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Abuse Investigated Only Patrol Thorough In Probe, Naylor Says - July 15, 1989 - Omaha World-Herald

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July 15, 1989 Abuse Investigated Only Patrol Thorough In Probe, Naylor Says; [Sunrise Edition] James Allen Flanery Paul Goodsell. Omaha World - Herald.

Full Text (882 words)
(Copyright 1989 Omaha World-Herald Company)

The former counsel for the Legislature's probe of the Franklin Community Federal Credit Union says that only the State Patrol truly investigated child-abuse reports allegedly tied to Franklin's former manager, Lawrence E. King Jr.

Kirk E. Naylor Jr., who resigned as counsel Thursday, said Friday that an FBI probe of the allegations was "limited to an assist capacity," and the Omaha Police Department "conducted a handful of interviews at most" on the subject.

Nicholas O'Hara, special agent in charge of the FBI in Nebraska and Iowa, and Robert Wadman, acting chief of the Omaha Police Department, said their investigations were thorough and turned up nothing of substance.

O'Hara said the FBI interviewed "dozens of people," checked leads "all over the country," and found "no credible witnesses."

Wadman said, "I stand by our earlier opinion (that the allegations lack substance), and it appears as if the legislative committee is confirming that."

Focus on Money

State Sen. Loran Schmit of Bellwood, chairman of the Legislature's Franklin committee, said Tuesday that the committee's own abuse inquiry had turned up nothing verifiable.

He directed the committee staff to focus on money matters, arguing that doing so might ultimately lead to abuse and other possible crimes.

Naylor and two others, State Sen. Ernie Chambers of Omaha, the committee vice chairman, and Jerry Lowe, the committee's chief investigator, resigned in protest over Schmit's statements and directive.

They said that there are still leads to follow in the alleged abuse, that Schmit's statements had the effect of chilling potential witnesses and that Schmit should have consulted the full committee before acting.

Schmit said he did not mean to suggest in his directive to follow "the trail of the money" that abuse was to be ignored.

"I have stated many times that it is my conviction that if we follow the money trail from Franklin officials wherever it leads, we will eventually discover most, if not all, of the illegal or improper activities which took place," Schmit wrote Friday in a newsletter to constituents.

'So Be It'

"If that leads to child abuse, drug abuse, the squandering of depositors' money on personal expenditures or other improprieties, then so be it."

State Sen. Bernice Labedz of Omaha, another member of the Franklin panel, said Schmit told her this week he had seen a credit card receipt that "brings forward new information" regarding abuse. He did not elaborate, she said.

Mrs. Labedz said she remains "very concerned about sexual abuse of children," but agrees with Schmit that "following the money trail" can lead to it.

Chambers and Naylor have said that the committee's lack of access to federal documents makes it impractical to pursue money matters.

About $38 million is missing from the Franklin credit union.

Naylor said he was in a position to review the various abuse investigations because he had been appointed a special assistant attorney general and had access to police, FBI, State Patrol and other records.

"The State Patrol was the only agency that really conducted any sort of investigation," Naylor said.

He said Omaha police interviewed one alleged abuse victim in June 1988. But, he said, "none of the other principals (alleged victims) were interviewed."

Countless Leads

He said the last Omaha police report on abuse was "authored in July 1988."

He said the FBI "did not initiate or operate the investigation, based on what I've seen in the records."

O'Hara said the FBI worked closely with the State Patrol in the investigation, including pursuing countless leads across state lines.

O'Hara said the FBI also worked with the Omaha police.

"We've done our job, and there's nothing to address," O'Hara said.

Schmit wrote in his newsletter that the committee had not succeeded in verifying the abuse rumors.

"We have spent six months and thousands of dollars chasing rumor innuendoes, and to my knowledge at this time we do not have one fact which we can take to a prosecutor for action," he wrote.

"I have seen the rumor mill create devastation among innocent victims in the past. So long as I am chairman of this committee, we shall protect the innocent just as certainly as we will pursue the guilty."

Schmit said in a telephone interview Friday from Wahoo, Neb., that his views on the Legislature's investigation of alleged child abuse had been "totally misrepresented" by critics who resigned from the probe Thursday.

"The investigation is going to continue," Schmit said.

Persuading to Return

"Chambers' and Naylor's comments sound as if they are taking the position I don't want to continue the investigation of child abuse," Schmit said. He said that is untrue.

He said he saw no reason to try to persuade Chambers, Naylor and Lowe to return to the committee. State Sen. Dan Lynch of Omaha, another member of the committee, said Friday he would urge the three men to change their minds.

In another Franklin matter, Attorney General Robert M. Spire said his office had asked the Lancaster County District Court for a July 21 hearing related to the legislative committee's request for investigative reports.

The hearing would deal with procedural matters related to a July 26 hearing scheduled in the same case. The later hearing would determine whether Spire's office must hand over reports compiled in connection with allegations of child sexual abuse.

Credit: World-Herald Staff Writers

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