WASHINGTON, DC -- Today National Legal and Policy Center Chairman Ken Boehm issued the following statement regarding Labor Day and union corruption:
"Thankfully, Labor Day is not a holiday for all of the union leaders doing time in prisons for their crimes against union members. Sadly, however, over the past year, the wave of union corruption that has recently plagued America's labor unions has not subsided--if anything, it has gotten worse.
The following list of forty-seven examples from the last twelve months is representative of the repulsive trend in union corruption and demonstrates the need for reforms such as mandatory annual audits of unions that are filed with the U.S. Department of Labor. (The following cases are listed by the amount in question):
1) International Brotherhood of Teamsters: form IBT president Ron Carey pled not guilty in February 2001 to federal criminal charges that he knowingly participated in a complex scheme to funnel more than $885,000 in union funds to his failed 1996 reelection campaign. Carey was indicted on seven counts of perjury and making false statements in connection with the probe of the money-laundering scandal. Prosecutors alleged that Carey lied when he denied knowledge of a swap of IBT contributions to various groups in return for their arranging for donations to his campaign.
2) Laborers' International Union of North America: Frank B. Zeuberis, president and business manager of LIUNA Local 5 in Illinois, pled guilty in June 2001 to a federal racketeering charge and admitted that he embezzled $470,106 in union funds. He admitted that he gave himself, his wife, and James A. DiForti unauthorized and fraudulent salary increases, bonuses, and paid vacations. DiForti was a reputed mob lieutenant who Zeuberis appointed as Local 5's secretary-treasurer. Zeuberis also admitted that he solicited $5,000 to appoint a union member as a business agent.
3) National Education Association: The Washington Education Association was found guilty in July 2001 for intentional violations of misusing mandatory dues and fees for politics. The penalties, sanctions, and reimbursements make this the largest fine ever levied against WEA: a $200,000 civil penalty which was doubled to $400,000 as a punitive sanction. WEA was also ordered to pay for the costs of the probe, trial, and attorneys' fees.
4) Independent Firefighters: Patrick Stiles agreed in April 2001 to pay $275,000 to two union groups, Aurora (Illinois) Firefighters Local 99 and the Aurora Firefighters Relief Association, that accused him of embezzlement. A court order stated that Stiles "misappropriated and used for his own purposes" more than $300,000 from Local 99 and $65,000 from AFRA. He was secretary-treasurer of AFRA from 1995-1999 and Local 99 from 1992-2001. The two groups filed the civil suit against Stiles in February 2001 about a week after filing police reports that led to an ongoing criminal probe.
5) United Food & Commercial Workers International Union: Alan L. Axt, vice-president of the United Food & Commercial Workers Local 1288 Federal Credit Union in California, was indicted in June 2001 for embezzling $237,335.13. He allegedly stole the funds between 1999-2000, and is reportedly close to a plea deal.
6) International Longshoremen & Warehousemen Union: Teresa E. Sanchez, admitted union embezzler, was sentenced in May 2001 to twelve months at a federal community confinement center and ordered to pay more than $210,000 in restitution to ILWU Local 20A in California. She pled guilty to three counts of embezzling union funds and two counts of falsifying union records. From 1993-1999, Sanchez cashed 168 union checks for her personal use and also signed an unauthorized union check to her daughter for $2,000. She concealed the embezzlement by falsifying monthly reports.
7) American Federation of State, County & Municipal Employees: Victor Garcia, Sr., president of the AFSCME District 1199J in New Jersey and his son, Victor Garcia, Jr., the district's pension fund assistant executive director, were found guilty in September 2000 of conspiring to embezzle about $200,000 from the pension fund. Senior was also found guilty of conspiring to receive about $200,000 in cash kickbacks from a general contractor who, from 1994-1997, made about $6 million in renovations to a building. The contractor, among other things, paid for the repair of Senior's car in order to retain the union contract.
8) United Brotherhood of Carpenters: Leslie S. King, a clerk for the Carpenters Union Hospital Fund in Ohio was sentenced in November 2000 to fourteen months in federal prison for embezzling more than $194,000 from the union fund. King pled guilty to embezzling the money between 1999-2000 by submitting false reimbursement claims for medical procedures she never underwent. King then reportedly used the fund's computer to issue checks to herself. King pled guilty to one count of theft from an employee benefit plan and will serve three years of probation upon her release. She will also reimburse $194,138.
9) Independent Firefighters: Allegedly, members of the Northern Ohio Firefighters Union have accused a member of Local 639 of embezzling money from union coffers. The thefts are alleged to have occurred over more than a decade and total as much as $160,000. The FBI is reportedly investigating.
10) AFL-CIO: Daniel Courchesne, "longtime labor activist" and New Hampshire AFL-CIO secretary-treasurer, was sentenced in May 2001 to twelve months in federal prison for embezzling union funds, possibly to cover gambling debts. Reportedly, Courchesne stole approximately $127,000, but no precise total was given at the sentencing hearing. Courchesne, who pled guilty to one count of wire fraud, put some cash back into union accounts thereby allegedly netting $53,150. He was also ordered to undergo counseling for gambling and pay for the treatment himself. The funds diverted to Courchesne's personal accounts included dues and fees from labor organizations and subsidies from the national AFL-CIO. He deposited funds coming into N.H. AFL-CIO's office into a personal account and an account of a firm that he controlled. He claimed the money was for legitimate lobbying expenses. Two signatures were needed to withdraw AFL-CIO funds; he used another officials' stamp to make withdrawals. Also, he transferred funds to the N.H. Central Labor Council where he was authorized to withdraw funds on his own.
11) International Association of Iron Workers: international general organizer Darrel E. Shelton pled guilty in September 2000 to embezzling up to $120,000 from the union. He admitted to routinely using the union's money to cover his and others' personal expenses. Shelton's illegal expenses included $3,995 for a golf outing in California, attended by Iron Workers President Jake West. It reportedly included $1,000 for a dinner attended by West, his friends, and "several women." Shelton also admitted spending funds for numerous other dinners for West and West's family and friends. Shelton allegedly had a deal with West to write "per J West" on union credit card receipts so no one would raises questions. In exchange, Shelton allegedly could charge his own personal expenses. These reportedly included an out-of-state family reunion, his mother's birthday dinner, and lodging at Disneyland. He was also accused of collecting reimbursement for thousands of dollars in phony charges related to phone and auto expenses.
12) Civil Service Employees Association: Nancy Groome, admitted in July 2001 that she embezzled more than $111,000 from CSEA Local 316 in New York. She pled guilty to one count of union embezzlement and said that she forged union checks to pay for groceries, car insurance, and other personal expenses. Allegedly, she forged 319 checks between 1993-1999. Groome wrote checks on a union account made out to herself. She also wrote checks to vendors for union-related training trips that she never took. She was Local 316's treasurer from 1980-2000. The checks were reportedly forged between 1993-1999. CSEA rules require that checks be signed by the union president and the chief financial officer, but Groome reportedly forged those signatures. The missing funds were discovered during a union audit.
13) United Railway Supervisors: Richard P. Miller was sentenced in August 2001 to five months in prison for embezzling funds from URS Local 202 in Pennsylvania. Miller pled guilty to double billing union expenses, pocketing excess reimbursements, and withdrawing money from the local's checking account for personal expenses. He was also sentenced to five months of community confinement plus three years of supervised release and was barred from serving as an officer in or representing any labor organization for thirteen years. He was further fined $10,000 and ordered to repay $100,000.
14) American Federation of State, County & Municipal Employees: Robert J. Gordon, financial secretary-treasurer of AFSCME Local 366 in Wisconsin, was indicted in May 2001 for an $88,000 union embezzlement. He allegedly wrote more than 200 unauthorized union checks to himself between 1996-1999. He held his union post from 1987-1999.
15) American Federation of State, County & Municipal Employees:
Peter Carosella, Treasurer of AFSCME Local 299 in New York was indicted
in April 2001 for grand larceny. Carosella was charged with embezzling
almost $80,000 by submitting 429 fake restaurant receipts. Reportedly,
the fraud was easy to discover because Carosella bought a restaurant receipt
book from a stationer and then submitted
consecutively numbered receipts.
16) National Education Association: The Florida Education Association is suing a former staffer, Kimberly Richey, claiming stole $66,000 from a FEA office. Allegedly, Richey forged FEA checks and put them into her own account between 1997-1999. Auditors discovered the missing funds.
17) United Association of Plumbers and Pipe Fitters: Janet L. Hornsby was sentenced in May 2001 to two years probation with ninety days home confinement for a $54,600 union embezzlement. The office manager of UA Local 6 in Minnesota admitted that between 1990-1999 she embezzled approximately $54,649 from the local for her own use.
18) International Association of Iron Workers: Jake West was charged in a forty-nine-count indictment in August 2001 with embezzling more than $50,000 from the union to cover costs of golf outings, dinner parties, vacations, liquor shipments, and other personal expenses. He was arrested by FBI agents while having dinner with friends at the Prime Rib restaurant in downtown Washington, D.C., a place where prosecutors said he spent nearly $7,000 of the union's money for personal meals and parties. Allegedly, the Prime Rib expenses included $1,072 for a meal with relatives, $1,351 bill for a birthday party, and $948 charge for a graduation party. The charges allege that he and other officials used the union funds 1992-1998 for personal activities and then failed to report the activities on expense reports submitted to the Department of Labor. Among other things, West is accused of spending more than $10,000 in union money for golf outings in Maryland and California. He also allegedly used union money to pay for holiday weekends and other vacations for himself and relatives, and to stock a home he kept in Allisonia, Va., with thousands of dollars worth of liquor. West resigned under a cloud in February 2001 after twelve years as BSORIW's international president.
19) American Federation of Railroad Police: Dennis Chiocchi of New Jersey was charged in February 2001 with embezzling more than $50,000 from the AFRP. Chiocchi allegedly embezzled the funds between 1995-1998 when he was AFRP's secretary-treasurer and then president. Chiocchi allegedly used union funds for personal travel and a Jeep Grand Cherokee.
20) AFL-CIO: H. Jeannine Selvaag, a bookkeeper for the South Central (Wisconsin) Federation of Labor, was charged in May 2001 with embezzling almost $40,000 from the union federation. She allegedly stole the money from SCFL bank accounts in 1998-1999, including proceeds from the SCFL's Labor Day picnic. She told police that she used much of the money for gambling, drinking, and house payments. A outside accounting firm found $39,254 missing from three SCFL accounts. Much of the money taken consisted of checks cashed with Selvaag's hand-written endorsement. Some was also taken as cash at the time funds were deposited. Selvaag told police that she took the 1999 Labor Day picnic cash, put it in her freezer, and used most of it for gambling. She said that in 1998-1999 she gambled several days a week and drank heavily.
21) Bakery, Confectionery & Tobacco Workers International Union: Donnie L. Block pled guilty in May 2001 to embezzling more than $38,000 from the BC&T Local 66 in Virginia. The local president embezzled dues paid through payroll deductions between 1997-1998. He wrote and cashed more than 100 checks for personal use that were drawn on the local's bank account, which caused it to be overdrawn. Four checks, for almost $1,500, were cashed at a Las Vegas casino. He also wrote two checks to his wife, worth $700. Reportedly, the couple recently separated due to his gambling.
22) International Association of Fire Fighters: Alan F. White, treasurer of the IAFF Local 539 in Virginia, was indicted in June 2001 on nine counts of embezzlement. The indictment came two months after White resigned as treasurer when an audit found $34,000 in union funds missing.
23) Brotherhood of Locomotive Engineers: Bryan D. Kroh pled guilty in June 2001 in North Dakota to embezzling $33,468.52 from BLE. The secretary-treasurer admitted to writing unauthorized checks to himself and his wife as well as numerous checks to vendors and a bank. Reportedly, there were 61 illegal transactions from 1996-1999.
24) United Brotherhood of Carpenters: Michelle Spragur was indicted in April 2001 on two counts each of union embezzlement, falsification of union records, and destruction of union records. She she allegedly stole about $30,000 from two UBC locals in Indiana and used the funds for her personal use. She allegedly falsified union records to cover her thefts and then destroyed certain records when she left. From 1995-1998, she was a secretary for the locals and responsible for collecting dues.
25) United Auto Workers: Pamela L. Schultz, financial secretary of UAW Local 553 in Wisconsin, was sentenced in March 2001 to five months in a halfway house for embezzling at least $28,000 from the local. She was also ordered to serve five months on home detention after her release and three years of supervised release. Additionally, she was fined $3,000. Schultz pled guilty and paid $36,000 in restitution. She allegedly wrote union checks to herself and others for her own benefit from 1996-1999.
26) Fraternal Order of Police: Alan A. Gouveia, who admitted embezzling $26,190 while treasurer of the local Fraternal Order of Police in Rhode Island, was sent to prison in January 2001. He received a ten-year sentence, with nine months to serve. Gouveia pled guilty to three counts of embezzling funds between 1994-1996. The FOP says it first discovered problems with the books after bringing in an independent auditor to look at them after Gouveia retired. Mark Norton, who took over the treasurer's post from Gouveia in 1997, said there is reason to believe that the amount that Gouveia stole during the ten years he served as treasurer was much higher than the amount he admitted to in court.
27) American Federation of State, County & Municipal Employees: Al Cannizzo, who racked up thousands of dollars for hometown hotel stays, pled guilty in October 2000 to $3,000 larceny charge and agreed to a sentence of five years probation. Cannizzo, of New York, also agreed to pay $20,000 in restitution to his union, AFSCME District Council 37. Cannizzo was president of AFSCME Local 1508. A union disciplinary panel accused Cannizzo of spending more than $100,000 improperly for hotel rooms, repairs to his personal cars, his personal telephone bills, dry-cleaning, and shoe repair.
28) International Association of Fire Fighters: Roger L. Mathisen, president of IAFF Local I-34 in Kansas and Missouri was sentenced in December 2000 to four months in a halfway house for embezzling more than $18,000 in union funds. He pled guilty to one count of felony embezzlement. Mathisen must further spend three years under supervision--the first four months under house arrest--after his release from the halfway house. Additionally, he was ordered to pay $15,295 in restitution. Reportedly, during his two-year stint as union president, Mathisen made about $14,000 in unauthorized withdrawals using a union debit card. Overpayment for Mathisen's expenses and unauthorized stipends accounted for the rest of the $18,000. Further, Max E. Biggerstaff, secretary-treasurer of Local I-34 pled guilty November 2000 to falsifying union records to conceal embezzlements by him and Mathisen. Biggerstaff acknowledged that he had prepared a document in that falsely showed that Mathisen had received a $2,159 loan from the local. Mathisen had, in fact, embezzled the funds. Biggerstaff also admitted that he embezzled $2,478 when he was reimbursed for unauthorized mileage, travel, and meeting expenses.
29) International Brotherhood of Electrical Workers: An union financial-secretary, his wife, and his secretary, were accused in May 2001 of stealing more than $16,800 from IBEW Local 429 in Tennessee. Financial-secretary Robert M. Emery, Sr., and secretary Terri J. Myatt face union embezzlement charges. Emery's wife, Patricia A., is accused of aiding and abetting union embezzlement. The indictment accuses Emery of stealing $5,693 for himself and $5,340 for his wife and helping Myatt steal $5,818 from union coffers. The thefts allegedly occurred in 1996-1998.
30) Operative Plasterers & Cement Masons International Association: Shelly S. Pfeifer was indicted in February 2001 on 265 counts of union embezzlement. She allegedly embezzled more than $16,000. Pfeifer is charged with pocketing union dues from 265 members of OPCMIA Local 577 in Colorado.
31) Laborers' International Union of North America: Joseph C. Rider pled guilty in May 2001 to one count of union embezzlement. The business manager and secretary-treasurer of LIUNA Local 1290 in Kansas, admitted to using a credit card to spend more than $15,000 in union funds for the personal benefit of himself and others. He also admitted to not reimbursing the local for the charges. His indictment said Rider used the credit card for airline tickets, restaurant bills, NASCAR tickets, Las Vegas shows, and vehicle rentals. The crime occurred over four years beginning in November 1995. Rider was the third generation in his family to head Local 1290. He was also president of the Western Missouri & Kansas Laborers' District Council.
32) Independent Teachers Union: The Nebraska State Board of Education voted in May 2001 to revoke the teaching certificate of Linda Harris for two years. Harris was sentenced to one year of probation in September 2000 for embezzling more than $14,000 from the school's teachers union. Harris was treasurer of the local union.
33) International Association of Iron Workers: general secretary James E. Cole pled guilty to union embezzlement in June 2001. A federal grand jury accused Cole of embezzling more than $10,000. Among the allegations: he used union credit cards and other funds to pay for personal meals, trips, and entertainment for himself as well as his family and friends. For example, he allegedly used union funds for a Scotland vacation, a high school reunion trip, and anniversary flowers for his wife. Also, Cole allegedly arranged for the union to pay for country club memberships that he and his wife often used for personal use. Cole allegedly submitted fraudulent reimbursement claims and falsified reports to the Department of Labor to conceal the expenditures for himself and other union officials. Specifically, he underreported the amount they spent by concealing disbursements in general categories such as "office and administrative" or "educational and publicity" expenses. Also, Cole allegedly participated with the union's former general counsel Victor Van Bourg, in obstructing the grand jury's investigation by withholding documents related to the Department of Labor reports for more than two years.
34) American Federation of State, County & Municipal Employees: Helen Greene, the No. 2 official in the AFSCME's District Council 37 in New York, was indicted in April 2001 on grand larceny charges, including one alleging that she charged $794 on her union credit card to pay for the rehearsal dinner for her son's wedding. Greene reportedly claimed that she spent the $794 on a union member retirement dinner. In total Greene allegedly embezzled about $8,700 from 1995-1998 by using union credit cards for personal expenses, including clothing, electronics and a down payment on a car lease. Greene reportedly had returned $5,000 after outside auditors found that she misused the credit cards.
35) American Federation of State, County & Municipal Employees: Laura Greco, treasurer of AFSCME Local 1501 in New York, was indicted in April 2001 for grand larceny. Greco was charged with stealing more than $8,500 in 1997. The indictment accused her of issuing local checks to herself and using a union credit card for transportation, sporting goods and clothes.
36) Laborers' International Union of North America: Ray R. Curtis pled guilty on May in May 2001 to embezzling from LIUNA Local 327 in Maine. He is the local's business manager and secretary-treasurer. He allegedly embezzled $8,548 from 1997-1999. A Department of Labor audit determined that he gave himself 109 paychecks over 91 weeks, wrongly receiving $7,704. It also found that he used a union check to buy an $835 snowblower for his personal use.
37) United Steelworkers of America: Donald G. Martin, of USWA Local 8681 in Tennessee, was charged in March 2001 with a fifty-six-count indictment for union corruption. Allegedly, he embezzled more than $6,875 in union funds. Specifically, he was charged with forty-nine counts of union embezzlement, five counts of making false entries into union records, and two counts of making false statements concerning union reporting requirements. Reportedly, Martin, Local 8681's financial secretary, had $6,600 in union reimbursement checks issued to him between 1996-1998. The checks were supposed to serve as reimbursements for time lost from their jobs for official union business and travel expenses. He also allegedly took $275 via a union check issued to him without authorization and without listing it in the cashbook. He is also accused of falsely stating that five reimbursement checks were payable to union officers when he knew they were payable to him. It also charges him with falsely representing that he received about $1,480 in disbursements for 1996 and $470 for 1997 when he knew he actually received $4,150 and $1,930. Martin allegedly deposited the funds to personal credit union accounts.
38) International Brotherhood of Teamsters: Stanley M. Bennett was charged in April 2001 with embezzling $4,833 from IBT Local 473 and Dayton (Ohio) Mailers Union Local 1137. He was secretary-treasurer of the Mailers Local before it merged with the IBT Local. From 1997-1998, he allegedly stole $2,588 in members' cash dues. He concealed the theft "by making false entries of receipts in the dues log or failing to record the amount received," according to court records. Reportedly, Bennett also wrote union checks totaling $2,245 "for the personal benefit of himself and not that of the union."
39) Paper, Allied-Industrial, Chemical & Energy Workers International Union: Angela B. Smith was indicted in March 2001 on two counts of union embezzlement. Smith was the secretary-treasurer of PACE Local 1325 in North Carolina. From 1997-1999, Smith allegedly embezzled $4,374.95 from Local 1325 by issuing checks to herself and third parties for her personal expenses. Further, she allegedly stole $150 from Local 1325 in 1999 by again issuing a check to a third party for her personal expenses.
40) Paper, Allied-Industrial, Chemical & Energy Workers International Union: Randy Kamp, president of a PACE local in Iowa, pled guilty in March 2001 to a $4,773 union embezzlement. Kamp was accused of stealing union funds in 1999.
41) International Brotherhood of Teamsters: Richard Lyter, an IBT staffer resigned after $3,414 in unauthorized meal expenses were discovered. He had been the assistant to secretary-treasurer C. Thomas Keegel since 1999. Lyter was asked to resign after an internal audit at IBT headquarters in Washington. It reportedly found discrepancies in an expense account. Lyter allegedly submitted personal expenses that were reported as union expenses over a ten-month period. In his resignation letter, Lyter acknowledged reporting errors and has reportedly reimbursed IBT. IBT said law enforcement has been notified.
42) Brotherhood of Maintenance of Way Employees: Lawrence A. Triche, of a BMWE local in Kentucky, was sentenced in January 2001 to one year probation and fined $600 after being convicted of making false statements to a Department of Labor investigator. Triche, who was vice-chairman and secretary-treasurer of the BMWE, was charged with lying to the federal agent, who was conducting a spot audit at the union's office to determine Triche's reasons for writing himself a check for $3,162 in union funds. Triche told the agent the check was written to cover union-related travel expenses, when it was not.
43) American Federation of State, County & Municipal Employees: Mary Wilson, and AFSCME District Council 37 official in New York, was indicted in September 2000 on charges of stealing more than $3,000 by steering union business to a conference center. Wilson, a vice-president of AFSCME Local 1549, is already awaiting trial on charges of conspiring with other union officials to steal more than $2 million through a variety of other schemes.
44) National Federation of Federal Employees: Richard LaRue, president of NFFE Local 225 in North Dakota, was sentenced January 2001 to two years probation for embezzling union funds. He pled guilty to misappropriating $2,300 in union funds between 1996-1997. He was also ordered to spend four months in home confinement and to pay a $500 fine and full restitution.
45) American Federation of State, County & Municipal Employees: James R. English, president of AFSCME Local 3895 in Ohio, pled guilty in November 2000 to a misuse of property charge for cashing checks totaling $1,900 at without proper authorization. The funds reportedly paid for his rent. English was sentenced to 32 days in jail, with ten days suspended. He was also ordered to complete a diversion program, placed on probation for three months, and fined $50.
46) United Public Workers: Gary W. Rodrigues and Robin H. Sabatini were charged in March 2001 in a forty-three-count indictment alleging fraud, embezzlement, and money laundering in connection with two UPW funds. The indictment charges that Rodrigues, Hawaii state director of the UPW and Sabatini, his daughter, devised a scheme to defraud UPW and its members of money paid out of UPW accounts for dental benefits and another scheme to defraud a UPW health benefit program. Further, it alleges that Rodrigues embezzled UPW funds by causing UPW to pay premiums not required to be paid for dental benefits. Finally, it accuses Rodrigues and Sabatini of laundering proceeds from the health benefit program fraud and embezzlement. The amounts were not disclosed.
47) American Federation of State, County & Municipal Employees: Lionel Scott, Mary Wilson, and Eugene Bruno all pled guilty in October 2001 to larceny charges. All were associated with AFSCME Local 1549 in New York. The indictments involved the use of union expense funds for personal use. Scott agreed to a sentence of 1.5 to 4.5 years in prison for grand larceny; Wilson to two to six years for grand larceny; and Bruno to three years probation for a misdemeanor, attempted grand larceny.
This list demonstrates the need for reform. It is also not complete, it only details cases that were readily available to the public through the media. It is also broad: covering twenty-eight unions and twenty-seven states. The National Legal and Policy Center, a leading union corruption watchdog group since 1997, has proposed eight reforms to Congress and the Department of Labor to better combat union embezzlement and corruption.
1) Federal law should be amended to require annual audits and quarterly reports from unions similar to those required by the Securities and Exchange Commission of corporations. Currently, union annual reports, called LM-2s, filed with the Department of Labor are deficient. Strengthening union reporting with such requirements as an independent public accountant's certification, generally accepted auditing standards, and generally accepted accounting principles would go a long way toward catching and preventing union embezzlement.
2) Federal law should be expanded to cover all unions. Currently, a loophole in the law allows government employee unions, such as the scandal-ridden American Federation of State, County & Municipal Employees, to escape federal law. Further, state and regional AFL-CIO councils are exempt. Recent embezzlement scandals in both types of union organizations warrant an expansion in federal coverage.
3) Congress should impose term limits on union leaders. Many embezzlement schemes take place because an official is entrenched for ten or twenty years. With such long reigns, officials are able to game the system to have a better chance to embezzle without detection. Additionally, many schemes are uncovered when an official retires. The union's records change hands, and the new official brings questionable records public in order to avoid being blamed for wrongdoing he didn't commit. Limiting terms to three or five years would increase transparency in union records making embezzlement more difficult.
4) The Department of Labor's oversight of unions needs reform. In pension matters, DOL has the right to sue for breaches of fiduciary duty. The rationale for this power is that the aggrieved parties may not always have the investigative and legal resources to press their claims. The same benefit should be afford to aggrieved union members. Separately, the Department of Labor's current distribution of the unions' disclosure information is woefully behind the times. It should emulate the Internet and electronic resources that the Securities and Exchange Commission provides the public for information on corporations.
5) Union members' right to sue should be improved. Different courts have applied different meanings to the terms of federal law and sometimes this cuts against the interests of union members. Congress should make it less restrictive for members to bring legitimate suits against corrupt union officials.
6) The maximum prison sentence that a judge can impose on a union embezzler is only five years. It should be increased to ten. Further, federal law allows a judge to ban a convicted official from union office for three to thirteen years. It should be increased to five to twenty.
7) Congress should give the Department of Labor the right to impose civil money penalties on officials that violate federal law. Many other labor law statutes permit DOL to impose civil penalties. Such penalties would increase the cost for wrongdoers who fall outside of the anti-corruption law's criminal provisions and would provide an additional sanction against a criminally convicted officials.
8) Federal law's definition of "appropriate relief" should be expanded to include convicted officials' pensions. In a 1990 Supreme Court case, union members tried to recover funds lost to an official's $377,000 embezzlement. The officials' pensions were declared off limits because of the current construction of the law. The court bluntly said that if Congress didn't like the result, Congress should change the law. NLPC argues that Congress should do just that.
These reforms offer the promise that future Labor Days may not be tarnished by the scourge of ever growing amounts of union corruption."
The National Legal and Policy Center is a nonpartisan, nonprofit foundation
monitoring union corruption and promoting ethics and accountability in
government through research, education, and legal action. NLPC's Organized
Labor Accountability Project investigates and exposes corruption and abuses
in the AFL-CIO, Teamsters, Laborers, and other labor organizations.
NLPC publishes a fortnightly newsletter, Union Corruption Update, which
details union corruption in many of the unions; past articles may found
by NLPC's union index and state index. For more about NLPC visit
<http://www.nlpc.org>.