SAVINGS AND LOANS: A Bailout with No Bucket

A Bailout with No Bucket

Could the Bush Administration's savings and loan bailout get any messier? Yes, in ways never imagined. In a surprise court victory last week, the ailing Olympic Federal Savings of Berwyn, Ill., convinced federal Judge Royce Lamberth that the Government's Office of Thrift Supervision currently has no power to seize the S&L. Reason: acting OTS director Salvatore Martoche and his predecessor, M. Danny Wall, were never constitutionally appointed to their posts.

The decision could invite lawsuits from other insolvent S&Ls seeking to avoid seizure by OTS. But the agency has received temporary permission to continue taking over bankrupt thrifts pending an appeal....

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