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
CARPENTERS (UBC)
DOL Sues Carpenters Pension Trustees for Misuse of Plan Assets
On March 27 the U.S. Dept. of Labor sued the trustees of the pension and
welfare plans of Local 2682 of the United Bhd. of Carpenters in Bronx, New
York, for improperly using plan assets to pay unreasonable expenses in excess
of $900,000. Named as defendants in the lawsuit are current and former
trustees Anthony Prezioso, Joseph Cruz, Manuel Dos Santos, Edward Orlando,
and Mark Goldsmith. Prezioso was the plan administrator. Cruz was a
trustee of the Local 2682 pension and welfare plans and president of Local
2682.
The lawsuit, filed in federal district court in Manhattan, alleges that
the trustees of Local 2682's benefit plans paid the Local 2682 union an
unreasonable amount for services unnecessary or not provided to the
plans. Specifically, the suit alleges that the trustees:
- failed to terminate building loans of $928,670 from the pension fund
to the Local 2682 Building Corp., which is owned by the same trustees.
The appraised value of the building was only $775,000:
- The trustees allegedly used pension assets to pay a “no show” employee:
- overcharged the pension and welfare plans for rent and expenses for
space in the building housing the funds and the union local:
- paid to lease a car used in part for business unrelated to the plans
by plan administrator Anthony Prezioso.
According to the Labor Dept., the officials violated ERISA by:
- failing to run the pension fund in the beneficiaries' interests [29
U.S.C. Sec. 1104(a)(1)(A)]:
- failing to fulfill their fiduciary duty to the pension beneficiaries
[29 U.S.C. Sec. 1104(a)(1)(B) and:
- self-interested financial dealings [29 U.S.C. Sec. 1106(a)(1)(B)].
The labor dept. is seeking to require that the defendants reimburse the
plans for losses in excess of $900,000 with interest, to permanently bar
Cruz from serving employee benefit plans in the future, to correct any prohibited
transactions with the plans, and to offset the defendants’ pension benefits
to repay money owed to the pension plan.
The case was investigated the New York Regional Office of the department’s
Employee Benefits Security Administration. [EBSA 3/28/03]
Union Corruption Update is made possible by the generous contributions
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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).
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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.
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