Sen. Gramm Denies He Offered Improper Help to S&L; Owner
WASHINGTON — Sen. Phil Gramm (R-Tex.) said Sunday he provided only routine help to a savings and loan operator who was paid $63,000 for doing $117,000 worth of work on the senator’s vacation home.
The FBI looked into the transaction but dropped the probe after the Senate Ethics Committee conducted a cursory review of the matter, the New York Times reported Sunday.
The thrift owner, Texas businessman Jerry D. Stiles, asked Gramm’s office for assistance in dealing with regulators in 1989, when Stiles’ three savings and loans faced collapse. Their bailout is expected to cost taxpayers $200 million.
In a statement, Gramm acknowledged that Stiles, a prominent Dallas home builder who bought the Hallmark Savings and Loan Assn. of Plano, Tex., in 1984, arranged in 1987 for a work crew to fly to Maryland to complete the interior of Gramm’s vacation home.
Gramm told the New York paper that he contacted Stiles because the senator wanted to provide work for Texas laborers and help boost the state’s sluggish economy. He said area contractors and laborers had reputations for being unreliable.
Three months after the work was completed, Gramm paid Stiles $63,433, although the bill for the work came to $117,019. The New York Times said three or four workers were flown to Maryland and stayed in a hotel for about two months while they worked on the vacation home.
Gramm maintained Sunday that he paid what he owed under an oral contract with Stiles and didn’t learn of the additional costs until two years after work was done.
“I did not believe then and I do not believe now that I received more value than I paid for in this contract,†Gramm’s statement said.
“At no time have I sought to exert undue influence with regulators on behalf of anyone in the saving and loan business,†Gramm’s statement said.
Gramm said he “did nothing to assist Mr. Stiles nor any other S&L; operator in Texas other than to assure that their requests were communicated†to the Federal Home Loan Bank Board.
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