Ties to Franklin Credit Union Alleged King's Cafe Carnavale Closes Its Doors - Jan 7 1989 - Omaha World-Herald
Not for commercial use. Solely to be used for educational purposes
Jan 7, 1989 Ties to Franklin Credit Union Alleged King's Cafe Carnavale Closes Its Doors; [Sunrise Edition] Paul Goodsell. Omaha World - Herald. Omaha, Neb. pg. 14
Full Text (383 words)
(Copyright 1989 Omaha World-Herald Company)
Cafe Carnavale, a restaurant owned by Lawrence E. King Jr., former chief executive of the failed Franklin Community Federal Credit Union, has closed.
"We're closed temporarily - at least 30 days," said an employee who answered the telephone Friday. "I'm the only one here. They're doing some remodeling or repairs."
The restaurant at 7555 Pacific St. closed Thursday, another employee said. Workers were told that they were not laid off, however, and would be recalled when the restaurant reopened.
A sign on the door advises would-be customers to "look for our reopening in your local newspaper."
King bought Cafe Carnavale, formerly operated by Omaha restaurateur Rusty Harmsen, for $150,000 in late 1987. King redecorated the restaurant and added a baby grand piano, among other changes.
The National Credit Union Administration, which closed Franklin Nov. 4, has alleged in a $34 million lawsuit against King that he used money from the credit union for the improvements, as well as for the $10,000 earnest deposit on the purchase agreement.
One person familiar with the business has said the restaurant did not turn a profit. Instead, the person said, King has invested additional funds into Cafe Carnavale to keep the restaurant going.
If that money came from Franklin, as the NCUA alleges, the closing of the credit union would have ended the funding source.
King has said that "negative publicity" about Franklin's closing hurt the business. His attorney, William E. Morrow Jr., said he was not aware that the restaurant had closed.
Omaha attorney Keith I. Frederick, the court-appointed receiver for King's assets, and the Cafe Carnavale building landlord also said they were unaware of the closing.
"I just heard it on the street this afternoon," Frederick said.
Frederick said the stock of the restaurant's holding company, Restaurant Food Service of Omaha Inc., has not been turned over to him. He said he had no information about the financial condition of Cafe Carnavale.
The Rigel Corp., which owns the restaurant building, had not been notified that Cafe Carnavale closed, treasurer Pat Kelley said. But he said a closing was not unexpected.
"It's not a real shock that they're closed," he said. "Whether they're open or closed doesn't affect their situation with us."
Sign next to door of restaurant . . . announces closing.