The U. S. Dept. of Labor has obtained settlement agreements providing for restitution of $4,312,063 to 10 pension and health plans in Arizona, Colorado, Minnesota and Ohio that invested plan assets in risky private placement schemes with Capital Consultants, LLC.The consent orders also require payment of $862,413 in civil penalties to the government.
The Union Independiente de Empleados Telefonicos agreed to pay $435,867 in restitution to the Fidelcomiso Para La Administracion Del Fondo De Benficencia De La Union Independiente De Empleados Telefonicos according to a consent judgment announced by the U.S. Labor Department on Feb. 18.
The DOL sued the union and six plan trustees on Dec. 4, 2004, for misusing the plan’s assets to benefit the union.The U.S. district court in Puerto Rico ordered the union to restore the money to the plan and dismissed the charges against the trustees.
The U. S. Dept. of Labor has sued current and former trustees, the plan administrator, and Local 38 of the United Association of Plumbers, Pipefitters and Journeymen.DOL charges that the officials diverted more than $36 million in assets of five employee benefit plans to renovate and operate the Konocti Harbor Resort and Spa facilities on ClearLake in Kelseyville, Calif.
The U.S. Dept. of Labor has sued the trustees and service providers to the HERE Local 4-69
Health Fund in Secaucus, N.J., for misusing plan assets to pay excessive and unreasonable compensation for services provided to the health fund, resulting in losses to the fund in excess of $2 million."This Administration is committed to protecting the employee benefits of America’s workers, and we won’t hesitate to act when plan officials are not managing their workers' benefits responsibly,” said U.S. Secy. of Labor Elaine L. Chao.
On Oct. 1, in the U.S. Dist. Court for the Dist. of Columbia, Renee Hallman, former project specialist with the Wash. D.C. Nurses Association, pled guilty to an information filed on that same date charging her with embezzling $9,572.89 in union funds . The charges were brought following an investigation by the Washington Dist. Ofc.of the U.S. Ofc. of Labor-Mgmt. Standards. [OLMS, 10/5/04]
The U. S. Dept. of Labor filed a consent order on Aug. 2, ousting four trustees from the board of the Plumbers and Pipefitters National Pension Fund and requiring them to pay $10.98 million in restitution and civil penalties in connection with the imprudent management of the fund’s investment in the Diplomat Resort and Country Club in Hollywood, Fla.
On July 15, in the U.S. Dist. Ct. for the Dist. of Ore., Dennis Paul Talbott, former secy.-treasurer of Sheet Metal Workers Local 33, was sentenced to 3 yrs. probation and ordered to pay a $1,000 fine. Talbott pled guilty to 1 count of accepting a gratuity in connection with his duties as a trustee of an employee benefit plan. The gratuity he accepted involved hunting and fishing trips paid for by Capital Consultants (CCL). CCL was involved in the loss of over 350 million dollars-mostly from union pension funds. The conviction follows an investigation by the Seattle Dist. Ofc. of the U.S. Ofc. of Labor Mgmt. Standards, the IRS, the FBI, the Dept. of Labor's Ofc. of Inspector General and the Employee Benefits Security Administration. [OLMS, 7/28/04]
On July 8, The U.S. Dept. of Labor sued Local 19 of the Bakery, Confectionery, Tobacco Wrkrs. and Grain Millers Union and the trustees of the ABC Local No. 12 Employer and Employee Life Benefit Fund in Pittsburgh, Pa., for abandoning the fund. The Department has also sued a former employee of the plan for unauthorized use of plan assets.The fund provides death benefits to beneficiaries of members of the former Local 12 Bakery, Confectionery, Tobacco Workers and Grain Millers Union. Local 19 was charged as a successor fiduciary after its merger with Local 12 in March 2004.
U.S. Dist. Judge Gladys Kessler (D.C., Clinton) has cleared away the AFL-CIO's last gasp attempt to escape the reformed financial disclosure forms they and the nation's wealthiest unions must file with the U.S. Dept. of Labor.Last Jan., Kessler ordered that the revised LM-2 forms take effect, either on July 1, 2004, or 90 days after DOL made available a "fully tested version" of the computer program for filling out the new form.
With the addition of a unit in the Ofc. of Labor Mgmt. Standards (OLMS), labor dept. officials are now prepared to more closely scrutinize intl. unions' compliance with fed. financial accounting laws.making up for steady cuts in OLMS staff during the Clinton admin.According to its budget request for FY 2005, OLMS staff fell from 425 in FY 1985 to 242 in FY 2001.One of the consequences of that decline is that 10 of the nation's largest unions have never been audited by OLMS.