Government Attorney Says: Tapes Are Examined for Anyone Who Had 'Something to Hide' - Jan 23, 1990 - Omaha World-Herald
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Jan 23, 1990 Government Attorney Says: Tapes Are Examined for Anyone Who Had 'Something to Hide'; [Metro Edition] Omaha World - Herald.Â Omaha, Neb.Â pg.Â 12
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(Copyright 1990 Omaha World-Herald Company)
A federal agency is examining 21 hours of videotapes to see whether anyone who might have alerted authorities to problems at Franklin Community Federal Credit Union "had something to hide," a government attorney said Tuesday.
Robert Fenner, National Credit Union Administration general counsel, said Tuesday that he has begun viewing videotaped statements of three people who said they were victims of, or witnesses to, sexual abuse when they were minors.
The videotapes were sent by the Legislature's special Franklin committee at the NCUA's request.
From Washington, Fenner said: "I think there are a number of people in Omaha who either knew (Lawrence E.) King was stealing or suspected he was stealing money from the credit union" before federal officials closed it Nov. 4, 1988.
"I want to know why they didn't come forward," Fenner said.
King, Franklin's manager and treasurer, has been indicted on 40 counts charging him with conspiracy, fraud and income tax evasion. He has pleaded innocent.
Those who might have suspected that illegal activities were occurring at the credit union but didn't report that to authorities could include "employees, officials and others who were associated with Franklin," Fenner said.
If there are such persons, the 21 hours of videotapes might help the NCUA determine who they are and what their motives were, Fenner said.
"There might be evidence on whether they have something to hide," he said.
Fenner said he realizes that the videotapes have limitations.
"I don't think those tapes standing alone prove anything," he said. "They are just statements by three people."
The three individuals appearing on the tapes reportedly name some people they claim were involved in sexual exploitation of minors and in child abuse.
The NCUA has filed lawsuits against King and a number of others formerly associated with Franklin in an effort to recover some of the $39 million that the NCUA says has disappeared.
The NCUA made up the loss from its insurance fund, repaying depositors up to $100,000 per account.
The federal grand jury indictment charges that $10.2 million in Franklin funds went to support the lifestyle of the King family from 1984 until Nov. 4, 1988.
Some people acquainted with the King family's lavish lifestyle have said they assumed that King's restaurant and catering businesses provided the family with a substantial income apart from the credit union.
Others said they thought the money came from Jamaican relatives of King's wife, Alice.
The federal grand jury indictment says the Kings told some people that the source of their money was "gifts or inheritances from relatives or profits from their independent business concerns.
"In fact, no substantial gifts or inheritances from relatives existed," the indictment says.
"Furthermore, while several of the business concerns made negligible profits, their business concerns were generally operating at a loss."
The indictment charges that $1.9 million was embezzled from Franklin to support King's businesses.