By Jim Schutze
By Rachel Watts
By Lauren Drewes Daniels
By Anna Merlan
By Lee Escobedo
Gerald Lee Osborne, 50, of Weatherford, appears as a minor figure in the government's 34-page affidavit about the alleged abduction and murder of O'Hair and her son and granddaughter. The three vanished in late 1995.
The government claims they were kidnapped by three men, had $500,000 in gold coins extorted from them, and were then killed. It also claims that two of the men, David Waters and Gary Karr, then turned on their accomplice, a Florida con man named Danny Fry, and murdered and beheaded him.
Fry's headless, handless body was found October 2, 1995, on a riverbank near Seagoville, but was not identified until January 1999. The bodies of the O'Hair family members have not been found.
The only overt act attributed to Osborne in the lengthy government affidavit was renting a storage locker in Austin during late 1995 when the O'Hairs were allegedly being held prisoner in San Antonio. Osborne was arraigned and pleaded not guilty in federal court in Fort Worth on January 6. The case is set to go to trial February 28, said Richard Herrington, Osborne's public defender.
Authorities believe the O'Hairs may have been dismembered in that storage locker after receiving delivery of the gold coins, and after being killed on September 29, 1995.
But without the O'Hairs' bodies or an eyewitness to their fate, the government's case against Karr and Waters is problematic. Ample evidence that the O'Hairs were planning to flee the country would provide a perfect defense.
Thus, the government, in search of a witness, is turning up the pressure.
Last month, Osborne, who has convictions for burglary and assault in Illinois, was indicted by a federal grand jury in Fort Worth on a single count of being a felon in possession of ammunition.
The five rounds of .357-caliber ammunition at issue were seized March 24 last year when federal and Dallas County authorities raided four locations in Texas, Michigan, and Illinois.
Karr and Waters were charged with similar weapons violations. Both remain behind bars.
Observers see the indictment as a means of turning the screws on Osborne in hopes of his making a deal to tell whatever he knows about the murderous events of September 1995.
Of possible significance was Osborne's address that year.
According to his residence history, from October 1993 to February 1996, Osborne lived in Quinlan, a half-hour drive from Seagoville, where Fry's body was found.
And according to the federal affidavit, Waters, an old prison buddy of Osborne's from Illinois, visited him in North Texas before the O'Hair family vanished and was visited by Osborne in Austin.
Another man apparently feeling the pressure went public last week with his version of what happened during September 1995, which the O'Hairs apparently spent in San Antonio with their three accused kidnappers. Karr, who was indicted in December on federal charges of kidnapping and robbing the O'Hairs, released an eight-page statement he gave to authorities last spring when they arrested him in Michigan on weapons charges. Karr claims the O'Hairs arranged their own disappearance.
"The O'Hairs were not kidnapped or abducted. They freely and voluntarily moved with Waters," stated Karr, who said he was hired by Waters to assist in the O'Hairs' getaway plan. "David told me that the O'Hairs had contacted him. David was to assist them by guarding them while they finalized their business," he said.
"Waters told me that the O'Hairs were leaving behind everything and were getting away from the IRS. Waters said the O'Hairs were going to be criminally charged and that they were fed up with all of it, including their organization and the people in it," Karr said.
According to Karr's statements, the three O'Hairs spent a leisurely month at the Warren Inn, a low-budget hotel in San Antonio, hanging around with the bad guys, playing cards, and lounging around the pool.
"Madalyn was in the apartment and appeared healthy, but she was not very mobile, but she at times left the apartment and stood out on the balcony," he wrote.
"Conversation was small except when it came to religion. The most talk was over the card table. We stayed at the apartment, watched television and movies, and also played cards with the O'Hairs at night. I slept on the sofa whenever I was there," he wrote.
Karr concedes that the affair ended badly for the O'Hairs.
He implies that Waters killed the O'Hairs and Fry but claims not to have been involved himself in anything remotely criminal. Rather, Karr casts himself as an errand boy who took care of mundane chores such as renting vehicles and apartments.
In the statement, Karr says he knows nothing of Gerald "Chico" Osborne.
As to the fate of Danny Fry, Karr told police, "Whenever an article came out in the newspaper about the O'Hairs or Danny Fry, Waters called me. In one instance, responding to an article, David told me that the police were wrong about Danny Fry being killed 'elsewhere.' Waters told me 'done there,' which meant to me that he killed Danny Fry at the spot the body was found in Dallas. Waters also told me...that Danny Fry is 'with the O'Hairs.' This meant to me that they were buried together."