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Panel Ends 82-Day Look at Franklin Report Exonerates Prominent Omahans - July 24, 1990 - Omaha World-Herald

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Panel Ends 82-Day Look at Franklin Report Exonerates Prominent Omahans - Robert Dorr, Gabriella Stern. July 24, 1990. page 1

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(Copyright 1990 Omaha World-Herald Company)

Franklin Case, County Grand Jury Report

A Douglas County grand jury Tuesday sharply criticized some state officials and others who made accusations in the Franklin Credit Union case. It indicted three people and cleared a number of prominent Omahans of sexual wrongdoing

The grand jury debunked many of the rumors that have surrounded the 1988 failure of the credit union. It said it traced a series of allegations and rumors that had been raised in the wake of the Franklin failure.

"We found no credible evidence of child sexual abuse, interstate transportation of minors, drug trafficking or participation in a pornography ring," the grand jury said.

"To the extent that homosexual relations occurred involving such employees or officials, the evidence we were able to uncover showed these exchanges to be voluntary acts of persons above the age of consent," the grand jury said.

On the matter of videotaped statements from three witnesses presented to a legislative committee, on which much of the investigation was based, the grand jury said:

"There is no doubt after reviewing all relevant evidence, that the story of sexual abuse, drugs, prostitution, and judicial bribery presented in the legislative videotapes is a carefully crafted hoax, scripted by a person or persons with considerable knowledge of the people and institutions of Omaha, including personal relationships and shortcomings."76 Witnesses

The grand jury said it focused its investigation on allegations of drug use, pornography and illicit sexual activity. It met 82 days, heard testimony from 76 witnesses, watched more than 30 hours of videotapes and listened to numerous audiotapes.

The 42-page report and the three indictments complete the grand jury's work which began March 19 and took place in the Douglas County Courthouse in downtown Omaha.

One of the persons indicted was Alisha Owen, 21, the inmate at the Nebraska Center for Women at York who had accused former Omaha Police Chief Robert Wadman of sexual misconduct with her when she was a teen-ager. The grand jury indicted her on eight counts of lying to the grand jury.

Miss Owen was one of three young people who told a legislative committee investigator last year during videotaped interviews that they were sexually abused as minors.

Wadman, now police chief in Aurora, Ill., was cleared of any wrongdoing.'No Direct Connection'

Another person indicted was Alan Baer, 67, former owner of the J.L. Brandeis & Sons department store chain, was charged with two felony counts of paying or compensating men to perform sexual acts.

The grand jury said, however, it found "no direct connection" between Baer and King or the Franklin Credit Union, other than limited social and business dealings.

The third indictment charged Paul A. Bonacci, 22, an inmate at the Lincoln Correctional Center, with three counts of lying to the grand jury.

The grand jury confirmed earlier reports that two other young men largely recanted "their stories and allegations" made to legislative committee investigator Gary Caradori. The two are Troy Boner and Danny King, the grand jury said.

Even if they had not recanted, inconsistencies in the three accounts "caused us to doubt the events really happened," the report said.

Miss Owen's "motivation was to obtain a reduced prison sentence, or more comfortable conditions, and to collect money for her story or from civil litigation," the report said.

The grand jury added: "We think that (Miss) Owen might have been sexually abused during her early years, but not by the people and in the way she has alleged."Specific References

The grand jury referred specifically to numerous people in addition to the three who were indicted:

Lawrence E. King Jr. Although King, chief executive of the failed Franklin Community Federal Credit Union, is charged with federal financial crimes relating to Franklin, the grand jury "found no credible evidence of child sexual abuse, interstate transportation of minors, drug trafficking or participation in a pornography ring by King or other Franklin officials and employees.''

The grand jury said King did use money or other items to procure men in their late teens or early 20s for homosexual sex and, thus, committed the crime of pandering.

But the statute of limitations may have expired on some of those crimes, and it probably would not be good use of court resources to pursue those crimes, considering the charges against King dealing with Franklin's financial failure, the grand jury said.

King was indicted by a federal grand jury last year and faces 40 charges. He currently is undergoing mental treatment to determine whether he can be tried.

Alan A. Baer.The report said that allegations made by Miss Owen and Bonacci about Baer "are not true. It appears Baer was written into the script because of his wealth and well-known homosexuality."

The grand jury said it had "two areas of concern regarding" Baer. The jury said it heard testimony from witnesses who said they had sexual relations with Baer.

"The names of one or more of these individuals appear on tax returns as recipients of money from a private foundation set up by Baer and of which he is the president," the grand jury said. "Such evidence calls into question the legitimacy of Baer's tax filings and charitable contributions and raises the possibility that such contributions were used to channel money in exchange for sex while at the same time providing Baer with income tax deductions."

The grand jury report said it decided "against indicting Baer for possible income tax evasion," based on a review of Nebraska's tax structure and state tax laws. However, the grand jury said it would "strongly urge a thorough and impartial review of all of Baer's applicable tax filings by federal authorities." A federal grand jury in Omaha has been investigating the Franklin case.

Baer's attorney, Steve Seline of Omaha, emphasized that Baer was cleared of any sexual exploitation of minors. He contended, however, that the pandering charges against Baer were ''incorrect and inappropriate."

He declined further comment.

Robert Wadman, former Omaha police chief. Wadman, now the police chief in Aurora, Ill., was "unjustly accused by Alisha Owen of sexually abusing her. . . ."

"These false accusations have caused him great anxiety, loss of personal and professional reputation and humiliation to his family," the jury said.

"We now look upon Owen as the perpetrator and Wadman as the victim."

Alisha Owen "made serious mistakes in describing a number of Wadman's physical characteristics," the report said.

The grand jury's report said the young men who originally said they were victims recanted their video statements and testified that a third person, Alisha Owen, was perpetrating a hoax for personal gain.

Contacted Tuesday in Utah where he was vacationing, Wadman said, "I've known the truth from the beginning. I'm glad I could assist the grand jury.

"The circumstances surrounding this problem have been very damaging to my family, very hurtful to my career."

Wadman's attorney, Michael O'Brien of Omaha, said he was surprised that the grand jury named as many people as it did in its report. He said he is afraid that by naming figures such as Wadman "it just furthers the damage and victimization of these individuals who are falsely accused."

Harold Andersen. The grand jury said it found no evidence to support allegations that Andersen, retired World-Herald publisher, was involved in sexual misconduct or other illegal activity.

"The motive for naming Andersen as connected with suspected child abusers was probably politically generated due to his position as publisher of the Omaha World-Herald at that time."

P.J. Morgan. The Omaha mayor had been exonerated earlier and was cleared again in the grand jury report.

Eugene Mahoney. The Omaha Public Power District director and former State Game and Parks Commission director was cleared of sexual misconduct allegations.

"Mahoney may have been included because of his personal friendship with Harold Andersen as well as his long-time political connections within the State of Nebraska," the grand jury said.

District Judge Theodore Carlson. The grand jury cleared Carlson of sexual misconduct allegations.

Thomas McKenney. The Omaha lawyer, a former deputy Douglas County attorney, was cleared of bribery allegations made by Alisha Owen.Words From Shakespeare

The grand jury quoted this from William Shakespeare's Henry IV: "Rumor is a pipe, blown by surmises, jealousies, conjectures and of so easy and so plain a stop that the blunt monster with uncounted heads, the still discordant wavering multitudes, can play upon it."

The grand jury then observed: "Perhaps never in the history of Douglas County has the discordant multitude played so feverishly upon the rumor pipe as in the allegations of sexual misconduct surrounding Franklin."

The grand jury criticized the conduct of the late Gary Caradori, investigator for the Franklin legislative committee; the legislative committee itself; the committee's head, State Sen. Loran Schmit; and State Sen. Ernie Chambers of Omaha.

Caradori "led his witnesses," "fed" them information and "worked from a sensational base," the grand jury said. "If there appeared to be something that would be scandalous, he was interested in following it through."

The grand jury said it believes Caradori "was duped" into working with Michael Casey, a sometime Omaha resident who once was fired from Boys Town.'Never Happened'

Marc Delman of Omaha, attorney for Troy Boner, said Tuesday that Caradori persisted in interviewing Boner even after Boner "told him he had no idea what he (Caradori) was talking about. The allegations never happened."

Delman urged the public to realize the seriousness of sexual and physical abuse of children and not to let the "fabrications" in the Franklin case divert attention from this problem.

The Franklin legislative committee "has operated largely from a political and personal motivational base" and "appeared to be operating with several hidden agendas," the grand jury said.

The jury made these points in its criticism of state officials and others:

State Sen. Loran Schmit. Schmit, of Bellwood, Neb., is sincerely concerned about children, the grand jury said. However, on several occasions, Schmit has been "politically irresponsible," the grand jury said.

"We are deeply concerned about his statement to the media that there were people who wanted to see Caradori dead," the grand jury said.

John DeCamp. Decamp, a Lincoln lawyer and lobbyist and former state senator, "issued his memorandum simply for personal political gain and possible revenge for past actions alleged against him," the grand jury said.

The grand jury described the DeCamp memo as "a smear campaign."

The DeCamp memo, originally sent to two newspaper reporters but later widely circulated, named five people that DeCamp said were rumored to be figures in the Franklin investigation.

Denny Henson. The grand jury said that Henson, a candidate for the Legislature in West Omaha's District 4 and a former Douglas County Republican chairman, "acted irresponsibly in distributing the DeCamp memo" in his legislative district.

Henson responded Tuesday that he had no regrets about mailing the DeCamp memo.

"I believe the public has a right to know," Henson said. "I did not create the memo. I only forwarded the memo on after it was given to the media and they refused to report it."

State Sen. Ernie Chambers. Chambers, who declined to appear before the grand jury and has been a severe critic of the jury's proceedings, has fed the media stories and has made "every effort possible" to disrupt grand jury operations, the grand jury said.

"It would appear that Chambers is far more interested in entertaining his constituents and drawing attention to himself than attaining justice for anyone," the grand jury said.

It added that it is difficult to understand how King could live a lavish lifestyle for many years in Chambers' district without Chambers learning of it, the report said.

"If Chambers did have such knowledge or suspicion of King's misbehavior, he should explain to the public why he was so silent then, and so vocal after it became too late to prevent or inhibit King's wrongdoing," the jury said.'Rumormongers'

In a section headed "the rumormongers," the grand jury said that many people "both spread and received the gossip." The jury specifically referred to the activities of three people:

Michael Casey, who was arrested Monday on a felony bad-check warrant from South Dakota, following testimony before the federal grand jury also investigating Franklin matters; Kirstin Hallberg and Bonnie Cosentino, both of whom have been prominent in the Concerned Parents group formed to press for child-abuse investigations.

The report said this about the three:

Michael Casey. Many who know Casey "describe him as a con man," the grand jury said, adding that it believes Casey may have "fueled the fire of rumor and innuendo in Omaha."

"We believe it possible that allegations about Harold Andersen and Boys Town were a product of Casey's personal grudges," the grand jury said.

It said Casey spent "a considerable amount of time" with the late Franklin legislative committee investigator Gary Caradori and was the reason that Caradori found Alisha Owen.

The grand jury concluded, "Omaha must go forward and try to leave behind the rumors, fear, accusations and lies which Casey helped to spread."

Kirstin Hallberg. The child-care worker, who lives in Washington County, had good intentions but used poor judgment and overreacted, causing "misinformation to be disseminated," the grand jury said.

She was involved in the original reporting of child-abuse allegations to state officials in 1988. The FBI and Omaha Police Department later reported the allegations couldn't be substantiated, but those findings by the law agencies were criticized by some persons in the child-care field.

Mrs. Hallberg "apparently is an individual who has difficulty following established guidelines and feels it necessary to become involved at all levels of the system, notwithstanding her lack of training, education and experience," the grand jury said.

Bonnie Cosentino. Active in the formation of Concerned Parents, she spread much "misinformation, rumor and innuendo, as well as false accusations against the prominent individuals named."

"If indeed there was a spawning ground in which Franklin rumors were born, nurtured and grew, Cosentino would be found as an inhabitant."

Credit: World-Herald Staff Writers

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