Eight Questions About WaMu for Tom Leppert

Tom Leppert. Photo by Jeanne Prejean

An advance copy of a new book about the failure of Washington Mutual says the giant S&L sought to off-load subprime and other risky loans as the housing market was unraveling and later suffered a crippling bank run, quietly losing nearly $17 billion in deposits en route to becoming the biggest bank failure in American history.

The account is timely and instructive because Tom Leppert, who’s running for the GOP nomination for the U.S. Senate in Texas, served as a WaMu director and has touted his acumen as a businessman in the race. When we asked to interview the former Dallas mayor about the book and about his role at WaMu, spokesman Daniel Keylin said, “Tom would be more than happy to talk to you, but he’d obviously like to read the book first, which I understand hasn’t been released yet. Tough to talk about the contents of the book unless you’ve read it.”

Leppert joined the Washington Mutual board in 2005, before becoming mayor, and left it in 2009. He was a member of the company’s audit and corporate relations committees and also chaired the board’s governance committee. In debates and elsewhere Leppert has deflected blame for WaMu’s failure, pinning it mainly on a sharp, unexpected drop in housing prices and on federal regulators taking over the bank even though it was still solvent. Those regulators seized WaMu in 2008 and promptly sold its assets to JPMorgan Chase. Meantime, investors in the bank lost at least $30 billion.

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