$4.6 Million in 13 Months Limousines, Flowers, 'Flair' Show on List of King's Bills - Dec 11, 1988 - Omaha World-Herald
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Dec 11, 1988 $4.6 Million in 13 Months Limousines, Flowers, 'Flair' Show on List of King's Bills; [Sunrise Edition] Robert Dorr. Omaha World - Herald. Omaha, Neb pg. 1.A
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(Copyright 1988 Omaha World-Herald Company)
World-Herald staff writers Paul Goodsell and James Allen Flanery contributed to this story.
Some of the business people with whom Lawrence E. King Jr. spent thousands of dollars over the last year say they found him to be a sociable and sometimes flashy man who paid his bills.
A New York limousine service owner said King sometimes gave $100 or bigger tips.
A florist said his dealings with King made him skeptical of allegations King used money belonging to Omaha's Franklin Federal Community Credit Union for personal purposes.
For a 13-month period, charge-card and credit-card spending by King allegedly amounted to $1,033,875, flowers cost $146,044 and limousine service in Omaha, New Orleans and Long Island, N.Y., took $186,395, a lawsuit involving the failed credit union says.
The money for the charge-card payments, flowers, limousines and scores of other items came from funds belonging to Franklin, a federal agency contends in its lawsuit filed last month in U.S. District Court in Omaha.
At least $34.2 million was diverted from Franklin Credit funds in "fraudulent, dishonest and illegal" ways, the National Credit Union Administration contends. The NCUA administers a $2 billion insurance fund that will cover Franklin's depositors up to $100,000 per account.
The lawsuit alleges the $34.2 million was spent for the benefit of King, the credit union manager, for his personal businesses, for his friends or to repay previously issued certificates of deposit.
In a later court filing, King denied taking Franklin funds for his own use.
The lawsuit lists expenditures totaling $4.6 million. That money was spent from June through December 1987 and during April, May and July through October 1988, the NCUA says.
People acquainted with King have said he has high-style personal tastes, that he gave elaborate parties and that he bestowed expensive gifts on friends - sometimes including entourages of young men who accompanied him.
The lawsuit includes a spending list that, if correct, provides additional indications of King's lifestyle.
The filing of the lawsuit was reported earlier by The World-Herald. The list of expenditures attached to the lawsuit was not reported in detail then because it was hand-written, and some entries were difficult to read.
The expenditures that the lawsuit says came from Franklin Credit funds include $32,120 in political donations, mostly to Republicans and to conservative causes.
The list also shows $35,574 in donations to charitable and education causes.
Some spending items involve the Cafe Carnavale and other Omaha businesses owned by King, the lawsuit contends.
Most people and businesses listed in the NCUA's lawsuit against King are in Omaha, where King worked and lived most of the time, or in Washington, D.C., where he rented a $5,000-a-month house.
The owner of a gourmet grocery and catering service near King's former Washington house said King always came to the grocery in a chauffeured black Cadillac limousine.
Each time King came to the grocery, he would buy as much as $500 or $1,000 of the best hams, roasts, seafood, liquor and wine for parties, said Andrew Zimmerman, owner of Larimer's Market.
The store sometimes delivered the items to King's house, Zimmerman said. Other times, King's chauffeur carried out bags of items to the waiting limousine, the market's owner said from Washington.
Zimmerman described King as outgoing, sociable and "somewhat flashy." King usually wore gold rings and expensive suits, he said.
Joe Fook, owner of Statewide Limousine Inc. of Long Island, N.Y., said he was King's personal driver in the New York area. "Whenever he comes in, whatever he needs, I would do for him," he said.
King paid $22,513 in Franklin Credit funds to Statewide Limousine during the 13 months, the NCUA lawsuit says.
Fook said he had overheard King tell people in New York that "he was doing real well at the credit union and that he had brought it up really well."
King came to New York about once a month, Fook said from his office in Long Island. Fook took King to office buildings, churches and other locations, he said.
"He is one of my best customers," Fook said.
Fook said he would typically remain with King all day at a rate of $40 an hour plus a 20 percent tip. "Every once in a while, he gave us an extra hundred (dollars) or two," he said.$138,863 Monthly
The American Express cards were used to charge a wide variety of items, including King's clothing, transportation, flowers, food, jewelry and apparent gifts, John Ianno, a NCUA attorney, said from Washington, D.C.
NCUA records show the American Express monthly bills ran as high as $138,863. American Express gold and platinum charge cards were used, the records show.
American Express spokesman Bill Moss said from New York it is possible to charge large amounts on regular, gold or platinum cards.
"There is no preset spending limit," he said. "Charges are approved based on past spending history, payment history and ability to pay."
Depending on the individual card holder, Moss said, it would be possible to charge expensive items - fur coats, charter airplane trips or even automobiles - and run up a large monthly bill. But he said he could not comment on any individual card holder's purchases.
Germaine Attebury, manager of King's Washington, D.C., house for a year before King and his wife Alice moved out in early November, said the Kings' large grocery bills were not surprising.
"They ate well," she said. "They entertained with his usual flair."
Interviewed from Washington, she said she had a one-room office in the house and she took care of household details from 8 a.m. to 5 p.m. weekdays. The Kings did not spend a great deal of time in Washington, she said.
Mrs. Attebury said she returned from a trip to Louisiana in November to find that King had moved out. She learned from one of King's attorneys that she was out of a job because King's assets were tied up - although she did not learn details of the $34 million lawsuit until last week.
"I'm stunned," she said. "That's a lot of money."
Despite her sudden unemployment, Mrs. Attebury said, she harbors no resentment against King. "Mr. King was a wonderful employer - fair, honest, sincere," she said.
Noel Stoddard, manager of Professional Leasing Inc., a subsidiary of Rhoden Motors Cos., said King leased 10 to 12 cars from Professional Leasing at any one time.
One car was a white 1988 Mercedes 560 SEC, another was a red 1987 Mercedes and a third was a Tojan, a sports car built by Knudsen Automotive Inc. in Omaha, Stoddard said. Some of the leasing contracts were financed through General Motors Acceptance Corp.
Stoddard said he has been leasing cars to King's businesses and to King since 1979 or 1980. King has been "a very valued client, obviously," he said.
A Mercedes will lease for $500 to $1,500 a month, he said.
Asked who was driving the cars, Stoddard said: "We had all the documents, the cars got delivered, we didn't concern ourselves with who was driving as long as these payments were made."
Daniel Janousek, who left Janousek Florists earlier this year to start Floral Concepts, said he was a subcontractor on various parties that King catered for others. King owns the King Co., a catering concern.
"It wasn't all from Larry King," Janousek said. "The money he's paying me is from other sources. When he gets paid, I get paid."
Janousek said his Floral Concepts business was paid about $20,000 for flowers at a party for people attending this year's Republican National Convention in New Orleans. Floral Concepts staff members flew to New Orleans to set up the floral displays, he said.
Although King organized the party, Janousek said he understood that the money for the party came from the Council on Minority Americans, a Republican group.
Floral Concepts also provided flowers that were used at Cafe Carnavale, Janousek said.
Janousek said his dealings with King led him to be skeptical of allegations that King used money belonging to the credit union for personal purposes. The lawsuit contends $70,475 in Franklin Credit funds went to Floral Concepts during the 13 months.
Jim Oestmann, vice president and manager of Davidson's Furniture Showcase, described King as a longtime customer who paid his bills. "We just know he was a good customer," he said.
Bruce Carlson, vice president of Hearthside Shop, said many of the checks used to pay for purchases by King or King-owned businesses were Franklin Credit Union checks.
The Hearthside Shop delivered patio furniture, barbeque grills, wicker furniture and other items to King's home, Cafe Carnavale, the Showcase Lounge and a Twin Towers penthouse apartment, Carlson said.
In one case, here is how funds flowed from a Franklin Credit bank account to a business with which a King-owned concern had dealings:
Better Business Equipment, an Omaha copying-machine company, is listed in the NCUA's lawsuit as recipient of $4,773 in Franklin Credit funds.
Coyner Smith, owner of Better Business, showed The World-Herald copies of Franklin Credit checks sent to his business indicating the payment came from a Franklin Credit account at FirsTier Bank Omaha.
The amounts of the checks coincided with amounts on copies of a sales contract enclosed with the checks to show why the payments were being made. The sales contract showed Cafe Carnavale, a King-owned restaurant, had purchased a copying machine from Better Business Equipment.
Some certificate-of-deposit interest checks seen by The World-Herald have been drawn on the same Franklin Credit account at FirsTier.
Bank FailureCredit: World-Herald Staff Writer