National Legal and Policy Center -- Organized Labor Accountability
Project
UNION CORRUPTION UPDATE
April 14, 2003 -- Vol. 6, Issue 8
For Influential Leaders & Important Decision Makers:
Information on America's most corrupt & aggressive unions
OPERATING ENGINEERS (IUOE) / ELEVATOR CONSTRUCTORS (IUEC)
NY Developer, Union Boss, Plead Guilty in $10 Million Fraud Case
A Manhattan developer and two former union bosses have confessed to defrauding
the taxpayers of NYC by helping to steal more than $10 million
from the N.Y. Metro. Transportation Authority (MTA). That brings
to four the number of defendants
who have pled guilty to the scheme in which developers overcharged the
MTA for construction projects, then conspired with officials from Local 14
of the Intl. Union of Operating Engineers (IUOE), and Local 1 of the Intl.
Union of Elevator Constructors, to pocket the savings from using lower-paid
non-union workers.
On March 31, Frederick Contini pled guilty to his major role in the conspiracy.
In Feb. 1999, the MTA contracted with Contini to renovate a 1.2 million-sq.
ft. space on Broadway at a cost of $55 million, which eventually grew to
$155 million. Contini, using a sham company called Links Construction,
billed the MTA at the highest possible wage for labor to be supplied by the
two unions. In addition to the use of non-union workers, Contini also
inflated the number of hours actually worked.
Those funds were then spread around to the benefit of the co-conspirators.
For instance, the ex-treasurer of IUOE Local 14, James Roemer, who pled guilty
on April 3, pocketed more $800,000 through companies he owned to buy a country
home he planned to run as a bed-and-breakfast. Also pleading guilty
the week before was David Coakley, the representative for Local 1 of the
IUEC. In his plea, Contini agreed to forfeit $1 million to the government.
he faces up to eight years in prison. Roemer agreed to serve at least
four years, and as much as five years, three months, in prison, and to repay
the funds he stole in the scheme. [New York Times 4/1/03, New York Daily
News 4/1/03, New York Post 4/4/03]
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
Update, readers can look forward to news and information on other corrupt
and abusive unions in future editions. All back issues of the Union
Corruption Update can be viewed at NLPC's website (http://www.nlpc.org).
Also available is a union-by-union and state-by-state index of all Union
Corruption Update articles. If you have story ideas or suggestions for
future editions of Union Corruption Update, please email NLPC at nlpc@nlpc.org.
Thank you.
Looking for a LM-2, LM-3, or LM-4 Annual Financial Report from the
Department of Labor? Visit http://www.dol-union-reports.gov.
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