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The Franklin Scandal and Pedophilia in High Places

Still Evil After All These Years

by CHARLES M. YOUNG

I have known Nick Bryant since 1995. He was new to New York from Minnesota then, and looking to make a jump from science reporting in technical journals to writing for a mass audience. I noticed that he was persistent and ethically motivated and I thought, “He might be a good reporter.” We got to be friends, and had many long discussions about the nature of evil, which was his preferred subject matter as he tried to make a move into general circulation magazines. When he wasn’t chasing doctors at AIDS conferences, he was chasing outlaw bikers and Satanists.

On one such foray in 2002, he stumbled on a scandal that I had never heard of. The scandal centered around the Franklin Community Federal Credit Union, which was created to serve a poor black neighborhood in Omaha, Nebraska. During the 70s and 80s, its manager, a man named Larry King (not the talk show host), ran the Franklin as a Ponzi scheme and looted over $40 million, which he spent on an opulent lifestyle and Republican fundraising. King sang the National Anthem at the Republican convention in 1984 and served on several committees of the National Black Republican Council. He had a townhouse in Washington, DC, where he threw parties with many prominent guests. In August 1988, he threw a $100,000 party at the Republican convention, and appeared in a video in which he and Jack Kemp urged blacks to vote for George H. W. Bush. In November 1988, his Ponzi scheme crashed and the Franklin was shut down by the National Credit Union Association and the FBI.

All run-of-the-mill scandal stuff, and uncontroversial in the basic facts, except that as King was climbing into the upper levels of the national Republican hierarchy, Omaha was boiling over with rumors that he was also running a pedophile ring, pandering children out to rich and powerful men in Omaha, even flying the children to Washington, Los Angeles and New York for orgiastic, abusive parties with even richer and more powerful men.

The late 80s and 90s were rough years for people to make accusations of pedophilia. Media of the left and right alike were debunking an array of scandals involving nursery schools around the country (most notoriously the McMartin Preschool in California). The charges of child abuse were often bizarre as well as horrifying, and were ultimately dismissed in court as Salem witch trial hysteria and the accused exonerated. “False memory syndrome” entered the language as a new psychological disorder and proved useful for understanding odd claims of “recovered memory” in many areas.

It was not until 2002, when the Boston Globe ran a courageous series on pedophiliac abuse by Catholic priests, that the national climate started to change. As more and more stories appeared in other outlets, it became clear and widely accepted that the Catholic church had been harboring thousands of pedophile priests around the world for decades, if not centuries. It was ghastly, and it wasn’t a witch hunt, and the revelations keep coming to this day (do a search on “Catholic priest” and “abuse”). It’s barely news anymore, but the stories are relentless. There was little or no “false memory syndrome” among the claims.

Recently, the country was stunned again by the Gerry Sandusky case at Penn State. LIke the Catholic Church, the Penn State football program was an unchallengeable, straight-arrow, totalitarian hierarchy that valued itself more than the lives of children who were being raped by an outrageously flamboyant pedophile. Outside of a few extreme Penn State football fans, nobody had a hard time seeing that something had gone terribly wrong, and that it had gone wrong for a long time because the victims had enormous difficulty coming forward and people in authority didn’t want to believe what was happening before their eyes.

But in Omaha during the first Bush presidency, with the nursery school scandals losing credibility around the country, almost the entire Omaha establishment closed ranks to discredit the accusers. By establishment, I mean the Omaha Police Department, Nebraska State Police, FBI, local and state judiciary, local and state and national media. Against them stood a few teenagers, most of them with drug problems, long rap sheets and traumatized brains. Their allies were some foster care supervisors and parents, plus a divided investigative committee in the Nebraska legislature. Under phenomenal pressure, the teenagers either retracted their testimony of sexual abuse or were crushed in court and sentenced to years in prison for perjury. Key figures in the case ended up dead in numbers that would astound any actuary but apparently interested no one in Omaha law enforcement.

Many years after all this was seemingly resolved in court, my friend Nick decided in 2002 it was a story. I confess that I tried to discourage him. It wasn’t timely, I said. The pedophiles were still out there in the news today, he said. Nobody’s going to believe it, I said. But there’s been an injustice, he said. You’re going to end up dead in a motel room, I said. That’s not definite, he said.

Nobody accepted his proposals for a magazine article, so he started making trips to Nebraska on his own dime. Nobody accepted the complete magazine article he subsequently wrote. He decided to write a book and made more trips to Nebraska.

I told him that the best possible outcome would be that the book was completely ignored. Look what happened to Gary Webb, I said. The New York Times and Washington Post ran him out of journalism for exposing the CIA connection to cocaine smuggling. Webb committed suicide. There’s nothing a major newspaper hates more than a scoop, I said, unless it’s a scoop that exposes the major newspaper blew another story of grave importance. But the story is true, Nick said again, and the real villains are still out there.

Nobody in New York accepted Nick’s book proposal. He went to Nebraska yet more times to nail the reporting, hauled back mountains of evidence, tracked down many victims who had never spoken out before, and wrote the book, which pretty much wrecked him financially. The book, The Franklin Scandal: A Story of Powerbrokers, Child Abuse and Betrayal, came out in hardcover in 2009. It was published by a small house far from New York, Trine Day in Oregon. The paperback, slightly revised for greater readability, is coming out next month.

I should say here that I helped Nick with editing at various points, and he has done work for me in other contexts. And we are, as I say, friends. So I’m obviously not a disinterested party.

I should also say that I’ve looked at his evidence, listened to interviews, sorted through 200 receipts for planes chartered by Larry King with five-to-eight unnamed passengers, and I’ve read the book carefully. I can think of no innocent explanation for why King would be flying children, some of them spirited out of the Catholic orphanage Boys Town, around the United States, mostly to Washington. I’ve listened to Nick at great length on the phone about all of this as he was reporting. I have listened to him in the immediate aftermath of strange phone calls and death threats over the years.

This isn’t “conspiracy theory.” It’s one of the best investigative books I’ve ever read. If it’s true, then there are significant elements in America’s ruling class that are depraved beyond Caligula’s dreams. And I don’t see how it isn’t true.

Parts of the The Franklin Scandal read like a great crime novel. Parts of it read like Nick was trying to build an impregnable legal fortress of fact to make his case stick, which can slow down the story a bit, but as the facts come together, it is staggering.

The book has two main heroes, Gary Caradori and Alisha Owen. An honored veteran of the Nebraska State Police and private detective, Caradori was chief investigator for the legislative committee. He tracked down Larry King’s reputed photographer in Chicago and flew his private plane there to retrieve incriminating photographs (pedophiles do love their porn). On his return flight, Caradori’s plane blew up in mid-air and the photographs were never found. The wreckage was spread over a wide area on a farm. The FAA was ruled that Caradori had lost control of his plane for an “unknown reason.”

Unlike most of the children who were abused during the scandal, Alisha Owen did not come from a massively dysfunctional family. Her parents were stable church-going Christians who happened to have energetic, rebellious teenagers. At the age of 14, she fell in with the wrong crowd, started going to Larry King’s parties, and later claimed that Robert Wadman, the Omaha chief of police, had raped and impregnated her and shoved the barrel of his gun up her vagina. She was put on trial for perjury.

Under enormous pressure from the media and law enforcement to recant, she refused. Friends who previously supported her story did recant and testified against her (and later recanted their recantations). Her younger brother, under arrest for joy riding in a stolen car, was found dead in his jail cell shortly before her trial. It was ruled a suicide despite indications of a beating before he ostensibly hanged himself. Nick makes a strong case that Owen’s lawyer, Pamela Vuchetich, was having an affair with the FBI agent, Mickey Mott, who appears to have been orchestrating Owen’s prosecution. Just before Owen’s trial, Vuchetich abandoned her client and started representing two key witnesses for the prosecution. This alone violated four or five of Owen’s constitutional rights. The account of the trial must be read to be grasped. Suffice it here to say that I didn’t think such a blatant kangaroo court was even possible in the United States, and none of the appeals went anywhere.

Owen did four years in prison for perjury. She has been a model citizen since her release and raised her daughter, who, I’m told, looks like Wadman.

Larry King was quickly removed from Omaha and hidden away for “psychiatric evaluation” after his credit union collapsed. He then pleaded guilty to financial crimes and did nine years in prison. He has never been questioned about the pedophile ring.

Why is the story still important? It’s not just an Omaha story.

King’s partner in crime in Washington appears to have been a man named Craig Spence, surely one of the oddest figures in the history of American politics. Once a correspondent for ABC in Vietnam, Spence subsequently made a living blackmailing rightwing politicians in Japan. In Washington, he had a large house that he used for parties. The house was bugged from floor to ceiling, and he often seemed to be in possession of information he could have learned only from the bugs. He bragged about his CIA connections. He was also in possession of White House china, proudly and illegally displayed in his house, that he likely grabbed on midnight tours of the George H. W. Bush White House. “Homosexual Prostitution Inquiry Ensnares VIPs with Reagan, Bush,” was the headline in the June 29, 1989 Washington Times. Sub-headline: “Call Boys Took Midnight Tour of White House.” Spence, according to the article, was the organizer. Later articles said that Spence had been the tour guide on three more occasions and had a 15-year-old boy with him. At least one victim of the Omaha ring, Paul Bonacci, says he went on a late-night tour of the White House. Spence committed a convenient suicide later that year.

When homosexuals in government were discovered in past decades, the argument for firing them was that they were subject to blackmail (even after they were outed). Almost nobody makes that argument anymore, but surely pedophiles would be subject to complete control by blackmail and should not be anywhere near government, unless it’s a government prison.

The FBI has had a reputation for dirty tricks and blackmail for its entire history. The revelations about COINTELPRO, the campaign of harassment against the left during the 60s, were shocking to anyone with a concern for freedom of speech. If it became known that the FBI covered up a pedophile ring of the rich and powerful, I think most Americans would react as they reacted to the Penn State scandal, and the FBI would be drastically reorganized. Minimally, a number of agents in the Omaha office in the late 80s and 90s are guilty of the worst sort of malfeasance.

If it’s bad for quack psychotherapists “implant” false memories in their patients, how much worse is it when the FBI does the implanting with threats, beatings and perjury trials?

The Omaha World-Herald was the foremost local cheerleader for persecuting teenagers instead of investigating their claims. One of its own columnists, Peter Citron, had a long history of arrests for pedophilia and child porn and was implicated by two witnesses at Larry King’s sex parties. The long-time publisher of the World-Herald, Harold Anderson, was a big supporter of Larry King and had raised money for the Franklin. During the 18 years that King presided over the Franklin, the newspaper never noticed that King was living a hugely expensive lifestyle when he was supposedly making $17,000 a year in salary. The World-Herald Company is co-owner of Election Software and Systems, which counts half the election ballots in the United States.

Americans have plenty of obvious reasons to hate the rich and powerful. Wars for oil, rampant pollution, the destruction of individual rights, the constant lying about everything. It’s all on the front page, and it’s like old furniture in the living room. It’s hard for most people to notice. Boutique evil of the Gerry Sandusky sort affects fewer victims, but is more easily understood once the initial denial breaks down. If the denial of the Franklin Credit Union scandal ever breaks down, the consequences will reverberate far higher than happened at Penn State. Except for all those who died in suspicious accidents and suicides, the witnesses are still out there. Some might even talk about it. They talked to Nick Bryant.

Until the paperback version of The Franklin Scandal: A Story of Powerbrokers, Child Abuse and Betrayal comes out in October, you can read more at Franklinscandal.com.

CHARLES M. YOUNG is a founding member of ThisCantBeHappening!, the new independent Project Censored Award-winning online alternative newspaper.