Cleveland-Area Steelworkers Boss Indicted for Tax Evasion

As if he didn’t have enough problems, David Sager has something new to worry about. On April 4, Sager, former president of United Steelworkers Local 5000, was indicted in U.S. District Court for the Northern District of Ohio on three counts of filing false tax returns. The charges grew out of income he allegedly had derived from diverting funds from the Cleveland-area union to his own personal use. He had been indicted last September on nine counts of embezzlement, 18 counts of mail fraud, one count of obstruction of justice and one count of making a false statement. All the charges follow a joint investigation by the IRS and the U.S. Labor Department’s Office of Labor-Management Standards.

United Steelworkers Local 5000, based in Middleburg, Ohio, represents about 100 employees of various Great Lakes shipping companies. David Sager headed the union from 1999 until last April. There was a good reason for his departure, as Union Corruption Update had explained a half-year ago. According to prosecutors, Sager, 58, a resident of Gibsonburg, Ohio (near Sandusky), during 2010-12 embezzled more than $180,000 from a strike fund set up by the local in 2009 in anticipation of a strike. Additionally, he allegedly extracted well over $200,000 in under-the-table payoffs to his union from unionized employers in return for a promise to ease up in future negotiations; the Taft-Hartley Act bars quid pro quo arrangements such as these. The anticipated strike happened, and Sager emerged richer for it. The latest charges amplify why he should have thought twice.