill him in the crowd why don’t they condone it? Or when McCain says “who is barack obama” and someone yelled TERRORIST. McCain didn’t say anything to this guy? They were feeding into it.
    If McCain didn’t want people to believe that Obama is a terrorist then he would have spoken strongly against the “kill him”, “terrorist”, “off with his head”. Remember early when he first started campaigning and that shock jock kept saying “Barack Hussein Obama”. McCain threw him under the bus. Why? Because he knew what the guy was trying to incite.
    Now McCain is happy to incite these same things. That shock jock is probably shocked right now.

    They have had two different people saying Barack Hussein Obama in conjuction with Palin making the claim that he hangs with multiple terrorists. I don’t know why i don’t hear everyone saying John Sydney McCain. Like when Ann Coulter kept saying Barack Hussein Obama over and over again on Bill O’reily and when he asked her why do you keep putting the emphasis on his middle name. She says it’s his name i can say it. O’Reily asked her well what is John McCain’s middle name. she had no answer. She didn’t even know what it was.

    The Democrats all campaigned that if we got them into office they would move on impeachment. Guess what they are in there and they aren’t doing anything. Maybe we should complain about that false promise too.

  • Babs

    Ok, Dreadsen, don’t believe me. You can hear it from him – and Palin. He says it everytime he’s asked, and he is very blunt about it right here:

    Now don’t you think, Dreadsen, that if McCain wants anyone to think Obama is a terrorist that an audience with Sean Hannity would be the perfect venue, wouldn’t it?

    Come on. You’re just enjoying arguing again. 😉

  • Bill Hedges

    Dreadsen. I said,,, known terrorist. I did not say ,,active terrorist. Does dictionary say known means active ? I chose my words carfully. I did not say the grant was from the government, maybe it is or maybe it is not. I see your argument as being assumption upon what I wrote. Not on what I actually wrote.

  • bdjnk

    McCain did something questionable, was exonerated from guilt, and still admitted he made a mistake.

    Obama’s entire political career is nothing but questionable. Alinsky, Ayres, Wright, Rezko, ACORN, etc. And he has a tortured explanation for every one.

    In the coming clean department, McCain is doing just fine. Obama, on the other hand, seems to have never heard of such a thing.

  • Bill Hedges

    Check out SCOPES.COM- OBAMA’s 50 lies..

  • The whole ‘Keating 5’ issue is a load of bull that happened years ago and it shouldn’t be brought up in my opinion.

    It’s a real shame that some morons have to say Obama is palling around with terrorists just to try and score some cheap points. It’s also a real shame for the morons though that their nonsense-talk isn’t working.

    In desperate times people do desperate things and McCains campaign and his supporters are about as desperate as it comes at the moment.

  • Babs lol

    McCain can not come out and say it blatantly and you know this.But he and Pain have come toooo close.
    The just create the dots and leave it for you to connect them.
    Just look at the evidence in their rallies you know what is going on. They just want to show he’s not truthful! No one is falling for that. lol!
    You all call foul or liar on A N Y explanation Obama gives on anything yet you are willing to believe this crock of bull? LOL!!!!!

  • I like how you’ve called her Pain, cos she definitely puts the L(hell) in PAIN…LOL

  • Bill Hedges

    Farahcon, who was neighbor to Ayers and Obama, has come out strongly for Obama. This was some neighborhood to live in.

  • Bill Hedges

    Dreadsen- Your assumption that the grant that Obama distributed for Ayers, for 5 years, was not a government grant.