There was one unfinished piece of business after Fiat Chrysler and French auto giant PSA had merged. And it was an expensive piece. On January 27, the Auburn Hills, Mich.-based automaker announced that it would plead guilty in Detroit federal court to conspiring to bribe officials of the United Auto Workers with millions of dollars in cash and gifts via its worker training center to discourage the union from raising demands during collective bargaining. The company also agreed to pay a $30 million fine and undergo three years of probation. At least eight persons were convicted in this scandal since the initial indictments of July 2017. Prosecutors had charged Fiat Chrysler earlier that day. 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.
Last month was momentous for the auto industry. On January … Read More ➡
Menendez ran interference with federal regulators to aid Melgen in his ultimately unsuccessful effort to get that contract. He also helped Melgen out with the feds in his Medicare fee dispute.
Why was a New Jersey senator acting on behalf of a Florida eye doctor? In that trial in Newark, the federal prosecutors argued that Menendez did it because of the favors that Melgen did for … Read More ➡
According to at least one published report, President Trump is being urged to pardon, or commute the prison sentence of, Dr. Salomon Melgen, currently serving 17 years for Medicare fraud and related crimes.
Letting Melgen off the hook would be a horrible abuse of the pardon and commutation powers invested in the president by the Constitution, arguably worse than Bill Clinton’s pardon of fugitive Marc Rich.
According to testimony at his trial and allegations in civil lawsuits, Melgen performed unnecessary surgeries and injections on unsuspecting elderly people, including some with fake eyes or who were already blind. Others claimed they suffered eye infections after receiving injections of bacteria-laden medicine. Some lost sight in one or both eyes. The contamination stemmed from Melgen dividing up single-use vials of ocular drugs so he could bill Medicare multiple times.
The United Auto Workers knew a settlement was coming. Now comes the hard part: compliance. This past Monday, December 14, Matthew Schneider, U.S. Attorney for the Eastern District of Michigan, announced that his office and the UAW had settled a civil suit filed earlier that day against the union based on acts of fraud, embezzlement and tax evasion committed by certain among its members. Criminal investigations had led to charges and convictions of 15 individuals, mostly union officials, including recent UAW Presidents Gary Jones and Dennis Williams. Most thus far have received sentences. The consent order, which requires court approval, creates an Independent Monitor possessed of the authority for up to six years to investigate and discipline corruption.
Union Corruption Update has covered this two-part investigation many times (such as here and here) since it broke open in July 2017. The 400,000-member, Detroit-based United Auto Workers, though … Read More ➡
The unfinished business of the United Auto Workers scandal is nearing its end. A week ago, on November 17, Joe Ashton, former vice president of the UAW’s General Motors Department, was sentenced in U.S. District Court for the Eastern District of Michigan to 30 months in prison for receiving over $250,000 in illegal bribes and kickbacks from a union vendor, and for conspiring with two fellow union officials to launder the proceeds. He had pleaded guilty last December. Several ranking UAW officials, including its two previous presidents, already have pleaded guilty to embezzlement, racketeering and tax fraud charges. The actions follow a joint investigation by the FBI, the IRS and the Labor Department’s Office of Labor-Management Standards and Office of Inspector General.
Ashton, now 72, a resident of Ocean View, N.J., is a retired UAW vice president. He now is also one 15 defendants convicted of financial crimes related to … Read More ➡
Don’t tell International Brotherhood of Electrical Workers Local 98 that lightning can’t strike twice in the same place. For them, it’s now happened. Around 7 A.M., October 16, FBI agents raided the headquarters of the Philadelphia union in search of evidence of threats of violent retaliation by union leaders against certain dissenting members. Authorities would not say if the search was related to an August 2016 FBI raid connected to an influence-peddling scandal implicating IBEW Local 98 Business Manager John Dougherty, Philadelphia City Council Member Bobby Henon, and certain other persons. That case produced multiple indictments a couple years later for bribery, embezzlement, concealment, and tax evasion. A former City official and an unindicted contractor thus far have pleaded guilty.
IBEW Local 98, with about 5,000 active members, for decades has been close to Philadelphia’s construction industry and City Hall. Some might say too close. On January 30, 2019, a … Read More ➡
New York City-area construction unions are well-known for being on the take. A recent announcement by the U.S. Department of Justice won’t likely alter that reputation. On October 1, the U.S. Attorney’s Office for the Southern District of New York announced the arrest and indictment of 11 officials of the New York State Building and Construction Trades Council on various charges related to their receipt of over $100,000 in bribes from nonunion contractors in return for bid-rigging, in the process selling out the dues-paying union members whom they represented. Led by Trades Council President James Cahill, the defendants are current or former members of two local affiliates of the United Association of Plumbers & Pipefitters. Aiding in the probe was the Suffolk County (Long Island), N.Y. district attorney’s office. All the defendants pleaded not guilty at arraignment.
It’s a common form of back-scratching in the world of organized labor: An … Read More ➡
John Ulrich exacted a high price for his favors. Now he’s paying a high price. On July 22, Ulrich, ex-vice president and recording secretary of the Great Neck (Long Island), N.Y.-based International Brotherhood of Teamsters Local 812, was sentenced in Manhattan federal court to 18 months in prison, to be followed by two years of supervised release, for soliciting and receiving bribes from a union health plan administrator in return for retaining that person’s services. He also was ordered to forfeit $55,000 in personal assets and pay restitution in a sum to be determined later. Ulrich had pleaded guilty in December 2019 following his indictment that February. The actions follow a probe by the FBI and the U.S. Labor Department’s Office of Labor-Management Standards, Office of Inspector General and Employee Benefits Security Administration.
Teamsters Local 812 represents about 3,000 beverage industry workers in the New York City metropolitan area. Its … Read More ➡
Secretary of State Mike Pompeo accused Senator Robert Menedez (D-NJ) of orchestrating the controversy over the firing of State Department Inspector General Steve Linick.
Pompeo said. “I don’t get my ethics guidance from a man who was criminally prosecuted — case number 15-155, New Jersey Federal District Court. A man for whom his Senate colleagues, bipartisan said basically that he was taking bribes. That’s not someone who I look to for ethics guidance.”
Pompeo is right. Menendez is a crook. He should have been forced out of the Senate and gone to jail with his co-defendant Salomon Melgen. But it was the Trump Justice Department that let Menendez off the hook.
As we have recounted previously, Menendez was tried on bribery and related charges, but that trial ended in a mistrial on November 16, 2017, and the Justice Department made a decision not to retry … Read More ➡
Glenn Blicht sold out his union for a price. Now he’s on the verge of paying a different kind of price. On October 16, Justice Department officials announced that Blicht, former president of International Longshoremen’s Association Local 164, had pleaded guilty in Manhattan federal court two days earlier to demanding and accepting about $150,000 in bribes over several years from a representative of an employer in exchange for the union backing away from filing arbitration complaints against the company. He had been arrested and charged in July. As part of the plea deal, Blicht must forfeit $150,000 and pay restitution. He faces up to five years in prison. The employer representative already had pleaded guilty. The actions follow a joint probe by the FBI, the IRS and U.S. Labor Department’s Office of Inspector General and Employee Benefits Security Administration.