An independent investigating arm of the Treasury Department found a handful of cases in which a bank regulator ignored questionable backdating of capital injections, an official said on Friday.

The Treasury said it was investigating certain actions by U.S. thrift regulators involving backdating of capital placement at some institutions.

There were a handful of instances of it. We are going over this now and we hope to have a report out later in the spring, said Rich Delmar, counsel to Treasury's inspector general.

A Treasury spokesperson said the department would make a determination later if any further action may be warranted after news on Thursday that the acting director of the Office of Thrift Supervision was placed on leave.

An OTS spokesperson declined to comment.

Concerns mounted during the financial crisis that banks might not be holding enough capital, which is used as a buffer against various market and economic shocks, as well as meet regulatory requirements.

Banks file quarterly financial reports with their primary regulators describing a range of data, including capital positions. Not having enough capital could put banks in precarious situations, such as placing them on a watchlist of problem institutions.

In addition, a bank that is downgraded by regulators to adequately capitalized from well capitalized would be prohibited from accepting brokered deposits, a big source of funding for banks.

BLESSED BACKDATING

Scott Polakoff, acting director of the agency that regulates thrifts, was placed on leave pending a review of actions related to backdating of capital at some institutions last year.

The decision to put Polakoff on leave was made by Treasury Secretary Timothy Geithner, Delmar said.

With the U.S. Congress debating how to reform regulation of U.S. financial institutions, the OTS has been the subject of much discussion focusing on whether it should be folded into the Office of the Comptroller of the Currency, another Treasury division that regulates some of the largest U.S. banks.

The issue could further tarnish an agency that is already the subject of much criticism in the wake of the failure of Washington Mutual and IndyMac and involving the regulation of Countrywide Financial.

We were doing a (material review) on IndyMac last summer ... In the course of that audit work, our auditors found an instance at IndyMac where there was backdating and it appeared an (Office of Thrift Supervision) official had allowed that to happen, Delmar told Reuters.

We did some further work and found other instances where OTS had been aware of and blessed backdating and we wrote ... a memo to the secretary around Christmas saying that this is an issue.

The OTS said earlier this year it conducted an internal investigation, which led to placing the director of the West Regional Office on administrative leave pending completion of reviews and investigations involving IndyMac.

Polakoff became OTS acting director at the end of February. He was placed on leave as the Treasury investigated the office's August 2008 actions related to post-period capital contributions, according to an agency statement on Thursday.

The investigation comes in the wake of revelations the agency, which largely regulates mortgage lenders, allowed several institutions last year to improperly backdate capital in their periodic regulatory reports.

Among the institutions caught backdating was IndyMac Bank, which recorded $18 million of a $50 million capital infusion from its holding company as first-quarter capital, although the money was not received until the second quarter.

Polakoff was replaced by John Bowman, deputy director and chief counsel, as acting director.

(Reporting by John Poirier and Patrick Rucker; Editing by Dan Grebler and Andre Grenon)

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