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DEPOSITION OF ROSEMARY STEWART

VOL. II

351

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reach an understanding?

A. Not on that point, no.

Q. While you did ask for a memorandum to

be issued by Mr. Gray, as a result of that

episode, correct?

A. Yes.

Q.

Is that the only contact you had with Mr. Gray.concerning the December 24th Wall Street Journal article, the written request for a meno?

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to have some input with him?

Q. All right. At the bottom of page, page

38, please. Would you take a moment to read the second paragraph on that page and over to the top of page 39.

I intend to ask you about vendetta

attitude on the top of page 39.

Are you with me?

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NR.

GALLAGHER:

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Bear with me just a second. (Consultation was had between the witness

and counsel.)

9. (BY MR. GALLAGHER) Let me just ask you, because I think I'm reading from your testimony; you correct me if I'm wrong: You recall testifying before Congress on Tuesday, November 21st, that, quote, "There was also at STICKLEY & SCHUTZMAN, INC.

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Q.

No.

Did you believe that Black and. Gray

were trying to hold Lincoln up as an example of
the evil that results from direct investment

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THE WITNESS: That is my conclusion now, after three years of information coming to my

attention.

Q. (BY MR. GALLAGHER) Do you believe that Black and Gray tried to punish Lincoln for its vocal objections to the direct investment rule?

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This is one of those phrases
where my choice of words was not very good. I

don't, I don't think "punishing" was exactly the
right word.

I think using then as an example of a
direct investment violator is a correct

conclusion.

And I don't think that the use of the

word "punishing" was a very wise choice of words

on my part.

STICKLEY & SCHUTZMAN, INC.

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Q. (BY MR. GALLAGHER) okay. Would you

A. I do not believe that had Lincoln challenged the reg, without already being in violation of it, that people would have had this

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believe that those two things together were
intolerable to Mr. Gray. And I understand that.

Q. Well, at least part of it was because
of the vocal objection, at least part of the
reason for Mr. Gray's being upset in your view
was the vocal objection to the direct investment
rule, correct?

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THE WITNESS: I'm sorry. I didn't get the

question.

Q. (BY MR. GALLAGHER)

Part of Gray's

reaction to Lincoln was based on Lincoln's vocal

STICKLEY & SCHUTZMAN, INC.

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The Committee has received a number of letters expressing concern that your participation in meetings with representatives of the Federal Home Loan Bank Board to discuss the board's review of the activities of Lincoln Savings was prompted by certain contributions made by Mr. Charles Keating, president of Lincoln Savings. Attached for your reference is a complaint filed by Common Cause.

The Committee would appreciate your response.

With best wishes,

Howell Heflin
Chairman

Cordially,

Wanen B. Rauch

Warren B. Rudman
Vice Chairman

SPECIAL COUNSEL

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