Janice R. Hughes turned out to be someone who couldn’t be trusted – ironic, considering she and her partner had been ripping off a union trust fund for a half-decade. On September 23, the Justice Department announced that Hughes, 68, a resident of Easton, Maryland, had pleaded guilty in federal court to six counts of bank fraud, five counts of mail fraud and two counts of money laundering. Back in March a grand jury had indicted Hughes and Gilbert A. Wolf, 72, for defrauding their former employer, the National Plastering Industry’s Joint Apprenticeship Trust Fund, and a pair of federal agencies, of at least $917,000 during 1995-2000.
Hughes was the office manager of the fund, a non-profit training organization run by the Operative Plasterers and Cement Masons International Association (OP & CMIA). Wolf had served as its executive director. The fund provided pre-apprenticeship career training for low-income youths … Read More ➡
Jeffrey Olson owed serious money to his credit cards and the IRS. Unfortunately, to cover those debts, the 58-year-old high school math teacher in Belfast, Maine embezzled from his teachers’ union local. Olson until recently had served as treasurer of SAD 34 Education Association, an affiliate of the National Education Association. On October 18 he turned himself into local authorities after a months-long investigation. According to Belfast Police Chief Jeffrey Trafton, Olson admitted to tapping union funds for years. “He has cooperated completely and fully with the investigation,” Trafton added. Investigators and auditors determined that Olson had removed about $150,000 in union funds over the previous six years, acknowledging that he managed to repay $91,000. But that still leaves roughly $60,000 to go.
As treasurer, Olson had sole control over teacher union dues deductions. The case emerged after Betty Lu Brown, a secretary at Belfast Area High School, … Read More ➡
Stephen Laffey, mayor of Cranston, Rhode Island, believes in his city. Armed with a combination of street smarts, populism and a Harvard M.B.A., for almost three years he’s been putting this heavily working-class community of about 80,000 on the road to sound fiscal footing. But certain local labor bosses are determined to make his job as difficult as possible.
Laffey, 43, and a Republican, was first elected mayor in this traditionally Democratic stronghold in 2002. Upon his taking office the following January, Cranston’s bond rating was the lowest of any U.S. city; bankruptcy loomed. Reluctantly, Laffey persuaded the city council to raise taxes. In return, he won spending concessions, including cutting costs of labor-intensive activities inflated by the demands of public-employees unions. “We were paying unionized crossing guards the equivalent of $129 per hour,” he recalls. “We had to do … Read More ➡
In South Korea, labor corruption makes headlines. Less visibly, it makes them here, too. On October 20, the entire leadership of that country’s largest and most powerful labor federation, the Korean Confederation of Trade Unions (KCTU), resigned in response to protests among its rank and file over scandals among senior officials. The organization, with roughly 620,000 members belonging to nearly 750 unions, increasingly has been prone to economic militancy and anti-American sentiment in its ranks. “The current leadership did everything it could to reinvigorate the labor movement through various internal reforms,” said KCTU President Lee Su-ho in his resignation speech. “But we have decided to step down because of aggravated infighting between union reforms.”
The federation was rocked by the arrest several weeks ago of its vice-president, Kang Seung-kyu, for allegedly taking $78,000 in bribes from taxi businesses in return for … Read More ➡
On October 5, Tina Buracker, formerly president of Local 82174 of the Communications Workers of America, was indicted in U.S. District Court, Western District of Virginia, on one count of embezzlement of union funds totaling $54,679. The indictment follows an investigation by the Labor Department’s Office of Labor-Management Standards. (OLMS, 10/28).
Massachusetts Local Treasurer Sentenced for Embezzlement
On October 3, George Beck, Jr. ex-secretary-treasurer for Paper, Allied-Industrial, Chemical and Energy Workers Local 01-366, was sentenced in U.S. District Court to six months home confinement, followed by two years of probation, for embezzling union funds. He also will have to make $26,918 in restitution. Beck pled guilty on September 7. The action follows an investigation by the Labor Department. (OLMS, 10/28).
Ex-Business Manager for Missouri Local Sentenced for Theft
On October 7, Duane Raab, former business manager for Iron Workers Local … Read More ➡
When the stakes are high, the real crime story usually lurks beneath the respectable surface. That seems to be the case, at any rate, for the new labor federation, Change to Win (CTW). The group, which comprises seven unions with a combined roughly 5.5 million members, held its gala inauguration in St. Louis on September 27. Organizing millions of new workers is priority number one, announced CTW President Anna Burger, who also serves as political director for the 1.8 million-member Service Employees International Union. Her boss, SEIU President Andrew Stern, made the same point, as did Teamster President James P. Hoffa. Somehow the issue of corruption never came up.
There’s a good reason for that. The federation’s newly-minted secretary-treasurer, Edgar Romney, back in the 90s was a suspected bagman for the Lucchese crime family, looking the other way as the New York City garment industry, especially in Lower Manhattan’s Chinatown, … Read More ➡
It’s hardly front-page news that the AFL-CIO has fallen upon hard times. Since late July, seven unions representing some 5.5 million workers have formed their own alternative federation, Change to Win, in hopes of adding to that total by millions more. Six of the unions had broken away from the AFL-CIO beginning this July; a seventh, the United Brotherhood of Carpenters and Joiners, already had taken flight back in 2001. Yet with understandably less fanfare, the AFL-CIO, whose unions represent 8 million union members (plus another 1 million workers who are not full-fledged members), has begun to recoup some of the lost ground. In September, the California Nurses Association, with 65,000 members, requested a charter from the AFL-CIO to begin petitioning for membership. This month another union, the United Transportation Union (UTU), which along with the Carpenters had left the federation four years ago, is back in.
The Cleveland-based UTU … Read More ➡
For more than a decade New York City’s International Union of Elevator Constructors Local 1 padded area construction projects with hundreds of no-show jobs for their pals, many of whom had friends in the mob. Certain contractors liked the arrangement, too, as they were paid well to look the other way. Now the union will be operating under a new set of rules – those of the feds. On October 3, officials from the Department of Justice and the Department of Labor announced that Local 1 had agreed to be placed under the supervision of an independent federal monitor. Additionally, the union would implement key internal reforms in hiring, disciplinary and election procedures. By complying for the next three years, in turn the union would get a reprieve from prosecution. Already, the investigation has produced more than three dozen convictions of individuals belonging to or connected with the union, … Read More ➡
Nathan Saunders is on a mission. He’s a teacher at Washington, D.C.’s Anacostia High School. And his main lesson for the last three years has been that crime doesn’t pay – especially when it’s committed by officials of his own local union, the Washington Teachers Union (WTU). For a good seven years, the WTU had fleeced its members all the while claiming to represent them. In 2002, an independent audit revealed roughly $5 million in local funds were missing. Saunders, now the WTU’s vice president, promptly sued the union and a local financial institution, Independence Federal Savings Bank, where the WTU conducted a large number of unusual transactions. He demanded a recovery of the missing funds, even as the Justice Department was prosecuting the ringleaders. Now he appears on the verge of solace.
U.S. District Judge Emmet G. … Read More ➡
Most people would consider an $82,400 salary, plus the use of a free motor vehicle and housing, sufficient to maintain a decent lifestyle. But Stanley J. Kluss apparently isn’t like most people. As executive director of the Wisconsin Professional Police Association during 1986-2004, he supplemented his aforementioned income and benefit package with roughly $25,000 in unauthorized expenses from the union till. On October 5, the 63-year-old Kluss received the bill: a 37-count federal indictment.
Justice Department officials allege that between October 2000 and February 2004 Kluss defrauded the Madison-based police association in several ways. First, he charged personal items to the tune of $8,879 on its credit cards, disguising them as legitimate expenses by cutting the tops and bottoms off receipts. He also inflated official travel records by nearly 50,000 miles, fraudulently obtaining about $15,000 in reimbursements this way. Finally, he made $1,440 … Read More ➡