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Keating wins new trial

December 2, 1996
Web posted at: 9:45 p.m. EST

LOS ANGELES (CNN) -- A federal judge in Los Angeles granted former Lincoln Savings and Loan kingpin Charles Keating Jr. a new trial on federal fraud charges Monday.

Federal prosecutors said they were prepared to re-try Keating, but disputed his claims he did not receive a fair trial.

Keating's lawyers successfully argued that jurors in his previous federal trial were prejudiced by information about Keating's previous state conviction.

The judge set a January 16th status conference to discuss the new trial date.

Keating was freed from an Arizona prison in October after prosecutors and defense attorneys questioned jurors in the federal case about whether Keating's prior state conviction for securities fraud was discussed during the federal trial.

Keating's attorneys say jurors knew about the state conviction and discussed it among themselves despite a judge's ruling that the evidence be banned because it was "highly prejudicial."

Keating was convicted on federal racketeering, fraud and conspiracy charges in January 1993. He was sentenced to 12 years in prison and ordered to pay $122 million in restitution. Lincoln's failure cost taxpayers $3.4 billion.

Keating's state court conviction was thrown out in April by a U.S District judge, who ruled Los Angeles Superior Court Judge Lance Ito botched the jury instructions.

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