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.

Chicago Boss Sentenced to 33 Months for $470,000 Theft

U.S. Dist. Judge Matthew F. Kennelly (N.D. Ill., Clinton) sentenced Frank B. Zeuberis, ex-boss of Laborers' Int'l Union of N. Am. Local 5 in Chicago Hts. Nov. 9 to 33 months in prison for embezzling more than $470,000 in union funds for himself, his wife, and a reputed mob lieutenant, James A. DiForti, he installed in a top local office. Kennelly also ordered the Ind. resident to pay restitution of $473,106. As president and business manager of Local 5, Zeuberis gave himself, his wife, and DiForti unauthorized and fraudulent salary increases, bonuses, and vacation. In pleading guilty to a federal racketeering charge in June, Zeuberis also admitted he solicited $5,000 to appoint a union member as a business agent. His wife was not charged. DiForti died last year. [Chi. Trib. 11/11/01]

New Details on New York Witness Tampering Case

As reported in the last the UCU, Matthew J. Downey, lead operator for Int'l Union of Elevator Constructors Local 1 in N.Y.C., was indicted Oct. 30 for witness tampering and obstruction of justice. The case is before U.S. Dist. Judge David G. Trager (E.D.N.Y., Clinton).  The U.S. Atty.'s Office for the E.D.N.Y. has provided the UCU with an July 25 affidavit of FBI Special Agent Joseph Bowen written in support of an application for an arrest warrant. It outlines troubling details on these alleged criminal acts.

New York Local Probed for Election Law Violations

Service Employees Int'l Union Local 32B-32J in N.Y.C. is being investigated for possible violations of a city campaign finance law in its political action efforts.  A subpoena was served Nov. 13 on Local 32B-32J by the office of Manhattan Dist. Atty. Robert M. Morgenthau. Local president Michael Fishman said officials were asked to provide information related to the local's "broad-based political action program" to support candidates in recently concluded city elections.

The investigation was apparently prompted by dissident Paul Pamias's Oct. 12 letter to Morgenthau's office. As previously reported in the UCU, Pamias told Morgenthau that the local was violating city law by "turning the union hall into a campaign headquarters" and compelling staff members to donate personal and vacation days to work on the losing mayoral campaign of city Public Advocate Mark Green (D), whose candidacy the local had endorsed.

Washington Union Must Repay $180,000 to Teachers

Thurston County (Wash.) Superior Court Judge Gary Tabor clarified a ruling Nov. 15 granting a state-sought injunction against the Wash. Educ. Ass'n to end the union's practice of using funds from non-members for election expenditures. The injunction requires WEA officials to refund $47 by Jan. 15 to approximately 4,000 teachers who pay fees to the union. WEA is also be required to document its election-affecting contributions and expenditures from general funds and must provide an advance reduction to non-members in the future. WEA sought a "memorandum of understanding," but the Tabor agreed with the state that a permanent injunction was necessary to assure that future violations could be addressed by contempt of court charges.

The ruling is the second part of a decision that Tabor issued in Aug. in which he fined WEA $200,000 for violating campaign finance disclosure laws, plus $200,000 in punitive damages for WEA's intentional violation of the state law. WEA will also be required to pay legal expenses for the state, estimated to be over $100,000.

Denver Boss Charged on 40 Counts

Bobby R. 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.  The case has been assigned to U.S. Dist. Chief Judge Lewis T. Babcock (D. Colo., Reagan).

Second Albany Boss Admits Theft

Daniel Vallee, ex-boss of Civil Service Employees Ass'n Local 316 in Albany, pled guilty Nov. 9 before U.S. Dist. Judge Thomas J. McAvoy (N.D.N.Y., Reagan) to embezzling $19,300.09 in union funds. Vallee admitted that from May 1988 until Jan. 2000 he wrote checks to himself drawn on the local's account. As president, Vallee was one of two people authorized to sign the checks. The other person, Nancy Groome, ex-secretary-treasurer of the local, cosigned some of the checks but Vallee admitted he forged her name on a majority of them. In some instances, Vallee also received excess reimbursements and kept the funds. He spent the embezzled funds on personal expenses such as his mortgage, car repairs, credit card bills, and gifts for others.

New York Brothers Admit to Mob and Union Payoffs

Guisseppe "Joseph" Scalamandre and his brother, Fortunato "Fred" Scalamandre pled guilty Nov. 14 to conspiring to make payoffs to the Luchese organized crime family and to the union boss of three locals in N.Y.C area. The two construction company owners were charged with conspiring between Jan. 1991 and Oct. 1998 to  pay members of the Luchese organized crime family, including the former acting boss, Alphonse D'Arco, and former underboss, Anthony "Gaspipe" Casso, approximately $40,000 a year, in order to buy labor peace. They admitted agreeing to pay unidentified bosses and employees of Laborers' Int'l Union of N. Am. Local 66, Blasters, Miners & Drill Runners Union Local 29, and Int'l Union of Bricklayers & Allied Craftworkers Local 1 to avoid contributing to union benefit funds and paying union dues on behalf of their employees, and to unlawfully influence the bosses and employees in other union-related matters affecting their companies.

Wisconsin Boss Embezzled from Local and Bank

The UCU has obtained new information from the U.S. Attorneys' Office in Milwaukee on previously reported union embezzlement. On Oct. 26, U.S. Dist. Judge Charles N. Clevert, Jr., (E.D. Wis., Clinton) sentenced Shawn D. Drake to 21 months in prison, 3 years probation, and ordered to pay $21,376 in restitution. Drake was secretary-treasurer of the Paper, Allied-Indus. Chemical & Energy Workers Int'l Union  Local 736 in Green Bay from Oct. 1999 to Apr. 2000. Drake embezzled about $10,891 in union funds by issuing unauthorized checks to himself and embezzled another $6,425 by converting to his own use 3 union dues checks that Drake's employer had issued to the local. Further, Drake obtained $3,956 from his bank by cashing yet another unauthorized union check which later bounced. Drake was indicted on Feb. 14 and later pled guilty.  Clevert enhanced Drake's sentence because he had abused a position of trust in committing these crimes.

Alleged Associate of Boston Boss in Custody

Frank Rossi, a career criminal with close ties to embattled Boston Teamsters boss George W. Cashman was arrested on drug charges Nov. 9 and sources said the arrest could signal a major break in the racketeering probe against the union boss. Rossi was just released from a N.J. halfway house in Oct. on a different charge. The slightly built and balding Rossi, dressed in a checkered, untucked button-down shirt, jeans and sneakers, was arraigned in U.S. District Court on one count of distributing cocaine after a wired informant tape recorded at least two purchases from him in Nov. U.S. Magistrate Judge Charles B. Swartwood III (D. Mass.) held Rossi without bail until a Nov. 14 probable cause hearing as well as a hearing on his dangerousness and risk of flight.

South Carolina Rioters Get Only Suspended Jail Time

Five S.C. unionists, known as the "Charleston Five," have pled no contest to low-level misdemeanor charges of participating in a "riot, rout, or affray," ending the possibility of prison terms.  Judge Victor Rawl of the S.C. Circuit Court, Ninth Circuit, sentenced all five to 30 days in jail but suspended the sentences upon the payments of $309 fines and fees.  Rawl sentenced Elijah Ford, Ricky Simmons, and Peter Washington on Nov. 13 and Kenneth Jefferson and Jason Edgerton on Nov. 7. The five are members of the Int'l Longshoremen's Ass'n, were charged with rioting and conspiracy to riot following an informational picket Jan. 20, 2000, at the Port of Charleston. The unionists were protesting the use of a nonunion stevedoring company to unload a Danish freighter. Although police had arrested eight members on misdemeanor charges, S.C. Atty. Gen. Charlie Condon intervened and raised the charges against five of the dockworkers to rioting, which is a felony that carries a prison term of up to five years. Condon, who took over prosecution of the case, procured indictments from a grand jury, and a trial was scheduled for Nov. 14.

Florida Boss Charged with Racketeering, Embezzlement

South Fla. union boss Walter J. "Buster" Browne pled not guilty Nov. 3 to a 40-page federal indictment accusing him and his sister, Patricia B. Devaney, of running a racketeering scheme that milked more than $400,000 from the union he heads and four companies. Browne is president of the Nat'l Fed'n of Public & Private Employees (a.k.a., Marine Eng'rs' Beneficial Ass'n Dist. 1) headquartered in Fort Lauderdale, which was founded in 1968 by his father Charles "Chuckie" Browne. Devaney was union staffer for her brother.

The 22-count indictment alleges that starting in 1994, Browne and Devaney used their union posts to "dominate and control its operation for their personal gain." They are accused of engaging in a pattern of criminal activity consisting of mail fraud,  bank fraud, embezzlement, gambling, and unlawful labor practices.  Browne, wearing a plaid shirt and looking rumpled after a night in federal custody, was asked by U.S. Magis. Judge Barry Seltzer whether he understood the charges. "Yes, I do," said Browne, who also told reporters: "What's to say? I'm not gonna try my case in the newspapers ... unless you're on the jury."

International Staffer Admits $350,000 Embezzlement

Kerry J. Tresselt, ex-bookkeeper for the Int'l Ass'n of Bridge, Structural, Ornamental & Reinforcing Iron Workers, admit Nov. 8 that she embezzled more than $350,000 from a union job-training fund, the Nat'l Ironworkers & Employers Apprenticeship & Journeyman Upgrading Fund, and attempted to cover it up. She pled guilty  in U.S. Dist. Court in Washington, D.C., to three counts of embezzlement from an employee benefit plan and one count of conspiring to make false statements. The Va. resident admitted to illegally issuing checks to herself and others while working for the training fund set up by BSORIW with contributions from contractors. She agreed to make restitution and assist prosecutors in a continuing criminal probe of BSORIW.

San Francisco Staffer Charge with Union Theft

Robin Neither, ex-bookkeeper for Int'l Longshoremen & Warehousemen Union Local 10 in San Francisco, was indicted on two felony counts: embezzling union funds and falsifying official union records. Allegedly, Neither stole an unspecified sum of union funds for her own personal use. She also made false entries in the local's payroll register which was use to provide false information to the Dep't of Labor.

Neither pled not guilty before U.S. Magis. Judge James Larson who released her after she posted an unsecured $20,000 bond. Neither's next court appearance is Dec. 12 before U.S. Dist. Judge Phyllis J. Hamilton (N.D. Cal., Clinton). [DOL 10/16/01; USAO N.D. Cal. 11/7/01]

New Jersey Boss Indicted for $19,200 Theft
George Wright, Jr., ex-fin'l secretary of United Auto Workers Local 267 in  Union, N.J., was indicted Oct. 30, in U.S. Dist. Court for the Dist. of N.J. on one count of embezzling $19,206 in union funds. [DOL 10/30/01]

National Boss Ousted after Probe

Kenneth T. Lyons, the president of the Nat'l Ass'n of Gov't Employees, was removed from office Nov. 5 and permanently barred from participating in union activities after a union hearing on charges that he attempted to obstruct a state ethics probe by falsifying union records. Lyons, who served as NAGE president for 40 years, denied any wrongdoing after being charged in July with altering and destroying union records relating to a dozen or so meals he had with James Hartnett, undersecretary of the Mass. Div. of Admin. & Fin. Lyons was also accused of trying to "involve other union officers in a scheme to thwart an investigation of Hartnett and of attempting to mislead state investigators."

Indicted Buffalo Boss Dies

Frank H. Ervolino, a corrupt ex-Buffalo union boss who was under federal indictment for union embezzlement, died Nov. 2 in a Fla. hospital after a brief illness. Ervolino, 80, was the longtime head of the now defunct AFL-CIO Hospital & Nursing Home Council, which had 7,000 members and served as an umbrella union for area hotel, restaurant and laundry employees. He also was ex-president of the Laundry & Dry Cleaners Int'l Union, based in Pittsburgh.

He and his wife, Anna May, an ex-union employee, came under scrutiny in the early 1990s for alleged irregularities in union fund balances. In May 2000, a federal grand jury indicted both Ervolinos, charging them with stealing more than $235,000 in union funds while they paid themselves some of the nation's highest labor salaries and left their unions in financial ruin. The felony indictments against the Ervolinos came a year after a court-appointed monitor of the Hotel Employees & Restaurant Employees Int'l Union found the couple guilty of embezzling funds from two Buffalo unions while they worked half-days, at most, and took four-month yearly Fla. vacations.

Michigan Local Loses ULP Coercion Case

Hundreds of Brighton Interior Systems employees who union bosses coerced into joining the United Auto Workers  have won a settlement in an unfair labor practice case pending against the union that requires the revocation of all illegally obtained membership and dues deduction authorization cards.  The settlement of federal class-action charges, filed by Brighton employee Erik Daly with the Nat'l Labor Relations Bd. against UAW Local 599 and the Int'l UAW, stipulates that all dues checkoff authorization/membership cards obtained at Brighton since Aug. 5, 2001 are invalid. The union must start over, this time properly notifying employees of their rights and allowing them to make a voluntary decision about whether or not to join the union.

"This settlement forces UAW officers to account for their systematic bullying of Brighton workers," said Stefan Gleason, of the Nat'l Right to Work Legal Def. Fdn., which negotiated the settlement on behalf of the Brighton employees.

California Boss Admits Extortion for Job Referrals

Hank Van Heyningen, president of Christian Labor Ass'n Local 17 (Dairy Union) in Chino, Cal., pled guilty Oct. 23 to one federal count of extortion by use of wrongful fear of economic loss. The boss admitted extorting money from union members in exchange for job referrals. He also served as business agent from 1990-2001. As an union officer, Van Heyningen had control over which dairy employees would be sent out to union jobs at local dairies. He admitted that for the last 10 years he was regularly extorting money from members in return for work. A member who received a full-time job with regular daylight hours was charged $800 to $1,500 by Van Heyningen. He faces up to 20 years in federal prison. U.S. Dist. Judge Virginia A. Phillips (C.D. Cal., Clinton) scheduled sentencing for Jan. 7, 2002. [DOL 10/23/01; USAO C.D. Cal. 10/23/01]

Boss Can't Make Bail; Sits in Illinois County Jail

An ex-firefighter union boss, accused of stealing some $350,000 from two union funds, could not come up with the $100,000 needed to make his bail on Oct. 30. So after a judge declined Patrick Stiles' request for a lower bail, the boss was taken to the county jail.  Kane County (Ill.) Associate Circuit Court Judge Robbin Stuckert subsequently reset bail at $50,000 on Oct. 31, but Stiles still remained in the Kane County Correctional Ctr. Stuckert declined a request by Stiles' attorney, Fred M. Morelli Jr., to release him on his own recognizance.

Stiles turned himself in after he was indicted on four felony counts in connection with the theft of more than $100,000 from Aurora Firefighters Local 99 and more than $10,000 from the Aurora Firefighters Relief Ass'n. At the bond hearing, Aurora Police investigator Mike Tierney said a 9-month probe found that Stiles stole about $350,000 from both groups. He pled not guilty. Circuit Court Judge Timothy Q. Sheldon set a Nov. 16 status hearing.

Michigan Treasurer Gets 18 Months for $152,700 Theft

U.S. Dist. Judge David M. Lawson (E.D. Mich., Clinton) sentenced union embezzler Tamara Miller Oct. 22 to 18 months in federal prison and ordered her to pay $152,724 in restitution. The ex-treasurer stole the funds from United Ass'n of Plumbers & Pipe Fitters Local 85 in Saginaw, Mich. Miller pled guilty on June 29. Lawson also ordered Miller  to serve 36 months of supervised release after prison plus pay a $100 fee.

Boston Union Wants Secret Corruption Report Disclosed

The Board of the Mass. Bay Trans. Auth.'s Retirement Fund abruptly canceled its monthly meeting Oct. 19 after dozens of Boston Carmen's Union members invaded the session demanding the release of a report examining executive director John J. Gallahue Jr.'s acceptance of apparent kickbacks from a convicted racketeer. "The members paid for the report. We ought to be able to see what's in it," said John Clancy, an MBTA bus driver.

But the Board refused to allow a vote on the issue, which was fiercely debated for nearly two hours before several members left the meeting, said James E. Lydon, a Broad member and president of Carmen's Union Local 589. Lydon said it is time to end the secrecy in the $2 billion Fund's activities. "The whole place needs an enema," said Lydon. "We want full disclosure. No more secrets here."

Syndicate content