CARPENTERS (UBC)
FBI Raids Detroit Council's Offices
Federal agents reportedly raided the Michigan Reg'l Council of Carpenters'
offices in Detroit and several construction firms elsewhere in the state
on Jan. 12. They seized several boxes of records. The FBI and Dep't
of Labor reportedly conducted the raid. The probe is reportedly targeting
the union's pension funds.
An official with the FBI regional office in Detroit confirmed that federal agents "executed a search warrant" at the Carpenter offices but declined further comment because the search warrant was sealed. There was no comment on similar action taken by federal agents elsewhere in the state.
Ralph Maybry, secretary-treasurer for the Council, said he was "disappointed with the way the whole thing went down." The Council "has never hidden anything from the government" and "always cooperated" with any investigations. Maybry said there was no cause for the hostile entry made by federal agents into the union's offices. As for the related visits on the same day to companies in Ann Arbor, Southfield, and Livonia, Maybry said the union pension fund had invested in projects in those cities. [BNA 01/17/01]
POLICE UNIONS (FOP)
Rhode Island Boss Off to Prison
An ex-East Providence police officer, Alan
A. Gouveia, who admitted embezzling $26,190 while treasurer of the
local Fraternal Order of Police was handcuffed Jan. 9 and sent to prison
by Superior Court Magistrate Joseph Keough who said police must be held
to a higher standard. Before imposing the 10-year sentence, with 9 months
to serve, Keough rejected a plea from Gouveia's attorney, Stephen R. Famiglietti,
that he be spared from any prison time because his mother is dying of cancer.
Keough said he had reduced prison time for Gouveia from 12 months to 9 months so as to give Gouveia time in the end to do something useful: 150 hours of community service that would begin after the prison time is finished, most of it devoted to giving lectures to students about his prison experience. Keough had previously ordered Gouveia to also make restitution for the $26,190 he admitted stealing by Jan 9. or face even more stringent punishment.
During sentencing arguments, Famiglietti pled for mercy for his client, saying that while what he had done was reprehensible using the money to feed his addiction to drinking and gambling his client was nonetheless a first-time offender and should be treated no differently than other first-time offenders who are generally not given jail terms.
Gouveia pled guilty last Nov. to three counts of embezzling funds from the East Providence FOP between 1994 and 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 10 years he served as treasurer was much higher than the amount he admitted to in court. "There is about $100,000 that's not accounted for, but we can't prove he took all of that," Norton said. "But we think we can prove he took $65,000, and we're going to court to get that back."
Asst. Atty. Gen. Alan R. Goulart said one aspect of the embezzlement that FOP members found particularly galling was that midway through Gouveia's term as treasurer, he announced to the membership that the group's legal expenses were such that it needed more cash. A $10-a-week assessment was imposed on each member over and above the regular union dues for the next two years in effect taking an additional $1,000 from every member. [Providence J.-Bull. 01/10/01]
GOVERNMENT EMPLOYEES (NFFE)
North Dakota Boss Embezzled $2,300
Ex-president of Nat'l Fed'n of Fed. Employees Local 225 in Fargo, N.D.,
Richard LaRue of Shevlin, Minn., was sentenced Jan. 16 to two years probation
for embezzling union funds. He pled guilty to misappropriating $2,300
in union funds between Oct. 1996 and Dec. 1997. U.S. Dist. Judge Rodney
Webb in Fargo ordered LaRue to spend four months in home confinement, pay
a $500 fine and make restitution. [Bismarck Trib. 01/17/01]
IRON WORKERS (BSOIW)
Union Opens Defense Fund for Bosses
As previously reported, James E. Cole, the
general secretary of the Int'l Ass'n of Bridge, Structural & Ornamental
Iron Workers, was indicted in Dec. 2000 for union embezzlement. Cole is
the fourth BSOIW boss to face charges in a FBI probe involving allegations
of corruption within the BSOIW hierarchy and D.C. police force. The others
have pled guilty and are cooperating. Cole's indictment has raised speculation
that BSOIW president Jake West is the next target in the ongoing federal
corruption probe. Investigators began looking at BSOIW's financial records
in 1998 because of allegations of police corruption. Officials are trying
to determine if West used union funds to curry favor with ex-D.C. Police
Chief Larry D. Soulsby. Neither Soulsby nor West have been charged, but
sources say West continues to be investigated. West is running for reelection
this Aug. An opposition slate already has emerged, headed by BSOIW
treasurer Joe Hunt of St. Louis.
Now comes word that to help pay legal bills, BSOIW has set up a defense trust fund. The fund's trustee, Cal. attorney Jack R. Ormes, made a direct plea to other building trades union bosses for financial help, hoping to sway them with a warning that their unions could be next. Individuals can contribute up to $10,000 without being subject to federal gift taxes, a solicitation letter notes. It asks: "Should authorized expenditures by union officials generally, but particularly by a general president, in carrying out their duty to implement the lawful provisions of a union's constitution...be subject to criminal prosecution?" Other unions have not been quick to open their checkbooks. Reportedly, only $44,000 has been raised. [Engineering News Record 01/15/01]
LABORERS (LIUNA)
Three Chicago Bosses Removed
Laborers' Int'l Union of N. Am.'s
"in-house judge" Peter F. Vaira permanently barred three Chicago bosses
Jan. 10, finding that they were trusted members of organized crime and
used their union positions to achieve Mafia objectives such as rigged union
elections. The Jan. 10 decision should end the Caruso family's long-running
control over two LIUNA locals and the Chicago Dist. Council, which oversees
the pension, training, and health-welfare funds of 21 Chicago locals.
The decision removes: Bruno Caruso, the business manager of Local 1001 and the former president and business manager of the CDC; Frank "Toots" Caruso, Jr., a member of Local 1006 and the former president and business manager of the local; and Leo Caruso, the president and business manager of Local 1006. Bruno and Frank are brothers and Leo is their first cousin. The decision permanently revokes the Carusos' LIUNA membership and bars them from holding any office or employment with LIUNA or any affiliated entities. No word if the Bush Dep't of Justice will pursue criminal (a.k.a. real) sanctions for the Carusos.
Reportedly, testimony from law enforcement officials, former mob associates, and informants in the witness protection program helped Vaira conclude that the three men were "associates" of the Mafia, which is known in Chicago as the "Outfit."
Bruno Caruso ran a campaign in 1996 against disgraced ex-LIUNA boss Arthur A. Coia. Coia beat Caruso with 67% of the vote; Coia was removed from office and the union and from the Rhode Island Bar after pleading guilty to tax crimes. Thus, in LIUNA's first-ever direct election of union officers, the two candidates for union president have been ousted from the union because of corruption scandals before the five-year term for which they ran ended.
The decision lays out the three men's long association with known organized crime figures in Chicago for more than 40 years, beginning with Frank "Skids" Caruso, Sr., the father of Bruno and Frank and uncle of Leo. The senior Caruso was the boss of the Outfit's so-called "26th Street Crew." Testimony also brought out witnesses who testified that the Carusos not only associated with the upper echelons of the Outfit, but they participated in the mob's illegal gambling, burglary, and loan sharking schemes.
Allan A. Ackerman, Bruno's attorney, called the ruling "flat out wrong." He added, "I think [Vaira's] decision was decidedly unfair. It's our intention to appeal the order because we find it totally conflicts with the facts that were produced during the lengthy hearings." He said his client intends to appeal the ruling to LIUNA's "appellate judge" (Bill Clinton and ex-Labor Secretary Alexis Herman attorney) W. Neil Eggleston. [BNA 1/16/01; Chi. Trib. 1/12/01]
TEAMSTERS (IBT)
Hollywood Talks to Boston Grand Jury
The federal grand jury investigation of alleged corruption within Int'l
Bhd. of Teamsters Local 25 in Boston has had a parade of Hollywood
filmmakers testified in recent weeks, according to a Boston Herald source.
But some industry officials are reportedly fearful of cooperating with
federal investigators. "These people in L.A. are scared of these guys (Teamsters),"
said the source. It is unclear which film producers have testified so far,
but a number of movies filmed in and near Boston including Good Will
Hunting, Cider House Rules, The Good Son, and Blown Away are reportedly
"on the radar screen" of investigators. Additionally, the Dep't of Justice
has put a halt to IBT and state investigations of Local 25 bosses, worried
that the probes could undercut the ongoing grand jury.
The Dep't of Labor began probing allegations that Local 25 members routinely forced producers to rent equipment from them, placed unneeded crew members on sets and padded overtime in exchange for labor peace during filming. Allegedly, favored members, many with criminal backgrounds, were routinely placed in the plum jobs that pay $2,000 a week. The probe is also reportedly targeting payoffs and forced hiring in the furniture moving industry. Investigators are also reportedly probing possible drug dealings on sets as well as intimidation of union members who buck demands.
Among those targeted in the probe is James Flynn, an ex-con with reputed ties to organized crime who is Local 25's chief transportation coordinator. Investigators raided Flynn's home in June 2000. Flynn allegedly forced producers to rent equipment from his company Location Connection. The grand jury is also looking at producers being forced to give acting spots to some Teamsters, including Flynn who has appeared in Good Will Hunting and The Perfect Storm. [Boston Herald 01/12/01]
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PROFESSIONAL SPORTS (IBF)
Court Oversight of Boxing Union Continues
The Int'l Boxing Federation was denied a request in Newark, N.J., Jan
8. for its court-appointed monitor to
be removed. The monitor had been installed to oversee the sanctioning body
following the corruption indictment of its now-convicted founder, Robert
W. Lee. U.S. Dist. Judge John Bissell rejected the request and said
he would decide later whether to expand the monitor's powers, as sought
by government lawyers pursuing a racketeering lawsuit against Lee. [Times
Union (Albany) 01/09/01]
TRUCK DRIVERS
Supreme Court Reverses Chicago Boss' Conviction
On Jan. 9, the U.S. Supreme Court reversed the conviction of Paul Glover,
ex-vice president and ex-general counsel of the Chicago Truck Drivers,
Helpers, & Warehouse Workers Union, who alleged his attorney
was ineffective for failing to challenge the calculation of his sentence,
and held that the U.S. Court of Appeals for the 7th Circuit erred in holding
that the increase in the sentence was not significant enough to be prejudicial.
Glover was indicted and charged with using his control over the union's investments to obtain kickbacks. Glover's first trial ended in a hung jury, but in a second trial he was convicted on multiple counts. The pre-sentence investigation report recommended that, pursuant to U.S. Sentencing Guidelines, the convictions for labor racketeering, money laundering, and tax evasion should be grouped together. The government argued that the money laundering count should not be grouped with the other counts. The trial court held that it would not group the money laundering count.
Glover's offense level was increased two levels, which resulted in an increase in his sentence. Glover's attorneys did not oppose the government's position in the trial court and, on appeal, they did not raise the grouping issue. The 7th Circuit affirmed Glover's conviction.
Glover filed a pro se motion to correct his sentence and argued that his attorneys had given him ineffective assistance because they did not contest the grouping decision, which unlawfully increased his sentence by anywhere between 6 and 21 months. The trial judge denied Glover's motion and held, under the 1984 Supreme Court case Strickland v. Washington, the increase in his sentence was not significant enough to amount to prejudice. The 7th Circuit affirmed the denial of the motion. The Supreme Court, in a unanimous decision authored by Justice Kennedy, held that the 7th Circuit erred in trying to graft a requirement that any increase in a sentence must meet a standard of significance onto the prejudice branch of the Strickland test. [UPI 01/09/01 & Legal Times 01/15/01 (citing Glover v. United States)]
LONGSHOREMEN (ILA)
Florida Probe of Campaign Contributions Moves Forward
A Port Everglades firm, Eller & Co., is negotiating with federal
prosecutors in Tampa who want to force the firm to restore about $230,000
to a pension fund of Int'l Longshoremen's Ass'n Local 1402. The negotiations
were disclosed in a criminal plea agreement between the U.S. Attorneys'
office and former Eller & Co. president and chief executive Arthur
C. Novacek. Novacek pled guilty in Sept. 2000 to making an illegal campaign
contribution. As part of the deal, Novacek agreed to cooperate in the governments
ongoing investigation.
Novacek, now a consultant to Eller, got into trouble for authorizing $1,000 in corporate contributions to Perry C. Harvey, who ran unsuccessfully for a seat on the Hillsborough County Commission in 1996. Harvey is the longtime president of Local 1402. At the time the contributions were made, Local 1402 represented Ellers' Tampa-based employees, including workers at Harborside Refrigerated Services, then a wholly owned subsidiary. Harvey at the time was negotiating a new labor contract for the ILA with one of Novaceks subordinates, Joseph Casella. One of Casellas duties was to keep labor costs down.
According to the government, the corporate contributions authorized by Novacek were followed by negotiations with Harvey that led to substantial cuts in benefits for ILA members who worked moving cargo for Harborside. The contract ultimately agreed to between Harvey and Casella [who were both trustees of the pension fund] called for an approximate $2 per hour per longshoreman reduction in employer contributions to the pension fund, the main retirement fund for Harveys rank and file, the plea agreement says. Novacek was charged under an anti-bribery provision of the federal Taft-Hartley Act that forbids employers or their agents from paying money or other valuable considerations to the officers of a labor union. [Broward Daily Business Rev. 01/18/01]
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