Posted on 03/03/2003 10:37:22 AM PST by Elle Bee
In September of last year, the U.S. Dept. of Labor asked a federal judge in Ft. Lauderdale to remove five trustees of the Plumbers & Pipefitters national pension fund. In its suit, the labor dept. laid out a pattern of poor planning, financial favoritism, and cost overruns surrounding the Diplomat Hotel in Hollywood, Florida, where the Executive Council met.
One of the officials whom Labor Secretary Elaine Chao is seeking to remove is Plumbers union president Martin Maddaloni, already under investigation for participating in insider stock trades involving the pension-funded Ullico, formerly known as the Union Labor Life Insurance Company. Maddaloni is one of many union presidents who sit on the Ullico board.
Perhaps as the AFL-CIO's Executive Council meets in that scandal-plagued hotel, they will reflect that it started with a company that is making a mockery of their "No More Enrons" campaign. In 1999, the union directors of Ullico began to buy and sell their own stock before its value was reset at the beginning of each year. Thus, with Ullico's stock highly leveraged on the telecom firm Global Crossing, directors could buy Ullico stock "low," before its value skyrocketted with Global Crossing's in 2000.
As the telecom bubble deflated in 2000 and 2001, they were allowed to sell back their Ullico stock "high," before its price was readjusted downward as Global Crossing spiraled toward the 4th largest bankruptcy in history. But Ullico's rules only allowed individuals, with a relatively small number of shares, to participate. As a result, the huge union pension funds, which largely own Ullico, were stuck with its falling stock.
OPERATING ENGINEERS (IUOE)
Mob Control of NYC Construction Sites Alleged in Indictment: WTC Possibly Involved
A massive indictment alleging mob control of two engineers' unions and construction sites throughout NYC was unsealed on Feb. 26. Forty-two men -- members of the Genovese and Colombo crime families and officials of Locals 14 and 15 of the Intl. Union of Operating Engineers -- are charged with stealing at least $3.6 million from 1997 until this year.
Not mentioned in yesterday's indictments are allegations that the collection of wages for no-show jobs and mob payments extended even to the clean-up at the fallen World Trade Center. At a press conference announcing the arrests, law enforcement officials would not say if those allegations were true or false. But James Comey, U.S. Attny. for the Sou. Dist. of NY, promised that any evidence of such a scheme would be "pursued very aggressively."
The investigation was spearheaded by the NY State Organized Crime Task Force and the NYCPD, while the indictments will be prosecuted by the U.S. Attnys. for the Southern and Eastern districts of NY.
In the Eastern Dist. indictment, reputed Colombo bosses and associates Joel Cacace (also known as "Joe Waverly"), his son Joel "Jo Jo" Jr., John "Jackie" DeRoss, Jamie DeRoss, Lawrence Persico, Vincent Ricciardo and Paul Buckley, extorted union positions and wages and benefits at various construction sites. They are also charged with strangling free speech and democracy in Locals 14 and 15. Charged with collecting payments for no-show jobs and mail fraud are: Local 14 delegate Joseph Coriasco, Local 14 members Nicholas Lupari (Coriasco's son-in-law), Richard Troy, Local 15 delegate Thomas "Tommy Mac" McNamara and Local 15 member Anthony Polito. Among the construction sites listed in the no-show scheme are the Brooklyn General Post Office, Yankee Stadium and Mets Stadium.
In the Southern Dist. indictment, 24 Genovese associates and delegates from Local 14 are charged with extorting job assignments for Genovese favorites, submitting false information to contractors to collect "no-show" payments, and collecting other unlawful payments through, for instance, a retirement dinner for Joseph Rizzuto Sr. According to the indictment, the Genovese chain of command included Louis Moscatiello as the general head of the crime family's infiltration of construction unions, and Carl "Carlo" Carrara Sr. who ran Locals 14 and 15. Much of the conspiracy was apparently planned from a shed at the site of an addition to the Museum of Modern Art, and was recorded by investigators who got a bug into the shed in 2002.
Both indictments include charges brought under the Racketeer Influenced and Corrupt Organizations (RICO) Act, under which prosecutors are seeking the return of at least $2 million in the E.D., and at least $1.6 million in the S.D., from the defendants as compensation for their alleged thefts. In addition to the RICO charges, the defendants are charged with violating the Taft-Hartley Act's prohibitions of unlawful payments, and are also charged with mail fraud.
In announcing the indictment and arrests, U.S. Attny. Comey stated: "By controlling Locals 14 and 15, the Genovese family harmed numerous real estate developers and contractors who are busy building, and rebuilding, our city. More importantly, the honest, hard working members of Locals 14 and 15 were repeatedly denied jobs and the right to participate meaningfully in the governance of their unions by the Genovese family."
Rosslyn Mauskopf, U.S. Attny. for the E.D. of NY, stated: "Todays indictments are the product of our continuing efforts to rid labor unions of the corrupting influence of organized crime. With corruption on the job sites comes increased costs, which inevitably, albeit indirectly, get passed on to the public."
NY Attny. Gen. Eliot Spitzer stated: "Through illicit activities to control two powerful unions, the Genovese and Colombo crime families have cost the city, and the state and federal governments millions of dollars, robbed the union pension funds of needed contributions, and prevented honest, hard-working union members from obtaining jobs,"
Gordon Heddell, Inspector Gen. of the U.S. Dept. of Labor stated: Todays racketeering indictments reinforce our continued commitment to clean up New Yorks construction industry from labor racketeering. Freeing unions from organized crime and corruption will allow qualified tradesmen to fairly obtain employment and enable contractors to conduct business without fear or intimidation. [U.S.A.O. E.D.N.Y. & S.D.N.Y., Attny. Gen. NY, 2/26/03: New York Post 1/19/03, New York Daily News 2/27/03]
TEAMSTERS (IBT)
NY Corruption Hearing Becomes Rally for Teamster Bosses
A Feb. 22 hearing to consider extending the Intl. Bhd. of Teamsters' trusteeship of Local 456 turned into a raucous rally in support of two brothers accused of nepotism, bribery and financial mismanagement.
In January, IBT president James P. Hoffa responded to a finding by the fed. Independent Rev. Bd (IRB) that Edward and Bernard Doyle had mismanaged the financial affairs of Local 456 in Elmsford by imposing a temporary trusteeship. The three-member IBT panel arrived in Elmsford on the 22nd to consider an IBT takeover of the Local. Over 1,000 of the Doyles' supporters met them, warmed up by State Sen. Nicholas Spano (R-Yonkers), who urged them to support the Doyles. To hoots and hollers, the panel entered a union hall draped with a banner saying, "Say no to the IRB and Trusteeship."
Local president Bernard Doyle, accused by the IRB of arbitrarily choosing union members and misusing a union credit card for personal expenses, addressed the hearing from the crowd of supporters. "[T]hey [the IRB] knock the Doyle name all over," he said: "I'm proud to be a DoyleÖObviously we did pretty well," Doyle said to repeated cheers and ovations.
Several other speakers spoke in the Doyles' support. Finally, Edward Doyle Sr., forced to resign the presidency of 456 due to a bribery charges in 1999, spat curses at the IRB investigator there at the hearing. Doyle Sr., in the fifth year of his suspension, referred to his return as the IRB's "worst nightmare."
The IBT panel has 60 days to recommend whether to uphold the charges and force new officer elections, or return the union leadership to Bernard Doyle, to Hoffa, who will then have 15 days to make a decision. [White Plains Journal News 2/23/03]
LABORERS (LIUNA)
Boss Coia Passes "Personal Responsibility" Course, Gets Back Law License
The Rhode Island Sup. Ct., last month, reinstated the license to practice law of Arthur Coia, who was forced to resign as boss of the Laborers Intl. Union of N. Amer. (LIUNA) in 1999. Thus, the man who was repeatedly accused of ties to organized crime by the U.S. Dept. of Justice, and pled guilty to tax evasion, has now come full circle. He has retained his $250,000 salary as "general president emeritus" of LIUNA, and is free again to practice law in RI.
Coia pled guilty on Jan. 31, 2000, to defrauding RI taxpayers of nearly $100,000 in taxes on three Ferraris he purchased from the vendor supplying vehicles to LIUNA executives. In one instance, Coia paid $215,000 for a vintage car, but used an invoice claiming that the price was only $2,160. Under a sweetheart deal negotiated with the Clinton-Reno justice dept., Coia resigned from all positions in the LIUNA hierarchy, and agreed to a two-year suspension of his law license. But Coia could have permanently disbarred, and by being given the emeritus title, he retained his full union salary.
To get his license back, Coia got the help of Francis J. Larkin, Chancellor of the Southern New England School of Law, who tutored Coia to keep him informed of new court decisions and developments in different branches of the law. Larkin also assigned a faculty member teaching "professional responsibility" to personally prepare Coia for a test on legal ethics, which he had to pass to regain his license.
Coia is listed as practicing from the firm of Coia & Lepore in Providence, but currently resides in Delray Beach, Fla. [Providence Journal-Bulletin 2/20/03]
GOVERNMENT WORKERS (AFSCME)
Convicted Hawaii Union Chief Claims $1 million in Unused Leave
Former United Public Workers boss Gary Rodrigues, convicted of over 100 counts of embezzlement and fraud then kicked out of his office, has now sued his replacement, claiming 37 years of unused leave.
Rodrigues and his daughter were convicted in a Hawaii federal court on Nov. 19 of last year. Two days later, the Amer. Fedtn. of State, County & Municipal Employees (AFSCME) announced Rodrigues' suspension. But Rodrigues showed up at the UPW's Honolulu HQ the next day and convened a bd. meeting that rejected AFSCME's choice of a temporary director and installed Rodrigues' choice instead. Finally, on Dec. 5, a delegation arrived from Washington, D.C. to place the UPW under direct AFSCME control.
Rodrigues now claims that he "retired" from the UPW on Nov. 22, and is entitled to nearly $1 million of unused sick leave and vacation, which he says temporary director Peter Trask is denying him. [Honolulu Advertiser 2/14/03]
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ADDITIONAL BRIEFS NOT INCLUDED ON THE FAX EDITION OF THIS UNION CORRUPTION UPDATE:
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CARPENTERS (UBC)
IN Dem Chief Embroiled in Possible Misuse of Pension Funds Resigns
Peter J. Manous, who took $10,000 to help sell property to a union pension fund that has gone undeveloped, resigned as Chairman of the Democratic Party in Indiana on Feb. 12.
In June 1999, pension trustees with the United Bhd. of Carpenters paid $600 million for the 640-acre Coffee Creek Center in Chesterton. Lake Erie Land Co., a subsidiary of NiSource Inc., sold the property and paid $10,000 in legal fees for what spokesman Mark Friedlander claimed was routine work to Manous. Governor Frank O'Bannon (D) gave the planned community a ringing endorsement. "This is the way we all should live as we continue forward to protect the environment," he said at its June 2001 dedication.
But the pension-owned property has become a boondoggle, with only a handful of houses and no commercial development. A federal indictment has reportedly been prepared, but has not yet been unsealed to the public. Manous's attny., Mark Rotert, said he had "no reason at all" to believe that Manous was named in the indictment. But he refused to say whether Manous had been called before the federal grand jury investigating the case. [Indianapolis Star 2/14/03]
Ex-Financial Secy. Sentenced in Minn. Fed. Ct.
On Feb. 18, 2003, in the U.S. Dist. Court for the Dist. of Minnesota, Jerome Dube, former financial secretary of Carpenters Local 1865, was sentenced to three years probation with the first 120 days to be served in community confinement with work release followed by 60 days in home detention with work release. Dube was ordered to pay restitution in the total amount of $14,176. Dube pled guilty to embezzling union funds on November 27, 2002, following an investigation by the Minneapolis Resident Investigator Office of the U.S. Ofc. of Labor-Mgmt. Standards. [OLMS 2/27/03]
ELECTRICAL WORKERS (IBEW)
WI Judge Throws Book at Convicted Embezzler
U.S. Dist. Judge Barbara Crabb (W.D. WI, Carter) rejected any leniency in sentencing Michael E. Koehler on Feb. 14 to 2 yrs., 1 month in prison, 3 yrs. supervised release, and full restitution of the $135,197 he embezzled from a Madison union. The frmr. financial secy. of Local 965 of the Intl. Bhd. of Electrical Wrkrs. pled guilty to taking unauthorized salary payments, and falsely claiming reimbursements for meal, mileage and meeting expenses.
Koehler pled guilty in exchange for the U.S. Attny's. recommendation of a reduced sentence. But Judge Crabb was angered by Koehler's statements to a pre-sentence investigator that frivolously denied relevant conduct that was the basis for the Oct. 24 information. Koehler was not being sentenced for mistakes, Judge Crabb told Koehler, but because "you cheated, you lied and you stole." [U.S.A.O. W.D. WI 2/14/03]
Frmr. Treasurer Pleads Guilty to Embezzlement in IL Fed. Ct.
On Feb. 20, 2003, in the U.S. Dist. Court for the Northern Dist. of Illinois, Anthony King, former treasurer of International Bhd. of Electrical Workers Local 533 in Berwyn, Illinois, pled guilty to embezzling $14,450 in union funds between May 1997 and June 1999 (a change of plea). King was charged on January 24, 2003, following an investigation by the Chicago branch of the U.S. Ofc. of Labor-Mgmt. Standards. [OLMS 2/27/03]
COMMUNICATIONS WORKERS (CWA)
Intl. Union Takes Over NC Local Amid Charges of Mishandles Finances
With local members claiming $100,000 in mishandled finances and credit card charges, the Communications Wrkrs. of Amer. imposed a trusteeship on Local 3640 in Winston-Salem late in Feb. Formed only in 2000, the Local represents about 1,100 U.S. Airways ticket workers. A number of frmr. local officials said that members had complained repeatedly of rules violations and misappropriation of funds. But CWA spokeswoman Dina Beaumont simply referred to "officers who said they...could not sort out their problems themselves" and "other internal issues that made it difficult to move forward." [Winston-Salem Journal 2/25/03]
TEACHERS (NEA)
Ex-Ofc. Mgr. for local Teacher Union Arrested for Theft in Ft. Pierce, Fla.
Rebecca B. Modine was arrested on Feb. 21 on charges that she embezzled at least $90,000 from the St. Lucie County Classroom Teachers Assn. She had worked for the union as its ofc. mgr. for seven years when president Clara Cook could not find bank statements for the union's checking acct. until she discovered them in Modine's desk. According to Cook, Modine's duties did not include bookkeeping.
An initial review showed at least $40,000 missing from the union's checking acct. Modine was suspended from her job on Jan. 17. But one week later, she tried to cash a union check at the SunTrust bank. Tellers noticed that the acct. had a negative balance, and that the signature on the check was not identical to the authorized signer's signature. They did not cash the check, but did take down Modine's driver license information and her car tag number.
Tellers at the bank told investigators that Modine had cashed large checks in the past. The amount reportedly stolen through unauthorized checks has now grown to $90,989. And with 250 blank checks still missing, that total could go higher still. Modine is charged with organized fraud and forgery, and is being held at the St. Lucie County jail on a $252,505 bond. [Fort Pierce Tribune, Palm Beach Post 2/23/03]
LABORERS (LIUNA)
Chicago Boss Loses Appeal, Gets Bigger Sentence
Not only did the U.S. 7th Circ. Ct. of Appeals uphold John Serpico's conviction of mail fraud, the three-judge panel added nearly a year to his prison time. In July 2001, Serpico and his mistress, Maria Busillo, were found guilty of steering Laborers pension funds they controlled to various banks in exchange for more than $5 million in personal loans.
Serpico's lawyers appealed his conviction, which the appellate panel rejected on Feb. 20. But writing for the panel, Judge Terrance T. Evans (Clinton) wrote that the exchange of personal loans for the steering of pension funds "is closer to bribery than mail fraud," of which Serpico was convicted. The panel chose to apply federal sentencing guidelines for bribery cases to the case, thus increasing Serpico's sentence from 2 1/2 yrs to 3 yrs. and 1 month. [Chicago Tribune 2/21/03]
ELEVATOR CONSTRUCTORS (IUEC)
More Sentences Announced in Multi-Million Dollar Racketeering Scheme in NYC
The U.S. Ofc. of Labor-Mgmt. Standards announced the following sentences in the $6 million racketeering case against 26 bosses and members of the Intl Union of Elevator Constructors Local One. All seven were indicted on February 5, 2002 for conspiracy, false pension statements, money laundering conspiracy, money laundering, and unlawful labor payments following a joint investigation by the New York branch of the OLMS, the U.S. Dept. of Labor's Pension and Welfare Benefits Admin., the FBI, and the IRS. They were all sentenced in the U.S. Dist. Ct. for the Eastern District of NY. All seven were sentenced in the U.S. Dist. Ct. for the East. Dist. of NY.
On Februay 10, 2003, Edward Donohue, a member of Elevator Constructors Local One, was sentenced to spend three years on probation, perform 400 hours of community service, pay $244,996 in restitution, pay a fine of $1,000, and pay a $100 assessment. In addition, Donohue must forfeit $72,000 to the United States government, representing the total sum of unlawful contributions made on behalf of the defendant to all benefit plans affiliated with Local One of the International Union of Elevator Constructors. On October 10, 2002, Donohue pled guilty to conspiracy to demand and receive unlawful labor payments.
On Februay 10, 2003, James Cassidy, an employee of Elevator Constructors Local One, was sentenced to spend three years on probation, perform 400 hours of community service, pay $40,000 in restitution, pay a fine of $3,750, and pay a $100 assessment. In addition, Cassidy must forfeit $31,817 to the United States government, representing the total sum of unlawful contributions made on behalf of the defendant to all benefit plans affiliated with Local One of the International Union of Elevator Constructors. On October 10, 2002, Cassidy pled guilty to conspiracy to demand and receive unlawful labor payments.
On January 24, 2003, Karen Gordan, a member of Elevator Constructors Local One, was sentenced to spend three years on probation, perform 400 hours of community service, pay $140,357 in restitution, and pay a $100 assessment. In addition, Gordan must forfeit $55,726 to the United States government, representing the total sum of unlawful contributions made on behalf of the defendant to all benefit plans affiliated with Local One of the International Union of Elevator Constructors. On November1, 2002, Gordan pled guilty to conspiracy to demand and receive unlawful labor payments.
On January 24, 2003, Paul Downey, a member of Elevator Constructors Local One, was sentenced to spend three years on probation, perform 400 hours of community service, pay $101,141 in restitution, pay a $5,000 fine, and pay a $100 assessment. In addition, Paul Downey must forfeit $24,949 to the United States government, representing the total sum of unlawful contributions made on behalf of the defendant to all benefit plans affiliated with Local One of the International Union of Elevator Constructors. On October 17, 2002, Paul Downey pled guilty to conspiracy to demand and receive unlawful labor payments.
On January 24, 2003, Kevin Murphy, a member of Elevator Constructors Local One, was sentenced to spend three years on probation, perform 400 hours of community service, pay $12,252.98 in restitution, pay a $500 fine, and pay a $100 assessment. In addition, Murphy must forfeit $3,311 representing the total sum of unlawful contributions made on behalf of the defendant to all benefit plans affiliated with Local One of the International Union of Elevator Constructors. On September 11, 2002, Murphy pled guilty to conspiracy to demand and receive unlawful labor payments.
On January 24, 2003, Michael O'Gara, a member of Elevator Constructors Local One, was sentenced to spend three years on probation, perform 400 hours of community service, pay $69,452.24 in restitution, pay a $5,000 fine, and pay a $100 assessment. In addition, O'Gara must forfeit $8,458.76 to the United States government, representing the total sum of unlawful contributions made on behalf of the defendant to all benefit plans affiliated with Local One of the International Union of Elevator Constructors. On October 17, 2002, O'Gara pled guilty to conspiracy to demand and receive unlawful labor payments.
On January 24, 2003, William Tracy, a member of Elevator Constructors Local One, was sentenced to spend three years on probation, perform 400 hours of community service, pay $23,127 in restitution, pay a $500 fine, and pay a $100 assessment. On September 11, 2002, Tracy pled guilty to conspiracy to demand and receive unlawful labor payments. [OLMS 2/20/03]
GOVERNMENT WORKERS (AFSCME)
Ex-Treasurer Pleads Guilty to Embezzlement in Minn. Court
Cheryl Raas pled guilty on Feb. 14 to using her frmr. position as a union treasurer to write $10,800 in union checks to herself. According to a criminal complaint filed in the Ramsey County Court, two officials of Local 22 of the Amer. Fedtn. Of State, County & Municipal Employees (AFSCME) confronted Raas last July after they discovered that only $400 remained in the union's checking acct.
Raas admitted to the theft, claiming that she took the money to pay for cancer treatments. But Local officials said she never appeared sick or claimed any sick leave, and St. Paul police officers questioning her said that Raas was vague when asked about her health. The 11 checks police identified were paid to the owner of her apartment and a rental-car company. Ramsey County Dist. Judge David Higgs is scheduled to sentence Raas on March 3. [Minneapolis Star Tribune 2/15/03]
AUTO WORKERS (UAW)
Ex-President Sentenced for Embezzlement in MI Fed. Ct.
On February 18, 2003, in the U.S. Dist. Ct. for the East. Dist. of Michigan, Isadore Hampton, former president of United Auto Workers Local 835, was sentenced to 180 days home confinement, three years probation, and ordered to pay restitution of $10,389 and a special assessment of $100. Hampton was also ordered to surrender a 17-foot fiberglass boat and a 1974 Dodge to the U.S. Marshals Service so that they might be sold with the proceeds being applied toward his restitution. Hampton pled guilty to embezzling union funds on October 3, 2002, following an investigation by the Detroit branch of the U.S. Ofc. of Labor-Mgmt. Standards. [OLMS 2/27/03]
STEELWORKERS (USW)
Va. Man Sentenced for Harboring Ex-Union Boss on the Run
On February 12, 2003, in the U.S. Dist. Ct. for the Western District of Virginia, Robert E. Martin, Jr., former member of Steelworkers Local Union 9336 in Radford, Virginia, was sentenced to spend three years on probation and ordered to pay $900.71 in restitution plus a special assessment of $100. Martin was further ordered to report to his probation officer any contacts with fugitive Elizabeth J. George and any information on her whereabouts. On December 11, 2002, Martin pled guilty to one count of harboring George and concealing her from arrest. Martin was previously charged with embezzlement before being jailed for three months on the harboring charge. These charges were brought following an investigation by the Pittsburgh branch of the U.S. Ofc. of Labor-Mgmt. Standards. [OLMS 2/20/03]
BRICKLAYERS (BAC)
Ex-Financial Secy. Indicted in ND Fed. Ct.
On February 11, 2003, in the U.S. Dist. Ct. for the District of North Dakota, the grand jury returned a three count indictment against Gary Halvorson, former financial secretary and business manager of Bricklayers Local 3. The indictment charges Halvorson with one count of embezzlement of $10,175 in union funds, one count of filing a false report, and one count of destruction of records. The charges were brought following an investigation by the Minneapolis Resident Investigator Office of the U.S. Ofc. of Labor-Mgmt. Standards. [OLMS 2/20/03]
ALLIED INDISTRIAL WORKERS (PACE)
Ex-Secy.-Treasurer Sentenced in NY Fed. Ct. for Theft
On February 11, 2003, in the U.S. Dist. Ct. for the West. District of New York, David Koch, former secretary-treasurer of PACE Local Union #1-236, was sentenced to two years of probation and 40 hours of community service after pleading guilty to filing a false union report. Koch was ordered to continuing making restitution to the union in the remaining amount of $9,445. The charges were brought following an investigation by the Buffalo branch of the U.S. Ofc. of Labor-Mgmt. Standards. [OLMS 2/20/03]
MACHINISTS (IAM)
Ex-Secy.-Treasurer Sentenced in NY Fed. Ct. for Embezzlement
On February 10, 2003, in the U.S. Dist. Ct. for the N. District of New York, Thomas Lannon, former secretary-treasurer of Machinists Local Lodge #1562, was sentenced to six months of home detention followed by three years of probation and to perform 120 hours of community service. Lannon pled guilty to embezzling union funds and made restitution in the amount of $13,175 following an investigation by the Buffalo branch of the U.S. Ofc. of Labor-Mgmt. Standards. [OLMS 2/20/03]
Frmr. President Sentenced for Embezzlement in Wisc. Fed. Ct.
On February 7, 2003, in the U.S. Dist. Ct. for the East. Dist. of Wisconsin, Steven Pautz, former president of Machinists Lodge 251, was sentenced to three years of probation including six months of home confinement. Pautz pled guilty to one count of embezzlement of union funds on November 19, 2002 following an investigation by the OLMS Milwaukee District Office. [OLMS 2/20/03]
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In September of last year, the U.S. Dept. of Labor asked a federal judge in Ft. Lauderdale to remove five trustees of the Plumbers & Pipefitters national pension fund. In its suit, the labor dept. laid out a pattern of poor planning, financial favoritism, and cost overruns surrounding the Diplomat Hotel in Hollywood, Florida, where the Executive Council met.
One of the officials whom Labor Secretary Elaine Chao is seeking to remove is Plumbers union president Martin Maddaloni, already under investigation for participating in insider stock trades involving the pension-funded Ullico, formerly known as the Union Labor Life Insurance Company. Maddaloni is one of many union presidents who sit on the Ullico board.
Perhaps as the AFL-CIO's Executive Council meets in that scandal-plagued hotel, they will reflect that it started with a company that is making a mockery of their "No More Enrons" campaign. In 1999, the union directors of Ullico began to buy and sell their own stock before its value was reset at the beginning of each year. Thus, with Ullico's stock highly leveraged on the telecom firm Global Crossing, directors could buy Ullico stock "low," before its value skyrocketted with Global Crossing's in 2000.
As the telecom bubble deflated in 2000 and 2001, they were allowed to sell back their Ullico stock "high," before its price was readjusted downward as Global Crossing spiraled toward the 4th largest bankruptcy in history. But Ullico's rules only allowed individuals, with a relatively small number of shares, to participate. As a result, the huge union pension funds, which largely own Ullico, were stuck with its falling stock.
OPERATING ENGINEERS (IUOE)
Mob Control of NYC Construction Sites Alleged in Indictment: WTC Possibly Involved
A massive indictment alleging mob control of two engineers' unions and construction sites throughout NYC was unsealed on Feb. 26. Forty-two men -- members of the Genovese and Colombo crime families and officials of Locals 14 and 15 of the Intl. Union of Operating Engineers -- are charged with stealing at least $3.6 million from 1997 until this year.
Not mentioned in yesterday's indictments are allegations that the collection of wages for no-show jobs and mob payments extended even to the clean-up at the fallen World Trade Center. At a press conference announcing the arrests, law enforcement officials would not say if those allegations were true or false. But James Comey, U.S. Attny. for the Sou. Dist. of NY, promised that any evidence of such a scheme would be "pursued very aggressively."
The investigation was spearheaded by the NY State Organized Crime Task Force and the NYCPD, while the indictments will be prosecuted by the U.S. Attnys. for the Southern and Eastern districts of NY.
In the Eastern Dist. indictment, reputed Colombo bosses and associates Joel Cacace (also known as "Joe Waverly"), his son Joel "Jo Jo" Jr., John "Jackie" DeRoss, Jamie DeRoss, Lawrence Persico, Vincent Ricciardo and Paul Buckley, extorted union positions and wages and benefits at various construction sites. They are also charged with strangling free speech and democracy in Locals 14 and 15. Charged with collecting payments for no-show jobs and mail fraud are: Local 14 delegate Joseph Coriasco, Local 14 members Nicholas Lupari (Coriasco's son-in-law), Richard Troy, Local 15 delegate Thomas "Tommy Mac" McNamara and Local 15 member Anthony Polito. Among the construction sites listed in the no-show scheme are the Brooklyn General Post Office, Yankee Stadium and Mets Stadium.
In the Southern Dist. indictment, 24 Genovese associates and delegates from Local 14 are charged with extorting job assignments for Genovese favorites, submitting false information to contractors to collect "no-show" payments, and collecting other unlawful payments through, for instance, a retirement dinner for Joseph Rizzuto Sr. According to the indictment, the Genovese chain of command included Louis Moscatiello as the general head of the crime family's infiltration of construction unions, and Carl "Carlo" Carrara Sr. who ran Locals 14 and 15. Much of the conspiracy was apparently planned from a shed at the site of an addition to the Museum of Modern Art, and was recorded by investigators who got a bug into the shed in 2002.
Both indictments include charges brought under the Racketeer Influenced and Corrupt Organizations (RICO) Act, under which prosecutors are seeking the return of at least $2 million in the E.D., and at least $1.6 million in the S.D., from the defendants as compensation for their alleged thefts. In addition to the RICO charges, the defendants are charged with violating the Taft-Hartley Act's prohibitions of unlawful payments, and are also charged with mail fraud.
In announcing the indictment and arrests, U.S. Attny. Comey stated: "By controlling Locals 14 and 15, the Genovese family harmed numerous real estate developers and contractors who are busy building, and rebuilding, our city. More importantly, the honest, hard working members of Locals 14 and 15 were repeatedly denied jobs and the right to participate meaningfully in the governance of their unions by the Genovese family."
Rosslyn Mauskopf, U.S. Attny. for the E.D. of NY, stated: "Todays indictments are the product of our continuing efforts to rid labor unions of the corrupting influence of organized crime. With corruption on the job sites comes increased costs, which inevitably, albeit indirectly, get passed on to the public."
NY Attny. Gen. Eliot Spitzer stated: "Through illicit activities to control two powerful unions, the Genovese and Colombo crime families have cost the city, and the state and federal governments millions of dollars, robbed the union pension funds of needed contributions, and prevented honest, hard-working union members from obtaining jobs,"
Gordon Heddell, Inspector Gen. of the U.S. Dept. of Labor stated: Todays racketeering indictments reinforce our continued commitment to clean up New Yorks construction industry from labor racketeering. Freeing unions from organized crime and corruption will allow qualified tradesmen to fairly obtain employment and enable contractors to conduct business without fear or intimidation. [U.S.A.O. E.D.N.Y. & S.D.N.Y., Attny. Gen. NY, 2/26/03: New York Post 1/19/03, New York Daily News 2/27/03]
TEAMSTERS (IBT)
NY Corruption Hearing Becomes Rally for Teamster Bosses
A Feb. 22 hearing to consider extending the Intl. Bhd. of Teamsters' trusteeship of Local 456 turned into a raucous rally in support of two brothers accused of nepotism, bribery and financial mismanagement.
In January, IBT president James P. Hoffa responded to a finding by the fed. Independent Rev. Bd (IRB) that Edward and Bernard Doyle had mismanaged the financial affairs of Local 456 in Elmsford by imposing a temporary trusteeship. The three-member IBT panel arrived in Elmsford on the 22nd to consider an IBT takeover of the Local. Over 1,000 of the Doyles' supporters met them, warmed up by State Sen. Nicholas Spano (R-Yonkers), who urged them to support the Doyles. To hoots and hollers, the panel entered a union hall draped with a banner saying, "Say no to the IRB and Trusteeship."
Local president Bernard Doyle, accused by the IRB of arbitrarily choosing union members and misusing a union credit card for personal expenses, addressed the hearing from the crowd of supporters. "[T]hey [the IRB] knock the Doyle name all over," he said: "I'm proud to be a DoyleÖObviously we did pretty well," Doyle said to repeated cheers and ovations.
Several other speakers spoke in the Doyles' support. Finally, Edward Doyle Sr., forced to resign the presidency of 456 due to a bribery charges in 1999, spat curses at the IRB investigator there at the hearing. Doyle Sr., in the fifth year of his suspension, referred to his return as the IRB's "worst nightmare."
The IBT panel has 60 days to recommend whether to uphold the charges and force new officer elections, or return the union leadership to Bernard Doyle, to Hoffa, who will then have 15 days to make a decision. [White Plains Journal News 2/23/03]
LABORERS (LIUNA)
Boss Coia Passes "Personal Responsibility" Course, Gets Back Law License
The Rhode Island Sup. Ct., last month, reinstated the license to practice law of Arthur Coia, who was forced to resign as boss of the Laborers Intl. Union of N. Amer. (LIUNA) in 1999. Thus, the man who was repeatedly accused of ties to organized crime by the U.S. Dept. of Justice, and pled guilty to tax evasion, has now come full circle. He has retained his $250,000 salary as "general president emeritus" of LIUNA, and is free again to practice law in RI.
Coia pled guilty on Jan. 31, 2000, to defrauding RI taxpayers of nearly $100,000 in taxes on three Ferraris he purchased from the vendor supplying vehicles to LIUNA executives. In one instance, Coia paid $215,000 for a vintage car, but used an invoice claiming that the price was only $2,160. Under a sweetheart deal negotiated with the Clinton-Reno justice dept., Coia resigned from all positions in the LIUNA hierarchy, and agreed to a two-year suspension of his law license. But Coia could have permanently disbarred, and by being given the emeritus title, he retained his full union salary.
To get his license back, Coia got the help of Francis J. Larkin, Chancellor of the Southern New England School of Law, who tutored Coia to keep him informed of new court decisions and developments in different branches of the law. Larkin also assigned a faculty member teaching "professional responsibility" to personally prepare Coia for a test on legal ethics, which he had to pass to regain his license.
Coia is listed as practicing from the firm of Coia & Lepore in Providence, but currently resides in Delray Beach, Fla. [Providence Journal-Bulletin 2/20/03]
GOVERNMENT WORKERS (AFSCME)
Convicted Hawaii Union Chief Claims $1 million in Unused Leave
Former United Public Workers boss Gary Rodrigues, convicted of over 100 counts of embezzlement and fraud then kicked out of his office, has now sued his replacement, claiming 37 years of unused leave.
Rodrigues and his daughter were convicted in a Hawaii federal court on Nov. 19 of last year. Two days later, the Amer. Fedtn. of State, County & Municipal Employees (AFSCME) announced Rodrigues' suspension. But Rodrigues showed up at the UPW's Honolulu HQ the next day and convened a bd. meeting that rejected AFSCME's choice of a temporary director and installed Rodrigues' choice instead. Finally, on Dec. 5, a delegation arrived from Washington, D.C. to place the UPW under direct AFSCME control.
Rodrigues now claims that he "retired" from the UPW on Nov. 22, and is entitled to nearly $1 million of unused sick leave and vacation, which he says temporary director Peter Trask is denying him. [Honolulu Advertiser 2/14/03]
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ADDITIONAL BRIEFS NOT INCLUDED ON THE FAX EDITION OF THIS UNION CORRUPTION UPDATE:
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CARPENTERS (UBC)
IN Dem Chief Embroiled in Possible Misuse of Pension Funds Resigns
Peter J. Manous, who took $10,000 to help sell property to a union pension fund that has gone undeveloped, resigned as Chairman of the Democratic Party in Indiana on Feb. 12.
In June 1999, pension trustees with the United Bhd. of Carpenters paid $600 million for the 640-acre Coffee Creek Center in Chesterton. Lake Erie Land Co., a subsidiary of NiSource Inc., sold the property and paid $10,000 in legal fees for what spokesman Mark Friedlander claimed was routine work to Manous. Governor Frank O'Bannon (D) gave the planned community a ringing endorsement. "This is the way we all should live as we continue forward to protect the environment," he said at its June 2001 dedication.
But the pension-owned property has become a boondoggle, with only a handful of houses and no commercial development. A federal indictment has reportedly been prepared, but has not yet been unsealed to the public. Manous's attny., Mark Rotert, said he had "no reason at all" to believe that Manous was named in the indictment. But he refused to say whether Manous had been called before the federal grand jury investigating the case. [Indianapolis Star 2/14/03]
Ex-Financial Secy. Sentenced in Minn. Fed. Ct.
On Feb. 18, 2003, in the U.S. Dist. Court for the Dist. of Minnesota, Jerome Dube, former financial secretary of Carpenters Local 1865, was sentenced to three years probation with the first 120 days to be served in community confinement with work release followed by 60 days in home detention with work release. Dube was ordered to pay restitution in the total amount of $14,176. Dube pled guilty to embezzling union funds on November 27, 2002, following an investigation by the Minneapolis Resident Investigator Office of the U.S. Ofc. of Labor-Mgmt. Standards. [OLMS 2/27/03]
ELECTRICAL WORKERS (IBEW)
WI Judge Throws Book at Convicted Embezzler
U.S. Dist. Judge Barbara Crabb (W.D. WI, Carter) rejected any leniency in sentencing Michael E. Koehler on Feb. 14 to 2 yrs., 1 month in prison, 3 yrs. supervised release, and full restitution of the $135,197 he embezzled from a Madison union. The frmr. financial secy. of Local 965 of the Intl. Bhd. of Electrical Wrkrs. pled guilty to taking unauthorized salary payments, and falsely claiming reimbursements for meal, mileage and meeting expenses.
Koehler pled guilty in exchange for the U.S. Attny's. recommendation of a reduced sentence. But Judge Crabb was angered by Koehler's statements to a pre-sentence investigator that frivolously denied relevant conduct that was the basis for the Oct. 24 information. Koehler was not being sentenced for mistakes, Judge Crabb told Koehler, but because "you cheated, you lied and you stole." [U.S.A.O. W.D. WI 2/14/03]
Frmr. Treasurer Pleads Guilty to Embezzlement in IL Fed. Ct.
On Feb. 20, 2003, in the U.S. Dist. Court for the Northern Dist. of Illinois, Anthony King, former treasurer of International Bhd. of Electrical Workers Local 533 in Berwyn, Illinois, pled guilty to embezzling $14,450 in union funds between May 1997 and June 1999 (a change of plea). King was charged on January 24, 2003, following an investigation by the Chicago branch of the U.S. Ofc. of Labor-Mgmt. Standards. [OLMS 2/27/03]
COMMUNICATIONS WORKERS (CWA)
Intl. Union Takes Over NC Local Amid Charges of Mishandles Finances
With local members claiming $100,000 in mishandled finances and credit card charges, the Communications Wrkrs. of Amer. imposed a trusteeship on Local 3640 in Winston-Salem late in Feb. Formed only in 2000, the Local represents about 1,100 U.S. Airways ticket workers. A number of frmr. local officials said that members had complained repeatedly of rules violations and misappropriation of funds. But CWA spokeswoman Dina Beaumont simply referred to "officers who said they...could not sort out their problems themselves" and "other internal issues that made it difficult to move forward." [Winston-Salem Journal 2/25/03]
TEACHERS (NEA)
Ex-Ofc. Mgr. for local Teacher Union Arrested for Theft in Ft. Pierce, Fla.
Rebecca B. Modine was arrested on Feb. 21 on charges that she embezzled at least $90,000 from the St. Lucie County Classroom Teachers Assn. She had worked for the union as its ofc. mgr. for seven years when president Clara Cook could not find bank statements for the union's checking acct. until she discovered them in Modine's desk. According to Cook, Modine's duties did not include bookkeeping.
An initial review showed at least $40,000 missing from the union's checking acct. Modine was suspended from her job on Jan. 17. But one week later, she tried to cash a union check at the SunTrust bank. Tellers noticed that the acct. had a negative balance, and that the signature on the check was not identical to the authorized signer's signature. They did not cash the check, but did take down Modine's driver license information and her car tag number.
Tellers at the bank told investigators that Modine had cashed large checks in the past. The amount reportedly stolen through unauthorized checks has now grown to $90,989. And with 250 blank checks still missing, that total could go higher still. Modine is charged with organized fraud and forgery, and is being held at the St. Lucie County jail on a $252,505 bond. [Fort Pierce Tribune, Palm Beach Post 2/23/03]
LABORERS (LIUNA)
Chicago Boss Loses Appeal, Gets Bigger Sentence
Not only did the U.S. 7th Circ. Ct. of Appeals uphold John Serpico's conviction of mail fraud, the three-judge panel added nearly a year to his prison time. In July 2001, Serpico and his mistress, Maria Busillo, were found guilty of steering Laborers pension funds they controlled to various banks in exchange for more than $5 million in personal loans.
Serpico's lawyers appealed his conviction, which the appellate panel rejected on Feb. 20. But writing for the panel, Judge Terrance T. Evans (Clinton) wrote that the exchange of personal loans for the steering of pension funds "is closer to bribery than mail fraud," of which Serpico was convicted. The panel chose to apply federal sentencing guidelines for bribery cases to the case, thus increasing Serpico's sentence from 2 1/2 yrs to 3 yrs. and 1 month. [Chicago Tribune 2/21/03]
ELEVATOR CONSTRUCTORS (IUEC)
More Sentences Announced in Multi-Million Dollar Racketeering Scheme in NYC
The U.S. Ofc. of Labor-Mgmt. Standards announced the following sentences in the $6 million racketeering case against 26 bosses and members of the Intl Union of Elevator Constructors Local One. All seven were indicted on February 5, 2002 for conspiracy, false pension statements, money laundering conspiracy, money laundering, and unlawful labor payments following a joint investigation by the New York branch of the OLMS, the U.S. Dept. of Labor's Pension and Welfare Benefits Admin., the FBI, and the IRS. They were all sentenced in the U.S. Dist. Ct. for the Eastern District of NY. All seven were sentenced in the U.S. Dist. Ct. for the East. Dist. of NY.
On Februay 10, 2003, Edward Donohue, a member of Elevator Constructors Local One, was sentenced to spend three years on probation, perform 400 hours of community service, pay $244,996 in restitution, pay a fine of $1,000, and pay a $100 assessment. In addition, Donohue must forfeit $72,000 to the United States government, representing the total sum of unlawful contributions made on behalf of the defendant to all benefit plans affiliated with Local One of the International Union of Elevator Constructors. On October 10, 2002, Donohue pled guilty to conspiracy to demand and receive unlawful labor payments.
On Februay 10, 2003, James Cassidy, an employee of Elevator Constructors Local One, was sentenced to spend three years on probation, perform 400 hours of community service, pay $40,000 in restitution, pay a fine of $3,750, and pay a $100 assessment. In addition, Cassidy must forfeit $31,817 to the United States government, representing the total sum of unlawful contributions made on behalf of the defendant to all benefit plans affiliated with Local One of the International Union of Elevator Constructors. On October 10, 2002, Cassidy pled guilty to conspiracy to demand and receive unlawful labor payments.
On January 24, 2003, Karen Gordan, a member of Elevator Constructors Local One, was sentenced to spend three years on probation, perform 400 hours of community service, pay $140,357 in restitution, and pay a $100 assessment. In addition, Gordan must forfeit $55,726 to the United States government, representing the total sum of unlawful contributions made on behalf of the defendant to all benefit plans affiliated with Local One of the International Union of Elevator Constructors. On November1, 2002, Gordan pled guilty to conspiracy to demand and receive unlawful labor payments.
On January 24, 2003, Paul Downey, a member of Elevator Constructors Local One, was sentenced to spend three years on probation, perform 400 hours of community service, pay $101,141 in restitution, pay a $5,000 fine, and pay a $100 assessment. In addition, Paul Downey must forfeit $24,949 to the United States government, representing the total sum of unlawful contributions made on behalf of the defendant to all benefit plans affiliated with Local One of the International Union of Elevator Constructors. On October 17, 2002, Paul Downey pled guilty to conspiracy to demand and receive unlawful labor payments.
On January 24, 2003, Kevin Murphy, a member of Elevator Constructors Local One, was sentenced to spend three years on probation, perform 400 hours of community service, pay $12,252.98 in restitution, pay a $500 fine, and pay a $100 assessment. In addition, Murphy must forfeit $3,311 representing the total sum of unlawful contributions made on behalf of the defendant to all benefit plans affiliated with Local One of the International Union of Elevator Constructors. On September 11, 2002, Murphy pled guilty to conspiracy to demand and receive unlawful labor payments.
On January 24, 2003, Michael O'Gara, a member of Elevator Constructors Local One, was sentenced to spend three years on probation, perform 400 hours of community service, pay $69,452.24 in restitution, pay a $5,000 fine, and pay a $100 assessment. In addition, O'Gara must forfeit $8,458.76 to the United States government, representing the total sum of unlawful contributions made on behalf of the defendant to all benefit plans affiliated with Local One of the International Union of Elevator Constructors. On October 17, 2002, O'Gara pled guilty to conspiracy to demand and receive unlawful labor payments.
On January 24, 2003, William Tracy, a member of Elevator Constructors Local One, was sentenced to spend three years on probation, perform 400 hours of community service, pay $23,127 in restitution, pay a $500 fine, and pay a $100 assessment. On September 11, 2002, Tracy pled guilty to conspiracy to demand and receive unlawful labor payments. [OLMS 2/20/03]
GOVERNMENT WORKERS (AFSCME)
Ex-Treasurer Pleads Guilty to Embezzlement in Minn. Court
Cheryl Raas pled guilty on Feb. 14 to using her frmr. position as a union treasurer to write $10,800 in union checks to herself. According to a criminal complaint filed in the Ramsey County Court, two officials of Local 22 of the Amer. Fedtn. Of State, County & Municipal Employees (AFSCME) confronted Raas last July after they discovered that only $400 remained in the union's checking acct.
Raas admitted to the theft, claiming that she took the money to pay for cancer treatments. But Local officials said she never appeared sick or claimed any sick leave, and St. Paul police officers questioning her said that Raas was vague when asked about her health. The 11 checks police identified were paid to the owner of her apartment and a rental-car company. Ramsey County Dist. Judge David Higgs is scheduled to sentence Raas on March 3. [Minneapolis Star Tribune 2/15/03]
AUTO WORKERS (UAW)
Ex-President Sentenced for Embezzlement in MI Fed. Ct.
On February 18, 2003, in the U.S. Dist. Ct. for the East. Dist. of Michigan, Isadore Hampton, former president of United Auto Workers Local 835, was sentenced to 180 days home confinement, three years probation, and ordered to pay restitution of $10,389 and a special assessment of $100. Hampton was also ordered to surrender a 17-foot fiberglass boat and a 1974 Dodge to the U.S. Marshals Service so that they might be sold with the proceeds being applied toward his restitution. Hampton pled guilty to embezzling union funds on October 3, 2002, following an investigation by the Detroit branch of the U.S. Ofc. of Labor-Mgmt. Standards. [OLMS 2/27/03]
STEELWORKERS (USW)
Va. Man Sentenced for Harboring Ex-Union Boss on the Run
On February 12, 2003, in the U.S. Dist. Ct. for the Western District of Virginia, Robert E. Martin, Jr., former member of Steelworkers Local Union 9336 in Radford, Virginia, was sentenced to spend three years on probation and ordered to pay $900.71 in restitution plus a special assessment of $100. Martin was further ordered to report to his probation officer any contacts with fugitive Elizabeth J. George and any information on her whereabouts. On December 11, 2002, Martin pled guilty to one count of harboring George and concealing her from arrest. Martin was previously charged with embezzlement before being jailed for three months on the harboring charge. These charges were brought following an investigation by the Pittsburgh branch of the U.S. Ofc. of Labor-Mgmt. Standards. [OLMS 2/20/03]
BRICKLAYERS (BAC)
Ex-Financial Secy. Indicted in ND Fed. Ct.
On February 11, 2003, in the U.S. Dist. Ct. for the District of North Dakota, the grand jury returned a three count indictment against Gary Halvorson, former financial secretary and business manager of Bricklayers Local 3. The indictment charges Halvorson with one count of embezzlement of $10,175 in union funds, one count of filing a false report, and one count of destruction of records. The charges were brought following an investigation by the Minneapolis Resident Investigator Office of the U.S. Ofc. of Labor-Mgmt. Standards. [OLMS 2/20/03]
ALLIED INDISTRIAL WORKERS (PACE)
Ex-Secy.-Treasurer Sentenced in NY Fed. Ct. for Theft
On February 11, 2003, in the U.S. Dist. Ct. for the West. District of New York, David Koch, former secretary-treasurer of PACE Local Union #1-236, was sentenced to two years of probation and 40 hours of community service after pleading guilty to filing a false union report. Koch was ordered to continuing making restitution to the union in the remaining amount of $9,445. The charges were brought following an investigation by the Buffalo branch of the U.S. Ofc. of Labor-Mgmt. Standards. [OLMS 2/20/03]
MACHINISTS (IAM)
Ex-Secy.-Treasurer Sentenced in NY Fed. Ct. for Embezzlement
On February 10, 2003, in the U.S. Dist. Ct. for the N. District of New York, Thomas Lannon, former secretary-treasurer of Machinists Local Lodge #1562, was sentenced to six months of home detention followed by three years of probation and to perform 120 hours of community service. Lannon pled guilty to embezzling union funds and made restitution in the amount of $13,175 following an investigation by the Buffalo branch of the U.S. Ofc. of Labor-Mgmt. Standards. [OLMS 2/20/03]
Frmr. President Sentenced for Embezzlement in Wisc. Fed. Ct.
On February 7, 2003, in the U.S. Dist. Ct. for the East. Dist. of Wisconsin, Steven Pautz, former president of Machinists Lodge 251, was sentenced to three years of probation including six months of home confinement. Pautz pled guilty to one count of embezzlement of union funds on November 19, 2002 following an investigation by the OLMS Milwaukee District Office. [OLMS 2/20/03]
Union Corruption Update is made possible by the generous contributions from readers like you. NLPC, PO Box 6821, Falls Church, VA 22040. Thank you. Union Corruption Update is part of NLPC's Organized Labor Accountability Project which is investigating and exposing corruption in the Teamsters, LIUNA, AFL-CIO and many other union organizations. NLPC is a nonpartisan, nonprofit foundation promoting ethics and accountability in government through research, education and legal action.
In addition to the unions and organizations covered in this Union Corruption Update, readers can look forward to news and information on other corrupt and abusive unions in future editions. All back issues of the Union Corruption Update can be viewed at NLPC's website (http://www.nlpc.org). Also available is a union-by-union and state-by-state index of all Union Corruption Update articles. If you have story ideas or suggestions for future editions of Union Corruption Update, please email NLPC at nlpc@nlpc.org. Thank you.
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Union Corruption Update Article Index (by Union)
Union Corruption Update Article Index (by State)
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Boilerplate Whitewater ~right down tothe straw-man father-in -law
By September it was revealed that Terry had underwritten the Clinton Mortgage in NY ~ the case seems to have died
ELECTRICAL WORKERS (IBEW)
DOL Sues Union Fund Tied to Clinton-Crony McAuliffe
The U.S. Dep't of Labor filed suit May 5 against two trustees of the $8.3 billion Nat. Electrical Benefit Fund charging improper dealings between the fund and top Clinton-fundraiser Terence R. McAuliffe. According to DOL, NEBF trustee John Grau and ex-trustee Jack F. Moore imprudently lent over $6 million in pension assets. NEBF is operated jointly by the Int'l Bhd. of Electrical Workers, from which Moore retired as secretary in 1997, and the Nat. Electrical Contractors Ass'n, of which Grau is a vice president.
The scam involved a $6 million loan in 1992 to Columbia Land & Development Corp. of Orlando to buy a subdivision called Country Run which was to be developed into 545 lots. McAuliffe and his wife, Dorothy S. McAuliffe, own Columbia. The loan was in default from Dec. 1992 to Oct. 1997. DOL says NEBF should have known the loan couldn't be repaid in full with interest. The suit seeks the trustees to reimburse the fund for losses, including interest.
The McAuliffes also own Am. Capitol Management, a partner with NEBF in a separate investment called Am. Capitol Group I Assets LP, which guaranteed payment of the Columbia loan. In a separate 1991 investment, NEBF paid $38.7 million to buy five apartment complexes and a shopping center near St. Petersburg. The partnership bought the properties from the Resolution Trust Corp., which had taken control of them from a bank in receivership that had been owned by McAuliffe's father-in-law.
DOL alleges NEBF imprudently purchased a $2.45 million interests in ACGIA, a move that reduced the value of the ACM guarantee on the Columbia loan. McAuliffe's holdings in ACM had been collateral for the loan. The suit further alleges trustees made one of the purchases in the ACM partnership even though the Columbia loan was in default. The pension fund then reportedly sold its share of the partnership and the Columbia loan to ACM at a loss. [Pensions & Investments 5/17/99]
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All the left wing websites I have seen have links to the AFL CIO.
Why is this not huge important news? Why aren't Americans resigning from unions en masse?
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