Hear No Evil, See No Evil

After months of accusations and mounting public fury that have made him a symbol of the $1 trillion savings and loan disaster, Neil Bush faced his accusers last week. In three hours of defiant testimony, President Bush's son denied that he was guilty of conflicts of interest as a director of Denver's Silverado S&L, which collapsed in 1988 at a $1 billion cost to the U.S. Bush insisted that he had done nothing wrong when he and the board committed more than $100 million in loans -- which later went sour -- to developer Bill Walters, one of Bush's business partners.

Even as he proclaimed his innocence, Bush grudgingly conceded that he had stood to benefit from a $900,000 line of credit that Silverado granted in 1986 to another Denver developer, Kenneth Good, the main backer of JNB Exploration, Bush's unprofitable oil and gas company. While Bush abstained from a vote on the credit, he failed to disclose the full extent of his ties with Good, who sought the credit for an oil-drilling venture that the two men planned in Argentina. Bush testified that the line of credit was never tapped.

Bush also defended his failure to disclose his financial dependence on Good when the Silverado board forgave $11 million worth of loans to the developer, who pleaded hardship. Bush said he saw no reason to mention that Good planned to invest $3 million in JNB after the vote, since the investment was only tentative.

An administrative law judge will rule in January on whether Bush should be ordered to avoid conflict-of-interest violations, a mild sanction. Last month federal regulators brought a $200 million suit that charged Bush and 11 former Silverado officials with gross negligence in the S&L's collapse. The cost of defending himself against that suit could bankrupt Bush.