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Attorney: Keating Five Demonstrated McCain’s Integrity

The McCain campaign today brought out the big guns to “set the record straight” about Sen. John McCain’s ties to Charles Keating, a central figure in the savings and loan crisis of the late 1980s and early 1990s.

On a McCain campaign-organized conference call with reporters, high-powered Washington lawyer and political fixer John Dowd defended McCain against criticism from the Obama campaign in response to McCain’s efforts to tie Sen. Barack Obama to former Weatherman William Ayers.

Dowd represented McCain during the Senate Ethics Committee investigations into the “Keating Five” scandal, in which McCain and four other senators were accused of corruption. McCain was ultimately cleared of wrongdoing, but was admonished by the committee for exercising “poor judgment.” Dowd described the scandal as “a smear job” against McCain.

Those who followed the hearings on former Attorney Gen. Alberto Gonzalez’s politicization of the Justice Department last year may remember Dowd as Monica Goodling’s attorney.

In the conference call, Dowd attempted to spin an apparent negative — McCain’s involvement in the scandal — into a positive, in that McCain fully cooperated with the investigation.

“From the time the initial allegations were made by the New York Times and Archibald Cox, John was completely open, both with the public and with the Senate — and in particular with the Senate Ethics Committee. He fully cooperated. He and his wife, Cindy, produced all documents requested by Bob Bennett, who was the special counsel. He gave interviews, he gave sworn testimony by way of deposition, and he testified at the hearing conducted by the Senate Ethics Committee. He was the only Republican in that hearing, and so it had some political overtones, given that a number of Democrats were in deep trouble.”

When asked to describe the relationship between Keating and McCain, Dowd was sparing:

“They were friends. They had known each other socially, I believe, as early as ’80 or ’81. So, they were social friends, and then Keating raised this business about [Keating's American Continental Corporation, the parent company of Lincoln Savings and Loan] with John.”

After a long pause, Dowd added:

“And Keating was a contributor to both [McCain's] House and Senate races, as documented by the Senate report.”

However, McCain’s ties to Keating were much deeper than Dowd let on.

Keating donated $112,000 to McCain’s campaigns, and McCain accepted at least nine undisclosed flights on Keating’s private jet, including several trips to Keating’s residence in the Bahamas.

McCain eventually reimbursed Keating for the flights– after the scandal broke, which Dowd pointed to as a demonstration of McCain’s integrity:

“[McCain] believed, I think, in good faith that he had reimbursed Keating for the plane flights. In 1989, when he learned that he had not, he not only reimbursed him, but he reported it to both the House and Senate committees. So no one knew about it, except John. That’s an act of integrity and honesty…I think John handled it appropriately, when he discovered that he had not fully reimbursed for the flights and other costs. He did it voluntarily, and he reported it himself – and that’s exactly what people expect members of the Senate and House to do.”

Dowd said he doubted “if you’d find any member of the House or Senate today that would do the same thing.”

Of course, Dowd neglected to address the underlying issue — that McCain accepted the trips at all, and the fact is that McCain did not pay for them until after he was under investigation. Dowd concluded by praising McCain for severing ties to Keating.

“The evidence bore out that [McCain] was honest about what he had done, and he tried to be very careful in the handling of it. When he discovered that Keating was pushing too hard, he threw Keating out of his office and ended all relations with him.”

While McCain’s connection to Keating may have no more relevance to the current race than does Obama’s connection to Ayers, the fact that it is now a campaign issue illustrates that McCain has invited closer scrutiny to his long history in Washington — and he is not without his own questionable friends.

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