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Kings' Pleas Are Not Sign of Cover-up, Hoagland Says - Feb 14, 1991 - Omaha World-Herald

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Feb 14, 1991 Kings' Pleas Are Not Sign of Cover-up, Hoagland Says; [Sunrise Edition] Robert Dorr. Omaha World - Herald. Omaha, Neb. pg. 15

Full Text (715 words)
(Copyright 1991 Omaha World-Herald Company)

The guilty pleas by Lawrence E. King Jr. and his wife, Alice, to a reduced number of charges doesn't mean important facts in the Franklin case are being covered up, Rep. Peter Hoagland, D-Neb., said Wednesday.

"I just don't think anyone can conclude that the case came out this way to cover anything up," Hoagland said.

Three members of the Franklin legislative committee - Sen. Loran Schmit of Bellwood, the chairman; and Sens. Dan Lynch and Bernice Labedz, both of Omaha - have said the full story of Franklin may not be told because the King case didn't come to trial.

Three attorneys in the case - First Assistant U.S. Attorney Thomas Thalken; Alan Stoler, one of King's attorneys; and Jerold Fennell, Mrs. King's attorney - have said a trial wouldn't have uncovered significant new information about the Kings or about Franklin.

'All Out There'

Hoagland indicated he agrees with the attorneys.

"All of the salient facts in this case have been explored and re-explored," Hoagland said. "It's all out there. . . . In addition to the actual facts, there are bucketloads of made-up facts."

He said he was referring to some of the child sexual abuse allegations against prominent Omahans that the Douglas County Franklin grand jury found to be "a carefully crafted hoax."

Two young people recanted the stories of sexual abuse they had told a legislative committee investigator. The county grand jury indicted two others on perjury charges.

A federal grand jury also said there was no basis for the wide-scale sexual abuse allegations.

King, who was Franklin Community Federal Credit Union's top executive, has pleaded guilty to three charges. Under his plea bargain with prosecutors, he will serve at least 10 years behind bars.

Mrs. King should be sentenced to three years in prison, her plea agreement says, but she could be paroled after one year.

Franklin Funds

In June 1989, Hoagland brought a congressional subcommittee to Omaha to hear testimony from National Credit Union Administration officials and others about Franklin's Nov. 4, 1988, failure.

At the hearing, NCUA officials made public information showing what an accounting team had determined happened to Franklin's money. Essentially, they said, the money had been spent.

Hoagland said he doesn't know of any reason to question the NCUA's conclusions.

Even so, he said, it is possible that King has stashed away some Franklin money. He said he hopes the federal court sentence takes into account the chance of Franklin funds later being discovered in King's possession.

U.S. District Judge William Cambridge will sentence the Kings May 13.

The plea bargain between King and prosecutors says: "The parties understand that the court may order restitution to the victims as part of the sentence in this case . . ."

Moreover, King can be fined a total of $750,000 as part of his sentence, the plea agreement says.

Both Sides Served

Hoagland, a lawyer, said it wasn't surprising that the Kings pleaded guilty because that plea served the interests of both sides.

The defense wasn't interested in taking the case to trial because the evidence against King was overwhelming, Hoagland said.

If defense attorneys had insisted on a trial, Hoagland said, they faced the probability of defeat and stiffer sentences than the ones the Kings are likely to get under the plea bargains.

Prosecutors gain the certainty of a conviction, and they avoid spending "thousands and thousands" of additional dollars in public funds on a trial.

Hoagland said the Franklin case has been investigated so thoroughly over more than two years "that I don't know what else there is to learn."

Hoagland cited the investigations conducted by two Franklin grand juries, by the special Franklin legislative committee and by the congressional subcommittee that held a hearing in Omaha.

In addition, he said, various news organizations "have aggressively reported" on the Franklin case.

Skeptical Nature

Despite the information produced from those sources, Hoagland said, it isn't surprising that some people still have suspicions that government officials haven't taken the proper actions.

"It's the birthright of every American to criticize government," Hoagland said. "There always are going to be a certain number of people who don't trust judges and prosecutors and who will think there is more to something than meets the eye.

"That's part of the skeptical nature of the American people."

Credit: World-Herald Staff Writer

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