James O. Baxter II, a mastermind of the Washington Teachers Union scheme that ripped off at least $4.6 million from dues-paying members during 1995-2002, learned his fate in federal court on June 5. And unlike his recently-sentenced partner in crime, former WTU office manager Gwendolyn Hemphill, he didn’t try to cop an insanity plea. Baxter will have to serve 10 years in prison, to be followed by three years of supervised probation and 900 hours of community service. He’ll also have to make more than $4.2 million in restitution. Last August 31, Baxter was found guilty along with Hemphill on 23 separate counts, including embezzlement, conspiracy, mail fraud and money laundering.
In the meantime, it’s going to take a while for the current union leadership to climb out of the financial hole left by its predecessors. Its fiscal year 2005 Department of … Read More ➡
On the matter of Ronnie Cunningham, Local 44 of the International Alliance of Theatrical Stage Employees was a house divided. He was the business agent for the 5,700-member North Hollywood, Calif.-based local, which represents prop makers, decorators, model builders and other employees in film and television set design. But on March 1 of this year the board voted 16-0 to oust him. Members alleged that for roughly a decade Cunningham had committed embezzlement, extortion and other offenses. Yet he had his defenders. In the face of a possible protracted legal battle, the board decided to cut its losses.
The Los Angeles Times reported that Local 44 had paid Cunningham a $170,000 settlement. Not every union member is happy. “A lot of us are very upset about this,” said Charlotte Laughon. “The decision to pay him before members could make their own … Read More ➡
The redemption of Martin Ludlow continues. On June 5, the former member of the Los Angeles City Council and secretary-treasurer of the Los Angeles County Federation of Labor was sentenced in U.S. District Court to five years probation and 2,000 hours of community service for diverting Service Employee International Union Local 99 funds to pay for his 2003 City Council run. He also will have to make $36,400 in restitution to the union. Former Local 99 President Janett Humphries still faces various charges. (OLMS, 6/13/06).
Former Bookkeeper in Philadelphia Sentenced for Theft
On May 30, Darnell Smith, formerly bookkeeper for SEIU Local 36, was sentenced in Philadelphia County Court of Common Pleas to one to two years in prison, followed by five years probation, for embezzling from the union. He also was ordered to pay more than $70,000 in restitution.… Read More ➡
Full-length studies of union corruption have been rolling off the presses at a rapid pace this year. First, Robert Fitch came out with Solidarity for Sale (Public Affairs). Then James B. Jacobs weighed in with Mobsters, Unions, and Feds (NYU Press). Now the institution that makes possible Union Corruption Update, the National Legal and Policy Center, has unleashed a monograph. It’s called Union Corruption and the Law: Toward a Unified Framework for Reform. Don’t be put off by the word “law.” In 62 densely-packed 8½ x 11 pages, the author, Phillip B. Wilson, vice president and general counsel of the Oklahoma-based Labor Relations Institute, Inc., makes clear the complexities of prosecuting illegal union behavior to laymen as well as to lawyers.
Wilson leads off by summarizing four representative cases, breaking down behavior and motives in fine detail to show … Read More ➡
Gwendolyn Hemphill wasn’t eager about doing time in federal prison. But it appears the former office manager of the Washington Teachers Union, an affiliate of the American Federation of Teachers, is headed that way, now that her claim of mental illness has fallen by the wayside. On May 22, Hemphill, 64, received an 11-year sentence for her role in a scheme that embezzled well over $4 million from union coffers, using much of that money to buy luxury goods. She isn’t likely to keep what merchandise she has left, since she’s been ordered by the court to make restitution. Though her attorney said she plans to appeal the sentence, such a move should prove yet another exercise in futility.
From 1995 until well into 2002, Hemphill, along with WTU President Barbara Bullock, Treasurer James O. Baxter II and several associates, had stolen and/or laundered at least $4.6 million from the … Read More ➡
It might be a longshot bet, but the bosses at the International Longshoremen’s Association think they can beat the rap. Last July the U.S. Attorney’s Office in Brooklyn, N.Y. filed a civil RICO lawsuit against several of the union’s top officials, including its longtime president, John Bowers, calling for their removal from office. In court filings, attorneys for the ILA and joint union-management benefit programs said the lawsuit was filled with generalities and unsupported conclusions, and overlooked the progress in the internal cleanup program that the union instituted a few years ago. “The Waterfront Enterprise it imagines is a largely unascertainable mass of people and businesses with no specified relationship to one another other than being part of the same industry,” said ILA lawyer Howard Goldstein.
The union is going up against some strong evidence. President Bowers, the 83-page RICO complaint alleges, violated an earlier settlement by “committing and otherwise … Read More ➡
Everyone knew that Jackie Presser was a kept man of the Cleveland mob. That’s how he eventually got to the top of the International Brotherhood of Teamsters in 1983. But it took a lot of gumshoe work to get the goods on him. Among those who did the work was James Thomas, known to his colleagues as “Foggy.” Thomas, 66, died May 23 after a long battle with lung cancer. He began his federal career with the IRS, and closed it in 1991 with the Defense Criminal Investigative Service. But it was his work with the Department of Labor during the early- to mid-80s for which he will be best remembered.
Thomas, along with fellow DOL investigator George “Red” Simmons, spent four years probing kickbacks and ghost-employee schemes operated by Presser, often engaging in telescope surveillance. He got plenty of resistance from the FBI, who, though unknown to the public … Read More ➡
On May 22, Tina Buracker, formerly president of Communications Workers of America Local 82174, was sentenced in U.S. District Court to five years in prison to be followed by five months home detention and three years probation. She also will have to make $51,554.15 in restitution to the union. Ms. Buracker pleaded guilty to embezzlement in March. Local 82174 is based in Shenandoah, Va. The sentencing follows an investigation by the Labor Department’s Office of Labor-Management Standards. (OLMS, 6/1/06).
Former Financial Secretary in New Jersey Indicted for Theft
On May 9, Marie-Elena Clayton, ex-financial secretary for Glass Molders & Plastics Union Local 236A, was indicted in U.S. District Court for the District of New Jersey on one count of embezzlement of $41,126 in union funds, and one count of not turning in union records. (OLMS, 6/1/06).
Pittsburgh-Area Financial Secretary Indicted for … Read More ➡
Public school teachers might want to recalculate the money they stand to collect on their 403(b) plans when they retire. That’s assuming, of course, the money will be there. In a lengthy expose in its April 25 edition, the Los Angeles Times revealed how cozy relationships between teacher union officials and investment companies result in retirement plans that charge unusually high fees but deliver below-average returns. The article’s author, Kathy M. Kristof, amassed extensive evidence to suggest that union officials actively steer funds into these plans.
The 403(b) plan for nearly a half-century has been the primary vehicle for investment for teacher retirement funds. Congress created the 403(b) in 1958; today such plans account for more than $600 billion. Like its more familiar private-sector equivalent, the 401(k), the 403(b) is a defined-contribution plan; the employee makes regular contributions until retirement, at which point he or she is ready to make … Read More ➡
The corporate campaign has been an increasingly powerful weapon in organized labor’s arsenal of bargaining tactics. Rather than go on strike, a union targets a company whose practices it finds offensive, links up with civil rights, environmentalist and/or community groups, and launches a blitz that may include in addition to a strike, a boycott, pickets, leaflets, negative public relations, harassment of customers, lawsuits, blackmail, and complaints to regulatory agencies. Unions first applied this tactic during the 70s. Coca-Cola, Food Lion, Nike and Wal-Mart are but a few major corporations that have learned first-hand how rough things can get. Wackenhut Services Inc. (WSI) for the last two years has joined the club. The Service Employees International Union has been trying to publicly discredit the company until it accepts the union as the sole collective bargaining agent. The company, for its part, has a reputation to protect, and is letting people know … Read More ➡