With the addition of a unit in the Ofc. of Labor Mgmt. Standards (OLMS), labor dept. officials are now prepared to more closely scrutinize intl. unions’ compliance with fed. financial accounting laws. making up for steady cuts in OLMS staff during the Clinton admin. According to its budget request for FY 2005, OLMS staff fell from 425 in FY 1985 to 242 in FY 2001. One of the consequences of that decline is that 10 of the nation’s largest unions have never been audited by OLMS.
Under the Bush admin., DOL has received budget increases for OLMS for the last 3 fiscal yrs. With those increases, OLMS has created a unit dedicated to auditing the financial disclosure forms of intl. unions. For FY 2005, DOL is seeking a budget hike of 12.9 pct. That increase would allow OLMS to get is staff level … Read More ➡ “DOL Planning Overdue Audits of Intl. Unions”
The AFL-CIO suspended the pres. of the Long Island Fedtn. of Labor, Jack Caffey, on June 22, along with about 30 other officials. The takeover was prompted by an audit begun after allegations emerged that one frmr. employee had embezzled $50,000 through a union credit card. Auditors with Buchbinder Tunick & Co. found “a disturbing pattern of financial improprieties and financial mismanagement of funds” at the Long Island Fedtn. Workforce Dev. Center. The nonprofit center is supposed to conduct wrkr. training programs.
The AFL-CIO’s northeast regional director, Joe Alvarez, said that while the audit was limited to the training center, its close relationship to the fedtn. means that as trustee, he will investigate the fedtn. and its related groups. “They’re interrelated organizations and they have the same fiduciaries,” he said, “the same people responsible. It’s a very close relationship.” The fedtn. controls … Read More ➡ “AFL-CIO Takes Over NY Affiliate”
N.J. state police are investigating the apparent loss of $15,000 from a 2003 Father’s Day event for state prison officers at Six Flags Great Adventure. Angry union members switched their allegiance from Police Benevolent Assn. Local 105 to Lodge 200 of the Fraternal Order of Police in response. State police began their investigation after a member sent a letter to the U.S. Dept. of Justice and the N.J. dept. of Criminal Justice.
According to the letter, The PBA purchased tickets from Six Flags at a discounted rate, which exec. bd. members and union vice presidents sold throughout the state at $25 ea. Union accountant Ed Brady said that past event chairmen had deposited ticket sales within 10 days of receipt, or turned the funds over to the union’s treasurer or fin. secy. But acc. to the dissident member, local PBA pres. Ed Murphy said that … Read More ➡ “N.J. Police Investigating Missing Funds from Father’s Day Event”
Senator Susan Collins (R-Maine) blamed the union chiefs making up the bd. of the union-pension-owned ULLICO company for a insider stock-trading scandal, due to their infrequent meetings and poor attendance. According to a June 2nd staff report by the U.S. Senate Cmte. on Governmental Affairs, the bd. members’ lack of oversight allowed ex-CEO Robert Georgine to orchestrate a series of deals involving the private company’s stock that enriched him and other employees and bd. members at the expense of the union pension funds supporting the company. The 98-page majority staff report can be accessed on NLPC’s website at https://www.nlpc.org/pdfs/ULLICO%20Report.pdf.
Key findings of the report include the following:
Although ULLICO (Union Labor Life Insurance Company) was a corporation directed by leaders of organized labor, Georgine and other mgrs. structured stock transactions largely for the benefit of insiders rather than the union members whose unions and pension funds … Read More ➡ “Senate Cmte. Issues ULLICO Report”
Broward County union boss Walter Browne and his sister, Patricia Devaney, were convicted on June 2 of running the Natl. Fdtn. of Public & Private Employees (NFPPE) as an organized crime enterprise. The 3rd time proved to be the charm for fed. prosecutors. In 1996, Browne pled guilty to a misdemeanor charge of mail tampering to allegedly rig a 1988 union vote, and accepted a brief suspension from the union. In 1993, Browne was acquitted by a judge of federal mail fraud charges in Ft. Lauderdale.
Jury foreman John Sprague said that this time the jurors were convinced by thousands of pages of receipts and financial records that the brother-and-sister team had: embezzled hundreds of thousands of dollars from the NFPPE and the Marine Engineers Beneficial Assn. and: raked in nearly $500,000 in “consulting fees” from employers in exchange for Browne keeping his union … Read More ➡ “S. Fla. Union Chief Convicted of Racketeering”
“[Walter Browne] lived, breathed and bled the union.” — Defense lawyer Theresa Van Vliet
“The only thing I agree with is he bled the union. He bled it dry.” — Asst. U.S. Attny. Lawrence LaVecchio. [Ft. Lauderdale Sun-Sentinel, 6/2/04]
Ex-DC 37 Bookkeeper Pleads Guilty to Embezzlement
Lloyd Clarke pled guilty in June 2 to embezzling more than $2.4 million from a NYC local affiliated with Dist. Council 37 of the Amer. Fdtn. of State, County & Municipal Employees. Clarke pled guilty to 1st-degree grand larceny before State Sup. Ct. Judge Gregory Carro, who will sentence him on Sept. 22. Depending on how much he repays, Judge Carro could sentence Clarke to anywhere from 1 to 9 yrs. in prison.
Clarke was the bookkeeper for 20 yrs. with the Civil Service Technical Guild, Local 375. Between July 1996 and Dec. 1997, Clarke … Read More ➡ “S. Fla. Union Boss “Bled the Union””
Two yrs. after the Intl. Alliance of Theatrical Stage Employees took over its Las Vegas affiliate, officials in the union’s NYC HQ continue to defend their takeover as necessary to repair a “complete breakdown of the democratic processes of the local.” Many local members, however, claim that the Intl. fraudulently seized the local union in 2002, and has failed to represent the financial interests of local stage employees. According to an attny. representing some of those members, the U.S. Dept. of Labor is examining the Intl. takeover of Local 720. A DOL spokeswoman would neither confirm nor deny whether such an investigation is occurring.
The dispute is now playing out in dueling lawsuits, both filed in the U.S. Dist. Ct. for Nev. Last Nov., the 2 trustees appointed by the Intl. to run 720, Robert Trombetta and Dennis Brook, alleged that officials of the Local’s pension … Read More ➡ “Las Vegas Officials & Intl. Trade Corruption Charges”
The U.S. Dept. of Labor (DOL) has obtained a consent judgment appointing an independent fiduciary to take over administration of the health plan of a defunct West Hills-based union. The department sued the president of the Intl. Union for Natural Health, Alternative and Complementary Medicine Professions (IUNHCAMP) and three plan trustees for mismanagement that resulted in an estimated $7 million in unpaid health care claims.
The judgment, entered in the the U.S. Dist. Ct. for the Cent. Dist. of Calif., settles the Nov. 2003 suit that alleged that union president Steven Gorman and the plan trustees violated the Employee Retirement Income Security Act (ERISA). The defendants allegedly failed to charge health plan participants adequate premium rates and to implement appropriate medical underwriting guidelines. The suit also alleged that Gorman’s involvement with the IUNHCAMP health benefits plan violated a Sept. 2000 court order barring him from any … Read More ➡ “Court Replaces Trustees of Defunct Calif. Union Health Plan – U.S. Labor Department Investigation Reveals $7 Million in Unpaid H”
A Chicopee man was sentenced on May 5 in federal court for embezzling $81,000 from a union representing employees of Top Flight, a wholly owned subsidiary of Callaway Golf formerly owned by Spalding. U.S. Attny. Michael J. Sullivan and Mark Letizi, Dist. Director for the U.S. Dept. of Labor’s Ofc. of Labor Mgmt. Standards (OLMS) in New England, announced that Gene Malinowski was sentenced by U.S. Dist. Judge Michael A. Ponsor (Mass., Clinton) to 5 yrs. of probation, including 6 mos. in a community corrections facility and 6 mos. in home confinement. Malinowski was also ordered to pay over $17,000 in restitution to the union.
Malinowski pled guilty on Dec. 19, 2003, to a one count indictment charging him with embezzling $81,000 from the union. At the earlier plea hearing, the prosecutor told the Court that, had the case proceeded to trial, … Read More ➡ “Mass. Bus. Agent Sentenced for Embezzlement”
Federal prosecutors presented a picture of a union existing solely to serve its founder and his sister in a trial that began on April 14. Walter Browne and his sister, Patricia Devaney, are on trial in the U.S. Dist. Ct. for the Sou. Dist. for Fla. on racketeering, fraud and embezzlement charges.
Debra Weiler testified that she met Browne when he created the Natl. Fedtn. of Public Employees (NFPE) in 1994, splitting it off from the Marine Engineers Beneficial Assn. According to Weiler, the NFPE’s secy.-treasurer complained that he was denied access to the union’s financial records. She also testified that Browne and Devaney had exclusive use of 2 out of 6 union cars. In Devaney’s case, Weiler said, it was hardly ever used for union business. Weiler, however, said she had to use her own car to cash union checks for Devaney … Read More ➡ “Racketeering Trial of Brother & Sister Proceeds in Fla. Fed. Court”