k How to Use This Book 1 1 2 4 3 2 3 4 5 6 7 8 9 10 11 12 13 XIII 5 6 7 9 10 13 12 11 8 GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION XIV HOW TO USE THIS BOOK Contributors Editorial Reviewers Patricia B. Brecht Matthew C. Cordon Frederick K. Grittner Halle Butler Hara Scott D. Slick Contributing Authors Richard Abowitz Paul Bard Joanne Bergum Michael Bernard Gregory A. Borchard Susan Buie James Cahoy Terry Carter Stacey Chamberlin Sally Chatelaine Joanne Smestad Claussen Matthew C. Cordon Richard J. Cretan Lynne Crist Paul D. Daggett Susan L. Dalhed Lisa M. DelFiacco Suzanne Paul Dell’Oro Heidi Denler Dan DeVoe Joanne Engelking Mark D. Engsberg Karl Finley Sharon Fischlowitz Jonathan Flanders Lisa Florey Robert A. Frame John E. Gisselquist Russell L. Gray III Frederick K. Grittner Victoria L. Handler Halle Butler Hara Lauri R. Harding Heidi L. Headlee James Heidberg Clifford P. Hooker Marianne Ashley Jerpbak David R. Johnstone Andrew Kass Margaret Anderson Kelliher Christopher J. Kennedy Anne E. Kevlin John K. Krol Lauren Kushkin Ann T. Laughlin Laura Ledsworth-Wang Linda Lincoln Theresa J. Lippert Gregory Luce David Luiken Frances T. Lynch Jennifer Marsh George A. Milite Melodie Monahan Sandra M. Olson Anne Larsen Olstad William Ostrem Lauren Pacelli Randolph C. Park Gary Peter Michele A. Potts Reinhard Priester Christy Rain Brian Roberts Debra J. Rosenthal Mary Lahr Schier Mary Scarbrough Stephanie Schmitt Theresa L. Schulz John Scobey Kelle Sisung James Slavicek Scott D. Slick David Strom Linda Tashbook Wendy Tien M. Uri Toch Douglas Tueting Richard F. Tyson Christine Ver Ploeg George E. Warner Anne Welsbacher Eric P. Wind Lindy T. Yokanovich XV SARBANES-OXLEY ACT OF 2002 Congress enacted the Sarbanes-Oxley Act of 2002 (Public Company Accounting Reform and Investor Protection Act, Pub. L. No. 107-204, 116 Stat. 745) in the wake of corporate and accounting scandals that led to bankruptcies, severe stock losses, and a loss of confidence in the STOCK MARKET. The act imposes new responsibilities on corporate management and criminal sanctions on those managers who flout the law. It makes SECURITIES fraud a serious federal crime and also increases the penalties for WHITE-COLLAR CRIMES. In addition, it created an oversight board for the accounting profession. During the 1990s the STOCK MARKET rose dramatically in value, fueled by the promise of the INTERNET revolution as well as large corpo- rate MERGERS AND ACQUISITIONS. Several of that decade’s changes produced severe consequences during the first years of the new century. The five major U.S. accounting firms developed consulting divisions that advised corporations on ways to maximize their profits. Their advice often clashed with the traditional auditing functions and standards of these accounting firms. At worst, the accounting firms forfeited their traditional oversight function and allowed or encouraged financial reporting practices that misled investors. On the corporate side, man- agers were expected to produce short-term gains on a quarterly basis to satisfy investment analysts who worked for stock brokerages. These analysts were sometimes encouraged or directed by management to tout the value of questionable stocks. Some corporate managers, who skirted or broke laws that mandated honest financial reporting, transformed the drive for profitability into a lust for personal fortune. The bubble burst w hen the Enron Corporation filed for BANKRUPTCY in December 2001, and the ac- counting firm of Arthur Andersen was con- victed of OBSTRUCTION OF JUSTICE for its actions in shredding Enron-related documents. As the stock market plummeted and investor confi- dence waned, Congress responded. Senator Paul S. Sarbanes (D-Md.) and Representative Michael Oxley (R-Ohio) worked to enact a set of provisions that would prevent future debacles such as those that ruined Enron and Arthur Andersen. President GEORGE W. BUSH, after initially downplaying the need for reform, signed the bill into law on July 30, 2002. Under the act, the SECURITIES AND EXCHANGE COMMISSION (SEC) has the authority to prohibit, conditionally or unconditionally, temporarily or permanently, any person who has violated laws governing the issuing of stock from acting as an officer or director of a corporation if the SEC has found that such person’sconduct“demonstrates unfitness” to serve as an officer or a director. The act also imposes new disclosure requirements when companies file financial reports. Under Section 302 of the act, the SEC is required to issue a rule that mandates that the principal executive officer and the principal financial S (cont.) 1 officer certify in each annual or quarterly report the accuracy of certain information. The signing officer must disclose to the auditors and audit committee any significant deficiencies in the design or operation of the internal controls, any FRAUD (whether it involves management or other employees who have a significant role in the issuer’s internal controls), and any significant changes in the internal controls. Section 906 requires that the chief executive officer and chief financial officer provide written statements to be filed with each periodic report filed under the Securities Exchange Act of 1934, certifying that the periodic report containing the financial statements fully complies with the requirements of Sections 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in the periodic report fairly presents, in all material respects, the financial condition and results of operations of the issuer. A knowing violation of Section 906 is punishable by up to ten years in prison and a $1 million fine. A willful violation is punishable by up to 20 years in prison and a $5 million fine. Section 303 prohibits any officer, director, or person acting at their direction “to fraudulently influence, coerce, manipulate, or mislead” an accountant who is conducting an audit. Under Section 304, if an issuer is required to restate its financial statements as a result of misconduct, the chief executive officer and chief financial officer must reimburse the issuer for any bonus or other incentive-based compensation paid during the 12-month period following the improper reporting. Those officers also must pay to the company any profits realized from the sale of its securities during that 12-month period. The Sarbanes-Oxley Act also authorizes the establishment of a Public Company Accounting Oversight Board (PCAOB), which will oversee the accounting profession. Under Section 1 of the act, the board will have five financially experienced members who are appointed to five- year terms. Two of the members must be or have been certified public accountants (CPAs), and the remaining three must not be, and must never have been, CPAs. The chair may be held by one of the CPA members, provided that he or she has not been engaged as a practicing CPA for five years. The board’s members will serve on a full- time basis. Members of the board are appointed by the SEC “after consultation with” the chairman of the FEDERAL RESERVE BOARD and the secretary of the Treasury. No member may, concurrent with service on the Board, “share in any of the profits of, or receive payments from, a public accounting firm,” other than “fixed continuing payments,” such as retirement pay- ments. The Commission may remove members “for good cause.” The PCAOB will register accounting firms, develop auditing standards and rules of ethics for the profession, and investigate accounting firms. The board may discipline and sanction account- ing firms that violate rules. It is required to “cooperate on an on-going basis” with desig- nated professional groups of accountants and any advisory groups convened in connection with standard-setting, and although the board may, “to the extent that it determines appropri- ate,“ adopt standards proposed by those groups, it will have authority to amend, modify, repeal, and reject any standards suggested by the groups. The board must report to the SEC on its standard-setting activity on an annual basis. Some commentators have provided evi- dence that Sarbanes Oxley has resulted in more companies making initial public offerings in London rather than New York. Among those who have asserted this were New York mayor Michael Bloomberg and U.S. Senator Charles Schumer (D-N.Y.), who in 2006 advocated for a reform of Sarbanes-Oxley based on the assertion that London’s requirements were more relax ed. Sarbanes-Oxley has been challenged, but as of 2009, courts have upheld its constitutionality. In Free Enterprise Fund v. Public Accounting Oversight Board, 537 F.3d 667 (D.C. Cir. 2008), the U.S. Court of Appeals for the District of Columbia rejected arguments that the PCAOB was uncon- stitutional either based on how its members are selected or based on SEPARATION OF POWERS principles. The U.S. SUPREME COURT in May 2009 granted CERTIORARI to review the decision. FURTHER READINGS Garner, Don E., David L. McKee, and Yosra AbuAmara McKee. 2008. Accounting and the Global Economy after Sarbanes-Oxley. Armonk, NY: M. E. Sharpe. Thibodeau, Jay C., and Deborah Freier. 2009. Auditing after Sarbanes-Oxley: Illustrative Cases. Boston: McGraw-Hill Irwin. CROSS REFERENCES Corporate Fraud “Enron: An Investigation into Corporate Fraud” (In Focus).; Fraud. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 2 SARBANES-OXLEY ACT OF 2002 v SARGENT, JOHN GARIBALDI John Garibaldi Sargent served as attorney general of the United States under President CALVIN COOLIDGE. He was born October 13, 1860, in Ludlow, Vermont, to John Henmon and Ann Eliza Hanley Sargent. He was schooled locally and then entered Tufts College in Boston, receiving a bachelor’s degree in 1887. Early in his college years, Sargent became active in the Zeta Psi Kappa Society; through the fraternity’s activities he was introduced to many of Boston’s oldest and most influential political families, including the Coolidges. After college Sargent returned to Ludlow, where he married Mary Lorraine Gordon in 1887. Sargent studied law with attorney, and future Vermont governor, William Wallace Stickney. Following Sargent’s admission to the Vermont bar in 1890, he joined Stickney in the practice of law. Sargent’s first political appointment came in 1898 when he was named state’s attorney for Windsor County, Vermont. He served until 1900 when he was appointed secretary of civil and military affairs for the state of Vermont by his law partner, who was then serving his first term as governor. After completing the two-year assign- ment, Sargent returned to the firm and resumed the practice of law. From 1902 to 1908, he argued the majority of his cases in federal court, and he established a national reputation as a trial lawyer. In 1908 Sargent was named attorney general of Vermont. While in office, he was involved in one of the leading cases in the history of Vermont’s highest court. In Sabre v. Rutland Railroad Co., 86 Vt. 347, 85 Aik. 693 (1912), attorneys for the railroad argued that the powers enjoyed by Vermont’s Public Service Commission (which regulated railroads) violated the Vermont Constitution by commin- gling legislative, executive, and judicial func- tions. Sargent, arguing for Sabre and the state, disagreed. His position was that the SEPARATION OF POWERS was only violated when one branch exercised all of the powers of another branch. The court agreed with Sargent and recognized the QUASI-JUDICIAL powers of executive-branch state agencies. The decision led the way for commissions and boards across the country to wield court-like powers. While serving as Vermont’s attorney gen- eral, Sargent also returned to school, receiving a master’s degree from Tufts College in 1912. When Sargent returned to his law firm in 1913, he turned his attention to partisan politics. He John Sargent. THE LIBRARY OF CONGRESS John Garibaldi Sargent 1860–1939 ▼▼ ▼▼ 18601860 19351935 19101910 18851885 1860 Born, Ludlow, Vt. ◆ ❖ 1887 Graduated from Tufts College ◆ 1890 Admitted to Vermont bar 1900–02 Served as secretary for Civil and Military Affairs of Vermont 1908–12 Served as attorney general of Vermont ◆ 1925 Appointed U.S. attorney general by President Calvin Coolidge; remained in office under President Herbert Hoover ◆ 1929 Left public office 1939 Died, Ludlow, Vt. 1861–65 U.S. Civil War 1914–18 World War I ❖ ◆ 1898 Named state's attorney for Windsor County, Vermont ◆ 1927 Sought commutation of Marcus Garvey's mail fraud sentence ◆ 1935 Served as director of the Vermont Valley, Boston and Main Railroad; also director of the Central Vermont Railroad GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION SARGENT, JOHN GARIBALDI 3 supported REPUBLICAN PARTY candidates in Ver- mont and throughout the Northeast and campaigned vigorously for WARREN G . HARDING in 1920 and Calvin Coolidge in 1924. Sargent was named attorney general of the United StatesonMarch 17, 1925, but onlyafter the president’s first choice, financier Charles B. Warren, withdrew after the Senate questioned his willingness to enforce ANTITRUST LAWS.Sargent proved to be a safe and noncontroversial alterna- tive. He was confirmed in just one day, and he served from March 18, 1925, until March 4, 1929. Sargent was not known as a leader in the fight for racial equality, but he did ask the president to commute the sentence of MARCUS GARVEY in 1927. Garvey was a political activist from Jamaica who had been convicted of MAIL FRAUD for his efforts to recru it black Americans for his Universal Negro Improvement League and African Communities Association Garvey v. United States, 267 U.S. 604, 45 S. Ct. 464 (1925). The tainted proceeding against Garvey was orchestrated by an overzealous young JUSTICE DEPARTMENT attorney named J. EDGAR HOOVER. Sargent was outspoken in his disapproval of Hoover’s tactics in the Garvey case, and he was among the first attorneys general to condemn the gathering of evidence through WIRETAPPING,a tactic approved by Hoover when he was director of the FEDERAL BUREAU OF INVESTIGATION. Testify- ing before a congressional committee, Sargent said, “Wire tapping, ENTRAPMENT, or use of any illegal or unethical tactics in procuring infor- mation will not be tolerated ” In 1930 Sargent returned to Vermont and again took an active role in his law firm. In his later years, Sargent devoted his time and energy to local businesses and community organiza- tions. When years of political infighting finally forced the reorganization of Vermont’s rail- roads in the early 1930s, Sargent was appointed to oversee the process. Sargent died at his home in Ludlow, Vermont, on March 5, 1939. FURTHER READINGS Justice Department. 1991. 200th Anniversary of the Office of the Attorney General, 1789–1989. Washington, D.C.: Department of Justice, Office of Attorney General and Justice Management Division. “Mr. Sargent.” Time (March 30, 1925). Available on- line at http://www.time.com/time/magazine/article/ 0,9171,720053,00. html?iid=digg_share; website home page: http://www.time.com (accessed September 7, 2009). Youseff, Sitamon M. 1998. Marcus Garvey: The FBI Investigation Files. Lawrenceville, NJ: Africa World Press. CROSS REFERENCES Coolidge, Calvin; Hoover, John Edgar. SATISFACTION The discharge of an obligation by paying a party what is due—as on a mortgage, lien, or contract —or by paying what is awarded to a person by the judgment of a court or otherwise. An entry made on the record, by which a party in whose favor a judgment was rendered declares that she has been satisfied and paid. The fulfillment of a gift by will, whereby the testator—one who dies leaving a will—makes an inter vivos gift, one which is made while the testator is alive to take effect while the testator is living, to the beneficiary with the intent that it be in lieu of the gift by will. In EQUITY, something given either in whole or in part as a substitute or equivalent for something else. SAVE To except, reserve, or exempt; as where a statute saves vested—fixed—rights. To toll, or suspend the running or operation of; as, to save the STATUTE OF LIMITATIONS. SAVING CLAUSE In a statute, an exception of a special item out of the general things mentioned in the statute. A restriction in a repealing act, which is intended to save rights, while proceedings are pending, from the obliteration that would result from an unrestricted repeal. The provision in a statute, sometimes referred to as the severability clause, that rescues the balance of the statute from a declaration of unconstitutionality if one or more parts are invalidated. With respect to existing rights, a saving clause enables the repealed law to continue in force. SAVINGS AND LOAN ASSOCIATION A savings and loan asso ciation is a financial institution owned by and operated for the benefit of those using its services. The primary purpose of the savings and loan association is making loans to its members, usually for the purchase of real estate or homes. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 4 SATISFACTION The savings and loan industry was first established in the 1830s as a BUILDING AND LOAN ASSOCIATION . The first savings and loan association was the Oxford Provident Building Society in Frankfort, Pennsylvania. As a building and loan association, Oxford Provident received regular weekly payments from each member and then lent the money to individuals until each member could build or purchase his own home. Building and loan associations were financial intermediar- ies, which acted as a condu it for the flow of investment funds between savers and borrower s. Savings and loan associations may be state or federally chartered. When formed under state law, savings and loan associations are generally incorporated and must follow the state’s requirements for incorporation, such as provid- ing ARTICLES OF INCORPORATION and BYLAWS. Although it depends on the applicable state’s law, the articles of incorporation usually must set forth the organizational structure of the association and define the rights of its members and the relationship between the association and its stockholders. A savings and loan association may not convert from a state corporation to a federal corporation without the consent of the state and compliance with state laws. A savings and loan association may also be federally chartered. Federal savings and loan associations are regulated by the OFFICE OF THRIFT SUPERVISION. Members of a savings and loan association are stockholders of the corporation. The members must have the capacity to enter into a valid contract, and as stockholders they are entitled to participate in management and share in the profits. Members have the same liability as stockholders of other corporations, which means that they are liable only for the amount of their stock interest and are not personally liable for the association’s NEGLIGENCE or debts. Officers and directors control the operation of the savings and loan associatio n. The officers and directors have the duty to organize and operate the institution in accordance with state and federal laws and regulations and with the same degree of diligence, care, and skill that an ordinary prudent person would exercise under similar circumstances. The officers and direc- tors are under the common-law duty to exercise due care as well as the duty of loyalty. Officers and directors may be held liable for breaches of these common-law du ties, for losses that result from violations of state and federal laws and regulations, and even for losses that result from a violation of the corporation’s bylaws. The responsibilities of the officers and directors of a savings and loan association are generally the same as the responsibilities of officers and directors of other corporations. They must select competent individuals to administer the institution’s affairs, establish operating poli- cies and internal controls, monitor the institu- tion’s operations, and review examination and audit reports. Furthermore, they have the power to assess losses incurred and to decide how the institution will recover those losses. Prior to the 1930s, savings and loan associa- tions flourished. However, during the Great Depression the savings and loan industry suf- fered. More than 1,700 institutions failed, and because depositor’sinsurancedidnotexist, customers lost all of the money they had deposited into the failed institutions. Congress responded to this crisis by passing several banking acts. The Federal Home Loan Bank Act of 1932, 12 U.S.C.A. §§ 1421 et seq., authorized the government to regulate and control the financial services industry. The legislation created the Federal Home Loan Bank Board (FHLBB) to oversee the operations of savings and loan institutions. The Banking Act of 1933, 48 Stat. 162, created the FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC) to promote stability and restore and maintain confidence in the nation’s banking system. In 1934, Congress passed the National Housing Act, 12 U.S.C.A. §§ 1701 et seq., which created the National Housing Administra- tion (NHA) and the Federal Savings and Loan Insurance Corporation (FSLIC). The NHA was created to protect mortgage lenders by insuring full repayment, and the FSLIC was created to insure each depositor’s account up to $5,000. The banking reform in the 1930s restored depositors’ faith in the savings and loan industry, and it was once again stable and prosperous. All acts of limitations, whether applicable to civil causes and proceedings, or to the prosecution of offenses, or for the recovery of penalties or forfeitures, embraced in the Revised Statutes and covered by the repeal contained therein, shall not be affected thereby; but suits, proceedings, or prosecutions, whether civil or criminal, for causes arising, or acts done or committed prior to said repeal, may be commenced and prosecuted within the same time as if said repeal had not been made. July 30, 1947, c. 388, §1, 61 Stat. 633. All acts of limitations, whether applicable to civil causes and proceedings, or to the prosecution of offenses, or for the recovery of penalties or forfeitures, embraced in the Revised Statutes and covered by the repeal contained therein, shall not be affected thereby; but suits, proceedings, or prosecutions, whether civil or criminal, for causes arising, or acts done or committed prior to said repeal, may be commenced and prosecuted within the same time as if said repeal had not been made. July 30, 1947, c. 388, §1, 61 Stat. 633. All acts of limitations, whether applicable to civil causes and proceedings, or to the prosecution of offenses, or for the recovery of penalties or forfeitures, embraced in the Revised Statutes and covered by the repeal contained therein, shall not be affected thereby; but suits, proceedings, or prosecutions, whether civil or criminal, for causes arising, or acts done or committed prior to said repeal, may be commenced and prosecuted within the same time as if said repeal had not been made. July 30, 1947, c. 388, §1, 61 Stat. 633. Saving Clause An example of a saving clause. ILLUSTRATION BY GGS CREATIVE RESOURCES. REPRODUCED BY PERMISSION OF GALE, A PART OF CENGAGE LEARNING. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3 RD E DITION SAVINGS AND LOAN ASSOCIATION 5 However, in the 1970s the industry began to feel the impact of competition and increased interest rates; investors were choosing to invest in money markets rather than in savings and loan associa- tions. To boost the savings and loan industry, Congress began deregulating it. Three types of deregulation took place during this time. The first major form of deregulation was the enactment of the Depository Institutions Deregulation and Monetary Control Ac t of 1980 (94 Stat. 132). The purpose of this legislation was to allow investors higher rates of return, thus making the savings and loan associations more competitive with the money markets. The industry was also allowed to offer money-market options and provide a broader range of services to its customers. The second major form of deregulation was the enactment of the Garn–St. Germain Depos- itory Institutions Act of 1982 (96 Stat. 1469). This act allowed savings and loan associations to diversify and invest in other types of loans besides home construction and purchase loans, including commercial loans, state and munici- pal SECURITIES, and unsecured REAL ESTATE loans. The third form of deregulation decreased the amount of regulatory supervision. This deregulation was not actually an “official ” deregulation; instead it was the effect of a change in required accounting procedures. The GENERALLY ACCEPTED ACCOUNTING PRINCIPLES were changed to Regulatory Accounting Procedures, which allowed savings and loan associations to include speculative forms of capital and exclude certain liabilities, thus making the thrifts appear to be in solid financial positions. This action resulted in more deregulation. In the 1980s the savings and loan industry collapsed. By the late 1980s at least one-third of the savings and loan associations were on the brink of insolvency. Eight factors were primarily responsi- ble for the collapse: a rigid institutional design, high and volatile interest rates, deterioration of asset quality, federal and state deregulation, fraudulent practices, increased competition in thefinancial servicesindustry, andtax lawchanges. The savings and loan collapse was also due in part to improper political influence. One prominent member of the savings and loan industry, Charles Keating, was influential with members of Congress. He convinced several U.S. senators to argue against tougher regula- tions. At the same time, Keating used depositors’ funds from Lincoln Savings and Loan in Arizona to invest in risky ventures. Keating’sactions eventually left more than 20,000 people without savings, and Keating went to prison. The senators involved became known as the Keating Five: JOHN MCCAIN (R-Ariz.), Alan Cranston (D-Calif.), John Glenn (D-Ohio.), Don Riegle (D-Mich.), and Dennis DeConcini (D-Ariz.). In an effort to restore confidence in the thrift industry, Congress enacte d the Financial Insti- tutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) (103 Stat. 183). The purpose of FIRREA, as set forth in Section 101 of the bill, was to promote a safe and stable system of affordable housing finance; improve supervi- sion; establish a general oversight by the TREASURY DEPARTMENT over the director of the Office of Thrift Supervision; establish an inde- pendent insurance agency to provide deposit insurance for savers; place the Federal Deposit Insurance System on sound financial footing; create the Resolution Trust Corporation; pro- vide the necessary private and public financing to resolve failed institutions in an expeditious manner; and improve supervision, enhance enforcement powers, and increase criminal and civil penalties for crimes of FRAUD against financial institutions and their depositors. FIRREA increased the enforcement powers of the federal banking regulators and conferred a wide array of administrative sanctions. FIRREA also granted federal bank regulators the power to hold liable “institution-affiliated parties” who engage in unsound practices that harm the insured depository institution. The institution- affiliated parties include directors, officers, em- ployees, agents, and any other persons, including attorneys, appraisers, and accountants, partici- pating in the institution’s affairs. FIRREA also allows federal regulators to seize the institution early, before it is “hopelessly insolvent” and too expensive for federal insurance funds to cover. Criminal penalties were also increased in 1990 by the CRIME CONTROL ACT, 104 Stat. 4789, which included the Comprehensive Thrift and Bank Fraud Prosecution and Taxpayer Recovery Act of 1990 (104 Stat. 4859). This act increased the criminal penalties “attaching” to crimes related to financial institutions. FIRREA created the Office of Thrift Supervi- sion (OTS) and the Resolution Trust Corporation (RTC). FIRREA eliminated the FHLBB and created the OTS to take its place. The RTC was GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 6 SAVINGS AND LOAN ASSOCIATION created solely to manage and dispose of the assets of thrifts that failed between 1989 and August 1992. In addition, the FSLIC was eliminated, and the FDIC, which oversaw the banking industry, began dealing with the troubled thrifts. The RTC was in existence for six years, closing its doors on December 31, 1996. During its existence, it merged or closed 747 thrifts and sold $465 billion in assets, including 120,000 pieces of property. The direct cost of resolving the failed thrifts amounted to $90 billion; however, analysts claim that it will take approximately 30 years to fully bail out the savings and loan associations at a cost of approximately $480.9 billion. FURTHER READINGS American Bar Association. 1995. “How a Good Idea Went Wrong: Deregulation and the Savings and Loan Crisis.” Administrative Law Review 47. American Bar Association. The Committee of Savings and Loan Associations Section of Corporation, Banking, and Business. 1973. Handbook of Savings and Loan Law. Chicago: American Bar Association. Calavita, Kitty, Henry N. Pontell, and Robert H. Tillman. 1999. Big Money Crime: Fraud and Politics in the Savings and Loan Crisis. Berkeley: Univ. of California Press. Gorman, Christopher Tyson. 1994–95. “Liability of Direc- tors and Officers under FIRREA: The Uncertain Standard of §1821(K) and the Need for Congressional Reform.” Kentucky Law Journal 83. Turck, Karsten F. 1998. The Crisis of American Savings & Loan Associations: A Comprehensive Analysis. New York: P. Lang. U.S. House. 1989. 101st Cong., 1st sess. H.R. 54 (I). United States Code Congressional and Administrative News. CROSS REFERENCE Banks and Banking. v SAXBE, WILLIAM BART William Bart Saxbe, a quotable lawyer, politi- cian, and U.S. senator from Ohio, served as U.S. attorney general under President RICHARD M. NIXON. He also served as ambassador to India under President GERALD R. FORD. Saxbe was born on June 24, 1916, in the farming community of Mechanicsburg, Ohio, to Bart Rockwell Saxbe, a religious and plain- spoken community leader who made his living as a cattle buyer, and Faye Henry Carey Saxbe, a political free-spirit who counted PATRICK HENRY among her ancestors. Saxbe’s education seemed to be influenced by his parents’ example; when he entered Ohio State University in 1936, he chose political science as his major field of study. He received a Bachelor of Arts degree in 1940. In the fall of that year, he married Ardath Louise (“Dolly”) Kleinhans. They eventually had three children: William Bart Jr., Juliet Louise, and Charles Rockwell. While attending college, Saxbe was a member of the Ohio NATIONAL GUARD. After William B. Saxbe. COURTESY OF CHESTER WILLCOX & SAXBE LLP William Bart Saxbe 1916– ❖ 1916 Born, Mechanicsburg, Ohio 1914–18 World War I 1939–45 World War II ▼▼ ▼▼ ◆ ◆ ◆ 1950–53 Korean War 1961–73 Vietnam War ◆ ◆ 1940–45 Served in Army Air Force 1947–54 Served in Ohio House of Representatives 1957–67 Served as Ohio attorney general 1969–74 Served in U.S. Senate 1975–77 Served as U.S. ambassador to India 1982 Hired as independent special counsel for the Central States Teamsters Pension Fund 1999 Participated in historic forum of former U.S. Attorneys General at American Bar Association convention 1974 Served as U.S. attorney general under Nixon and Ford 1994 Joined his son’s law practice at Chester, Hoffman, Wilcox & Saxbe 1925 1950 1975 2000 2000 I’ve Seen the Elephant published GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION SAXBE, WILLIAM BART 7 . on March 5, 193 9. FURTHER READINGS Justice Department. 199 1. 200th Anniversary of the Office of the Attorney General, 17 89 198 9. Washington, D.C.: Department of Justice, Office of Attorney General. General at American Bar Association convention 197 4 Served as U.S. attorney general under Nixon and Ford 199 4 Joined his son’s law practice at Chester, Hoffman, Wilcox & Saxbe 192 5 195 0 197 5 2000 2000. attorney general of Vermont ◆ 192 5 Appointed U.S. attorney general by President Calvin Coolidge; remained in office under President Herbert Hoover ◆ 192 9 Left public office 193 9 Died, Ludlow,