Ex-Local Chieftain in Madison, Wisconsin Pleads Guilty

Mike Rice’s fall from grace was swift.  On September 19, Rice, ex-president of UFCW Local 538 in Madison, pleaded guilty in federal court to embezzling $30,211 from the union.  He filed false expense vouchers over several years, even as he led members in a bitter strike against the Tyson Foods plant in Jefferson.  The 2,200-member local also represents workers at Oscar Meyer (Madison) and Jones Dairy Farm (Fort Atkinson).  His sentence could include up to five years in prison and a fine of up to $250,000.  “Over a number of years as president of Local 538, I was paid money to attend meetings that did not happen,” Rice admitted to U.S. District Judge Barbara Crabb in Madison.  (Wisconsin State Journal, 9/20).    


Wisconsin Local President Indicted for Embezzlement

There must be something in the Read More ➡

National Official Charged with Obstructing Theft Probe

The International Brotherhood of Boilermakers needed some renovation work at its headquarters in Kansas City, Kan.  Unfortunately, someone at the union thought that an unauthorized use of member funds – about $920,000 worth – could pay for it.  Investigators aren’t yet certain if thefts actually occurred.  But at least one person at the union appears to have something to hide.  As a result, he’s facing some serious legal problems. 


On September 15, a federal grand jury returned a pair of indictments against Christopher Scott Wagner, operations manager for Boilermakers National Funds, which includes at least three separate benefit plans.  Wagner, 44, this past March 20 allegedly lied to investigators and obstructed a criminal investigation.  This, say prosecutors, suggests that he or someone else at the union during the course of 1999 through 2001 embezzled benefit fund assets to pay for the Read More ➡

Niagara Falls Thug Pleads Guilty to Vandalism

It’s getting to be a regular occurrence over the past several months:  A very unpleasant guy from Laborers Local 91, the scourge of the Niagara Falls, N.Y. area, pleads guilty.  The latest to join the club is Patrick McKeown, a local board member.  McKeown, 58, recently admitted his role in two incidents:  1) the destruction of landfill liner roughly the size of four football fields that had been installed by a non-union company at the Browning Ferris Industries landfill in the Town of Niagara; and 2) the destruction of construction equipment used by a non-union company at the Ordnance Works in Lewiston, N.Y.


Local 91 long had used assaults, threats and property destruction to intimidate non-union workers and their contractors from building in Niagara County.  Fourteen of its leaders and members were indicted after a lengthy investigation by federal, state Read More ➡

New Labor Federation Downplays Corruption Issues

It began on June 15 of this year as a rump faction within the AFL-CIO.  And now the Change to Win Coalition, on Tuesday, September 27, made it official:  It is now a federation in its own right.  The group split from the AFL-CIO after several years of growing acrimony.  Change to Win (CTW) unions came to believe that the AFL-CIO was pouring enormous amounts of money and energy into political advocacy at the expense of organizing.  The result of misguided priorities was a decaying labor movement.  “Organizing is our core principle.  It is our North Star,” declared Change to Win founding chair, Anna Burger, before a large, cheering convention in St. Louis.  Burger, longtime (and still) political director for the 1.8 million-member Service Employees International Union (SEIU), added, “We will put our money where our mouth is, with three-quarters of our resources going to a groundbreaking organizing crusade.”  Read More ➡

Nebraska Local Treasurer Charged with Embezzlement

Crime paid well for Antoinette Cox-Burress – at least for three and a half years.  But now the former treasurer of Amalgamated Transit Union Local 1293, in Lincoln, stands accused of stealing $14,663 from the union.  During June 2001-December 2004, Lancaster County prosecutors allege, she embezzled funds from the local account at First Choice Credit Union in Lincoln.  Officers served a search warrant at the credit union on September 22, and determined that she had made 42 unauthorized withdrawals.  In some cases, Cox-Burress took cash; in others, she transferred funds to another personal account at the union.  She posted a $300 bond and was released from county jail on September 29.  (Lincoln Journal Star, 10/1).


Teacher in Kansas Gets Probation for Thefts

Wayne Kruse, a former sixth-grade teacher in Lawrence, Kansas, remarked at his sentencing hearing of Read More ➡

Gambino Mobster Sentenced in NYC Union Construction Scam

The New York City Metropolitan Transit Authority (MTA) back in the late 90s thought it was getting a steal of a deal on the construction of its new headquarters at 2 Broadway in Lower Manhattan. And in an unintended way, it was. An unholy alliance between a major developer, the Gambino crime family, a host of contractors, and at least three unions led to thefts in excess of $10 million, and contributed toward a total project cost overrun of more than $300 million. A 43-count federal indictment unveiled last September alleged that Gambino influence led to fraud, extortion and kickbacks in at least 10 separate contracts. This August 2 one of the syndicate’s key players, Mario Garafola, learned he would have to do some prison time. But his wrongdoing has to be seen in the context of a far broader conspiracy uncovered by the FBI and the Department of Read More ➡

Dockworkers Boss in N.J. Pleads Guilty to Conspiracy

Albert Cernadas began working on the New Jersey docks more than 50 years ago. And he almost made it to the top of the International Longshoremen’s Association. As executive vice president of the New York-based union as well as longtime president of Local 1235 across the river in Newark, he was heir apparent to ILA President John Bowers. But after the Justice Department slapped him and several associates with criminal racketeering charges, there was nowhere to go but down.


On September 12, Cernadas, 70, pleaded guilty to reduced conspiracy charges involving fraud while serving on the board of a benefit program known as ILA-Management, or MILA. He signed a consent agreement that forced him to cut all union ties; in return he was exempted from paying fines or doing serious prison time. In a separate agreement, Cernadas settled a civil racketeering suit that had been filed in Brooklyn, Read More ➡

California Teachers Association Possibly Involved in Massive Dues Scheme

Teachers unions aren’t exactly shrinking violets when it comes to politics.  And nothing fuels political campaigns more than member dues.  In California, at least, there’s a blurred line between campaigning and embezzlement – at least according to a prominent conservative legal group.  On September 14, the Landmark Legal Foundation formally requested the California Public Employment Relations Board to investigate whether the California Teachers Association (CTA) is illegally financing a multimillion dollar effort to defeat several ballot initiatives in a statewide November 8 special election. 


So what’s the story here?  Well, the CTA recently imposed a $60 annual special assessment over three years – i.e., $180 per person – on all union members and non-union employees required by state law to pay agency fees to the union for collective bargaining.  Union officials claim the money will be routed toward debt retirement.  But the Kansas City, Mo.-based Landmark Legal Foundation says Read More ➡

D.C. Union, Feds Begin Recovering Stolen Funds

Until about three years ago the Washington Teachers Union (WTU) had been run by what amounted to a theft and money-laundering ring.  Now the local’s new leadership has a message: It wants its money back – as soon as possible.  With help from federal prosecutors, it’s begun the recovery process.  Early this month the union filed a claim to the $31,178 seized by the government from a Charles Schwab account registered in the names of Gwendolyn Hemphill and her husband, Charles Hemphill.  Mrs. Hemphill, formerly the local’s office manager, along with ex-treasurer James O. Baxter II, was convicted on August 31 on 23 counts of conspiracy, embezzlement and other offenses.  It’s true that $31,178 is only a drop in the bucket in comparison to the $4.6 million or more that the local leadership ripped off.  But prosecutors and the current local leadership would call Read More ➡

National President, Three Others Hit with RICO Suit

America’s maritime officers are seafarers, working the decks, engine rooms and other sections of U.S.-flagged commercial and military vessels.  They sail the world’s oceans, the Great Lakes and inland waters.  But federal prosecutors right now are concerned about certain things the people who run their 4,000-member union may have done on land.  On September 14, officials from the Justice and Labor Departments announced the unsealing of a 13-count indictment against Michael McKay, 58, national president of the American Maritime Officers (AMO), his brother, Robert McKay, 55, AMO’s national secretary-treasurer, and two other men.  Charges include embezzlement, mail fraud, graft, obstruction of justice, witness tampering and falsification of records.


The government charged that the McKays, along with union employees Phillip Ciccarelli, 64, and James Lynch, 55, embezzled funds from union benefit plans to pay for personal expenses such as fine china, cigars, hockey games and Read More ➡