On October 24, Devon Madray, president of Security, Police and Fire Professionals of America (SPFPA) Local 119, pleaded guilty in U.S. District Court for the Eastern District of Michigan to one count of embezzling $20,097 in funds from the Roseville (suburban Detroit) union. He had been indicted in July. The actions follow an investigation by the U.S. Labor Department’s Office of Labor-Management Standards.… Read More ➡
It was one of the stranger union scams, stretching from suburban Washington, D.C. to the Arab nation of Qatar. And the defendants reaped what they sowed. On November 1, Anthony Frederick Sr., former business manager of Laborers International Union of North America (LIUNA) Local 657, pleaded guilty in U.S. District Court for the District of Columbia to fraud and theft charges in connection with the diversion of over $1.7 million in funds from the Washington, D.C.-based union to a suburban Maryland firm, STS General Contracting. Three weeks later, on November 22, STS owner Gary Cooper was convicted by a Washington trial jury on similar charges. A Maryland real estate agent, Christopher Kwegan, previously had pleaded guilty in the case. The convictions follow indictments handed down in October 2015.
LIUNA Local 657 represents roughly 1,500 construction workers in the Washington, D.C. area. It also for a while served as a source … Read More ➡
On October 18, Frank Gluberman, former secretary-treasurer of the Greenburgh Teachers Federation, an affiliate of the American Federation of Teachers, was sentenced in Westchester County (N.Y.) District Court to one to three years in prison for embezzling nearly $800,000 from the union over a seven-year period. He also was ordered to pay restitution totaling $822,281. Gluberman, a former teacher and assistant principal at Greenburgh High School, had pleaded guilty to grand larceny in August 2014 after being arrested in January of that year. The actions follow an investigation by the U.S. Labor Department’s Office of Labor-Management Standards.… Read More ➡
Union health care fraud is well and alive on the West Coast. On October 14, David Gomez, a member of International Longshore and Warehouse Union (ILWU) Local 13, was convicted by a federal jury in Los Angeles on 20 counts of mail fraud in connection with a scheme to bill the local health care plan for nonexistent, unnecessary or unauthorized chiropractic services. Another co-defendant, Sergio Amador, similarly pleaded guilty earlier this year. Through various scams the defendants stole at least $3 million. Gomez and Amador, respectively, are set for sentencing on January 9 and December 1. ILWU Local 13 represents dockworkers at Port of Los Angeles and Port of Long Beach. The actions follow a joint investigation by the FBI, and the U.S. Labor Department’s Office of Inspector General and Employee Benefits & Security Administration.
Gomez and Amador opened a medical and chiropractic clinic in Long Beach in 2009 operating … Read More ➡
Union health plans have become one of the largest targets of scams in this country. Nermin Awad El-Hadik, for one, is evidence of that. On November 9, El-Hadik, owner of a Houston-area pharmacy, pleaded guilty in U.S. District Court for the Western District of Texas to paying more than $5 million in kickbacks to an Austin-area chiropractor, part of a larger scheme costing the Department of Labor about $18 million in program funds. Ms. El-Hadik, who faces up to five years in prison, has agreed to make restitution. She remains free pending sentencing. This and related actions follow a joint investigation by the FBI, IRS, U.S. Army, U.S. Postal Service and U.S. Labor Department’s Office of Inspector General.
Union Corruption Update described this case at length last month. Garry Craighead, an Austin-area chiropractor, had been sentenced to 14 years in prison, plus three years of supervised release, for soliciting kickbacks … Read More ➡
On October 19, Patrick Remigio, former president of American Federation of Government Employees Local 2859, pleaded guilty in U.S. District Court for the District of Arizona to one count of wire fraud against the Tucson union, which represents U.S. Immigration and Customs Enforcement (ICE) agents. As part of the plea deal, he agreed to pay $95,000 in restitution. Remigio had been indicted in January on eight counts of wire fraud and two counts of false record-keeping. The actions follow a joint investigation by the FBI, the Department of Homeland Security and the Department of Labor’s Office of Labor-Management Standards.… Read More ➡
On October 13, Clinton Humphrey, former president and business manager of International Brotherhood of Electrical Workers Local 386, was sentenced in U.S. District Court for the Western District of Arkansas to six months of home confinement and five years of probation for embezzling $51,811.70 in funds from the Texarkana, Ark.-based union. He also was ordered to pay full restitution plus a $100 special assessment. Humphrey had pleaded guilty to an information in January. The actions follow an investigation by the U.S. Labor Department’s Office of Labor-Management Standards.… Read More ➡
Ronald Mulcahey often paid his employees in cash. Now he’s preparing to pay a price of a different kind. On October 25, Mulcahey, proprietor of a number of environmental services firms in the Boston area, pleaded guilty in U.S. District Court for the District of Massachusetts to defrauding his employees of scheduled benefits. One of his companies had a collective bargaining contract in force with a local of the Laborers International Union of North America (LIUNA). By paying certain employees off the books through a pair of identical nonunion companies, he was able to underreport benefits and avoid applicable federal taxes. The guilty plea follows a joint investigation by the IRS and the U.S. Labor Department’s Employee Benefits Security Administration. Sentencing is set for January 19.
In the construction industry there is a widespread practice, known as double-breasting, in which the owner of a unionized business sets up one … Read More ➡
On October 11, Violet Lamorie, former secretary-treasurer of American Federation of Government Employees Local 695, was charged in U.S. District Court for the District of Colorado with embezzling more than $70,000 from the Denver union, which represents employees of the U.S. Mint plant in that city. The charge follows a probe by the Labor Department’s Office of Labor-Management Relations and the Treasury Department’s Office of Inspector General.… Read More ➡
On October 11, Steve Hartman, former secretary-treasurer of Association of Civilian Technicians Chapter 83, was sentenced in U.S. District Court for the Eastern District of Kentucky to two years of probation and 50 hours of community service for forging a security in the amount of $2,173 from the Fort Knox union. He also was ordered to perform 50 hours of community service and pay a $100 special assessment. Hartman had been charged in June, at which time he pleaded guilty. He previously had paid restitution in the amount of $13,208. The actions follow an investigation by the U.S. Labor Department’s Office of Labor-Management Standards.… Read More ➡