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.

Minnesota Postal Workers Local Secretary Charged with Theft

On August 16, Cherity Perez, former secretary-treasurer of American Postal Workers Union Local 631, was charged in Kandiyohi County (Minn.) District Court with felony theft of $1,240 from the Willmar-based union. The charge follows an investigation by the U.S. Labor Department's Office of Labor-Management Standards.

Corrections Union Treasurer in Massachusetts Resigns Following Allegations

Police officerLt. Roy Renaud until recently worked at a county jail. He's hoping he won't be an inmate. On September 23, Renaud, a 20-year veteran of Worcester County (Mass.) Jail and House of Correction, resigned his post in the wake of evidence implicating him in the theft of an unspecified sum of funds from the union where he serves as treasurer, New England Police Benevolent Association Local 275. His departure came three days after he was placed on unpaid administrative leave. So far, it's been a matter for internal affairs. "At this time we're still in fact-finding mode and determining whether it should be referred to an outside agency," said Jail Superintendent Shawn Jenkins, declining to comment on how the jail learned of the allegations. The union represents about 40 to 50 officers at the West Boylston correctional facility.

Federal Treasury Workers Local Official in Atlanta Charged

On September 20, Rebecca Mercer, former treasurer of National Treasury Employees Union Chapter 284, was charged in U.S. District Court for the Northern District of Georgia with 10 counts of wire fraud totaling $4,403.11 from the Atlanta-based union. The charge follows an investigation by the Labor Department's Office of Labor-Management Standards.

Carpenters Office Manager in Oregon Pleads Guilty to Theft

CarpentersOn September 19, Toni Lancaster, former office manager for Millrights & Machine Erectors Local 711, an affiliate of the United Brotherhood of Carpenters and Joiners, pleaded guilty in U.S. District Court for the District of Oregon to embezzling funds from the Portland union. Lancaster, a resident of the Portland suburb of Milwaukie, had been indicted in March 2010 for thefts totaling about $68,000. At the time, she pleaded not guilty. Sentencing is set for this January. The indictment and guilty plea follow a probe by the U.S. Labor Department's Office of Labor-Management Standards.

Detroit-Area School Principal Charged with Embezzlement

Teacher's deskTo some, Samuel Craig has been an excellent role model. But to prosecutors, and at least one member of his local school board, he's an embezzler. He may have a tough time avoiding the latter tag. On September 28, Craig, formerly assistant principal at Highland Park Community High School, near Detroit, was charged in 30th District Court, State of Michigan, with embezzlement from his union, the Highland Park Association of School Administrators, where he served as treasurer. Craig also was charged with using a fraudulent transaction device.

FBI Arrests 11 in Probe of Massive LIRR Disability Scam

doctor bribery photoThey might not have been Oscar-worthy performances. But the acting job by hundreds of Long Island Rail Road (LIRR) employees and their enablers was convincing enough to run a racket that could wind up costing U.S. taxpayers $1 billion or more. On October 27, FBI and New York State agents arrested 11 persons for operating a scheme by which retired workers at the heavily unionized LIRR allegedly visited doctors who would prepare phony medical histories, allowing retirees to receive outsized pension and "disability" checks, courtesy of the U.S. Railroad Retirement Board. One arrestee, in fact, was a former union president. The investigation was triggered by revelations a few years ago of unusually high rates of disability claims and awards. "This was a game where every retiree was a winner," said FBI New York bureau head Janice Fedarcyk.

Why Didn’t NHTSA Immediately Report Chevy Volt Fire?

Volt fire photoOver five months ago, a Chevy Volt that had been crash tested weeks earlier and was sitting in a government storage facility burst into flames. The story was just recently reported by news outlets like the New York Times, a source that certainly can not be accused of being on a right wing witch hunt to discredit electric cars. The Chevy Volt has been very controversial with questions raised regarding the rush to electrify America's auto fleet at the expense of taxpayers, particularly when the main player in the field is an entry of Government Motors. The latest question that has yet to be asked is, "why did NHTSA delay reporting the spontaneously combusting Volt?"

Michigan Utility Workers Local Financial Secretary Pleads Guilty

On August 11, Robert Cole, former financial secretary of Utility Workers Union of America Local 124, pleaded guilty in U.S. District Court for the Western District of Michigan to one count of embezzlement of union funds in the amount of $11,605.59, one count of filing a false report and one count of making false entries in union records. The union is located in Irons (Lake County), Mich. The guilty plea follows an investigation by the U.S. Labor Department's Office of Labor-Management Standards.

Steelworkers Treasurer in Florida Guilty to Theft; Sentenced

Steelworkers logoOn August 11, Dakota Wilson, former financial secretary of United Steelworkers Local 9-802, pled guilty in Circuit Court of Nassau County, Florida, to theft of funds from the Yulee (north of Jacksonville)-based union. She then was sentenced to five years probation, and ordered to pay $20,157.98 in restitution, $498 in fines and a court surcharge. She had been charged and arrested in June with theft of $19,472.53 in union funds. The actions follow a probe by the U.S. Labor Department's Office of Labor-Management Standards.

Bailed-Out GM Earnings Disappoint

Government Motors graphicGeneral Motors reported disappointing earnings yesterday and share price fell over 11% (compared to about 3% for broader markets) to $22 and change, down 33% from its IPO offering at $33 about a year ago. Taxpayers saw a paper loss of over $1 billion on their "investment" in just one day. Individual investors may have been confused by initial headlines that trumpeted an earnings beat by GM at the same time that pre-market share price signaled that the earnings report was a disappointment. Let's take a look at what drove the move as well as where GM may be heading.

UFCW District President in Pennsylvania Pleads Guilty to Theft

Food & Commercial Workers logoOn August 9, Ernest Milewski, former president of United Food and Commercial Workers, Northeast District Council, pleaded guilty in U.S. District Court for the Middle District of Pennsylvania to one count of embezzling union funds and one count of embezzling assets from a union-sponsored health care benefit program, each in an unspecified sum. Union Corruption Update reported on this case back in July. Milewski at the time had been charged with embezzling a combined more than $200,000 from the council, which is based in Wilkes-Barre, Pa., and its allied benefit fund. The charge and guilty plea follow a joint probe by the U.S. Labor Department's Office of Labor-Management Standards, Office of Inspector General, and Employee Benefits Security Administration.

Former Carpenters Local Secretary-Treasurer in Indiana Charged

On August 5, Cynthia Collier, former secretary-treasurer of United Brotherhood of Carpenters and Joiners Local 2177, was charged in Morgan County, Indiana, Circuit/Superior Court with theft of union funds in an unspecified amount. The union is based in Scottsburg, Ind. (Scott County). The charge follows an investigation by the Labor Department's Office of Labor-Management Standards.

Former Public Employees Boss in Cincinnati Pleads Guilty

Downtown CincinnatiDiana Frey is hoping for leniency. Given the evidence, she might not get it. On September 21, Frey, until recently the president of an independent local government workers union, Cincinnati Organized and Dedicated Employees (CODE), pleaded guilty in federal court to wire fraud. The outcome wasn't much in doubt, as she already had signed a statement in August indicating her intent to cop a plea. But new details in the massive embezzlement case have revealed the destination of most of the take: real estate. Frey, with the help of certain family members, bought, sold or transferred half a dozen Cincinnati homes. She remains free until sentencing. No criminal charges have been filed thus far against the other persons.

Texas Postal Workers District Official Sentenced for Theft

APWU logoOn August 4, Eddie De Hoyos, former district vice president for the American Postal Workers Union, Texas State Association, was ordered in the 187th District Court for Bexar County, Texas to serve up to 180 days in prison, five years of probation and 150 hours of community service for theft from the McAllen, Tex.-based labor organization. De Hoyos also will have to pay $15,761.21 in restitution, plus court fees totaling $1,793, an administrative fee of $60 a month and a one-time crime stoppers fee of $50. The sentencing follows an investigation by the Labor Department's Office of Labor-Management Standards.

Electrical Workers Financial Secretary in SE Virginia Indicted

IBEW logoOn August 3, Leonard Carman, former financial secretary of International Brotherhood of Electrical Workers Local 1142 in Virginia Beach, Va., was indicted in Circuit Court for the City of Norfolk for embezzlement in an amount of at least $200 from the union. The indictment follows an investigation by the U.S. Labor Department's Office of Labor-Management Standards.

Carpenters Bookkeeper in NE Pennsylvania Sentenced for Theft

Carpenters at workColin Rehrig insists he's a law-abiding citizen. A federal court in Philadelphia believes otherwise. On September 27, Rehrig, former bookkeeper for United Brotherhood of Carpenters and Joiners Local 600, was sentenced in U.S. District Court for the Eastern District of Pennsylvania to eight months of home confinement, plus two years of probation, for embezzling more than $30,000 from the Bethlehem, Pa.-based union. He also was ordered to pay a $1,500 fine and a $100 special assessment. Rehrig had pleaded guilty in June after being charged in March.

Is Consumer Reports’ Pulling Punches on Chevy Volt Reliability?

Akerson and Volt photoGeneral Motors has gotten much attention on its controversial Chevy Volt tax-subsidized vehicle. The hype for the Volt started over two years ago as GM was trying to put a positive face on the future green potential of a plug-in vehicle that was to be a game changer for the industry as  Washington was lobbied for a taxpayer funded bailout. While the final verdict on the success of the Volt has not been reached, the initial performance is underwhelming; especially considering the amount of hype and marketing money (supplied by taxpayers) emanating from GM.

Chevy Volt Again Suspected in House Fire

burnt Volt photoCars in Depth reports that the Chevy Volt and it's charging station are suspected as possible causes for a house fire that started in the garage of a Mooresville, NC home. According to the report, investigators found a Volt plugged into a charging station located in the burned out garage. The Iredell County Fire Marshal's office investigating the fire states, "The charging station was in the known area of origin, but the cause of the fire has not been officially determined."

Benefits Manager for NYC Sandhogs Union Pleads Guilty

Sandhogs at workMelissa King, belatedly, has admitted to wrongdoing. But she still insists she's small-time. King, former benefits administrator for Local 147 of the Laborers International Union of North America, "the Sandhogs," pleaded guilty in Manhattan federal court on October 21 to embezzling union funds and filing false personal income tax returns. Though prosecutors have put her total take at more than $40 million, King believes that's inflated. "I plead guilty, but I don't plead guilty to millions of dollars," she told U.S. District Judge John Koeltl. Evidence, however, reveals a woman possessed of a limitless desire for material extravagance at the expense of the roughly 1,000-member New York City underground construction union. The exact total of the thefts will be determined later. She faces a maximum eight-year prison sentence in February.

Obamacare Covert Bailout Should be Scrutinized

Back in April of this year I wrote about the covert bailout that was buried in the Obamacare bill which gives $5 billion of taxpayer money to unions, states (for public employees) and corporations for health care coverage for retirees aged between 55 and 64. The program is called the Early Retiree Reinsurance Program or ERRP. The UAW is the largest single beneficiary, receiving over 200 million dollars. General Motors also gets a piece of the pork with about a 20 million dollar cut. A recent report by the Washington Examiner identifies early retirees (many of whom are being paid over $100,000 a year in pension payments) of the California Public Employees Retirement System (CalPERS) as the other top recipient of about 200 million dollars.

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