Union Corruption Update

Since 1997, NLPC has become a high-profile and credible source for information about America’s labor unions through our publication Union Corruption Update.

The newsletter has been referenced in many other media outlets including the New York Times, Chicago Tribune and National Journal.

EEOC Threatens Union With Prosecution

In response to religious discrimination charges brought by Ohio teacher Dennis Robey, the Equal Employment Opportunity Comm'n threatens to prosecute the Nat'l Educ. Ass'n on May 20, if the union does not  stop forcing teachers to endure annually a burdensome and invasive process before respecting their religious objections to union affiliation. With the help of Nat'l Right to Work Legal Def. Fdn. attorneys, Robey brought charges against NEA and its local affiliates after they refused to honor his religious objection to supporting the union because it promotes pro-abortion, pro-homosexuality positions and constantly attempts to interfere with parental rights.

"The NEA union's illegal scheme is intended to force teachers of faith to shut up and pay up," said NRTWLDF vice president Stefan Gleason. "The EEOC's action further  underscores that the nation's largest teacher union is systematically persecuting people of faith."

Davis, Ansara Sentenced; Pay $1,345,000 in Restitution

The UCU has now learned that the two last unaccounted for defendants in the Teamsters money-laundering scandal were sentenced in Mar. 2002, at two hush hush court hearings, which that have gone unreported by major daily newspapers. When the UCU previously reported that scandal figure Jere Nash was sentenced on Apr. 9, it incorrectly reported that the two other defendants who pled guilty with Nash, had not yet been sentenced. Both were sentenced some 54 months after they pled guilty on Sept. 18, 1997. The three engaged in a series of schemes which led to the embezzlement of some $885,000 from the Int'l Bhd. of Teamsters and to $538,100 in illegal campaign contributions to the failed 1996 reelection campaign of expelled IBT president Ron Carey.

Trusteeship Illegal: $400,000 Punitive Award Upheld

The U.S. Court of Appeals for the Sixth Circuit upheld a jury's $400,000 punitive damages award against the United Steelworkers of Am. on Apr. 18. The court ruled that USWA unlawfully imposed a trusteeship and removed the officers of Local 5644 in Toronto, Ohio. Further, the court held that the district court properly assessed compensatory damages of $9,406 against USWA plus agreed with U.S. Dist. Judge Algenon L. Marbley (S.D. Ohio, Clinton) that USWA's actions were sufficiently "reprehensible" to warrant the jury's large punitive award. Allegedly, the plaintiffs, Local 5644 officers Charles Argentine, Clarence Wingo, and John Gooch, were removed to silence their opposition to a USWA-negotiated collective bargaining agreement.

Indicted Boss: My Attorney Said It Was Okay

Union boss Jacob "Jake" West, who spent thousands on personal meals, liquor, and golf trips, is claiming he did so only because his attorney said such expenditures were legitimate union expenses. That was the argument of West's new attorney, Michele Roberts, at a May 7 pretrial hearing before U.S. Dist. Judge Thomas F. Hogan (D.D.C., Reagan). West, ex-president  and  current president emeritus of the Int'l Ass'n of Iron Workers, allegedly embezzled some $50,000 from the Washington, D.C., based union during his 12 years as president. Roberts was previewing arguments that may be used in West's trial, which is scheduled for this summer.

Ullico Board on Defensive; Fashions an "Investigation"

The scandal-scarred board of Ullico, Inc., appointed labor-friendly ex-Ill. Gov. James R. Thompson (R) Apr. 29 to "review" the insider trading scheme that allowed some directors of the union-dominated insurance company to make hundreds of thousands in tainted profits. To see just how labor-friendly, visit http://www.ipsn.org/ullico/thompson_ullico.htm, for a picture from when Thompson was governor. It shows Thompson with Robert A. Georgine, now the Ullico president, who helped select Thompson for the lucrative investigatory job and who Thompson is supposed to be investigating. Also pictured is Angelo Fosco. The deceased Fosco was president, as was his father, of the Laborers' Int'l Union of N. Am from 1975-1993. The government's draft 1994 racketeering suit that led to a quasi-government takeover of LIUNA, stated that Fosco "was an associate of the Chicago [La Costa Nostra] family" and accused him of racketeering acts related to extortion of LIUNA members. Also in the picture is deceased plumbers and AFL-CIO boss Edward Brabec.

Boss Stole $52,000 from Illinois Local

John M. Cornwell pled guilty Apr. 29 to one count of union embezzlement and agreed to pay restitution of $52,009.33. Cornwell was financial secretary-treasurer for Sheet Metal Workers Int'l Ass'n Local 479 in Peoria, Ill., from Jan. 1998 to Feb. 2001. During the plea hearing in open court, he admitted to converting more than $50,000 in local funds to his personal use from Dec. 18, 1998 to Jan. 20, 2001.

Cornwell confessed that he wrote and negotiated some 62 unauthorized Local 479 checks to himself and to his wife. He signed both his name and Local 479 president Sharon Ball's name to the checks without Ball's knowledge or permission. The U.S. Atty's Office for the Cent. Dist. of Ill. told the UCU that Cornwell spent the funds on routine living expenses. U.S. Dist. Judge Joe B. McDade (C.D. Ill., G.H.W. Bush) scheduled sentencing for Aug. 23. Cornwell currently a resident of Lenoir City, Tenn. [USAO C.D. Ill. 4/30/02; DOL 4/29/02]

Grand Jury Still Probing Michigan Local

A federal grand jury has subpoenaed United Auto Workers Local 594 in Pontiac, Mich., seeking the minutes or audio records from membership meetings held in Sept. 1997, months after the local ended a contentious 87-day strike at a Gen. Motors Corp. plant. The strike has been under investigation for years by federal officials, who suspect that bogus overtime for union bosses and jobs for their relatives and friends were illegally used to settle the strike.

At the 1997 meetings in question, angry workers reportedly confronted their union bosses about the strike and allegations of improper inducements to settle it. The grand jury was convened and began looking into the strike and related issues at Local 594 as early as Jan. 2001. The subpoena requested that Local 594's custodian of records testify before the grand jury May 8. The Dep't of Labor and the FBI have also investigated whether Local 594 president Larry Trandell made a deal with GM to delay a $35,000 overtime payment to him until after his May 1999 election, when he defeated Gene Austin.

Judge Suggests Aging Crooks Retire

"I suggest at your age . . . you ought to be thinking about getting out of that life, worrying about who's coming knocking at your door putting handcuffs on you." That was the advice of U.S. Dist. Court Justice I. Leo Glasser (E.D.N.Y., Reagan) to two septuagenarians at their May 8 sentencing: John "Johnny Green" Faraci, 79, reputed Bonanno soldier, and Jerome Brancato, 74, reputed Gambino soldier. The two and a third reputed "wiseguy," Gambino capo Louis "Big Lou" Vallario, 60, pled guilty and were sentenced to probation for their roles in conspiring to bribe a union boss of Serv. Employees Int'l Union Local 32B-32J in N.Y.C. There have been nine guilty pleas in the case, plus landlord Abe Wieder and union delegate Ismet Kukic await trial.

Glasser grew annoyed at attempts to downplayed the trio's roles. When Faraci's attorney, Vincent Romano, noted that his client, whose criminal record spans nearly 25 years, had fought in WWII's Battle of Normandy and won the Bronze Star, the unimpressed 78-year old judge snapped, "So did I."

Missouri Boss Sentenced for $18,500 Embezzlement

U.S. Dist. Judge Ortrie D. Smith (W.D. Mo., Clinton) sentenced admitted union embezzler  J. Steven Call Apr. 23 to five years probation, 250 hours of community service and ordered him to make full restitution of $18,536. Call was the president of Am. Fed'n Musicians Local 150, which represented entertainers in Mo., Kan., Okla., and Ark. Call pled guilty Nov. 29 and admitted embezzling funds from the Branson, Mo., based local .

His scheme ran from Apr. 1997 to Mar. 1999. The local was first placed in trusteeship by the int'l union due to financial difficulties in 1995. Then as the the trusteeship was ending, int'l trustee Theresa Gafford made a poor judgment and groomed Call to run the local. He was elected president and secretary-treasurer in Apr. 1997. In an apparent cost-cutting move, Call relocated the local's office to his leased house in May 1997. He received no salary from the local, but the local's board agreed to pay him $100 for rent and utility-related costs of running the local out of his home plus any expense he incurred in the course of his work for the local.

Denver Boss Ordered to Pay $18,000 in Restitution

U.S. Dist. Judge Lewis T. Babcock (D. Colo., Reagan) sentenced union embezzler Bobby R. Putnam Apr. 23 to five years probation, including six months in home detention with electronic monitoring, and was ordered to pay $18,026.95 in restitution. Putnam, ex-secretary-treasurer of Communications Workers of Am. Local 14708 (a.k.a., Denver Mailers Union No. 8) in Denver, was charged Oct. 31 in a 40-count indictment with embezzling $7,808.26 and falsifying union
records. He later pled guilty. The reason for the $10,218.69 difference between the indictment and the restitution amounts was unavailable.

Illinois Boss Pleads Guilty to Embezzling $13,000

Wesley J. Sharp, ex-financial secretary-treasurer of Paper, Allied-Indus., Chem. & Energy Workers Int'l Union Local 647 in Des Plaines, Ill., pled guilty May 6 to a one-count of embezzling $13,062.86 in union funds. According to the plea agreement, Sharp wrote 53 unauthorized checks on the local's checking account between Mar. 1, 1996 and Dec. 29, 1997 totaling $13,062.86. Each check required two signatures of union officers.  On 49 checks, Sharp forged the signature of a second  union officer before negotiating the check. On the other four checks, he simply left off the second signature but was still able to cash the check. He made all the checks payable to himself and converted the union's funds to his personal use.

Of the embezzled amount, $9,362.86 remains outstanding. Sharp agreed to reimburse $5,000 to Local 647's corruption insurance company, Fidelity & Deposit Co. of Md. He also agreed to make further restitution of $4,362.86 to Local 647.  U.S. Dist. Judge William J. Hibbler (N.D. Ill., Clinton) set sentencing for July 29. [USAO N.D. Ill. 5/9/02; DOL 5/6/02]

Magistrate in Florida Embezzlement Case Rules She Has No Impermissible Conflict

As previously reported, over the Dep't of Justice' strenuous objections, U.S. Magis. Judge Linnea R. Johnson (S.D. Fla.) ruled in Mar. 2002 that ex-U.S. Atty. Thomas E. Scott's prior government service did not create a conflict of interest that would bar him from representing indicted union boss Walter J. "Buster"  Browne. Johnson allowed Scott to represent Browne in his upcoming criminal trial on racketeering and embezzlement charges. Browne pled not guilty Nov. 3 to a 40-page federal indictment, brought by Scott's former U.S. Atty.'s Office, accusing Browne and his sister, Patricia B. Devaney, of running a racketeering scheme that milked more than $400,000 from his union and four companies. Browne is president of the Marine Eng'rs' Beneficial Ass'n Dist. 1 (a.k.a., Nat'l Fed'n of Public & Private Employees) headquartered in Fort Lauderdale.

LMRDA Victory for Ex-Kansas City Boss

The U.S. Court of Appeals for the Eighth Cir. ruled Apr. 24 that an ex-officer of Int'l Bhd. of Painters & Allied Trades Dist. Council 3 who won a Nat'l Labor Relations Bd. action against his union over his job loss can additionally bring a civil action against the union and its officers alleging violations of the the Labor Mgmt. Reporting & Disclosure Act of 1959. Reversing the U.S. Dist. Court for the W. Dist. of Mo.'s dismissal of Lonnie Gurley's LMRDA action on the ground that he had already been "made whole" by the NLRB's order that the union restore his lost earnings and benefits, the Eighth Cir., in an opinion by U.S. Cir. Judge Gerald W. Heaney (8th Cir., Johnson), held that Gurley did not have an "adequate opportunity" to litigate his LMRDA claim before the NLRB. The agency lacked jurisdiction over the claim, the court found, and was unable to award the full range of remedies available to a district court under the LMRDA.

Ohio Unionist Indicted on Pipebomb and Counterfeiting Charges

The State of Utah's Third Dist. Court has rejected union lawyers' attempts to dismiss a counter suit, brought by employees represented by Nat'l Right to Work Legal Def. Fdn. attorneys, which, as a result, calls into question the constitutionality of the fundamental union privilege known as monopoly bargaining.  In his ruling issued the week of April 29, Utah Judge Stephen L. Henriod allowed the employees to defend the constitutionality of Utah's Voluntary Contributions Act (VCA), a law intending to give union members the right to withhold union dues spent for political activities.  If the court refuses to uphold the VCA as constitutional, the court will consider the employees alternative argument that monopoly bargaining power--held in many locales by union  officials of the Utah Public Employees' Ass'n (UPEA) and Utah Education Association (UEA)--is unconstitutional.

Judge Allows ADA Suit Against Union to Proceed

U.S. Dist. Judge George Z. Singa (D. Me., Clinton) held Apr. 23 that an ex-paper mill employee can go forward with an Americans with Disabilities Act claim against Paper, Allied-Indus., Chem. & Energy Workers Int'l Union Local 1188 in Bucksport, Me., because of the local's "deliberate acquiescence" with the potentially illegal actions of the employer.  The U.S. Court of Appeals for the First Cir. has not yet considered whether a claim for deliberate acquiescence can be brought under either the ADA,  said Singa; but his decision to allow Joseph Greenier to proceed with an ADA claim against the union is "recognition that it is a plausible legal theory worthy of further factual development."

Boss Admits Stealing $271,800 Ontario Local

It's hard for Gordon Walsh to even consider forgiving his longtime friend, a man who turned against him and stole more than C$270,000 from the union he was heading. Walsh, president of the Canadian Union of Public Employees Local 32 and ex-president of Local 68, sat in the Ontario Court of Justice in Kitchener, Ontario, Apr. 26 as Harvey Holst, ex-Local 68 secretary-treasurer, pled guilty to pocketing a total of C$271,800 in union funds from Jan. 1989 to May 2000. The missing money was noticed in May 2000 after Local 68 amalgamated with two other unions representing outside municipal workers. Holst, who secretary-treasurer for 12 years, was arrested in July 2001.

Seven Bosses, Contractors Indicted in $10 Million Fraud

A Manhattan developer and several union bosses defrauded the N.Y. Metro. Transp. Auth. (i.e., taxpayers) and a landlord of more than $10 million by billing for phantom workers at inflated rates, according to an indictment unsealed Apr. 18 in U.S. Dist. Court in Brooklyn. Seven people, including developer Frederick Contini and Int'l Union of Operating Eng'rs Local 14 shop steward Morris "Mickey" or "Fat Boy" DiMinno, were charged in a 55-count fraud and money laundering indictment. Contini allegedly conspired with DiMinno and other union bosses to set up a shell company that billed MTA and the landlord, Zar Realty Mgmt., for non-existent elevator operators at MTA's new headquarters a 2 Broadway in Manhattan.

Cleveland Boss Gets 18 Months for $144,900 Theft

U.S. Dist. Judge Donald Nugent (N.D. Ohio, Clinton) sentenced Richard Adams Apr. 19 to 18 months in federal prison for stealing $144,939.46 in union funds and donations, including money collected for the family of a slain police officer. Adams, who was the treasurer of Int'l Ass'n of Fire Fighters Local 639 in Parma, Ohio, for 13 years, often told members that their money was safe and earning 13% interest in bank accounts. Instead, Adams looted the local's accounts for his own purposes and left the local $12,000 in debt when he was ousted in Dec. 2000.

Local 639 president Nick Kashi told Nugent that the local could have fulfilled dreams but for Adams. "Would we own a union hall today to hold our meetings, children's Christmas parties and other union-sponsored events to raise money for local charities and public relations events? The possibilities are almost endless. We will never know where our union could have been today," he said. Later Nugent told Adams, "The members will never be made whole. They had plans. They thought things were being done. This is really a black eye on the firefighters, even though they didn't have anything to do with it."

Ohio Boss Get 21 Months for $130,500 Gambling-Related Theft

After confessing that casino gambling on the Ohio River and in Las Vegas as well as sport wagering led him to embezzle $130,507 from the United Union of Roofers, Waterproofers & Allied Workers Local 86 in Columbus, Ohio, Robert D. King, Jr.,  was sentenced Apr. 17 to 21 months imprisonment and three years probation. He stole $88,757 from the local plus $41,750 from local's benefit funds. He was ordered to make full restitution. He pled guilty to two embezzlement counts Dec. 11 before U.S. Dist. Judge George C. Smith (S.D. Ohio, Reagan). King stole the money from Aug. 1999 to Jan. 2001 by writing himself checks from Local 86's general and apprentice-training accounts.

King served as the local's business manager and financial secretary for six years until the union ousted him in Jan. 2001. Local officials became suspicious because King's sloppy record-keeping. The int'l union audited the books and confronted King with numerous discrepancies. The case was then turned over to the Dep't of Labor. [DOL 4/17/02; Columbus Dispatch 12/12/01]

Feds Indict Minneapolis City Councilman & Union Boss

Stolen union money paid for plumbing work at property owned by Minneapolis City Councilman Joe Biernat (DFL), according to federal charges against Biernat, a boss of United Ass'n of Plumbers & Pipe Fitters Local 15 in Minneapolis, and the boss' brother. The indictments unsealed Apr. 18 allege that in 1999, Thomas J. Martin, ex-Local 15 business agent used $2,700 in union funds to pay for Biernat's plumbing work at the same time the council member and his colleagues were approving Martin's appointment to the city board that licenses plumbers. The specific charge is conspiracy to extort under color of official right in violation of 18 U.S.C. § 1951 (Hobbs Act). Biernat also was charged with making a false statement to the FBI, aiding and abetting union embezzlement, and mail fraud.

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