"His Personal Piggy Bank"

Bathed every evening in colored lights and gleaming like a stack of silver dollars, the 48-story CenTrust Tower became the pre-eminent landmark on Miami's skyline in the booming 1980s. The tower was visual testimony to the success of CenTrust Bank, which grew out of near failure seven years ago into the largest savings and loan in the Southeast (peak assets in 1989: $11 billion). But the building took on a gloomier symbolism last month when federal regulators seized the now insolvent thrift and ousted its top executives. As the Government conducts a bailout that could cost $2 billion, federal agencies are investigating David Paul, 50, the CenTrust chairman who presided in grand style over the thrift's rise and fall. Paul, says Florida's top banking regulator, treated CenTrust "as if it were his own personal piggy bank."

A Miami native whose family moved to New York City when he was a youngster, Paul returned in 1983 as a little known real estate developer with a $52 million offer to buy the faltering Dade Savings and Loan (assets: $2.2 billion). State regulators were happy someone was willing to take over the sick thrift. Paul renamed the S&L and within a few years sent its profits zooming. His method: investing CenTrust's assets heavily in junk bonds, many of which he bought from Michael Milken at Drexel Burnham Lambert. By the late 1980s the payoff from CenTrust's $1.35 billion portfolio of junk made the S&L the region's most profitable thrift. But as the market value of junk bonds collapsed in recent months, CenTrust was doomed to go with it.

CenTrust's hefty contributions to charity helped make Paul a member of the city's elite. And his opulent indulgences -- an estate on exclusive La Gorce Island, a 96-ft. yacht and a chauffeured limousine -- drew the attention of state banking regulators. Federal investigators are now probing whether Paul illegally diverted corporate funds for his personal use. The list of his suspect expenses totals more than $40 million. Paul has denied any wrongdoing, but he will find few sympathizers in Miami. "David Paul saw a good deal, set it up and milked it excessively," says Paul Bauer, a local S&L analyst. The CenTrust chief's legacy will long be visible on Miami's skyline, where the tower still glows irreverently.