"I'm not beholden to my past out here," Symington explained in 1984 while trying to drum up support for his ill-fated Camelback Esplanade.
But Symington has corruption in his DNA; like his father, he was destined to see his political ambitions dashed and his public-service career end in disgrace.
J. Fife Symington II was an archconservative from tony Lutherville, Maryland, who lost three congressional elections in the late 1950s and early 1960s.
An avid and early supporter of Barry Goldwater's disastrous 1964 presidential campaign, the elder Symington saw his political aspirations wither with a Watergate-era bribery scandal that sent President Richard Nixon's personal lawyer, Herbert W. Kalmbach, to prison.
Although he was never charged, Fife II secretly contributed $100,000 to Nixon's Committee to Re-Elect the President (CREEP) in 1970 in exchange for a promised European ambassadorship. The solicitation was made by Kalmbach. Fife II was dissatisfied with his current station, ambassador to Trinidad-Tobago.
His son, Fife III, stayed one step ahead of the law--if not creditors--for more than 14 years.
But he was branded a criminal at 1:23 p.m., Wednesday, September 3, when a federal jury found him guilty on seven counts of bank and wire fraud.
The verdict in U.S. District Court came after a historic 12-week trial before Judge Roger B. Strand. More than 1,300 exhibits were introduced, and 40 witnesses called. Symington was acquitted on three counts and the jury was deadlocked on 11 others.
Symington is to be sentenced on November 10. The 52-year-old real estate developer turned politician could face prison time and substantial fines, although Strand is free to depart from federal sentencing guidelines and give Symington probation.
Sitting between two defense attorneys, Symington displayed no visible emotion as the guilty verdicts were read by a court clerk. Several minutes passed before he turned around to face his family and wife, seated directly behind him.
Ann Symington had spent the summer in the front row of the courtroom, supporting her husband. Now, Symington could only manage a glance at his wife, who, in turn, gazed for the first time upon a convict and soon to be former governor.
A few more minutes passed before Ann joined her husband behind the defense table. The couple, escorted by two state Department of Public Safety security guards, exited the courtroom through a side door at 1:36 p.m. and took an elevator to the basement where the state limousine waited.
By slipping out, Symington avoided a crush of reporters and onlookers that stood outside the courthouse as the verdicts were returned. Cheers erupted when the first guilty verdict was announced.
The verdict brings to an end a federal investigation that began six years ago and ultimately showed that Symington never managed to escape the ethical vacuum his father's politics inhabited.
Ninety minutes after being found guilty, Symington, with Ann at his side, received a standing ovation from his staff as he strode to a podium at the State Capitol to make his final speech as governor.
While eloquent and inspirational, Symington never admitted wrongdoing during the speech nor asked the people of Arizona to forgive him for dragging the state through yet another political scandal.
Instead, Symington, who became the second Arizona governor in nine years to be forced from office when his resignation took effect at 5 p.m. September 5, proclaimed victory in the face of utter defeat.
"What is to come, we know not; but we know that what has been is good," Symington said.
The facts, however, belie Symington's assertion that his six-plus year tenure has been one of greatness--a theme Valley daily newspapers trumpeted in the wake of the verdict.
The record is far more stark. Besides the sordid details of his conviction, it shows:
Shortly after returning from a European vacation, he filed for personal bankruptcy, seeking to wipe out $25 million in debt while knowing he stood to inherit millions.
He lied when he told voters he was a successful businessman.
He stole the 1990 gubernatorial election with $1.3 million in illegal campaign contributions from his wife and his mother.
He defaulted on millions of dollars in personally guaranteed loans, never apologizing or even hinting that he felt any obligation to repay them.
He fought viciously to keep journalists and citizens alike from reviewing public records, which go beyond rhetoric to tell the true story of governance.
He counts among his friends a prominent Mexican businessman and a Mexican politician suspected of narcotics trafficking.
He used his state office to pay off personal debts.
He appointed friends to key state positions and took them at taxpayer expense on a fabulous Japanese "trade mission" and Hawaiian vacation. His first deputy chief of staff wrecked the Governor's Office budget.
He routinely used a state plane to whisk him, his family, friends--even a criminal defense lawyer--on pleasure trips.
He betrayed his business partners.
He ruthlessly swept aside political opponents.
He demanded fiscal restraint in others, but showed a wanton disregard for his own finances.
He turned his back on Arizona's children--except to enact harsher criminal penalties against them.
He advocated shooting endangered species.
He was sued by the Resolution Trust Corporation for his role in the failure of Southwest Savings & Loan, a collapse that cost taxpayers $1 billion.
It was while he was a director at Southwest Savings, from 1972 until 1984, that Symington sowed the seeds that would ultimately lead to his downfall.
In September 1983, J. Fife Symington III convinced his fellow directors on the board of Southwest Savings & Loan to invest $30 million to purchase 20 acres on the southeast corner of 24th Street and Camelback Road. Symington wanted the land to build the Camelback Esplanade hotel, retail, office and residential complex.
Southwest Savings and Symington formed a development partnership to buy the land. Symington invested a mere $216 in exchange for his 19 percent share in the project while Southwest Savings' $30 million got it a 50 percent stake. Symington's partner, I. Jerome Hirsch, obtained a 19 percent share while the original owners of the land, the Friedman Family Trust, retained a 12 percent stake.
Symington's deal with Southwest Savings violated at least two federal banking regulations.
First, Southwest's board approved buying the land even though no formal appraisal had been conducted. Second, the board violated conflict-of-interest regulations by approving the investment in a board member's project without obtaining prior regulatory approval.
The violations did not surface publicly until years later, and the revelations couldn't have come at a worse time for Symington.
In February 1991, just weeks before the gubernatorial runoff election between Symington and Democrat Terry Goddard, former Ohio Democratic Senator Howard Metzenbaum called a hearing on the failure of Southwest Savings.
Metzenbaum chaired the Subcommittee on Antitrust, Monopolies and Business Rights, which began an investigation into Southwest Savings in August 1990 after hearing from a disgruntled federal employee that banking regulators were not thoroughly investigating the 1989 failure of the thrift.
The subcommittee's investigation and subsequent hearing unearthed stunning information about Symington's relationship with Southwest Savings. Such data are normally kept secret.
The investigation revealed that Don Lewis, Southwest Savings' former president, had admitted to regulators that the thrift had failed to obtain a formal appraisal before purchasing the land and had violated conflict-of-interest regulations. Symington resigned from the Southwest board in January 1984 after regulators raised the conflict-of-interest.
The congressional probe also showed that Southwest Savings was crippled when it made its Esplanade investment, its single largest ever.
"They had no capital when they went into Camelback--all the money would have to borrowed from the public via savings accounts," former Federal Home Loan Bank Board examiner Jerry Landers told Senate investigators.
Besides the flouting of regulations and imprudent investments, the Senate investigation provided insight into Symington's management skills--or lack of them.
The subcommittee released two letters sent to Symington by his partner Hirsch that were critical of Symington's handling of the Esplanade project. Hirsch complained that Symington was hiring too many consultants and was failing to devote adequate time to the huge project.
"If this continues I fear we will have the largest white elephant in the Southwest," Hirsch wrote in an October 3, 1983, letter to Symington--less than three weeks after Southwest Savings invested $30 million to buy the land.
Hirsch wasn't the only person complaining about Symington's management skills. A 1984 report by the national accounting firm of Peat, Marwick, Mitchell & Co. found that Southwest Savings' managers knew little about the project.
Three years later, Southwest's internal audit committee reported that "for a project of this size and volume of activity, formal accounting records did not exist."
During this three-year period, predevelopment expenses rose from the $3.1 million projected by Symington to $12.1 million. Fees for consultants alone increased 436 percent to $3.3 million.
Meanwhile, development fees Symington paid himself rose to $2.2 million, up from his original $300,000 projection.
Rather than seizing control of the project, the Southwest board gave Symington more latitude. In May 1987, the board shifted management of the thrift's Esplanade investment to a subsidiary headed by Symington.
Symington sat on the thrift's executive compensation committee, which determined Lewis' pay.
When Southwest Savings failed in 1989, the Esplanade investment became the thrift's single largest loss at more than $21.6 million, not including millions of dollars in interest that the $30 million could have earned if invested safely.
Symington--who was not asked by Metzenbaum to comment on the investigation prior to the hearing--was enraged by the proceedings. Symington happened to be in Washington, D.C., on the day of the hearing and demanded to speak before the subcommittee.
"I was shocked to learn that Chairman Metzenbaum released a statement alleging wrongdoing on my part in connection with my service as a board member of Southwest Savings & Loan," Symington told the subcommittee.
Symington then launched into a litany that would become familiar to Arizonans. He said he was "proud" of his business accomplishments and "resent[ed] this attempt to denigrate my achievements."
Symington told Metzenbaum while under oath that "I personally borrowed from a Japanese bank $135 million" to get the development phase of the Esplanade project under way. This assertion would prove to be one of many lies Symington told as his development empire began to collapse. Testimony during his criminal trial showed the money was borrowed by real estate partnerships Symington managed. Symington personally guaranteed to repay $9 million of it, which he never did.
Despite the damaging information released at the hearings, Symington survived the fallout (with the help of friendly coverage from Phoenix's daily newspapers) and went on to defeat Terry Goddard by 4 percentage points in the runoff election.
But the Metzenbaum hearings set the stage for the Resolution Trust Corporation to file a civil suit against Symington and other officers and directors of Southwest Savings on December 16, 1991. The RTC sought $140 million in damages (amended to $197 million in 1992) stemming from the thrift's failure.
The RTC suit accused Symington of breaching his "duties of candor and loyalty" and receiving "unwarranted millions" of dollars from Southwest Savings for the Camelback Esplanade.
More important, the RTC investigation into Symington's relationship with Southwest Savings led to a criminal referral to the Department of Justice in the fall of 1991.
Symington was by then entrenched as governor, and maintained publicly that he was an honorable businessman who was being persecuted by the federal government. In truth, he saw serious trouble was on the horizon.
On December 27, 1991, an anonymous memo arrived at the Mesa Tribune.
The four-page document titled "Countershot" appeared to be the work of Symington aides and listed a series of proposed actions to counter the RTC civil suit and Justice Department criminal investigation.
The memo included extensive details of the RTC investigation, including obscure information and names that only people close to the probe would know. After reviewing recent activities, the memo listed a series of actions to be considered.
The criminal probe was the biggest concern.
"The strategy is to push for a favorable termination of the FBI/DOJ probe, announce the G's [governor's] innocence, and thereby relegate the RTC suit to the shadows," the Countershot memo stated.
The memo also discussed leaking key information related to the RTC suit, and then making a motion for mistrial.
Symington and his top aides--including his criminal defense attorney, John Dowd, and political adviser, Jay Smith--have long claimed the memorandum is a fabrication.
But the Countershot memo created a stir and led to U.S. Senate hearings in October 1992 to discuss its contents. Although the memo was never entered into the Senate's official records, former Colorado Democratic Senator Timothy Wirth discounted Symington's assertion that the memo was counterfeit and said it "warrants a far more serious and thorough investigation."
The memo described how Symington's team would attempt to deflect attention from the criminal investigation by focusing the public's attention on the RTC suit while working behind the scenes in Washington to terminate the investigation.
"The smokescreen is the battle against the RTC in Phoenix. The real theater of operations is D.C.: a preemptive political strike at FBI/DOJ," the memo states.
Actions taken in the ensuring years by Dowd and others lend credence to the memo.
Dowd was a crucial player. The former head of the Justice Department's white-collar criminal task force spent more than four years negotiating with prosecutors in an unsuccessful effort to derail the criminal probe.
Dowd wrote five long letters to federal prosecutors, urging them to drop the investigation. Prosecutors later alleged in court pleadings that Dowd had lied in the written statements.
The Countershot memo was Nixonian. It praised Symington's performance at a December 19, 1991, press conference during which he accused the RTC of "Gestapo" tactics in its investigation and filing of the civil suit. Symington's attack, the memo noted, successfully diverted the media's attention from the criminal investigation as well as from looking into "an alleged 'cover-up' in D.C."
A September 1991 Washington Post story had raised suspicions that Symington allies at the RTC and Federal Deposit Insurance Corporation had interfered with the RTC investigation and subsequent civil suit. The Post reported that the former top federal attorney overseeing the RTC investigation of Southwest Savings ordered the draft lawsuit naming Symington to be rewritten, removing serious allegations that Symington had engaged in "blatant self-dealing" on the Esplanade deal. The order by former FDIC general counsel Al Byrne infuriated staff attorneys, but the self-dealing reference did not appear in the civil complaint.
The Countershot memorandum also contained a list of "press enemies" who would "be monitored at all times" as well as "press friends" who would be "briefed on a superficial basis."
During the winter and spring of 1992, Dowd and Smith launched a blistering campaign aimed at any publication that dared scrutinize Symington's legal problems.
As part of the campaign, Smith fabricated stories about this reporter, who at the time worked for the Mesa Tribune. Smith falsely claimed this reporter had made a bet that he would "bring down the governor."
In written demands for retractions, Dowd circulated the false allegation to reporters in Washington and Phoenix. The letters were a thinly disguised effort to discredit the Tribune's reporting, which had been accurate, and reduce the likelihood other newspapers would aggressively cover the story.
The strategy worked.
Press coverage of Symington's RTC and criminal investigation troubles soon faded into the background.
But Symington wasn't out of the woods. Blunders by his gubernatorial staff created one scandalous story after another. His appointment of shapely Annette Alvarez as his top trade official raised protests when a suggestive letter she sent to the governor was published by New Times.
Alvarez resigned in the spring of 1992 after questionable travel expenses surfaced and it was revealed that Symington's campaign had paid $9,000 of her back taxes.
Symington's reckless management was only reined in after Senator John McCain dispatched some of his top aides to help run the Governor's Office. The scandals subsided as aides Wes Gullett, Chuck Coughlin and Jay Heiler brought some control to the Ninth Floor.
But there was nothing they could do about the RTC and criminal probes.
The criminal investigation attracted little attention, however, and Symington used the media to deliver a "preemptive" strike at the RTC lawsuit. In January 1993, the Arizona Republic reported in a front-page story that Symington--great-grandson of robber baron Henry Clay Frick, who co-founded what is now U.S. Steel--was broke.
Symington made the announcement at the same time he was successfully arguing in U.S. District Court that personal financial records, including details of four family trusts that were provided to government attorneys in the RTC suit, should remain sealed.
In February 1993, Symington secretly met with federal prosecutors and for two days answered questions under oath. Dowd arranged the meeting in the hope that it would bring the criminal probe to a quick conclusion.
Dowd's strategy backfired.
Instead, the criminal investigation picked up, and by July 1993 a federal grand jury was subpoenaing documents from bankers, appraisers and other businesses that worked with Symington and his development firm, The Symington Company.
Although New Times reported the grand jury probe in September 1993, the daily newspapers ignored the story. The Arizona Republic didn't write about the grand jury investigation until February 1994.
That same month, New Times obtained a startling document that revealed the grand jury's direction. Federal prosecutors had grilled Symington's longtime personal secretary, Joyce Reibel, about Symington's penchant for preparing multiple financial statements and sending different versions to different lenders.
Reibel had also revealed that Symington had hired his longtime accounting firm, Coopers & Lybrand, to help prepare some of those financial statements. Information obtained from Reibel eventually became the centerpiece of a 23-count criminal indictment filed against Symington in June 1996.
But that indictment was two years away. And in July 1994, in the midst of a heated challenge from fellow Republican Barbara Barrett for the party's gubernatorial nomination, Symington got a break.
The RTC settled its lawsuit.
The governor got a sweet deal. The RTC agreed to accept $12.1 million from the estate of the former owner of the thrift, the late billionaire Daniel K. Ludwig. All civil complaints against Symington were dropped and the governor was not required to admit wrongdoing or pay a fine.
An RTC official said the lawsuit was settled only because Symington had no money to collect.
Symington declared victory, anyway. The voters agreed, handing him a convincing primary win over Barrett. Symington carried that momentum through the fall and scored a dramatic come-from-behind win against Democrat Eddie Basha, who failed to make an issue of Symington's dubious business practices.
But just as Symington realized in December 1991 that trouble hovered near, he knew 1995 would bring more serious challenges.
For more than a year, Symington had tried to quell allegations that his top aide--George Leckie--had improperly passed confidential bidding information for a state contract to Coopers & Lybrand.
The Republic reported in early 1994 that Leckie had made a series of phone calls to Coopers & Lybrand partner John Yeoman in September 1991. The calls occurred while Leckie was a member of the bid review committee considering a multimillion-dollar contract for Symington's government cost-cutting program, Project SLIM.
Coopers & Lybrand won the contract after the firm slashed its bid by $440,000. It was illegal for members of the state committee to have any contact with bidders.
The Project SLIM scandal focused attention on Symington's relationship with his accounting firm and raised questions of whether Symington was using government contracts to pay personal and business debts to Coopers & Lybrand. Symington owed Coopers & Lybrand about $45,000 at the time the Project SLIM contract was awarded.
Attorney General Grant Woods launched an investigation after Maricopa County Attorney Richard Romley had looked into the matter and found no impropriety. In July 1995, Woods reached separate settlements with Leckie and Coopers & Lybrand. Leckie paid a $25,000 penalty while Coopers & Lybrand paid a $725,000 levy; in exchange, the state dropped civil and criminal investigations.
But Leckie and Yeoman, as well as Symington, faced more scrutiny as evidence surfaced that Coopers & Lybrand had dramatically reduced Symington's debt to the firm after the Project SLIM contract was awarded. By the fall of 1995, the federal grand jury began reviewing the Project SLIM case, and Yeoman was called to testify.
As the Project SLIM investigation continued to erode Symington's credibility, he faced another legal challenge from a consortium of union pension funds that had loaned his Mercado Developers Limited Partnership $10 million in 1990.
Symington defaulted on the loan in the fall of 1991. A four-year legal battle erupted in Maricopa County Superior Court; the pension funds won a $10 million judgment against Symington in July 1995.
After taking a European vacation in August 1995--reportedly paid for by his wife--Symington declared bankruptcy that September, reporting $62,000 in assets and $25 million in debts. Rather than seeking a court plan to gradually pay off his debts, Symington asked the bankruptcy court to liquidate them.
Symington's bankruptcy petition unleashed an avalanche of new information on the governor's finances, including damaging evidence that the net worth Symington reported on his financial statements had plunged $35 million in one year.
To obtain the $10 million Mercado loan, Symington in June 1990 submitted a financial statement to the union pension funds' money manager, claiming a net worth of $11.9 million. Symington personally guaranteed repayment of the loan.
By August 1991, Symington's Mercado partnership was unable to cover the loan payments. Symington, by now governor, wanted the pension funds to restructure the loan. He also told the pension funds he would not make good on his personal guarantee.
As part of his effort to persuade the pension funds to restructure the loan, Symington submitted a new financial statement reporting a net worth of negative $23 million. The pension funds were not swayed.
Instead, the funds hired one of the top bank-fraud attorneys in the nation, Mike Manning. They authorized Manning to investigate, and if necessary, file a civil fraud suit in bankruptcy court to block the discharge of Symington's Mercado debt.
Manning attacked Symington's bankruptcy with zeal. On October 31, 1995, he grilled Symington for more than two hours during a sworn debtor's examination before a packed courtroom. Symington repeatedly dodged questions, saying he couldn't remember details of his numerous real estate transactions.
Manning's withering attack and Symington's evasive answers left little doubt that it was only a matter of time before J. Fife Symington III was called to account.
The pressure on Symington increased in March 1996 when a federal grand jury indicted Leckie and Yeoman on bid-rigging charges in awarding the contract for Project SLIM.
But as soon as the government appeared to be making headway in convincing Yeoman to testify, tragedy struck.
Yeoman was killed when a Ford F-250 pickup truck slammed into his rented Escort sedan in April 1996. Yeoman and the driver of the pickup, who was not seriously injured, were both intoxicated. Yeoman's blood concentration exceeded the legal limit. The driver of the truck, David Int-Hout, was high on methamphetamine.
Speculation swirled that Yeoman's death would derail the grand jury investigation into Symington.
It didn't.
Two months later, the federal grand jury lowered the boom on the governor, indicting Symington on 21 counts of bank and wire fraud and one count each of perjury and attempted extortion.
"I am innocent of these accusations," Symington declared after the indictment was returned on June 13, 1996.
But Nora Manella, U.S. Attorney for the Central District of California, which oversaw Symington's prosecution, said the case had been thoroughly investigated and the government was convinced Symington had prepared fraudulent financial statements with different net worths for the same time period.
Symington, Manella said, submitted different versions of the financial statements to lenders depending on whether he wanted a loan or wanted get out of repaying a loan.
Despite Symington's looming criminal trial and embarrassing bankruptcy, no state legislators publicly discussed removing him from office. And Symington made it clear he had no intention of resigning.
The governor's prospects dimmed further in September 1996, when Coopers & Lybrand agreed to cooperate with the federal government in its criminal case against the governor. Coopers & Lybrand also paid a $2.275 million fine to end the federal investigation into its role in the Project SLIM bid-rigging.
Leckie's case went to trial in April. Government prosecutors put on a lackluster case, failing to present damaging evidence that had been uncovered by the state investigation.
The case was further weakened when U.S. District Court Judge Earl Carroll refused to allow the prosecution to introduce a January 1996 sworn statement Yeoman had given to Coopers & Lybrand's investigators. Yeoman said he had met with Leckie at the Paradise Valley Country Club, and that Leckie had passed along confidential bidding information.
"Mr. Leckie had a piece of paper--I think it might have been a napkin--on which he was putting the numbers that I walked away from the conversation with," Yeoman said.
Carroll tossed out three counts against Leckie midway through the trial. The jury acquitted Leckie on the remaining four charges on May 14, two days after jury selection began in Symington's criminal case.
Federal prosecutors David Schindler and George Cardona methodically plowed through Symington's financial history.
The government introduced nearly all of the 1,300-plus exhibits via big video monitors linked to a CD-ROM. Prosecutors called 35 of the trial's 40 witnesses, many of whom considered Symington to be an innocent friend.
"It's not unusual in white-collar cases to have prosecution witnesses who are friends of the defendant," Cardona says.
Among them were Symington's former personal secretary, Joyce Reibel; former Symington Company chief financial officer and current high-ranking state employee, James Cockerham; business partner Randy Todd; retired Southwest Savings president Don Lewis; construction tycoon Robert Hunt; and former construction contractor Russell Horton, who testified that Symington was the most important person in his life next to his parents.
In contrast, Symington's defense, which cost about $350,000 a month during the trial, called only four witnesses before putting Symington on the stand.
"We don't waste time," Dowd said of the brief defense.
Symington's defense hinged on Symington himself.
And why not? Symington was prepared to do battle with federal prosecutors, who were salivating at the chance to cross-examine the governor.
Symington already had endured days of sworn bankruptcy depositions with the pension funds' attorney, Mike Manning. The governor was seasoned and tough. He knew how to dodge questions while appearing to answer them.
Symington also knew the intimate details of the government's case, having taken copious notes throughout the trial and carefully studied the exhibits.
If anybody could sway a jury, it would be the man who convinced Arizonans to reelect him governor in 1994 after it was revealed he was under federal criminal investigation.
Dowd led Symington through a day of questioning in which the governor admitted there were numerous unintentional errors in his financial statements. Symington cast blame for some of the errors on his accountants, saying they failed to carefully review the statements.
"They had everything that I could give them and I just assumed they checked my financial condition," Symington said.
Symington's answers seemed reasonable. His tenor believable. Many court observers thought he would walk.
But that was before prosecutor Schindler had his turn.
Schindler dragged Symington blow-by-blow through each of his disastrous real estate projects. The prosecutor draped Symington's wildly divergent financial statements over the ruins of one real estate project after another.
Symington battled back, challenging Schindler every step of the way.
"The financial statement was not the focus of my life," Symington said. "I didn't spend a lot of time on it."
But day after day, Schindler bored in--exposing contradictions in Symington's testimony.
Schindler also adopted a tactic which many attorneys observing the case criticized: he asked opened-ended questions that gave Symington the opportunity to expound on his case rather than simply answer yes or no.
But there was a good reason for Schindler's style of questioning. Schindler said he wanted the jury to see for itself that Symington was a quick and clever man who could come up with an answer for everything--just like any good con man.
Four days of cross-examination took its toll on Symington. Longtime aide Chuck Coughlin said Symington was exhausted after the ordeal finally ended.
Once again, the Camelback Esplanade proved to be the governor's Achilles' heel.
Four of the seven guilty verdicts were directly related to the Esplanade. Two other counts were indirectly linked to the massive $200 million office, retail and hotel complex at 24th Street and Camelback Road.
Built in the late 1980s primarily with Japanese financing from Dai-Ichi Kangyo Bank (DKB) and Shimizu Land Corporation, the development brought Symington national attention and helped propel him in 1991 to the governor's office.
The Esplanade, which includes a Ritz-Carlton Hotel and two 11-story office buildings, ended up costing Symington his job as governor and will very likely send him to prison.
The jury found Symington had lied about his financial condition when his partnerships drew on $127 million in loans from DKB, a relationship he misrepresented six years earlier to Metzenbaum as a "personal" loan.
The jury found Symington guilty on three counts of submitting false certifications to DKB by declaring he had a net worth of $4 million. DKB had required that Symington maintain at least a $4 million net worth or face default.
Symington was found guilty of submitting false net worth certifications in connection with routine requests to draw loan funds in July 1991, November 1991 and April 1992.
Testimony and exhibits presented during the trial showed that Symington knew his net worth, as of May 31, 1991, was negative $23 million. The governor admitted on the witness stand that he knew his net worth was negative when he signed the DKB certifications.
But Symington testified that he wasn't thinking about his net worth when he signed the certifications and was more concerned about obtaining the funds so that construction workers and his employees would be paid.
The jury also found Symington guilty of giving DKB false information when he sent a May 14, 1992, letter to the bank claiming he had a net worth of $5.4 million as of December 31, 1990.
Evidence presented during the trial showed that Symington was circulating two December 31, 1990, financial statements, including one that showed a net worth of negative $4.1 million.
The jury returned guilty verdicts on two counts related to false financial statements Symington submitted to Valley National Bank (now Bank One). These counts also were indirectly linked to the Esplanade.
Borrowing a requirement imposed by DKB, Valley National Bank also insisted that Symington maintain a $4 million net worth in connection with several loans.
The jury found Symington guilty of submitting a false December 31, 1990, financial statement to Valley National showing a net worth of $5.4 million in order to meet the $4 million net worth requirement and avoid default.
The net worth requirement cropped up again when the jury convicted Symington of defrauding Valley National in mid-1991, when he claimed that the year-end 1990 financial statement was still accurate.
The remaining count was tied to Symington's construction of the Mercado project in downtown Phoenix. The jury found Symington guilty of defrauding six union pension funds when he obtained the $10 million loan for the Mercado.
Prosecutors showed that Symington hid negative financial information from the pension funds in June 1990 when he certified that his December 31, 1989, financial statement stating a net worth of $11.9 million was accurate.
Symington's $11.9 million net worth was a fabrication. At the same time Symington was telling the pension funds the statement was true, he was telling First Interstate Bank and Valley National Bank that his financial condition was much worse.
Just three days before the union pension fund loan closed on June 29, 1990, Symington told First Interstate that the same $11.9 million financial statement was only a "best efforts" guess of his net worth because of the real estate depression that had gripped Arizona.
The guilty verdict in the Mercado deal compounds Symington's troubles in U.S. Bankruptcy Court, where the pension funds have filed a civil suit seeking to prevent Symington from discharging the Mercado debt, which with interest, is now $12 million and counting. The verdict greatly increases the chances the pension funds will obtain a judgment against Symington.
After the verdicts, Symington wasted little time announcing his intention to resign and declare a unilateral cease fire. With sentencing still to be decided by Judge Strand, Symington appeared to be in no mood stir up more controversy.
"The war of words is over, an era has passed," Symington said.
The governor's combative attorney, however, appeared far from ready to surrender. Dowd, sticking to the theme he had repeated since the criminal probe began in September 1991, blasted the federal government for bringing the case.
Dowd promised to fight the case on appeal, first with Judge Strand, and, if necessary, the Ninth U.S. Circuit Court of Appeals.
"We are not through," Dowd said. "We are not done fighting, mainly because this case does not have any merit."
While Dowd was licking his wounds, Nora Manella, U.S. Attorney for the Central District of California, held a press conference across town and congratulated Schindler and Cardona for their work on the case.
"I'm absolutely convinced that no two prosecutors in the country could have done a finer job," Manella said.
Manella said the verdict is a victory for all Americans because it proves that the rich and powerful cannot escape the hand of justice.
"No amount of pedigree, education or business sophistication will excuse someone from playing by the rules," Manella said.
"The jury has held the governor accountable."
By September 3, George Leckie's acquittal proved to be the only bright point in the scandals that rocked Symington's administration.
Symington's longtime personal, business and campaign accountant, John Yeoman, was dead.
Leckie, while acquitted of federal criminal charges, has suffered immeasurably from a struggle with throat cancer.
And Symington, who led a charge from Republican business leaders to remove former Republican governor Evan Mecham from office in 1988, was stripped of his job as governor and faces an uncertain future when he is sentenced in November. In addition to prison time, he probably will face stiff fines.
The bankruptcy civil case also looms. If he loses that, he could be saddled with a $12 million judgment that he would have no choice but to repay.
Symington should have the wherewithal to cover at least part of the debt because of the inheritance he received after his mother died last year.
Symington's fall from power began with the release of sensitive examination reports of Southwest Savings by Senator Metzenbaum's subcommittee.
Metzenbaum, now retired and living in Bethesda, Maryland, said Saturday he was pleased that his suspicions about Symington held up in federal court.
"I can't say I don't feel vindicated," Metzenbaum said. "I got a lot of criticism at that time. And it's obvious we were not on the wrong track."
Metzenbaum said he was severely criticized by Symington and his supporters for conducting the examination and releasing the details just weeks before the runoff election.
"I remember Symington came in, as well as a number of my friends in Arizona, and took umbrage with me that I would be raising these questions about his business deals. But obviously we had a basis to be doing so," Metzenbaum said.
Metzenbaum said he pressed forward with the hearings because he feared that federal regulators were not aggressively prosecuting those responsible for the collapse of the nation's savings and loan industry.
"I was concerned then about hundreds of millions, billions of dollars that were being taken out of the federal treasury" to cover the losses resulting from shoddy management and poor investments, like Symington's Camelback Esplanade, he said.
Symington, Metzenbaum said, was just one of many developers and crooked bankers who looted the nation's thrifts. The scandal that rocked the nation in the late 1980s will cost taxpayers more than $500 billion before all the losses and interest costs are paid.
"We tried to do something about it," Metzenbaum said. "And Fife Symington as well as [Charles] Keating were major players. It's interesting time has caught up with him. It hasn't caught up with a lot of the other guys who ripped off the system, unfortunately.
