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.

Detroit Teamsters Local Business Agent Pleads Guilty to Accepting Bribes

Teamsters logoIt's one of the oldest forms of corruption: a union official accepts a bribe from an employer in exchange for an assurance the workplace will remain nonunion. Michael Townsend believed, wrongly, he could avoid detection. On Monday, December 23, Townsend, a former business agent and trustee of International Brotherhood of Teamsters Local 337, pleaded guilty in Detroit federal court to conspiracy in connection to receiving illegal cash payments from an official of the Detroit-based LaGrasso Brothers Produce Inc. and promising, in turn, not to organize employees. The company, having already pleaded guilty last January and facing a heavy fine, had agreed to cooperate with the U.S. Labor Department in its investigation. Sentencing for Townsend is set for March 24.

Upstate New York Independent Public Employees Treasurer Arrested

On December 10, the Tioga County Sheriff's Office arrested Amy Wales, treasurer of the Owego-Apalachin Employees Association, for embezzling funds from the Owego (near Binghamton), N.Y. independent union. Wales, 45, a longtime secretary in the athletic department of the local public school system, allegedly used her union position as a license to steal more than $51,000 from the union during June 2012-June 2013. Following her arrest, she was charged with grand larceny in Village of Owego Court and released on her own recognizance. The actions follow a complaint by the union president and a subsequent three-month sheriff's investigation.

SEIU Local Treasurer in Los Angeles Indicted for Thefts

Service Employees logoOn December 6, Cedric Hughes, former treasurer for Service Employees International Union Local 721, was indicted in U.S. District Court for the Central District of California on five counts of wire fraud and one count of embezzlement of $15,193 in funds from the Los Angeles union. Hughes, who served in his position during March 2009-June 2010, wrote unauthorized union checks to himself and made unauthorized cash withdrawals and debit card transactions with his union debit card. The indictment follows an investigation by the U.S. Labor Department's Office of Labor-Management Standards.

Ohio UAW Local Treasurer Charged with Embezzlement

UAW logoOn December 3, Kristie McClarren, former financial secretary-treasurer of United Auto Workers Local 3061, was charged in U.S. District Court for the Northern District of Ohio with embezzling $152,639 in funds from the Crestline (near Mansfield), Ohio-based union, which represents employees at the Pittsburgh Glass Works plant in nearby Shelby. The charge follows a joint probe by the Labor Department's Office of Labor-Management Standards and Office of Inspector General.

Kansas City-Area Oil Workers Treasurer Pleads Guilty

On November 27, Jesse Madrigal, former treasurer of the Independent Oil and Chemical Workers Union, pleaded guilty in U.S. District Court for the District of Kansas to embezzling about $24,000 from the Kansas City, Kan.-based independent union. The guilty plea follows an investigation by the U.S. Labor Department's Office of Labor-Management Standards.

UAW President in East Texas Indicted for Theft

UAW logoOn November 21, Jerry Ragster, former president of United Auto Workers Local 3057, was indicted in the Harrison County Court, Texas for theft of $3,372 in funds from the Marshall, Tex.-based union. The indictment follows an investigation by the U.S. Labor Department's Office of Labor-Management Standards.

Transportation Union Political Operative in Nebraska Indicted

United Transportation Union logoOn November 19, Ray Lineweber, former legislative director for the United Transportation Union Nebraska State Legislative Board, was indicted in U.S. District Court for the District of Nebraska on one count of embezzling $102,907 in funds from the Omaha-based union and 14 counts of concealing the thefts through false record-keeping. The indictment follows an investigation by the Labor Department's Office of Labor-Management Standards.

Postal Workers President in SE Virginia Indicted for Embezzlement

Postal Workers logo On November 7, Eric Barnett, former president of American Postal Workers Union Local 171, was indicted in the Circuit Court for the City of Portsmouth on one count of embezzling funds of $200 or more from the Portsmouth, Va. union. The indictment follows a joint probe by the Labor Department's Office of Labor-Management Standards and the Portsmouth Police Department.

Rhode Island Public-Sector Unions Lock Horns with State Treasurer over Pensions

Gina RaimondoAmong unions, the term "pension reform" is a red flag. In Rhode Island, labor officials are taking their opposition to a higher level. Early this month, a prominent researcher hired by the American Federation of State, County and Municipal Employees (AFSCME), Ted Siedle, filed a request with the Securities & Exchange Commission requesting an investigation of Rhode Island State Treasurer Gina Raimondo (in photo). Back in mid-October Siedle had released a report accusing her and her various associates in the financial industry of siphoning benefits. Not long after, Rhode Island State Senator and Laborers union official Frank Ciccone filed a similar request with the SEC. Yet in November he resigned from his union posts.

Obamacare Pork to UAW Rolled Out Without a Glitch

Obama UAWWhile the Obama Administration is still pumping resources and taxpayer money into the implementation of Obamacare, the initial disbursement of pork included in the bill was successfully doled out almost a full two years ago. And the main recipient of taxpayer largess was, once again, the UAW.

The Obamacare pork came in the form of a program called the Early Retiree Reinsurance Program or ERRP. $5 billion of taxpayer money was allocated to help pay for healthcare costs to retirees between the age of 55 and 65. Number one on the union-dominated list of recipients was the UAW, which received $387.2 million for its VEBA fund, which was set up to pay UAW retiree health care costs. This amount was still not good enough for the UAW as they penned a letter to Congress in February of 2012 requesting an increase in ERRP funding to $10 billion.

GM Spends $1.3 Billion to “Create or Retain” 1,000 Jobs

Just days after the US government announced their exit from General Motors, the company announced a move that sounds like it could have come directly out of the Obama Administration playbook. GM is boasting about "creating or retaining" roughly a thousand jobs at the cost of approximately $1.3 million per job in a move that could only be viewed as a positive from a political point of view.

Western Pennsylvania Metal Workers Secretary-Treasurer Pleads Guilty

Metal workerOn November 21, Duane Rill, secretary-treasurer for Berry Metal Employees Association, pleaded guilty in U.S. District Court for the Western District of Pennsylvania to embezzlement of funds during March 2007-November 2009 in the amount of $13,496 from the Cranberry Township, Pa.-based independent union. He had been indicted this May. The indictment and guilty plea follow a probe by the U.S. Labor Department's Office of Labor-Management Standards.

Postal Workers Local President in NYC Sentenced for Theft

APWU logoOn November 14, Neil Cardoso, former president of American Postal Workers Union Local 1241, was sentenced in the New York State Court for New York County to one to three years in prison for theft from the Long Island City (Queens), N.Y. union. He also was ordered to pay $50,000 in restitution. Cardoso had been indicted and arrested in February 2012 for grand larceny in connection with his unauthorized use of the union ATM for withdrawals totaling about $75,000; he pleaded guilty this October. The actions follow an investigation by the U.S. Labor Department's Office of Labor-Management Standards.

Twin Cities-Area Postal Workers Treasurer Pleads Guilty to Theft

APWU logoOn November 12, David Westgard, former treasurer of American Postal Workers Union Local 65, pleaded guilty in Dakota County, Minnesota District Court, to one count of theft in an amount of more than $5,000 from the Mendota Heights, Minn.-based union. He had been charged in November 2012. The actions follow an investigation by the Labor Department's Office of Labor-Management Standards.

Virgin Islands Police Union Boss Pleads Guilty; Sentenced

Virgin IslandsDonald Liburd was a cop and a union president. But that didn't make him immune to becoming a criminal as well. On November 12, Liburd, who had been president of the St. Thomas-St. John Police Benevolent Association (PBA) and a detective on the local police force, pleaded guilty in Virgin Islands Superior Court to embezzling $65,073 in union funds. He then was sentenced to four years in prison, of which three and a half years would be suspended, plus three and a half years of probation upon release. "This is a tragic circumstance when an officer sworn to uphold the law violates the law," said Superior Court Judge Michael Dunston. Liburd had been arrested this past March following a lengthy investigation. He had resigned his duties as PBA president in the summer of 2011.

GM's Balance Sheet Not as Healthy as it Looks

GM UAW logosOne of the major architects of the General Motors bankruptcy process, Harry Wilson, recently gave a very optimistic outlook for GM future share price. Mr. Wilson was a member of President Obama's Auto Task Force, and was an instrumental player in seeing that UAW interests were put ahead of other creditors, like old GM bondholders.

Automotive News now reports that Mr. Wilson feels that GM may be a target for activists because of their "huge" cash hoard. According to the piece:

Supreme Court Hears Challenge to UNITE HERE-Florida Casino 'Neutrality Agreement'

Mardi Gras CasinoThey're called "neutrality agreements." Their supporters say they promote labor peace during union organizing drives. Yet too often these pacts grant a union a blank check to box in a targeted employer. Fittingly, not all workers are happy about this. On November 13, the U.S. Supreme Court heard arguments over the extent to which federal law allows a union to use a neutrality agreement to extract concessions. The case, UNITE HERE Local 355 v. Mulhall et al., has its origins in a complaint by an employee of a Florida dog track-casino following the employer's agreement with the union in 2004.

Office Secretary for Oklahoma Carpenters Local Pleads Guilty

Carpenters logoOn November 5, Angela Webster, former office secretary for United Brotherhood of Carpenters and Joiners Local 943, pleaded guilty in U.S. District Court for the Northern District of Oklahoma to embezzlement of $13,015 in funds from the Tulsa-based union. She had been indicted in September. The actions follow a probe by the Labor Department's Office of Labor-Management Standards.

AFGE President in New York City Sentenced for Embezzlement

AFGE logoOn November 1, Federck Petro, former president of American Federation of Government Employees Local 2094, was sentenced in U.S. District Court for the Southern District of New York to six months of home confinement and three years of probation for embezzling $112,477 from the Manhattan union, which represents VA hospital employees. He also was ordered to pay full restitution and a $100 special assessment. Petro, who had served as local president during February 2006-July 2008, wrote nearly 200 unauthorized union checks for his own benefit. He had been arrested in December 2011, and pleaded guilty in February of this year following a joint probe by the Labor Department's Office of Labor-Management Standards and the Veterans Affairs Department's Office of Inspector General.

Former Business Manager of New Jersey IBEW Local Convicted

IBEW logoThere's nothing wrong with a man spending money to make his lady feel special - as long as it's his own money. Richard Dressel apparently thought little of that principle. Earlier today, a Newark, N.J. federal jury convicted Dressel, the former business manager for International Brotherhood of Electrical Workers Local 164, on two of eight counts for his participation in various illegal schemes to benefit him, his unindicted girlfriend (and now-wife) Kathleen Libonati, and union president John DeBouter. Last November, Dressel and DeBouter were arrested and indicted for embezzling a combined roughly $350,000 from the Paramus, N.J.-based union and its Joint Apprentice Training Fund. DeBouter was relieved from trial last week after his lawyer collapsed from an aneurysm.

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