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.

Kentucky Steelworkers Local Employee Indicted for Embezzlement

Steelworkers logoOn October 8, Dawn Colley, former employee of United Steelworkers Local 8-719, was charged in a three-count indictment in U.S. District Court for the Eastern District of Kentucky for embezzling $7,201 in funds from the Ashland, Ky. union.  The indictment follows an investigation by the U.S. Labor Department’s Office of Labor-Management Standards.

Steelworkers Local Treasurer in Pennsylvania Sentenced for Theft

Steelworkers logoOn October 7, David Deitrick, former financial secretary-treasurer of United Steelworkers Local 10-1338, was sentenced in U.S. District Court for the Middle District of Pennsylvania to two years of probation, and ordered to pay $8,993 in restitution and a $100 special assessment, for embezzling funds from the Shamokin (Northumberland County), Pa.-based union.  Deitrick had pleaded guilty in April following a probe by the U.S. Labor Department’s Office of Labor-Management Standards.

Boston Teamster Sentenced for Unemployment Fraud

Teamsters logoOn September 24, Thomas Flaherty, a former member of International Brotherhood of Teamsters Local 82 (taken over in 2011 by Teamsters Local 25), was sentenced in U.S. District Court for the District of Massachusetts to two years of probation for fraudulently collecting unemployment benefits from the Massachusetts Department of Workforce Development.  He also was ordered to pay $21,011 in restitution and a $1,000 fine.  He had pleaded guilty in June.  Flaherty previously had been accused, along with three other Local 82 members, of running an intimidation racket against participants at Boston trade shows.  He was acquitted in that case, but couldn’t walk in this one.  The plea and sentencing follow a joint investigation by the U.S. Labor Department and the Boston Police Department.

West Virginia Steelworkers President Charged with Embezzlement

Steelworkers logoOn October 6, James Coffey Jr., former president of United Steelworkers Local 5-887, was indicted in U.S. District Court for the Northern District of West Virginia on two counts of embezzling $7,098 in funds from the Newell, W.Va.-based union.  Coffey, 54, a resident of Bergholz, Ohio, allegedly used a union debit card to pay for personal expenses and wrote unauthorized checks to himself from a union bank account.  The indictment follows an investigation by the Labor Department’s Office of Labor-Management Standards.

Steelworkers Local Secretary in Michigan Charged with Theft

United Steelworkers logoOn September 30, Alton Alexander, former financial secretary of United Steelworkers Local 2-479, was charged in the 8th District Court of Kalamazoo County, Michigan, with one count of misdemeanor embezzlement of between $200 and $1,000 from the Plainwell, Mich.-based local.  The charge follows a probe by the Labor Department’s Office of Labor-Management Standards.

Nuclear Power Plant Security Union Steward Pleads Guilty

Seabrook nuclear power plantOn October 2, Gregory Paradis, former chief steward of United Federation of Special Police and Security Officers (UFSPSO) Local 501, pleaded guilty in U.S. District Court for the District of New Hampshire to embezzling $13,493 in funds from the union, which represents workers at the Seabrook, N.H. nuclear power plant.  Paradis had been charged in August following an investigation by the U.S. Labor Department’s Office of Labor-Management Standards.

Washington, D.C.-Area LIUNA Ex-Business Manager, Two Contractors Charged with $1.7M+ in Thefts

LIUNA logoIt’s hard to imagine theft from an American labor union being related to politics in a Arab nation.  But federal prosecutors are convinced they have found a connection.  And that's not the only problem in this case.  Yesterday, on October 28, the FBI and the Labor Department announced the indictment of three Maryland men – Anthony Frederick, Gary Cooper and Christopher Kwegan – for theft, fraud, money laundering, and bribe-taking related to the disappearance of more than $1.7 million from the Washington, D.C.-based Laborers International Union of North America (LIUNA) Local 657.  Frederick is a former business manager of the union; Cooper and Kwegan are co-owners of a Greenbelt, Md.-based construction firm, STS General Contracting.

Michigan AFGE President Pleads Guilty to Making False Statements

AFGE logoOn September 17, Edward Mason, former president of American Federation of Government Employees Local 2274, pleaded guilty in U.S. District Court for the Eastern District of Michigan to one count of making false entries in financial statements of the Saginaw-based union.  The plea follows a probe by the U.S. Labor Department’s Office of Labor-Management Standards and Office of Inspector General.

AFGE President in Maine Pleads Guilty to False Reporting

AFGE logoOn September 14, Mark Durinski, former president of American Federation of Government Employees Local 294, pleaded guilty in U.S. District Court for the District of Maine to three counts of making false statements in annual financial reports in connection with his claims of travel and other expenses for which he already had been reimbursed by his employer, the Defense Finance Accounting Service.  As part of his plea agreement, he also will have to make restitution in the amount of $53,544 to the Limestone, Maine union.  Durinski, now 63, had been charged on August 7.  The actions follow an investigation by the U.S. Labor Department’s Office of Labor-Management Standards.

Vice President of AFGE Local in Minnesota Charged with Theft

AFGE logoOn August 31, Edward Barker, former vice president of American Federation of Government Employees Local 899, was charged in the Hennepin County Court of Minnesota with one count of theft from the Minneapolis-based union in the amount of $1,790 during March 2013-July 2013.  The charge follows an investigation by the U.S. Labor Department’s Office of Labor-Management Standards.

Security Employees Local President in Texas Pleads Guilty to Theft

SPFPA logo On August 27, Cynthia Angulo, former president of the Currency and Security Handlers Association, pleaded guilty in U.S. District Court for the Southern District of Texas to one count of embezzling $61,200 in funds from the Houston-based union, an affiliate of the Security, Police and Fire Professionals of America (SPFPA).  The plea follows a probe by the Labor Department’s Office of Labor-Management Standards.

Arizona Court of Appeals Curbs Public-Sector Union 'Release Time'

Conducting union business and performing employment duties are two activities that don’t, and shouldn’t, overlap.  Yet in a number of jurisdictions, taxpayers are being forced to pay for both.  In Arizona, at least, this trend has hit a detour.  This August, the Arizona Court of Appeals, affirming a lower court decision, ruled that a Memorandum of Understanding forcing the City of Phoenix to compensate local cops for union activity, while not necessarily violating the state constitution’s Gift Clause, imposed grossly excessive costs.  This was a significant, if incomplete victory for public accountability.  And further pushback against release time clauses is occurring in courts and legislatures across the nation. 

Former Detroit Police Union Vice President Sentenced for Fraud

Downtown DetroitCorruption ran rampant in Detroit during the tenure of Mayor Kwame Kilpatrick, now serving a 28-year sentence in federal prison.  Many people as well as Kilpatrick have paid a high price.  One of them was Paul Stewart.  On September 29, Stewart, former vice president of the Detroit Police Officers Association and trustee of the police pension fund, was sentenced in U.S. District Court for the Eastern District of Michigan to 57 months in prison and three years of supervised release for conspiracy to commit honest services fraud through bribes and kickbacks.  He also must pay restitution of a sum yet to be determined.  Stewart had been convicted by a jury last December.  The actions follow a joint probe by the FBI, the IRS, and the U.S. Labor Department’s Office of Labor-Management Standards and Office of Inspector General.

Postal Workers Secretary in South Carolina Indicted for $200K+ in Thefts

Postal Workers logoOn September 1, Sharon Holmes, former secretary-treasurer of American Postal Workers Union Local 807, was indicted in U.S. District Court for the District of South Carolina on one count of embezzling $41,823 from the Columbia, S.C. union; one count of wire fraud in the amount of $178,330; and one count of fraud and related activity in connection with access devices.  The charges follow a probe by the U.S. Labor Department’s Office of Labor-Management Standards.

Missouri Steelworkers Local Treasurer Indicted for Theft

Steelworkers logoOn October 7, Terry Aters, former treasurer of United Steelworkers Local 11-7686, was indicted in U.S. District Court for the Eastern District of Missouri on one count of embezzling $153,434 in funds from the Marston (New Madrid County)-based union.  The union represents about 850 workers at the Noranda Aluminum plant in Marston, located in the southeast corner of the state.  The indictment follows a probe by the U.S. Labor Department’s Office of Labor-Management Standards.

Teamsters Central States Pension Fund Puts PBGC in Jeopardy

Decades ago, the Teamsters’ Central States Pension Fund was a project of organized crime.  In the future, it may well be a project of Pension Benefit Guaranty Corporation, the federal agency that insures pension plans against insolvency.  Ironically, this could put PBGC itself at risk.  This September, the troubled fund, which enrolls over 400,000 active and retired union members in 37 states, filed a restructuring plan with the Treasury Department proposing benefit cuts of nearly 23 percent.  The action is the first under a new law.  Central States Executive Director-General Counsel Thomas Nyhan explains:  “The longer we wait to act, the larger the benefit reductions will have to be.”  Yet the union, with help from Congress, helped bring about this dilemma.

Laborers Bookkeeper in Los Angeles Sentenced for Theft

LIUNA logoOn September 14, Sergio Rascon Jr., former bookkeeper assistant for Laborers International Union of North America Local 300, was sentenced in U.S. District Court for the Central District of California to one year of probation and ordered to pay a $100 special assessment for embezzling $2,417 from the Los Angeles union.  Rascon had pleaded guilty in June.  The actions follow an investigation by the U.S. Labor Department’s Office of Labor-Management Standards and Office of Inspector General.

Washington State Carpenters Local Secretary Sentenced

Carpenters logoOn September 9, John Jones, former financial secretary of United Brotherhood of Carpenters and Joiners Local 59, was sentenced in U.S. District Court for the Eastern District of Washington to two months in federal prison and three years of supervised release for embezzling more than $12,000 in funds from the Spokane-based union.  He also was ordered to pay $10,762 in remaining restitution and a $100 special assessment.  Jones had pleaded guilty in June.  The actions follow a probe by the Labor Department’s Office of Labor-Management Standards.

AFGE Local President in Texas Sentenced for Theft

AFGE logoOn September 9, Paul Florez, former president of American Federation of Government Employees Local 3922, was sentenced in U.S. District Court for the Western District of Texas to 180 days of home confinement and five years of probation for stealing from the El Paso-based union, which represents employees at the local VA Hospital.  He also was ordered to pay $44,878 in restitution and a $5,000 fine.  Florez had pleaded guilty in June after being charged last December with theft in the amount of $59,709.  The actions follow a probe by the U.S. Labor Department’s Office of Labor-Management Standards.

BMWE Secretary-Treasurer in Kansas City, Mo. Sentenced

BMWE logoOn September 3, Jeremy Bolte, former secretary-treasurer of Brotherhood of Maintenance of Way Employees Lodge 800, was sentenced in U.S. District Court for the Western District of Missouri to five years of probation for embezzling $12,500 from the Kansas City, Mo.-based union, which represents area workers for BNSF Railway.  He also was ordered to pay full restitution and a special assessment of $1,000.  Bolte had pleaded guilty in October 2014 to 10 counts of embezzlement upon being charged.  The actions follow an investigation by the Labor Department’s Office of Labor-Management Standards.

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