BAD DEBTS, BAD JUDGMENTS

By Michael S. Serrill

In a state known for hard-nosed law enforcement, no one talked tougher than Arizona Governor Fife Symington. Since taking office in 1991 he had called countless times for more arrests and harsher penalties. "Crime is not traced to the lack of material things," he once said. "It happens through loss of values."

Could be. Last week the Governor was himself convicted in a Phoenix federal court of seven counts of fraud. A jury found him guilty of repeatedly lying on loan applications to shore up his wobbly real estate empire. Under stringent federal sentencing guidelines--of the sort he in the past would have heartily endorsed--Symington will almost certainly do time.

Within hours of his conviction, Symington, 52, a Republican, resigned from office and thus became the second Arizona Governor in a decade to step down as a result of scandal. Governor Evan Mecham, a former car dealer, was impeached and removed from office in 1988 on charges of obstructing justice and misusing state money. He was acquitted of separate charges in a criminal trial.

Symington's governorship was tainted almost from its inception. Soon after taking office, he was sued by the Resolution Trust Corporation for his role in directing the failed Southwest Savings & Loan Association in Phoenix. Two years later, Symington, who had campaigned as a successful business mogul, declared himself broke. Despite his troubles, he won re-election in 1994. But the litany of scandal never stopped. In 1995, after a court ruled that Symington was personally liable for a $10 million loan from six pension funds to his now defunct real estate company, he declared personal bankruptcy. Then last year a federal grand jury indicted the Governor on 23 felony counts. He declared himself a victim of sloppy accountants and said he never intended to defraud his creditors.

But 40 prosecution witnesses and 1,400 documents were enough for the jury last week to find him guilty. Assistant U.S. Attorney David Schindler called Symington a classic con man, who falsely inflated his net worth when he wanted to borrow and pleaded poverty when he wanted to refinance a loan on more favorable terms. Between 1989 and 1991, for instance, his declared net worth swung between $12 million and minus $23 million.

Symington, who will be sentenced in November, said he would appeal, but he appeared contrite. "Every once in a while there is salvation in surrender," he tearfully told supporters before stepping down.

Symington will be succeeded this week by Secretary of State Jane Hull, a 15-year Republican veteran of the state legislature--who has never sold either cars or real estate.

--By Michael S. Serrill. Reported by Laura Laughlin/Phoenix

With reporting by LAURA LAUGHLIN/PHOENIX