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.

Transportation Union Secretary-Treasurer in New Jersey Charged; Pleads Guilty

UTU logoAt least Kevin McKnight didn't pretend to be innocent. McKnight, formerly secretary-treasurer of United Transportation Union Local 1390, was charged in U.S. District Court for the District of New Jersey on November 17 with embezzling about $68,000 in funds from the Laurence Harbor, N.J. (Middlesex County) union, which represents road and yard workers for Norfolk Southern and Conrail. He then pleaded guilty and agreed to make full restitution. McKnight faces up to five years in prison and a $250,000 fine. The charge and guilty plea follow an investigation by the Labor Department's Office of Labor-Management Standards.

Why is GM Spending Millions to Re-Hype the Chevy Volt?

In the words of Yogi Berra, it looks like déjà vu all over again as General Motors plans to "relaunch" the Chevy Volt. Just in case you missed the first rollout that saw certain financial news networks dedicate loads of airtime to help GM build the hype surrounding a vehicle that was to be a savior for GM as support was garnered for a taxpayer bailout and subsequent IPO, we now get a second take on the failed first production.

What’s Behind Eastwood’s Super Bowl Ad?

It is mostly unanimous that Clint Eastwood's Super Bowl ad appearance was a stirring and emotional tribute to America and Detroit. The ad was heartfelt, despite the fact that bailed out Italian-owned auto company, Chrysler, paid for it. Unless NBC offered some significant discounts to their ad rates, the ad cost Chrysler about $14 million. Considering the political nature of the ad and the fact that Chrysler vehicles were not touted in the ad, I must ask the cynical question; what's in it for Italian-owned Chrysler?

GM’s Dubious Super Bowl Ad Claims

Some very humorous (if not cost-effective) ads were exhibited by General Motors during this year's Super Bowl game. GM continues to freely spend its stockpile of taxpayer supplied cash reserve as it even aired a spot touting the Chevy Volt. At a cost of $3.5 million for a 30 second spot the expense equals about 15% of the total revenues GM brought in during the entire month of January for the Volt when sales fell to a dismal level of 603. What is the reasoning behind spending so much to advertise a vehicle that sells in such small numbers and is not profitable if not political? But the ad that may lead to more controversy than the Volt folly was the one in which GM claims their trucks are more dependable than Ford's; a claim that is highly debatable and not backed by studies at Consumers Reports (CR).

UAW Weighs in on GM's “No-Strike Clause”

UAW strike photoI recently questioned the existence of a binding "no-strike clause" that the media reported on back when General Motors was making a plea for its taxpayer-funded bailout. The claims were that the UAW could not strike at GM or Chrysler until 2015. UAW Communications Coordinator, Tom Brune, has responded and gave a bit of clarification as to what the so-called no-strike clause actually means.

New York Thruway Employees Counsel Charged with $200K+ Theft

New York Thruway logoKevin Clor's intentions may have been good, but members of the union he represented might not be impressed. Clor, formerly general counsel for New York State Thruway Employees Local 72, was indicted in Manhattan state court on January 25 on charges of embezzling more than $211,000 from the Teamsters-affiliated union, which represents some 2,500 toll collectors and other Thruway employees. Working out of his Buffalo home office, the defendant allegedly used his position to generate phony receipts enabling him to receive funds from two separate union accounts. "Instead of representing their best interests, (Clor) now stands accused of violating their trust and using his position to enrich himself illegally," said District Attorney Cyrus Vance Jr. Clor has pleaded not guilty and is free on $75,000 bail.

What's Behind Lutz’s Chevy Volt Tirade?

Bob Lutz & VoltWell-respected car guy and General Motors supporter, Bob Lutz, posted a piece on Forbes that attacked "right-wing" criticism of the Chevy Volt. With all due respect and noting that I have nowhere near the credentials of Mr. Lutz, I feel it appropriate to respond to the ridiculous defense that we have seen of a vehicle that is costing taxpayers billions of dollars while offering little in return. I also have some questions of my own for Mr. Lutz and GM.

Musicians Secretary-Treasurer in Illinois Charged; Pleads Guilty

ViolinistOn November 15, Mary Lynn Otten, former secretary-treasurer of American Federation of Musicians Local 26, was charged in U.S. District Court for the Central District of Illinois with filing false financial information on behalf of the Peoria union. She then pleaded guilty. The charge and guilty plea follow a probe by the Labor Department's Office of Labor-Management Standards.

Missouri Rail Union Official Sentenced for Wire Fraud

UTU logoOn November 14, Charles McDaniel, former general chairman of United Transportation Union General Committee of Adjustment 341, was sentenced in U.S. District Court for the Western District of Missouri to five years probation and ordered to pay $68,365.62 in restitution and a $100 special assessment. McDaniel had been charged in April with wire fraud in the theft of $44,889.62 from the St. Joseph, Mo.-based union and another $36.629.29 from Burlington Northern Santa Fe Railroad, pleading guilty immediately afterward. The actions follow a probe by the U.S. Labor Department's Office of Labor-Management Standards.

AFSCME Local Official in Michigan Sentenced for Records Fraud

AFSCME logoOn November 14, Perry Taylor, former vice president of American Federation of State, County and Municipal Employees Local 1820 in Pontiac, Mich., was sentenced in U.S. District Court for the Eastern District of Michigan to two years probation and ordered to pay $5,897.60 in restitution and a special assessment of $25 for aiding and abetting union financial records fraud. He had pleaded guilty in July. The sentencing follows an investigation by the U.S. Labor Department's Office of Labor-Management Standards.

Iowa AFGE Secretary-Treasurer Sentenced for Embezzlement

AFGE logoAnn Kelly can be thankful she paid back what she took. On November 16, Kelly, formerly secretary-treasurer of American Federation of Government Employees Local 2814, was sentenced in U.S. District Court for the Southern District of Iowa to three years probation and six months home confinement for embezzling $33,296.28 in funds from the Council Bluffs union. She also was ordered to pay a $5,000 fine and a $100 special assessment. The retired federal railroad inspector had pleaded guilty to one count of wire fraud back in August for stealing the money during 2002-07 to pay off credit cards and help family members. Kelly pleaded for leniency, stating that she had paid the money back after dipping into her retirement savings. The sentencing follows a probe by the U.S. Labor Department's Office of Labor-Management Standards.

Appeals Court Upholds New National Mediation Board Rule

Northwest Airlines strikeOne of the defining features of union activism during the Obama years has been a heavy reliance on federal agencies and courts to do things that Congress isn't likely to do, especially now that Republicans hold a majority in the House. Sometimes merely waiting for the right ruling can pay off. On December 16, the U.S. Circuit Court of Appeals for the District of Columbia ruled 2-1 that the National Mediation Board (NMB), an independent body overseeing labor relations in the railroad and airline industries, had the authority to issue a rule change making it easier for unions to win representation elections.

Was UAW No-Strike Clause Another GM Bailout Deception?

Back during the days of General Motors' bankruptcy proceedings, media reports cited the many "sacrifices" made by the politically favored UAW. I have long wondered what these many sacrifices were, as UAW members seem to be doing pretty well since the GM bankruptcy. One such "sacrifice" was a supposed agreement that the UAW could not go on strike at GM until after 2015, as mentioned in this Bloomberg piece, and accepted as fact by all media sources. I questioned this assertion in a piece I wrote in December of 2010, but as has been the case with much of the coverage of GM, the potential GM deception was left unchallenged by auto journalists and the mainstream media. Recent reports of a strike authorized by GM UAW workers in Kansas now raise the question of if my suspicions were correct that there are no binding agreements to prevent strikes at GM plants.

Ohio Glass Workers Local Secretary-Treasurer Indicted for Theft

GlassmakingOn November 9, William Geisler, former secretary-treasurer of Glass, Molders, Pottery, Plastics and Allied Workers International Union Local 45, was indicted in Franklin County (Ohio) Court of Common Pleas on one count of felony theft in the amount of $4,295 from the Columbus union. The indictment follows a probe by the U.S. Labor Department's Office of Labor-Management Standards.

Secretary-Treasurer of Pennsylvania Transportation Local Charged

Transit busOn November 9, Derek Klingman, former secretary-treasurer of United Transportation Union Local 1006, was indicted in U.S. District Court for the Southern of Pennsylvania for embezzling $9,354.84 in funds from the Finleyville, Pa. (near Pittsburgh) union. The charge follows a probe by the Labor Department's Office of Labor-Management Standards.

Minnesota CWA Local President Files Alford Plea in Theft Case

On November 4, Michelle Jean Nelson, ex-president of Communications Workers of America Local 7272, entered an Alford plea in Polk County (Minn.) Circuit Court to felony theft by false representation in an amount between $1,000 and $5,000 from the Erskine, Minn. (near Grand Forks, N.D.) union. An Alford plea is a guilty plea, but one in which the defendant does not admit committing the alleged act, but instead concedes that the evidence for a conviction is sufficient beyond a reasonable doubt. Nelson had been charged in March. The charge and Alford plea follow an investigation by the U.S. Labor Department's Office of Labor-Management Standards.

Former UAW Officers at Detroit-Area GM Truck Plant Sentenced

UAW logoSometimes the unfinished business of a strike can take years to resolve. In the case of Donny Douglas and Jay Campbell, it was close to 15 years. Douglas and Campbell, each a former officer with United Auto Workers (UAW) Local 594 in Pontiac, Mich., were sentenced in Detroit federal court on December 19 for conspiracy to commit extortion and violate the Taft-Hartley Act. The pair had used their bargaining leverage to extend a strike in 1997 against General Motors by telling GM negotiators if they didn't hire Campbell's son and the son of another UAW official for high-paying jobs, the strike would continue. Douglas received 18 months in prison, while Campbell received 12 months and a day in prison.

Will GM's Akerson Come Clean on the Chevy Volt?

Akerson and VoltGeneral Motors' CEO, Dan Akerson, is scheduled to testify at congressional hearings on the NHTSA delay in reporting Chevy Volt fires. GM and the government agency waited about five months to report an incident involving a Volt which erupted in flames weeks after a crash-test. Up to this point, Akerson has not exactly been honest about the Volt; can we now expect him to come clean?

Postal Workers Ex-Treasurer in Georgia Sentenced for Theft

Postal Workers logoOn November 1, Bobby Harrison, former treasurer of American Postal Workers Union Local 79, was sentenced in U.S. District Court for the Northern District of Georgia to six months in prison, three years of supervised probation and 300 hours of community service for embezzling $21,737.11 in funds from the Gainesville, Ga.-based union. He also was ordered to pay $15,159.77 in restitution and a $100 special assessment. Harrison pled guilty in August. The guilty plea and sentencing follow a joint investigation by the U.S. Labor Department's Office of Labor-Management Standards and the U.S. Postal Service's Office of Inspector General.

Chicago Teamsters Vice President Charged with Embezzlement

TrucksOn November 1, John Gianonne, former vice president of International Brotherhood of Teamsters Local 706 in Chicago, was charged in U.S. District Court for the Northern District of Illinois with an information count for embezzlement of $11,900 in union funds. The charge follows an investigation of the Labor Department's Office of Labor-Management Standards.

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