The outcome couldn’t have been more inevitable for Vance Pearson. And it couldn’t have been less welcome for the people ranking above him. Last Friday, February 7, Pearson, former regional director for the United Auto Workers and a member of the union’s international board, pleaded guilty in Detroit federal court to conspiracy to embezzle hundreds of thousands of dollars in union funds, enabling him and other UAW officials to live large – or at least larger – for nearly a decade. In so doing, he may have brought prosecutors one step closer to bringing charges against former Auto Workers President Gary Jones and his immediate predecessor, Dennis Williams. The action follows a probe by the FBI, the IRS, and the U.S. Labor Department’s Office of Labor-Management Standards and Office of Inspector General.
Beverly Davis and Evelyn Smith treated their union like a personal ATM machine. Eventually, their money supply ran out. On December 13, 2019, Davis and Smith, each an office employee of Communications Workers of America Local 6222, pleaded guilty in U.S. District Court for the Southern District of Texas to their roles in an embezzlement scheme that yielded a combined more than $135,000 over several years from the Houston-based union, which represents AT&T employees. The pleas follow a probe by the U.S. Labor Department’s Office of Labor-Management Standards. Each woman faces up to five years in prison and a $10,000 fine at sentencing on February 28.
Davis and Smith, each now 67, were employed by the union, respectively, during 2010-17 and 2005-18. Davis administered a special fund intended to help union members during financial hardships, while Smith served as secretary-treasurer. According to prosecutors, they used their positions to help themselves … Read More ➡
It’s been a dream of organized labor for decades. Yesterday the House of Representatives took a big step toward its realization. By a nearly party-line 224-194 vote, the House approved the misnamed Protecting the Right to Organize or PRO Act (H.R. 2474), which would strip employers and non-joining employees of their capacity to resist union aggression. Introduced last May by Rep. Bobby Scott, D-Va., and Sen. Patty Murray, D-Wash., and passed by the Education and Labor Committee in September, the measure, under the premise of “restoring” lost rights, among other things, would override state Right to Work laws, ban arbitration agreements, and force employers to recognize a union if a majority of workers sign membership pledge cards. Supporters are ecstatic for now, but they may have to wait a while for Senate action.
The PRO Act, at bottom, is a union power grab. Indeed, it is a power grab so … Read More ➡
A slaughterhouse presents numerous potential health and safety hazards for its workers. Union representation, unfortunately, can prove economically hazardous. On January 28, Keith Ludlum, former president of United Food and Commercial Workers Local 1208, pleaded guilty in U.S. District Court for the Eastern District of North Carolina to conspiracy to steal hundreds of thousands of dollars from the Tar Heel, N.C. union, which represents about 3,600 employees of Smithfield Foods-owned pork processing plants in North Carolina and South Carolina. The aptly-named Terry Slaughter, who served as local secretary-treasurer, pleaded guilty a year ago. Ludlum would be indicted two months later following a probe by the U.S. Labor Department’s Office of Labor-Management Standards.
Union Corruption Update covered this case following the February 2019 guilty plea of Slaughter. UFCW Local 1208 had been formed and recognized a little over a decade ago in the wake of an unusually bitter and prolonged campaign … Read More ➡
Thomas Williamson Sr. and Jeffrey Veach had a traditional, “old school” approach to putting union workers on the payroll. That approach may win them a stiff prison sentence. On January 24, Williamson and Veach, respectively, member and president of the Portage, Ind.-based International Association of Bridge, Structural, Ornamental and Reinforcing Iron Workers Local 395, pleaded guilty in U.S. District Court for the Northern District of Indiana to one count of extortion conspiracy related to violent physical assaults committed four years earlier against nonunion workers at a construction site in Dyer, Ind. The pair had been arrested and charged in August 2018 following an investigation by the FBI, the U.S. Labor Department’s Office of Inspector General and the Dyer Police Department.
On January 23, Shannon Pemberton, former treasurer of International Union of Painters and Allied Trades Local 238, pleaded guilty in U.S. District Court for the Eastern District of Kentucky to one count of embezzling $6,403 in funds from the Cincinnati union. The alleged offenses occurred in neighboring Kentucky. He had been indicted in October. The actions follow a probe by the U.S. Labor Department’s Office of Labor-Management Standards.… Read More ➡
On January 14, Eleanor Harvey, former secretary-treasurer of American Federation of State, County and Municipal Employees Local 3826, pleaded guilty in Marion County, Indiana Superior Court to one count of theft of union funds in an amount of between $750 and $50,000. She then was sentenced to a year of home confinement (suspended) and a year of probation, and was ordered to pay $18,800 in restitution and attend an anti-conversion class. Harvey had been charged last August following a joint investigation by the U.S. Labor Department’s Office of Labor-Management Standards and the Marion County Prosecutor’s Office.… Read More ➡
Lawrence Ackerman isn’t going to spend too much time behind bars, but his business career deservedly is over. On January 15, Ackerman, founder of two fake health insurance brokerages, was sentenced in Trenton, N.J. federal court to six months in prison and six months of home confinement for his role in a $6.6 million fraud scheme. He also was ordered to pay $1 million in restitution to the welfare fund of United Auto Workers Local 2326, now based in South River, N.J. Ackerman had pleaded guilty in December 2018 after being indicted in January 2017. His partner in crime, former union president Sergio Acosta, was sentenced a little over a year ago to three years of home confinement, and ordered to pay $32,000. The actions follow a probe by the Labor Department’s Office of Labor-Management Standards, Office of Inspector General and Employee Benefits Security Administration.
Lawrence Ackerman, now 55, a … Read More ➡
Perhaps more than usual, corruption stories in 2019 involved the overlapping worlds of unions and politics. In Chicago, former Teamster boss John T. Coli Sr., whose ability to cut deals with City Hall and the Illinois legislature for years went virtually unchallenged, pleaded guilty in July to shaking down a television studio owner. One of his allies, State Senator Tom Cullerton, was hit with multiple embezzlement charges. In Boston, two city officials were convicted of putting the squeeze on a concert promoter on behalf of a Theatrical Employees local. In Philadelphia, an Electrical Workers business manager and seven other persons, including a city councilman, were indicted in January for embezzlement, wire fraud and bribery; a contractor and a fundraiser subsequently pleaded guilty.
It’s official: The United Auto Workers has been declared a racket. On January 6, recently departed UAW President Gary Jones (in photo) and his immediate predecessor, Dennis Williams, were cited, albeit under assumed names, in Detroit federal court as participants in a racketeering enterprise. The designation was part of a new charge against Vance Pearson, former director of a major regional affiliate and a member of the union’s international executive board, of embezzlement conspiracy. U.S. Attorney Matthew Schneider had been hinting at such action these last few months. Jones had resigned his post under pressure in November. The actions follow a joint probe by the FBI, the IRS and the Labor Department’s Office of Labor-Management Standards and Office of Inspector General.
Union Corruption Update more than once has covered this scandal, the details of which provide a hard look into how the Detroit-based union, with around 400,000 active members, … Read More ➡