Union Corruption Update

Missouri Secretary Gets Probation for Embezzlement

On July 29, in U.S. District Court for the Western District of Missouri (Southwestern Division), Tawyuna Palmer, ex-financial secretary of Local 11-14228 for the United Steelworkers, was sentenced to five years probation for embezzlement of nearly $21,500 in union funds.  She pleaded guilty back in April following an investigation by the Department of Labor’s Office of Labor-Management Standards (OLMS), and since then has made restitution.  In addition to probation, Palmer will have to serve six months of home detention and perform 120 hours of community service.  (OLMS, 8/17).

Former Philly-Area Manager Pleads Guilty to Embezzlement 
On July 26, James Jordan, ex-business manager for Local 161 of the Riggers union, pleaded guilty in U.S. District Court for the Eastern District of Pennsylvania to one count of embezzlement totaling $21,652.80.  Additionally, he pleaded guilty to one count of making a false entry in the local’s records.  He had been indicted in May.  (OLMS, 8/17).

Puerto Rican Benefit Fund Managers Indicted

This summer hasn’t been the best for the International Longshoremen’s Association (ILA).  On July 6 the Justice Department slapped the union’s top leadership with a massive civil RICO suit centering on acts of extortion, fraud and other crimes it allegedly tolerated in the Ports of New York-New Jersey and Miami.  Now, just two weeks later, on July 19, the department accused leaders of an ILA affiliate in Puerto Rico and several of their associates of ripping off as much as $10 million and underreporting another $1.5 million.


NLRB Sues Employer, Union at South Carolina Plant

Labor unions, in theory, are supposed to support higher pay for workers.  The idea of a union colluding with an employer to drive down wages doesn’t make sense.  Then again, forced card-check agreements have never made sense – at least for workers reluctant to join a union.  A case originating in South Carolina on the issue may have major implications for the rights of non-joining employees who may view a particular union as corrupt.


Expensive Gift to New Jersey CWA Boss Raises Ethics Questions

The soap opera that is latter-day New Jersey politics has a new episode.  This time the central characters are a U.S. Senator who wants to be the state’s next governor, a divorcee who represents the state's largest collective-bargaining unit for state employees, and, from a distance, her ex-husband.  Nobody has broken the law – so far as one knows.  And it’s a private matter, involving no union funds.  But many observers are worried that a major conflict of interest is in the making unless the candidate is more forthright with the facts.

Former Secretary-Treasurer for Indiana Local Sentenced

On July 18, Bernard Scheller, ex-secretary-treasurer for Communications Workers Local 14448, was sentenced in federal court to six months in a halfway house, to be followed by two years of supervised release and 100 hours of community service, for embezzlement.  Scheller in May pleaded guilty to stealing $7,250 in union funds.  The plea and sentence resulted from an investigation by the OLMS Cincinnati District Office.  (OLMS, 8/6).


Ex-N.H. Business Manager Indicted for Embezzlement

New Report Claims Union Is Mob-Free, but May Be a Cover-up

Is it the truth or is it a whitewash?  That’s the question rank-and-file members of the International Brotherhood of Teamsters ought to be asking in the wake of the release of the public portion of a new report prepared for the union, concluding that the IBT is free of organized crime.  Union leadership, beginning with President James P. Hoffa, couldn’t be happier.  But there’s an unpleasant reality:  The report is in conflict with an earlier one released over a year ago.  The extent to which the Teamsters can sway skeptics will determine how soon, if at all, the federal government will lift its more than decade-and-a-half of surveillance.


RICO Suit Could Mean Long-Term Federal Control

On the surface, life at International Longshoremen’s Association (ILA) headquarters in Manhattan hasn’t changed all that much.  But the seeming normalcy doesn’t disguise the fact that the union’s longstanding alleged ties to two Mafia families are about to be exposed wide open.  On July 6, Justice Department lawyers filed a massive civil RICO lawsuit in U.S. District Court in Brooklyn.

Federation Split May Have Little Effect on Corruption

People saw it coming a mile away.  The Teamsters’ James P. Hoffa and the Service Employees’ Andrew Stern each made good on their threats to take their unions out of the AFL-CIO at the start of that labor federation’s 50th anniversary convention in Chicago.  In the process, they and several other dissenting unions have left observers wondering if the fortunes of organized labor have been irrevocably damaged.  While that’s a possibility, the most likely long-run outcome probably will be the opposite.  Indeed, unions may emerge with more members, revenues and political clout.  As for battling corruption, they don’t seem to view this as a high-priority item.  But this requires some context.   And the context is the convention.      

Genovese Boss, 19 Others Arrested for Various Crimes

Age is no obstacle when it comes to running a business, especially when it’s a Genovese crime family business.  Apparently it’s no obstacle to getting arrested either.  Matty “the Horse” Ianniello, a longtime Genovese capo, knows the lesson as well as anyone.  On Thursday, July 28, federal agents and local police arrested Ianniello and 19 other alleged members and associates on extortion, loansharking and other charges.  Ianniello, 85, who at one point allegedly served as acting family boss following the conviction of Vincent “the Chin” Gigante, was still active.  “Don’t let age fool you,” said FBI Agent Matt Heron.  “He’s still an influential player in the Genovese family.”


Former Benefits Fund Manager Sentenced for Embezzlement

Robert Cataldo couldn’t stay out of prison forever.  Back in August 2003, the ex-finance director for the health and retirements funds for the American Federation of Television and Radio Artists, had pleaded guilty in New York for embezzling $1.36 million from the funds.  Nearly two years later, on Thursday, July 21, he got his due from U.S. District Judge Naomi Reice Buchwald:  a 37-month prison sentence, plus mandatory restitution and two years’ probation upon release.  Cataldo was responsible for financial and accounting processes.  After his arrest, fund trustees announced they had commissioned a study by independent auditors to identify and implement procedures to prevent future thefts of this sort.  (Daily Variety, 7/22).  

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