By Timothy Mclaughlin

(Reuters) - Sponsors have been fleeing next month's National Puerto Rican Day Parade in New York City since organizers decided to honor an activist recently freed after more than three decades in prison for ties to a nationalist group that carried out more than 100 bombings in the 1970s and 1980s.

Oscar Lopez Rivera, 74, was convicted in 1981 of numerous charges, along with other members of the Armed Forces of National Liberation (FALN), who sought to secure Puerto Rican independence from the United States.

Rivera's sentence was commuted by former President Barack Obama, and the prisoner was freed this month. He is to be honored as "National Freedom Hero" at the June 11 parade, which makes its way up Fifth Avenue and draws millions of onlookers.

However, some view Rivera as a terrorist. Several sponsors this week pulled financial support for the parade.

"It became clear that the debate about this year's parade was dividing the community," JetBlue Airways Corp said in a statement on Monday. "Out of respect for the many different points of view, we will be redirecting our funds."

JetBlue, like some others who have pulled their support, did not specifically cite Rivera as the reason for its exit. Spanish-language broadcaster Univision Communications Inc and telecommunications company AT&T Inc also backed away.

Univision, which had three radio and television stations sponsoring the event, said it would still provide news coverage of the parade and it and the other sponsors said they would donate funds for student scholarships.

The New York Daily News and the New York City Patrolmen's Benevolent Association, New York's largest police union, have been more direct in their criticisms of organizers.

The newspaper said on Wednesday it was pulling its sponsorship, while the police union said in a statement last week that this year's parade honors a "remorseless terrorist" and its members will not participate.

The board of the parade said on Tuesday it was "saddened and disappointed" by the decision of sponsors pulling out from the parade, but added it was committed to representing a broad number of Puerto Rican voices.

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In 1981, Rivera was sentenced to 55 years in prison for charges including seditious conspiracy. An additional 15 years were added to his sentence in 1988 after law enforcement foiled a plot to break him out of prison.

Rivera rejected clemency from former President Bill Clinton in 1999 because it was not extended to another imprisoned FALN member.

After his sentence was commuted by Obama, Rivera spent the final months of his incarceration in Puerto Rico. He was previously held in Indiana. He was freed earlier this month and returned to Chicago to a hero's welcome.





(Reporting by Timothy Mclaughlin in Chicago; Editing by David Gregorio)