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Federal Grand Jury Investigating Credit Union Indicts Two

September 27, 1990 GMT

OMAHA, Neb. (AP) _ A federal grand jury investigating a failed credit union concluded Wednesday that stories of sexual abuse and drug trafficking that arose after the credit union closed were unfounded.

The grand jury returned two indictments and said in its report that it found evidence of obstruction of justice in its investigation of the Franklin Community Federal Credit Union.

Shortly after Franklin failed in November 1988, allegations were circulated about sexual abuse of children and drug abuse among prominent Omaha residents.

The grand jury report said it didn’t find any credible evidence that any prominent individuals in Omaha were involved in ″any ring of organized activity to sexually exploit minors, transport minors in interstate commerce for sexual purposes, or to traffic in controlled substances.″

″Hopefully, this will place to rest the concerns and the rumors that have been circulating in our community this past year,″ said U.S. District Judge Lyle Strom, who dismissed the grand jury.

Indicted were Alisha Owen, 22, who testified that she was sexually abused as a minor, and Sandra Rhode Prucha of Omaha, former assistant to the manager and treasurer of the Franklin Community Federal Credit Union.

Ms. Owen, who was indicted earlier on perjury charges by a county grand jury, was charged with eight counts of lying to the federal grand jury. Ms. Prucha was accused of one count of bank fraud.

The grand jury is the same one that issued indictments last year against Lawrence E. King Jr., former manager of Franklin. King is awaiting trial in U.S. District Court on 40 counts charging conspiracy, fraud and filing false tax returns in connection with the November 1988 failure of Franklin.

King’s wife, Alice, is charged with 12 counts of conspiracy and fraud.

The National Credit Union Administration also has filed lawsuits against the Kings seeking to recover some of the $39 million it says was missing from the credit union.

The federal grand jury spent 24 months investigating the credit union’s failure.

Its report said it found evidence to believe there had been an obstruction of justice but not enough to charge anyone but Ms. Owen. The federal grand jury indicted Ms. Owen for statements she made to the federal grand jury in June.

In July, a Douglas County grand jury indicted Ms. Owen on eight counts of perjury for testimony she gave to the grand jury in the state court system.

The Douglas County grand jury had said a story of sexual abuse and prostitution told to a legislative committee was ″a carefully crafted hoax.″

The bank fraud charge against Ms. Prucha, 47, alleges that she used expense vouchers to obtain cash and credit, then used the cash and credit for her personal use, Lahners said. The indictment alleges that about $29,000 was involved, he said.