"We witness the sorry spectacle of Gary Winnick, the CEO of Global Crossing,
selling off $734 million in stock while urging his employees to buy more,
and then using the money to purchase a $92 million dollar mansion in Bel
Air."
Uh, would this be the same Global Crossing that received millions in
investment dollars from ULLICO, a union pension fund-owned insurance company
with a board that included John Sweeney and numerous other union officials?
A federal grand jury and the U.S. Dept.
of Labor are now investigating insider stock trades that apparently enriched
ULLICO board members at the expense of rank-and-file union members.
While Sweeney claims not to have participated in
the stock deals, he sat on the ULLICO board while others did.
"[W]e insist that the Securities and Exchange Commission and all three stock exchanges agree to a single higher standard for publicly-traded corporations. That standard must...prohibit CEOs from selling their company stock while they are in office."
Oh. Would the Sweeney Standard apply to ULLICO board members, like Communications Workers president Morton Bahr and Carpenters president Doug McCarron? Reportedly, they and other Board members enjoyed trading privileges allowing them to profit from the purchase and sale of their own company's stock. Because the privately held company's stock price was reset each year based on its value on Jan. 1, the board members could anticipate the change before the new year. Barred from selling their ULLICO stock before its value was adjusted downward were the pension funds of rank-and-file workers.
COMMUNICATIONS WORKERS (CWA)
Ex-Secy.-Treas. Admits Stealing $90K from Stockton, Calif., Local
United States Attorney John K.Vincent announced on July 19 that Mary
Dolores Anderson pled guilty to embezzling nearly $90,000 as a union officer
from 1993 to 1999. Anderson faces a sentence of up to five years imprisonment
and up to a $10,000 fine. Her sentencing is scheduled for October 4, 2002
before U.S.District Court Judge Garland E. Burrell,Jr. (E.D. Calif., G.H.W.
Bush)
According to Asst. U.S.Attorney Christopher P. Sonderby, who is prosecuting the case, Anderson served from 1993 to 1999 as the Secretary-Treasurer of the Communication Workers of America Local 9417, a Stockton union made up of about 700 Pacific Bell employees in San Joaquin County. In FY 2000, the Local had $189,307 in receipts, 94% of which came in the form of members' dues, acc. to the union's LM-3 financial disclosure form filed with the U.S. Labor Dept.
Anderson admitted that she got other union officers to sign blank checks for the payment of bills while they were out of town, as all union checks required the signatures of two officers. Rather than using the funds for legitimate union expenses, Anderson made over 90 of these checks payable to herself, signed them, and deposited them directly into her personal bank accounts. Anderson then attempted to conceal her embezzlement by falsifying and destroying the check stubs. Anderson also made a payment on her personal credit card using the union's funds, and made two unauthorized withdrawals from the union's bank account. Anderson embezzled approximately $89,422.58 from the union by employing this scheme.
Anderson has agreed to make full restitution to the union as part of a plea agreement. The case was investigated by the United States Department of Labor, Office of Labor-Management Standards. [U.S.A.O.. E.D. CA]
TEAMSTERS
Elected Twin Cities Leaders Sue Hoffa over Removal from Office
Elected leaders of Teamsters Local 2000 sued Intl. Bhd. of Teamsters
President James P. Hoffa in a Detroit fed. court July 25, contending Hoffa
illegally removed them from office.
On July 1, Hoffa ousted the officers of the Local that represents more than 11,500 Northwest flight attendants after they refused to fight an organizing effort by some attendants trying to form an independent union. The suit calls for reinstatement of the elected leaders and withdrawal of the trusteeship that Hoffa also imposed on the 1st.
Ousted president Danny Campbell said that he and other officers filed suit because they believe Hoffa violated the Labor-Management Reporting and Disclosure Act, and violated Campbell's free-speech rights with the removal. "Essentially that law was designed to provide a more democratic infrastructure in local unions," Campbell said. He argued that top Teamsters officials "removed us from office for political reasons, rather than what they cited we were unwilling to do."
In mid-June, some Northwest employees began asking attendants to sign cards authorizing a representational election to choose between the Teamsters and a new union, the Professional Flight Attendants Assn (PFAA). Hoffa called on Local 2000 leaders to take eight specific actions against the campaign. Campbell, Vice President Anne Meyer and Secretary-Treasurer Bob Krabbe sought a meeting with Hoffa to discuss what they called an alternative strategy. In the 28-page complaint, the plaintiffs said, "Hoffa never engaged in two-way communication, face-to-face or in any other way."
Teamsters spokesman Brian Rainville said Local 2000 officials were removed from office because of "their absolute refusal to do anything about the raid" by the PFAA. Rainville said the elected leaders tried to "use the raid to gain further advantage for their political aspirations." He said the behavior of the Local 2000 leaders has given "aid and comfort to the PFAA."
The PFAA needs at least half of the flight attendants to sign cards before the National Mediation Board will call an election. [Star-Tribune, 7/26/02]
MACHINISTS (Woodworkers)
Ex-Bus. Rep. in Wash. State ‘Fesses to Theft, Falsification
John McKay, United States Attorney for the Western District of Washington,
and John Heaney, District Director, United States Department of Labor,
Office of Labor-Management Standards in Seattle, announced that on July
12, 2000, David Rux, a former Business Representative of Woodworkers Local
Lodge W2 in Aberdeen, Washington, pled guilty to 7 felony counts of Union
Embezzlement under U.S.C. 29, 501(c), and 15 counts of Falsification
of Union Financial Records under U.S.C., 439(c). Now living in Veguita,
NM, Rux will be sentenced on October 15, by U.S. Dist. Judge William Johnson
(G.W. Bush) in Albuquerque. For each of the 7 counts of embezzlement, Rux
faces a maximum of 5 years in prison, $10,000 in fines, and 3 years of
supervised release following imprisonment. He also faces a maximum
penalty of 1 year in prison, up to $10,000 in fines, and 1 year of supervised
release for each of count of Falsification.
According to court records, Rux was the Business Representative of the Woodworkers Local, which is affiliated with the International Association of Machinists, from May 1992 to December 22, 2000. Beginning in March 1997, Rux embezzled $21,557 by 1) submitting false vouchers for mileage and other expenses related to attending union meetings, then forging the Lodge President's name on checks payable to Rux, ostensibly as reimbursements: 2) preparing Lodge W2 checks made payable to others and again, forging the Lodge W2 president's name on the checks: 3) using the Lodge's credit card for his personal benefit; and 4) creating false entries and alterations of Local W2 checks and the check register to conceal the checks that he made payable to himself and his personal credit card charges.
A federal grand jury in Seattle indicted Rux on March 27, 2002 after an investigation by the U.S. Labor Dept. in Seattle. Rux and federal prosecutors agreed to move the case to New Mexico for his guilty plea and sentencing. Rux has agreed to not hold a union position for 13 years, and has made full restitution to Lodge W2. [U.S.A.O. W.D. WA, DOL]
GOVERNMENT WORKERS (AFGE)
AZ Local Treasurer Caught Stealing nearly $30K
On July 3, 2002, in the Superior Court of the State of Arizona, Maricopa
County, Mary Katherine Johnson, former treasurer of American Federation
of Government Employees Local 2552, was sentenced to incarceration for
four months followed by five years probation and was ordered to make full
restitution to the union of $28,853.69. She had pled guilty on June 3,
2002, to attempted theft following an investigation by the OLMS Los Angeles
District Office. [DOL]
STEELWORKERS
More Details Emerge on Va. Hierarchy's Pilfering of Relief Funds
Newly released documents reveal the looting of disaster relief funds
in Radford as the tip of an iceberg engulfing the hierarchy of Local 9336
that stretched back six years and nearly swallowed up the union's funds.
And while four of the embezzlers have admitted their guilt in fed. court,
a fifth official is a fugitive from the law.
The four who pled guilty on July 12 in Roanoke were: Edward Ramsey, President from 1996-2000: William Fricker, Grievance Cmte. Chair from ‘97-2000, when he became President: Joseph Burress, Financial Secy. from ‘98-2000: and Rhonda Creed, Vice-President from ‘97-2000. The fifth official charged, Elizabeth George, was Fricker's campaign manager in 2000, and was appointed Recording Secy. by Fricker when he won. She also joined the relief fund formed in response to an explosion at the Intermet New River Foundry on March 5, 2000. George did not appear in court, and is considered a fugitive from justice.
At various times from March 1996 to March 2000, acc. to the Indictment, the first four defendants submitted claims to the union for reimbursement of time spent on union business for which they were also paid by the company. They also claimed reimbursement at the highest hourly wage when in fact they made significantly less. In March ‘99, all four claimed at least 11 full days spent on negotiations, eight of which were also paid by the company.
The four embezzlers drained the union's checking acct. balance from $28,967 in April 1996, to just $1,740 in March 2000.
President Fricker appointed George to head the disaster relief fund, of which Ramsey, Burress and Fricker were also members, in March 2000. George was recalled to the plant in May, but then went on paid sick leave. Of the 14 checks and four food certificates totaling $4,186 that George approved for herself, she received all but two of the checks after her recall. That figure includes payments she approved for her companion, Robert Martin, who was never laid off from the foundry. Fricker received seven relief checks while on paid sick leave, and seven more after returning to work for a total of $3,154. Ramsey was never laid off, yet received four checks and eight food certificates of $1,101. Burress helped himself to $1,276, Creed to $1,239.
The five dipped into the relief fund even as they failed to publicize the fund's existence, and denied benefits to those of greater need who heard of the fund and applied for relief. Of the $22,500 raised for the relief fund, the defendants stole $10,866. [U.S.A.O. W.D. Va.]
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TEAMSTERS
Buffalo Teamsters Hit with NLRB Complaint for Illegal Dues Seizures
Responding to federal labor charges filed by attorneys with the National
Right to Work Legal Defense Foundation, the National Labor Relations Board
(NLRB) has issued a complaint to force Teamsters Local 449 to refund dues
illegally collected from employees of Laidlaw Transit Services after they
were expelled from union membership for voicing opposition to the union.
The case arose when four workers, Alfonso Ditillio, June Reinard, Jill Galluzzo, and Tim Stalker, filed unfair labor practice charges with the NLRB in April 2002. In October 2001, the employees exercised their right to resign from formal union membership and to pay a reduced fee to cover only the costs of collective bargaining. However, Teamsters officials illegally refused to accept their resignations and continued charging them full union dues.
In December 2001, Teamsters officials further harassed the workers by expelling them from the union for participating in a decertification election to remove the union from the workplace. Even after the expulsion, union officials continued to demand that the four workers pay full union dues.
The NLRB seeks an order requiring the Teamster officials to refund all of the union dues collected from the workers since December 2001. Under law, if an employee is kicked out of a union for any reason other than failing to pay union dues he cannot be compelled to pay any dues whatsoever to the union -- despite the existence of a forced unionism requirement in the collective bargaining agreement. [NRTWLDF]
SHEET METAL WORKERS
Frmr. Bookkeeper Stole $18K from Detroit-Area Union
On July 15, 2002, in the United States District Court for the Eastern
District of Michigan, Lori Delaney, former bookkeeper for Sheet Metal
Workers Local 80 in Southfield, pled guilty to embezzling approximately
$18,000 in union funds. The charges had been brought on February 6, 2002,
following a joint investigation by the Detroit Office of the U.S. Labor
Dept. Office of Labor-Mgmt. Standards and the Department of Labor's Office
of the Inspector General. [DOL]
LABORERS
Ex-Official Admits $10K Embezzlement in Fresno, Calif.
Jeremias Lopez pled guilty on July 10 to embezzling about $10,800 from
Laborers Intl. Union Local 220. She faces a maximum sentence of one year
in prison and a $10,000 fine in the U.S. Dist. Ct. in Fresno. Lopez is
also barred from employment or service with a union for 13 years.
Lopez was both Business Manager and Secy.-Treasurer of Local 220 from May 1996 to December 1997. During that time, according to the plea agreement, Lopez falsified the union's financial disclosure form to be filed with the U.S. Dept. of Labor. By changing those records, Lopez converted $10,814 of the Local members' funds to his personal use. Eventually, the Los Angeles office of the DOL's Office of Labor-Mgmt. Standards uncovered the embezzlement. [U.S.A.O., E.D. CA, DOL]
POLICE UNIONS (Portland Police Assn)
Ore. Police Union Defends Officer Indicted for Domestic Abuse
Police union officials in Portland, Oregon, have rallied behind an
officer indicted on July 25 for felony assault of a former girlfriend and
falsification of police records.
According to the unidentified woman's affidavit, Michael Pimentel pulled her car over on June 26, 2001, without legal cause and berated her. He allegedly showed up at her apartment the next day and refused to leave, slamming her finger in a window. The woman also charged that Pimentel seized her biceps, wrists, shoulder and breast, bruising her biceps. When the woman ran to her bedroom and locked the door, Pimentel forced it open and got into bed with her, acc. to the affidavit. Later in the day, he tried to block her car with his body to prevent her from driving away and then allegedly followed her in his car until she drove to the precinct where Pimentel is assigned.
The alleged false entry and alteration of a police report is said to have happened between Aug. 11 and Sept. 1 of last year. Aug. 11 is also the date on which, according to the indictment, Pimentel allegedly harassed his girlfriend by subjecting her to offensive physical contact.
Meanwhile, many bureau colleagues and the police union have rallied around Pimentel, even as those groups have condemned the societal problem of domestic violence. Earlier this month, supporters held a benefit to raise money for his legal defense. "In light of what's happened we are concerned about Mike Pimentel and very concerned about this," said Robert King, president of the Portland Police Association. "We recognize there may be a trial and that in this system, people are innocent until proven guilty." [Oregonian 7/26/02]
TRANSPORTATION-COMMUNICATION UNION (TCIU)
WVa. Official Indicted for Embezzlement
On July 2, 2002, in Wayne County (West Virginia) court, Dwight D. Icenhower,
former secretary-treasurer of Transportation Communication Workers Lodge
6455, was indicted on one count of embezzling $3,953.44 in union funds.
The charges were brought following an investigation by the OLMS Pittsburgh
District Office. [DOL]
PLASTERERS (OP&CMIA)
OH Treasurer Charged w/ Embezzlement of Union Funds, Employee Benefits
On July 5, 2002, in the United States District Court for the Northern
District of Ohio, John Mylek II, former treasurer of Plasters & Cement
Masons Local 886, was charged in an information with embezzling $7,551.28
in union funds and $675 in employee benefit plan funds. The charges were
brought following an investigation by the OLMS Cleveland District Office,
the FBI, and the Department of Labor's Office of the Inspector General.
[DOL]
Union Corruption Update is made possible by the generous contributions from readers like you. NLPC, PO Box 6821, Falls Church, VA 22040. Thank you. Union Corruption Update is part of NLPC's Organized Labor Accountability Project which is investigating and exposing corruption in the Teamsters, LIUNA, AFL-CIO and many other union organizations. NLPC is a nonpartisan, nonprofit foundation promoting ethics and accountability in government through research, education and legal action.
In addition to the unions and organizations covered in this Union Corruption
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