SEN. Phil Gramm helped a troubled Texas thrift operator deal with regulators after the man picked up more than $50,000 worth of building expenses on the senator's home, the New York Times reported yesterday.
The man's three savings and loans collapsed in 1989 and their bailout will cost taxpayers an estimated $200 million, federal regulators said.
Mr. Gramm, a Texas Republican, is a member of the Senate Banking Committee, which is overseeing the cleanup of the nation's savings and loan scandal. The collapse of several once-prominent savings and loans has cost taxpayers billions of dollars.
The Dallas businessman, Jerry Stiles, was a prominent developer when he took on a building project for Gramm and his wife in 1987 after they bought 35 acres of property on Maryland's eastern shore, the Times reported.
The couple needed a contractor to finish construction on the shell of a two-story vacation house, the newspaper said.
Mr. Stiles flew a crew of workers from Texas, the newspaper said.
He also put up $117,000 for labor, materials, and travel expenses to complete the job, then asked Gramm for $63,000, which was the maximum amount the senator said he was willing to pay, the Times reported.
Neither Stiles nor Gramm could immediately be reached for comment.