Grand juries determined alleged sex trafficking ‘Franklin scandal’ in Omaha was a hoax

A recent Facebook post talks about a supposed scandal involving the abuse of hundreds of children in the 1980s as fact. But it’s been investigated and found baseless by multiple grand juries.

"Research eventually led to the Franklin scandal that broke in 1989 when hundreds of children were apparently flown around the US to be abused by high ranking ‘Establishment’ members," said a November 2021 Facebook post that continues to get traction on the social media platform. 

This post was flagged as part of Facebook’s efforts to combat false news and misinformation on its News Feed. (Read more about our partnership with Facebook.)

In late 1988, after the failure of the Franklin Community Federal Credit Union in Omaha, Nebraska, rumors started to spread that money from the union had been used to pay for child prostitution. 

"Businessmen, media personalities, lawmen and educators," were among those implicated, as well as Lawrence E. King Jr., who headed the credit union and was an affiliate of the National Black Republican council, an affiliate of the Republican Party, the Washington Post reported at the time. 

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King, who was also accused of embezzling millions from the credit union, called the sexual allegations against him "garbage." The Post in 1990 reported the allegations were "based on still unverified reports from half a dozen young people who reportedly have described being auctioned as love slaves, flown to the coasts for wild parties, or plied with drugs and alcohol as part of a bisexual bacchanal."  

A county grand jury in Nebraska concluded the "lurid reports of child sex abuse, drug trafficking, pornography, and political intrigue" were a "carefully crafted hoax," the New York Times reported in 1990. The grand jury didn’t identify who was suspected of engineering the hoax but indicted two people on grounds they had given perjured testimony. 

A couple months later, a federal grand jury agreed that the allegations were unfounded. 

We rate this post False.