Donald “Gus” Dougherty, Jr. and John J. Dougherty aren’t related, but they’ve been friends since childhood.This ongoing relationship lies at the heart of a scandal that’s been rocking the Philadelphia area for the past half-year. This past June a federal grand jury indicted Gus Dougherty for diverting nearly $870,000 in union benefit plan contributions toward his own use and evading taxes as part of an off-the-books payroll scheme that lasted four years.The sweeping 33-page, 100-count indictment, handed down after a joint investigation by the FBI, the IRS and the Labor Department, also accuses the Philadelphia electrical contractor of evading more than $1.6 million in taxes.His lawyer, Nicholas Nastasi, would not comment on the case directly, but added that his client would cooperate with the courts.
Mary Hartsock is living proof that longevity with an employer is no guarantee of honesty.The ex-office manager for Laborers International Union of North America Local 1358, based in Elmira, N.Y., pleaded guilty on October 29 in U.S. District Court for the Western District of New York to embezzling $17,958 in funds.Hartsock, 49, a resident of nearby Millport, N.Y., had served in her position from 1980 until January 2007.Federal prosecutors charged that from January 2002 until her dismissal five years later, she converted union receipts to her own use by not depositing or reporting member dues payments.The guilty plea came as the result of an investigation by the Labor Department’s Office of Labor-Management Standards.(Elmira Star-Gazette, 10/30/07; OLMS, 11/1/07).
St. Louis Ex-Financial Secretary Pleads Guilty to Embezzlement
On October 2, Danny Beyser, ex-financial secretary of United Mine Workers Local 1638, pleaded guilty in U.S. District Court for the Northern District of West Virginia to embezzlement.He had been charged in June with one count of embezzling $83,274.39 in funds from the Moundsville, West Va.-based union.The guilty plea follows an investigation by the U.S. Labor Department’s Office of Labor-Management Standards.(OLMS, 10/12/07).
Alabama Business Manager Indicted for Embezzlement
For someone who might wind up doing a long prison stretch, Brian McLaughlin for the past several months has been leading a normal life, working as a full-time electrician in Midtown Manhattan.But appearances are deceiving.McLaughlin, a Queens, N.Y., Democratic State Assemblyman and head of the New York City Central Labor Council until a year ago, is set to go on trial on federal charges that he embezzled or otherwise took without authorization a combined $2.2 million from unions, contractors, taxpayers and even a baseball Little League over the years.The jury selection process in Manhattan federal court is now in the beginning stages.If convicted, McLaughlin, 55, could get life in prison.
It didn’t take Joseph Capece too long to recognize that resistance would be futile.On September 4, Capece, former longtime business manager for Local 163 of the International Brotherhood of Electrical Workers, was charged by federal authorities with theft of funds from the Wilkes-Barre union. A resident of Nanticoke, Pa., Capece, 60, had served for 16 years before resigning in February.That was right about the time a union internal audit discovered the missing money, the sum of which was unspecified.It took only a week to learn how much.On September 11, Capece pleaded guilty in U.S.
On August 31, Judy Thurman, former treasurer of Federated Independent Texas Union Local 900, pled guilty in U.S. District Court for the Northern District of Texas to one count of embezzling union funds totaling $164,268.50.Thurman, who had served at her union post for nearly two years, originally had been indicted on 19 counts.FITU Local 900 represents Lockheed Aerospace workers in Ft.Worth.The plea follows an investigation by the U.S. Labor Department.(OLMS, 9/21/07).
Oklahoma Local President Sentenced for False Record-Keeping
The New York City Labor Council (CLC) has found a permanent successor to fallen president Brian McLaughlin.On June 25, delegates at a meeting of the AFL-CIO-chartered federation, representing some 400 unions, overwhelmingly elected Gary La Barbera, an official with the International Brotherhood of Teamsters, as its new head.Though that union bolted from the AFL-CIO to help form a rival group, Change to Win, La Barbera, 47, impressed the CLC with his track record as a corruption fighter.More than a decade ago, he’d begun serving as a trustee overseeing the cleanup of Teamsters Local 282, a cement-truck drivers’ union previously under the thumb of the Gambino crime family.
On June 5, James A. Pulsifer, a certified public accountant, was sentenced to one year of probation and fined $1,000 for knowingly making false entries in the annual Labor Department reporting form of the Society of Professional Engineering Employees in Aerospace (SPEEA).In the course of making accounting adjustments, he had misclassified some $500,000 in union expenditures.SPEEA officers who signed the report believed it was free of errors and in compliance with federal regulations.Pulsifer was charged in November and pleaded guilty in February.The union, based in Seattle, represents professional employees of Boeing, BAE Systems and other aerospace companies.The action comes in the wake of an investigation by the Labor Department’s Office of Labor-Management Standards.(OLMS, 6/15/07).
Former Treasurer of AtlantaUnion Indicted for Embezzlement
On May 25, David Taylor, formerly financial secretary for Carpenters and Millwrights Local 1402, was sentenced in U.S. District Court for the Eastern District of Virginia to 12 months and one day in prison and fined $35,074.18.Last October he pleaded guilty to one count of making false statements on Department of Labor financial reporting forms in order to cover up his embezzlement of $72,422 in union funds.He previously paid full restitution plus more than $14,000 in interest to the Richmond-based union, affiliated with the United Brotherhood of Carpenters and Joiners.The sentencing comes after an investigation by the Labor Department’s Office of Labor-Management Standards.(OLMS, 6/12/07).
Upstate New York Local Treasurer Sentenced for Embezzlement
For seven years Alan Raines thought he could outsmart his union.Then reality caught up.Raines, financial secretary for Local 1358 of the United Steelworkers, recently was charged in Detroit federal court with embezzlement and bank fraud.During 1999-2006, say federal prosecutors, Raines stole nearly $275,000 in funds from the 300-member Southfield, Mich. union, forging a third-party name on union checks, and using the proceeds to pay for personal expenses.(Detroit News, 5/14/07).
NYC Union Member Sentenced for Role in Racketeering Scam