Union Cited by DOL, Texas in Massive Health Insurance Fraud

When is a union health plan not a health plan?  A good guess would be the moment at which its “beneficiaries” discover they’re not covered.  Thousands of enrollees in a plan sponsored by a California-based union have been finding out the hard way.  This past December the U.S. Department of Labor filed suit against the International Union of Public and Industrial Workers (IUPIW) Canadian Benefit Fund and its trustees for more than $1.2 million.  DOL officials say the action was required to cover unpaid health care claims due more than 2,000 workers and family members.


The lawsuit, filed in U.S. District Court in Atlanta, alleges mismanagement by plan trustees.  The plan itself is intended for employees belonging to one of two affiliates of the Paramount, Calif.-based IUPIW:  the International Union of Petroleum and Industrial Workers (IUPIW) and the International Union of Industrial Read More ➡

Union Dissenters Point to Campaign Violations by Hoffa Allies

Teamsters for a Democratic Union has been fighting uphill battles since its founding in 1980, alerting fellow union members to corruption occurring within their ranks. Their workload isn’t likely to get any lighter, given that general elections are set to be held this fall. TDU has been a steadfast opponent of James P. Hoffa, since 1999 president of the International Brotherhood of Teamsters. They’re accusing Hoffa of pulling out the stops to defeat chief rival Tom Leedham and his “Strong Contracts, Good Pensions” slate.


Union politics have never followed a standard “Democrat vs. Republican” script. It’s a world where candidates and their followers sling mud with extra ferocity, and where payback has no mercy. Portland, Ore. Teamsters chieftain Leedham, who served as a general vice president and director of the union’s warehouse division during Ron Carey’s presidency, has challenged Hoffa, unsuccessfully, for the top spot before, in a 1998 special Read More ➡

S.F. Bay-Area Local Punishes Whistle-Blower; Now in Court

Gustave Link never set out to be a troublemaker.  An apprentice welder and a union man, he was trying to raise worker safety issues at one of the nation’s largest ongoing engineering projects, the rebuilding of the San Francisco-Oakland Bay Bridge.  The existing 4.5 mile-long structure, opened in 1936, is scheduled for demolition next summer, a decision driven heavily by the Bay Area’s destructive 1989 earthquake.  The structure slated to replace the bridge, the New East Span, is the source of Link’s current predicament.  He and his former union, Pile Drivers Local 34, an affiliate of the United Brotherhood of Carpenters and Joiners, are squaring off in federal court. 


The saga began about a year ago when Link, 38, called the FBI’s public-corruption hotline to talk about hazardous onsite conditions.  He’d talked about this with the prime contractor, KFM Joint Venture, and his Read More ➡

Ex-Wisconsin Executive Director Pleads Guilty to Embezzlement

Look at it on the bright side – at least the numbers are right this time around.  Three months ago newspaper reports indicated Stanley Kluss had been charged with embezzling roughly $25,000 from the Wisconsin Professional Police Association, for whom he had served as executive director during 1986-2004.  The real haul, as it turns out, was three or four times that.  On January 20, Kluss pleaded guilty in federal court to embezzling anywhere from $70,000 to $120,000 over the course of October 2000 to February 2003.


It’s something of a mystery why Kluss, 64, a resident of Crandon, in the northern part of the state, had resorted to theft.  His salary was $82,400, and he got free use of a car and an apartment.  Yet according to last fall’s 37-count indictment, he used WPPA credit cards to charge personal items such as a snowmobile, Read More ➡

Former Iowa Local Secretary-Treasurer Sentenced

On December 20, Debra Herrig, formerly secretary-treasurer for American Postal Workers Local 2339, was sentenced in U.S. District Court for the Northern District of Iowa to three months imprisonment and two years of supervised release.  She also will have to serve three months of home detention.  Herrig pleaded guilty last March to one count of embezzling funds from the Dubuque local; she since has made restitution in the amount of $13,265.26.  The sentencing follows an investigation by the Labor Department’s Office of Labor-Management Standards.  (OLMS, 1/25).     


Ex-Bookkeeper for Philadelphia Local Sentenced for Thefts

On January 3, Barbara Wituschek, ex-bookkeeper for Iron Workers Local 161, was sentenced in U.S. District Court, Eastern District of Pennsylvania, to 36 months of probation and fined $1,000.  She had pleaded guilty last October to two counts of embezzling $5,741.41 in union funds.  (OLMS, 1/25).     Read More ➡

Change to Win, LM-2 Ruling, Longshoremen Led Pack in 2005

Compiling a list of the previous year’s Top Ten Whatever – news stories, TV shows or movies – is one of life’s guiltier pleasures for the scribbling class, providing an opportunity for the compiler to exhibit a briefly heightened sense of importance.  Yet despite inviting a certain level of self-indulgence, it also serves a needed function:  putting events in perspective.  There’s no reason why labor corruption stories can’t be ranked as such.


The Top 10 stories for 2005 are not the product of any weighted formula, but they do reflect the application of several criteria.  First is the amount of funds stolen or missing.  A union that fleeces its treasury of $2 million, all other things held equal, is making a far bigger dent in its members’ livelihoods than if it had stolen $200,000.  Second is evidence of involvement, if any, by officials rather than office employees.  When a union Read More ➡

Massachusetts UFCW Local Official Sentenced for Extortion, Fraud

Joseph DiFlumera must have forgotten who was paying his dues. As president of United Food and Commercial Workers Local 1445 in Dedham, Mass., he was supposed to be negotiating on behalf of supermarket workers. What he negotiated instead, over the course of 1989 to 2003, was a sweet deal worth $1.56 million to himself. He’s set to enter federal prison on January 17 to serve a 46-month sentence for mail and wire fraud. But it’s not likely that he’ll be able to make any restitution because it was the casinos who were the biggest winners of all. 


DiFlumera, 71, had served his union for a long time. From 1959 through 1976 he was president of UFCW Local 1459, based in Springfield, Mass.  Though it had been years since he headed Local 1445 at the time of his arrest in 2003, the union trusted him to negotiate deals. Read More ➡

Amid Complaints, D.C. AFT Local Election Runoff Is Planned

teachers desk reduced_0The Washington Teachers Union thought its days of scandal, or at least accusations of it, were long behind.  But the process of choosing a new local president seems to have produced an echo effect.  Last month the union, an affiliate of the American Federation of Teachers, held an election to determine a successor to its former president, Barbara Bullock, now doing a nine-year stretch in federal prison.  Bullock and her cronies embezzled or otherwise stole roughly $5 million during 1995-2002 before an outside audit turned up massive financial irregularities.  This led to an FBI raid and an AFT takeover of the local.   Three candidates entered the race:  George Parker, Rachel Hicks and Elizabeth Davis.  Parker and Hicks finished a close first and second; Davis is crying foul. 

On January 3, Davis announced plans to appeal the results to the U.S. Department of Labor, claiming there were widespread voting irregularities.  She Read More ➡

Maine Teacher Pleads Guilty to Embezzlement, Sentenced

Jeffrey Olson found out that humility can go a long way.  Olson, 59, pleaded guilty on January 5 to embezzlement charges.  A former math teacher at Belfast Area High School, he had served for two decades as treasurer of SAD 34 Education Association, an affiliate of the National Education Association.  Unbeknownst to his colleagues, for some of that time he’d embezzled about $140,000.  Upon his arrest, he cooperated with police, admitting he took the money to cover financial difficulties.  He also paid back around $90,000 back in June when the thefts had been discovered by the new local president, Betty Lu Brown.  Brown had opened a bank statement and discovered 32 checks, each for $514 written out to Olson or his wife over a three-month period.  She then notified police, who with Olson’s cooperation, discovered a lot more missing.   

Olson’s cooperation and contrition moved Waldo County Superior Court Justice Read More ➡

Pennsylvania Workers Join Lawsuit Against Snoopy Unions

Organized labor has never been too keen on the right to privacy – at least the privacy of workers who might be reluctant to join and need some persuading. About a thousand workers at the Cintas Corp. plant in Emmaus, Pa. have joined in a suit over what they say are overly aggressive organizing tactics by two major unions. The employees allege that for two years, during July 1, 2002-August 2, 2004, members of UNITE and the Teamsters copied down license plate numbers of workers’ parked cars at the plant, subsequently sending organizers or mailing information to their homes.

The employees are basing their complaint on a 1994 federal law, the Driver’s Privacy Protection Act, prohibiting the disclosure and use of personal information obtained through motor-vehicle records. Late last spring U.S. District Judge Stewart Dalzell had granted class-action status to Cintas workers in Pichler v. UNITE et al. Read More ➡

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