IndyMac Bank’s U.S. regulator allowed the lender to backdate a capital infusion from its holding company to let the mortgage lender maintain “well-capitalized” status and escape regulatory sanctions, the Treasury Department’s watchdog arm said Monday.

The Office of Thrift Supervision permitted IndyMac Bank to record $18 million of a $50 million infusion received May 9 as first-quarter capital, Eric M. Thorson, the Treasury Department’s inspector general, wrote today in a letter to U.S. Senator Charles Grassley of Iowa, the top Republican on the Senate Finance Committee. IndyMac was closed by the OTS on July 11 after a run on deposits depleted its cash.

The move came to light as part of a routine federal investigation into the failure of IndyMac, one of five OTS- regulated lenders to be shuttered this year. The regulator also oversaw Washington Mutual Inc., whose September collapse was the biggest bank failure in U.S. history.

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