FOOD & COMMERCIAL WORKERS (UFCW)
California Vice President Admits $277,000 Embezzlement
Alan L. Axt, ex-vice president of member
services for the United Food & Commercial Workers Local 1288 Federal
Credit Union, pled guilty Sept. 4 to embezzling $277,335 from the financial
institution based in Fresno, Cal. Axt admitted before U.S. Dist. Judge
Oliver W. Wanger (E.D. Cal., H.W. Bush) that he stole the money from Mar.
1999 to Nov. 2000. The plea had been postponed on several occasions; his
attorney David Gottlieb said Axt is being treated by a psychiatrist for
depression and other problems. The money was insured by the Nat'l Credit
Union Admin., making the embezzlement a federal crime. Axt was facing a
maximum of 30 years in prison and a $1 million fine, but his sentence is
expected to be much less because of his plea. Wanger set Dec. 3 for sentencing
and allowed Axt to remain free on his own recognizance. [Fresno Bee 9/5/01]
IRON WORKERS (BSORIW)
Ex-International President Indicted for $50,000 Embezzlement
The ex-top boss of the Int'l Ass'n of Bridge,
Structural, Ornamental & Reinforcing Iron Workers was charged Aug.
28 with embezzling more than $50,000 in union funds to cover costs of golf
outings, dinner parties, vacations, liquor shipments, and other personal
expenses. Jake West pled not guilty to union
embezzlement and other corruption charges in a 49-count indictment. West
resigned in Feb. after running BSORIW for twelve years. He is the fifth
BSORIW boss nabbed in the scandal.
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 for a birthday party, and $948 for a graduation party. West's attorney, Cary M. Feldman, criticized authorities for not permitting West to surrender at U.S. Dist. Court. West was treated to a night in jail before being released on personal recognizance by U.S. Magis. Judge Alan Kay. Feldman says he repeatedly offered to bring West to court if he were to be indicted. Federal law enforcement officials didn't comment on the timing of West's arrest.
The charges against West include allegations that he and other bosses used the union funds 1992-98 for personal activities and then failed to report the activities on expense reports submitted to the Dep't of Labor. Among other things, West is accused of spending more than $10,000 in union money for golf outings. West 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.
Others charged in the scandal are: Darrel E.
Shelton, ex-gen. organizer, who pled guilty to embezzling as much as
$120,000; Fred G. Summers, the former executive
director of organizing, who admitted embezzling more than $50,000; James
E. Cole, ex-general secretary , who pled guilty to embezzling more
than 10,000; and Michael J. Brennan, the ex-head
of the Iron Workers Political Action League, who pled guilty to charges
involving the theft of $7,000. Brennan received probation. Shelton, Summers,
and Cole are awaiting sentencing. [Wash. Post 8/30/01]
GOVERNMENT EMPLOYEES (AFSCME)
New York Boss Gets the Max Sentence for Vote Rigging
N.Y. trial judge Bonnie G. Wittner sentenced Albert
A. Diop, an ex-int'l vice president of the Am. Fed'n of State, County
& Mun. Employees and ex-boss in AFSCME Dist.
Council 37 in N.Y., Aug. 28 to the maximum sentence, sixteen to forty-eight
months in jail, for helping to rig a 1996 union contract vote. Diop still
faces trial on separate charges that he embezzled over $1 million for personal
purposes, including a penthouse suite, credit card charges, and equipment
to try to detect listening devices in DC37 offices during a Manhattan Dist.
Atty probe. If convicted of grand larceny, he could face twenty-fives years
in jail.
Diop was once a top adviser to DC37 boss Stanley Hill and president of AFSCME Local 1549, for which he received $209,000 annually. He was charged in 1999 with ordering subordinates to alter ballots to win ratification of a five-year city contract. Before Wittner, Diop, appearing frail, said he was "sorry and ashamed" and then recounted his success as a union boss. Then in a barely audible voice, he said, "I am innocent of any wrongdoing." Wittner told him that "shame is normally the first step toward admitting your guilt...I don't believe you're sorry or ashamed." She said: you "violated the trust of [the] membership" and "[w]ithout your participation, this whole scheme couldn't have taken place." She added: "You misused your high union position. I don't find anything really mitigating."
Diop's attorney, Ramon W. Pagan, said that he would appeal, because Diop had been found unfit to stand trial by court-appointed psychologists. But after several hospitalizations for depression, he was deemed well enough to proceed to trial. Pagan also alleged other bosses had "bought their freedom" by falsely implicating Diop. Because Diop has already served ten months in jail, Pagan said that he could be released within two and a half months, but that he would need time to prepare for the next trial. [N.Y. Times, N.Y. Post, Daily News 8/29/01]
LABORERS (LIUNA)
Federal Judge Lifts Chicago Consent Decree
On Aug. 30, U.S. Dist. Judge Robert W. Gettleman (N.D. Ill., Clinton)
lifted a consent decree and, thereby, ended federal supervision of the
Laborers' Int'l Union of N. Am.'s
Chicago Laborers' Dist. Council. The ruling came after prosecutors and
union attorneys joined sides asserting that the need for strict federal
oversight had come to an end. "It's not perfect," said Asst. U.S. Atty.
Craig Oswald, but "[w]e think it's time for the labor union to show they
can run the thing free of organized crime."
Nevertheless, on the very day that the consent decree was lifted, Steven Miller, the court-appointed monitor filed internal union charges in court seeking to discipline two CLDC bosses who are the sons of reputed mob bosses: Joseph Lombardo, Jr., CLDC's ex-secretary-treasurer and Anthony Solano, head of CLDC's training center. Their fathers, Joseph "the Clown" Lombardo, Sr., and the late Vince Solano, were identified in the charges as longtime mob bosses. Lombardo, Jr., was accused of contributing to the mob's influence on CLDC, while the younger Solano allegedly permitted mobsters to influence the hiring of instructors at the training center.
In 1995, the Dep't of Justice began a weak program overseeing the highly-questionable "internal reform effort" of LIUNA. In 1998, as part of that effort, LIUNA took over CLDC. In 1999, DOJ showed some signs of life and brought a civil racketeering suit with LIUNA alleging CLDC had been dominated for three decades by the mob. This suit, for the first time, made at least the Chicago portion of the reform effort accountable to a federal judge, rather than LIUNA's leadership.
Jim McGough, leader of Laborers for Justice, argued that CLDC is still not free of the mob. "They've only scraped the surface with respect to organized crime," he said. "They have not gone in and effectively eliminated the union officers and executives who hold their positions due to the influence and control of organized crime. In many respects, the monitorship was a failure."
Oswald said DOJ was satisfied that much progress had been made ridding CLDC mob influence and realized that overextending its stay could leave "honest" union bosses vulnerable to attack from opponents. "We don't think the government should be running labor unions," he said. "Labor unions should be running labor unions, but they shouldn't be run by organized crime." He added: "There are still problems" and DOJ continues to have some minimal oversight of LIUNA through the 2006 election. "We'll be watching," he said. [Chi. Trib., BNA 8/31/01]
ELECTIONS & POLITICS / AFL-CIO / TEAMSTERS / CARPENTERS
/ MINE WORKERS
News: Trumka, Mary Jo, Union Politics
Some recent investigative work by columnist Robert Novak has provided
insights into the Bush Administration and AFL-CIO politics. On his Sept.
1 CNN show, he asked Sec'y of Labor Elaine L. Chao if AFL-CIO secretary-treasurer
Richard L. Trumka should resign because
he invoked the Fifth Amendment to avoid answering investigators questions
about corruption on his part. Chao said, "it is certainly very unusual
for a top official of the AFL-CIO to invoke the Fifth Amendment, particularly
when, in the past, when any high official has done so, they have automatically
been terminated or left." Novak pressed her again if Trumka should
resign, and she refused to say yes: "I think this issue is still working,
and so let's see what happens. It's in the courts, and there are numerous
cases associated with it. Let justice take its course." Does Chao know
something about a possible Trumka prosecution that we don't?
Any such prosecution has to go through, around, or over U.S. Atty. Mary Jo White. In his Labor Day speech to Teamsters in Detroit, President Bush said: IBT boss James P. Hoffa "is running a good union; and in an aboveboard way." Novak's Sept. 6 column reported that afterward, Bush asked: "I don't know why we just don't end it" referring to the government's cleanup of IBT. Bush was told that the cleanup is supervised by White. Bush asked, "Isn't she a [Clinton] holdover?" Novak commented: "That's a question Teamster officials have been asking."
In addition to IBT, Bush met with the United Bhd. of Carpenters in Green Bay on Labor Day. Bush and UBC president Douglas McCarron shared kind words. As previously reported in the UCU, UBC bolted the AFL-CIO earlier this year because of a lack of confidence in the Sweeney-Trumka cabal. McCarron has reportedly asked Hoffa to join UBC in a new labor federation. On that point, Novak added, "They conceivably could be joined by the United Mine Workers, whose president, Cecil Roberts, was at the White House [recently] saying his members are interested in jobs and guns and helped Bush carry West Virginia. That sounds like Big Labor splitting."
TEAMSTERS / AFL-CIO / GOVERNMENT EMPLOYEES / SERVICE
EMPLOYEES
Carey Trial Begins in Manhattan
The perjury and false statements trial of expelled Int'l Bhd. of Teamsters
boss Ron Carey began Aug. 28. He allegedly lied
about matters in several complex schemes
in which $885,000 of IBT funds were embezzled and some $538,000 was wrongfully
funneled into his failed 1996 campaign. Five others have pled guilty
and one has been convicted in the scandal. Carey faces up to thirty-five
years in prison. U.S. Dist. Judge Robert L. Carter (S.D.N.Y., Nixon) said
at jury selection on Aug. 27 that the trial is expected to last three weeks.
Asst. U.S. Atty. Deborah A. Landis is trying the case with Andrew Dember, chief of U.S. Atty. Mary Jo White's Public Corruption Unit. Landis told the jury in opening arguments that Carey lied sixty-three times in six months to investigators and a grand jury. Landis also said that Carey knew about a scheme to raise campaign funds from AFSCME, SEIU, and AFL-CIO bosses in violation of election rules barring employers contributions. She singled out the AFL-CIO's Richard L. Trumka, saying that Carey had been angered when told that Trumka "had not yet fulfilled his commitment to raise" $50,000. Carey was "mad because he had helped Trumka get his job and he expected Trumka would return the favor," she said.
Carey's attorney Mark J. Hulkower argued that Carey had been the victim of a scheme by professional political aides to enrich themselves at IBT's expense. Hulkower blamed the scheme on two Carey campaigners, Jere Nash and Martin Davis. He argued that Nash, falsely implicated Carey in an effort to win leniency after having been convicted twice of perjury. Nash "is looking at a lot of jail time," Hulkower said. Separately, Carter scolded Hulkower after the jury was dismissed for one lunch break: "We had agreed you were forbidden to indicate that Mr. Carey was not indicted by the government because he was innocent of the charge." He added, "I'm not going to tolerate any more" and threatened to "embarrass" Hulkower in front of the jury if there was a recurrence.
Nash testified Aug. 30 that he gave $5,000 in cash to a Carey campaign worker, Joe Fahey, and told him "to write out a [personal] check to the campaign" for the same amount. The switch was done to hide the fact that Trumka was the source of the money. On Sept. 4, Nash faced new questions of shenanigans. Hulkower confronted him with old expense reports, which showed that Nash charged both the Carey campaign and a consulting firm for the same airline tickets. Nash call the double-dipping "an accident."
In a very surprising development, prison inmate and ex-IBT political director, William W. Hamilton will testify in the Carey trial, according to Landis. Convicted in 1999 of embezzlement and related corruption, Hamilton began serving a three-year sentence April 30 at a federal prison in Cumberland, Md. He must have something the government wants: a more solid case against Carey and maybe others? Also, the government has to have something Hamilton wants and that could only mean reduced jail time or restitution. [BNA 8/30; N.Y. Times 8/28; N.Y.L.J., Newsday, Daily News 8/29; N.Y. Post 8/31, 9/5/01]
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ADDITIONAL BRIEFS NOT INCLUDED ON THE FAX EDITION OF THIS UNION CORRUPTION UPDATE:
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QUOTABLE QUOTE
"There is an obvious reason why the [AFL-CIO]
has refused to acknowledge its political activity, as required by federal
tax law: Because it is loathe to comply with the Supreme Court's 13-year-old
Beck decision."
- Joseph Perkins, Big Labor Plays politics and Skirts the Law, San-Diego Union-Trib., Aug. 24, 2001.
TEAMSTERS (IBT)
Appeals Court Reinstates Conviction and Sentence of Chicago Boss
The U.S. Court of Appeals for the Seventh Cir. reversed a district
court ruling in a Teamster's union violence case. Defendant Michael J.
Gochis is an ex-steward for Int'l Bhd. of Teamsters Local 705 in Chicago.
On Jan. 22, 1998, he was charged with three counts of threatening and using
violence against another union member, a Class A misdemeanor. Pursuant
to the local court rules, of his case was randomly assigned to a magistrate
judge. On Jan. 29, 1998, Gochis appeared without counsel and was arraigned.
U.S. Magistrate Judge W. Thomas Rosemond, Jr., advised Gochis to retain
an attorney but the judge did not explain to the defendant about his right
to a trial, judgment and sentencing by a district judge as required by
the Fed. Rules of Criminal Procedure.
Gochis later retained an attorney and on Feb. 12, he and his attorney signed and filed a consent form entitled "consent to proceed before U.S. Magistrate in a misdemeanor case." By signing the form, Gochis waived his right to a trial before a district judge. A jury trial was held before Rosemond and Gochis was found guilty on three counts. Rosemond sentenced him to concurrent prison terms of six months each, followed by six months of work release, and restitution.
In appealing his conviction and sentence to the district court, Gochis and his attorney never sought to withdraw his written consent to Rosemond's authority and they never challenged Rosemond's failure to admonish him of his right to be tried by by district judge until the district judge in his case, U.S. Dist. Judge Robert W. Gettleman (N.D. Ill., Clinton), raised the issue on his own. Gettleman vacated the judgment and ordered a new trial reasoning that because Rosemond failed to explain to Gochis his right to be tried by a district judge, the written consent was invalid and Rosemond lacked the authority to preside over the trial.
On appeal to the Seventh Circuit, the government argued that Gettleman should not have automatically vacated a three-week trial and jury verdict simply because Rosemond did not explain to Gochis what he and his attorney already knew. The government contended that Gettleman should not have imposed a per se reversible error rule on Rosemond's failure to literally comply with every letter of the federal rules, without considering whether the magistrate judge's error was harmless.
Circuit Judge Daniel A. Manion (Reagan), writing for the Seventh Cir., agreed and reversed Gettleman, saying that there was no indication that Gochis suffered any prejudice. Manion said that the omission by the magistrate judge should not "automatically eradicate what appears to be a complete and proper trial process to which the parties unequivocally consented." Manion said Rosemond's failure to strictly comply with the federal rules did not require the automatic reversal of the conviction because the error was harmless. The court remanded the matter for reinstatement of Rosemond's final order. Circuits Judges John L. Coffey (Reagan) and Diane P. Wood (Clinton) joined the opinion. [Chi. Daily L. Bull. 8/28/01]
ELECTRONIC WORKERS (IUE)
Appeals Court Allows International Boss' Retaliation Claim to Proceed
The U.S. Court of Appeals for the D.C. Circuit ruled Aug. 21 that former
secretary-treasurer of the Int'l Union of Electronic Workers Ron
Gilvin, who was suspended after criticizing IUE's president Edward
Fire, may proceed with his claim that he was retaliated against for exercising
his right to free expression in violation of the Labor-Mgmt. Reporting
& Disclosure Act of 1959, popularly known as the Landrum-Griffin Act.
Holding that Gilvin was covered by the LMRDA's free speech provision, the
D.C. Circuit reversed a district court decesion that the law protects only
the rights of union members, not union officers. "That holding was an error
of law," the court said, explaining that it ran counter to the U.S. Supreme
Court's 1989 decision in Sheet Metal Workers' Int'l Ass'n v. Lynn.
The D.C. Circuit's decision involved IUE's 1998 suspension of Gilvin for refusing to sign checks authorized by Fire. Gilvin, who subsequently was recalled by IUE members, maintained that the union violated his LMRDA rights to free expression because the suspension was imposed in retaliation for his criticism of Fire's budget plans. Gilvin was critical of, among other things, increases in union subsidies to IUE district councils, as well as raises and travel reimbursements authorized by Fire. He was suspended in June 1998 after refusing to sign subsidy checks to IUE districts and recalled in October 1998 after a membership vote.
IUE argued against application of the Lynn decision to Gilvin's case, Gilvin's situation involved the removal of an elected official from office, not a suspension. The D.C. Circuit, however, called the distinction "insufficient," pointing out that "the term of Gilvin's suspension was indefinite, and it immediately relieved him of all official authority."
"That action implicates the same concerns relied upon by the Court in Lynn: Union members who voted for Gilvin were denied the representative of their choice for the length of the suspension, and both Gilvin and those who observed what happened to him were likely to be 'chilled in the exercise' of their free speech rights," the court said in a decision written by Circuit Judge Merrick B. Garland (Clinton). "We are unable to perceive a difference in the degree of 'chill' generated by suspension as compared to removal sufficient to justify a difference in outcomes."
Nor did the court agree that LMRDA protections do not apply since Gilvin's letters to union members criticizing the union leadership were inconsistent with his duties and precluded effective representation of the union. The "fact that the letters were critical of the union leadership can hardly suffice to remove the protections" of LMRDA. "Indeed, as the Supreme Court noted in Lynn, such criticism was 'precisely' what Congress intended to protect in passing the LMRDA." Garland added that there was nothing about the substance of Gilvin's criticism that was inconsistent with his duties as a union official. Circuit Judges Karen L. Henderson (H.W. Bush) and David S. Tatel (Clinton) joined in the opinion. [BNA 9/6/01]
HOTEL & RESTAURANT EMPLOYEES (HERE)
Hotel Files NLRB Charges Against Union and City of Pittsburgh
The Pittsburgh's so-called "labor peace ordinance" enacted in 1999
is at the heart of a legal dispute between the developer of the newly renovated
downtown Pittsburgh Fulton Renaissance Hotel and the Hotel Employees &
Restaurant Employees Int'l Union. The Nat'l Labor Relations Bd.'s
Pittsburgh reg'l office is investigating charges of coercion and intimidation
filed in early July by the hotel against HERE and the Pittsburgh City Council.
Acting Reg'l Director Stanley Zawatski said the hotel's unfair labor practices charges are still under investigation. The ULPs grow out of an agreement brokered by Pittsburgh Mayor Tom Murphy early this year in which hotel developer Sage Hospitality Resources of Denver agreed to voluntarily recognize HERE Local 57 if the union could demonstrate through signed authorization cards that it had the support of the majority of the hotel's employees once the newly renovated facility opened in March. Sage earlier had accepted some $3.5 million in city tax incentive funds as part of the multimillion dollar hotel renovation project. Under city ordinance No. 22, passed in 1999, as a condition of receiving public funds, Sage agreed to remain neutral in any organizing drive and to bargain collectively once the union showed it had majority support.
Local 57 began collecting authorization cards in April and in June determined it had cards from more than half of the approximately 160 hotel employees, according to Ed Nassan, Local 57's president. But when a city official verified the cards, several cards had been revoked at the urging of management, according to Nassan. The union no longer had a majority. The local initially contested the card check outcome through arbitration, but has since opted simply to try to gather more cards.
Meanwhile, the hotel on June 28 filed unfair labor practice charges challenging the legality of the city's tax incentive ordinance. It claimed Local 57 had conspired with members of the city council to force the employees to become union members without a secret ballot election. Attorney John M. O'Donnell of the Pittsburgh firm of Stokes & Murphy, who represents the hotel, said the neutrality agreement required by the ordinance is invalid because the hotel was coerced into accepting it. The city council was acting in concert with the union in enacting the ordinance, he charged. "Our position is that employees should make the decision [to organize] through a secret ballot election," he said. "They have a legal right to organize, and if they elect the union, the hotel will bargain." [BNA 8/30/01]
TEACHERS
South Florida Boss Indicted
Broward Teachers Union president Tony Gentile
surrendered to U.S. Marshals after his indictment Aug. 30 on federal child
pornography charges. Gentile is charged with one count of trying to induce
a minor into engaging in a sexual act and one count possession of child
pornography, according to the indictment handed up by a federal grand jury
in Ft. Lauderdale, Fla. The charges carry a combined penalty of up to 20
years in prison and $500,000 in fines.
The union boss was arrested July 26, when he allegedly showed up outside a Ft. Lauderdale store where he planned to meet an Internet acquaintance who had presented herself as a 14-year-old girl. The "girl" was an undercover police detective working with a special task force that handles crimes against minors over the Internet. Gentile has run the union in since 1979 and has taken an indefinite leave of absence since his arrest.[Sun-Sentinel (Ft. Lauderdale) 8/31/01]
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