-Caveat Lector- http://www.conservativenews.org/ViewPolitics.asp?Page=\Politics\archive\1999 08\POL19990831d.html CNS: Politics Update: 3:15 ET September 1, 1999 Union Corruption Update By National Legal and Policy Center CNS News Analysis 31 August, 1999 GOVERNMENT EMPLOYEES (AFGE) Florida Boss Indicted for Embezzling $40,000 Am. Fed. of Government Employees Local 507's ex-president Diana M. Morgan was indicted Aug. 19 on federal mail fraud charges after investigators accused her of embezzling $40,000 worth of union dues for her personal use from Nov. 1996 to Jan. 1999. The indictment said the boss wrote a series of checks for $28,400 to herself and eight checks for $2,780 to her teenage daughter. She also reportedly made $1,770 in ATM withdrawals. It also said she used union funds to pay personal creditors, including her rent, a personal loan and car payments. She also reportedly bought $610 worth of Disney World tickets with a union check. As president, Morgan had full check-signing power for accounts that held dues for Local 507 in Riviera Beach, Fla. Morgan left her union post and her $28,798-a-year lab technician job at a Veterans Admin. Medical Center in Mar. Asst. U.S. Attorney Bruce Reinhart said he chose the mail fraud charge because a suitable federal embezzlement charge didn't exist. The boss was released on a $50,000 bond. [Sun-Sentinel & Palm Beach Post 8/20/99] LABORERS (LIUNA) Chicago Boss and Top Cop in Business Together Ex-U.S. Marshal for Chicago, Peter J. Wilkes, partnered with a corrupt boss of the Laborers' Int'l Union of No. Am., John Serpico, in a company that was bankrolled by a loan listed in a criminal racketeering suit against Serpico. Serpico was indicted Aug. 4 for allegedly using his union muscle to get a series of illegal bank loans. He and his codefendants, Maria Busillo, the president of the Central States Joint Board, and Gilbert Cataldo, an ex-Chicago housing commissioner, pled not guilty Aug. 23 to all counts. Serpico was also named in a civil racketeering suit against the Chicago Laborers' District Council on Aug 12. In addition to the utter outrage of law enforcement working with a corrupt LIUNA boss, more troubling is the fact that the U.S. Marshals Service runs the ultra-secretive federal witness protection program, where mob informants cooperating with the government hide from their old mob associates. U.S. Marshals also transport jailed mobsters who are secretly cooperating with prosecutors. Additionally outrageous is the fact that one of this company's clients was the federal government. It ran a detention center for illegal aliens for the U.S. Immigration & Naturalization Service. INS is a branch of the Department of Justice. The company, Protective Service Systems, Inc., was formed by Wilkes two months after he resigned as U.S. Marshal on Sep. 12, 1986. At the time, he was being investigated for entertaining a girlfriend on government money, basing personnel decisions on sexual favors and misuse of confiscated property. He wasn't charged. It's unclear when they became partners, but Serpico's indictment alleges the startup cash for PSSI came from an illegal loan secured by Serpico. The indictment names the company, but not Wilkes, who is referred to only as "Individual B." One of the nine loans cited in the indictment, for $195,000, was used by PSSI to buy a building to reportedly hold illegals for INS. The timing of their partnership raises questions about what, if any, connections the two had while Wilkes was still a top law enforcement official. [Chicago Sun-Times 8/16/99; Chicago Tribune 8/24/99] Indictment: Serpico also had Mob-Linked Loans The indictment also alleged that Serpico used one of the tainted loans to join with reputed organized-crime figure Paul Spano to construct a West Side apartment complex. The construction was reportedly aided by a decision by the City of Chicago to sell the land at a reduced rate. The indictment said Serpico obtained a $540,000 loan, with no collateral, to finance the project from Capitol Bank & Trust Co. The complex sold last Sep. for almost $1 million. A few months after the City Council approved the sale of the site to Spano in Feb. 1989, he was indicted by a federal grand jury on charges of operating an organized crime gambling business in Cicero. He pled guilty and served seven months in federal prison. Spano is also the subject of a separate, current FBI investigation into another real estate transaction. Spano wasn't charged with Serpico. Reportedly, Serpico and a person identified as "Individual E" sought the loan in question in Dec. 1989. Records identified Spano as the sole owner of the property. Ex-Mayor Eugene Sawyer's (D) administration was actively recruiting developers for the area. Records show Spano paid $30,291 for the property and that there were no competitive bids. Records also reveal they paid only $5.50 a square foot, about half the amount paid for similar property at that time. The City also agreed to a zoning change that permitted the complex to utilize more land. [Chicago Tribune 8/22/99] St. Louis Bomber To Be Put to Death David R. Leisure, whose involvement in a series of car bombings and mob violence for control of LIUNA Local 110 in St. Louis, is scheduled to die by injection Sep. 1. He would be the first organized-crime figure executed since 1944, when Louis "Lepke" Buchalter was electrocuted in N.Y. Leisure was sentenced to death in 1987 for his role in the car bombing murder of mob boss James Michaels, Sr. The date was set by the Missouri Supreme Court on Aug. 3. Final legal pushes are under way to stop the execution. Reportedly, Leisure helped kill Michaels so the Leisure family could gain power over LIUNA Local 110. Leisure was just one of many players in a mob feud that left three dead, one maimed and another wounded. Yet while many involved were convicted of state or federal crimes, none received the death penalty. On Sep. 17, 1980, Leisure crawled beneath Michaels' car and planted a remote-controlled bomb as the car was parked outside a church. Michaels was inside eating lunch. The state alleged that Leisure had practiced the technique several times on an identical car until he could do it flawlessly in under a minute. After planting the device, he was present when his cousin Anthony Leisure detonated the bomb on Interstate-55. Pieces of Michaels' car were scattered over a 200-foot radius by the force of the explosion. Michaels' body was dismembered; part was hurled against a passing car. It took police years to unravel the story behind the crime and the retaliations that followed. To avenge Michaels' murder, his family bombed the car of Leisure's cousin Paul Leisure. He survived the attack, but it cost him part of his legs, hands and face. In retaliation for the bombing of Paul Leisure, the Leisure family killed George M. "Sonny" Faheen with a car bomb. Faheen was Michaels' nephew. David Leisure was sentenced to life in prison for Faheen's murder. Leisure was convicted of federal racketeering charges in 1985. His state trial for Michaels' murder was held in Mar. 1987. The jury took a little over five hours to find him guilty of capital murder. [St. Louis Post-Dispatch 8/4/99] POSTAL WORKERS Audit: New York Bosses Misused $817,000 Ex-bosses of the N.Y. Metro Area Postal Union allegedly misspent over $817,000 in union funds, according to an outside audit. It found improper spending for personal travel, meals, clothing and liquor, as well as thousands of dollars paid out in allegedly improper bonuses. The audit covered 1997-98 spending but has led federal investigators to subpoena all records back to 1995. Newly elected president, William Smith, said he hired the auditing firm, Pogogeff & Lafharis, to look at the books because: "I was concerned that my administration not be left holding the bag." Specifically, the audit found "evidence of waste and padding of expenditures" by bosses, including personal expenses charged to union credit cards. It said bosses paid for family and friends to travel at union expense and charged restaurant and grocery bills to the union. Reportedly, a majority of the expenses were approved without required signoffs and documentation. The audit found that on Apr. 15, just days after ex-boss Josie McMillian and others were defeated by Smith's slate, the ex-bosses authorized a total of $147,500 in back pay for themselves. Auditors said documentation for these payments was "inadequate." The audit also states, "There is evidence that indicates that officers of the union received compensation exceeding the amount to which each was entitled." McMillian ran the union since 1981. Ex-vice-pres., Anthony Caniano, has called the accusations "politically motivated." [Daily News 8/16/99] ELECTRICAL WORKERS (IBEW) Chicago Local Skirts DOL Accord The Department of Justice asked U.S. District Judge Charles P. Kocoras to hold International Board of Electrical Workers Local 134 in Chicago in contempt of court for violating a settlement that allowed bosses to stay in office. The Mar. 1999 agreement settled a suit brought by the Department of Labor against Local 134 seeking to void its 1998 election. The suit alleged employer funds were used by boss Michael Fitzgerald's winning slate. Under the settlement, Local 134 agreed that DOL would supervise the next election in 2001. The agreement also required that member Charlie Chathas, who protested the election with DOL, be allowed to send out a letter to members responding to one sent out by Fitzgerald, before the settlement, that accused Chathas of "conspiring to overthrow" his slate. Local 134 refused to distribute the letter, which DOL approved, and that violated the agreement, said Asst. U.S. Atty. Craig A. Oswald. "Failure to comply could potentially jeopardize the entire settlement," he said. However, no contempt of court citation was issued. Judge Kocoras said Aug. 26 the local must send the letter, but it may include a disclaimer saying it doesn't reflect the bosses' views. Local 134 also agreed under the settlement to sever ties with a social club that allegedly funneled proceeds to Fitzgerald's campaign. Local 134 has a scandal-scared history. In 1992, ex-boss Timothy Bresnahan pled guilty to charges that he had dipped into a union slush fund to buy a car for his son and other personal items. In 1990, ex-boss Edmond M. Ryan, Jr., pled guilty to lying about misuse of funds during a probe that led IBEW to seize control of the local. [Chicago Sun-Times 8/19 & 27/99] QUOTABLE QUOTE "After five decades of organized corruption in a union, corruption does not go away in one year or ten." - Randy Mastro, Asst. U.S. Atty. in Manhattan, commenting on Teamsters boss James P. Hoffa's bid to end the governments' ten year supervision over the corrupt union. [N.Y. Times 8/14/99] Someone should tell this guy to get involved in LIUNA's failed "internal reform effort" in which the government has wrongfully allowed LIUNA to manage its own cleanup. UNION DEMOCRACY / SHEET METAL WORKERS (SMW) Top Boss and Slate Elected without Opposition In yet another blow to union democracy in America, delegates to the Sheet Metal Workers' convention Aug. 9-13 in Las Vegas elected incumbent Michael J. Sullivan as SMW President. Sullivan and his slate of officers ran unopposed. [BNA 8/18/99] FOOD & COMMERCIAL WORKERS (UFCW) / TEXTILE WORKERS (UNITE) Excessive Compensation Alleged in Chicago Merger Feud The recent merger of the tiny Textile Processors, Service Trades, Health Care Professional & Technical Employees, an ex-independent laundry workers union in Chicago, with the United Food & Commercial Workers has triggered ruthless infighting between UFCW and another AFL-CIO affiliate, the Union of Needletrades Industry & Textile Employees. The merger was complete in May. It now is being challenged by several laundry worker members who claim they were not informed of the merger plan nor allowed to vote on the decision to affiliate with the larger union. In an amended complaint filed in federal court Aug. 19, the members also charge that their bosses are receiving excessive pension benefits and cash payments of over $2 million as part of deal. The suit seeks to block the merger and to enjoin the payments to the officers. The rebellious members are being supported in their suit by UNITE. UNITE spokesman Benjamin Hensler said, "We think these workers should have had a say [in the merger]. They should not have been kept in the dark or sold out" by their officers. The suit claims that by voting for the merger and then receiving unearned pensions and cash payments, the union's bosses breached their fiduciary duty. The suit alleges that the "special convention" of the Textile Processors, to ratify the merger, violated the union's constitution. A small group of unelected, handpicked delegates to this meeting approved the merger, the suit states. It says the same bosses who voted for the merger will receive pension benefits or lump-sum cash payments in excess of $2 million. As the result of the termination of the Textile Processors officers' pension fund, union president Frank Scalish is reportedly due to receive an additional $700,000. A transcript of the meeting, which is part of court record, included talk by bosses about how much they will receive from UFCW. At one point, a UFCW official, who is identified in the transcript only as McNaughton, admonishes the group about their requests. "None of you have gotten a pension from your international union," he is quoted as saying. "So, you're getting something that you never had, and we're all talking like it's our God-given right that we should have this. Somebody is giving you something and you're saying, 'OK, well, that's not very good. I want more.'" UFCW spokesmen Greg Denier claimed UNITE's interest in supporting this suit result from the fact that the Textile Processors earlier had considered affiliating with UNITE but then chose UFCW instead. "This is a case of a jilted suitor," he said. The merger is suppose to stop further "raids" for members by UNITE because the AFL-CIO constitution prohibits raiding by one federation affiliate on the membership of another. [BNA 08/23/99; Chicago Tribune 8/20/99] TEAMSTERS (IBT) Hoffa Says DOL Not Necessary for 2001 Election James P. Hoffa, president of the International Board of Teamsters, said Aug. 18 that while the Department of Labor may choose to supervise IBT's 2001 general election, he believes the union is capable of conducting a free and fair election on its own. Under the 1989 Consent Decree settling federal racketeering charges against IBT, DOL has the option of supervising the next election. When asked whether DOL would add credibility to the election, Hoffa responded, "I don't necessarily believe that. When we conduct the election we're going to have it supervised by people of high integrity. We have in mind a group of people that are former government employees." This was the latest statement in Hoffa's battle to end the government's supervision over the corrupt union. [BNA 8/20/99] In a related story on IBT's disastrous 1996 election, court-appointed Election Officer Michael G. Cherkasky recently reported that he issued 1,770 decisions on "protests" related to the election. In total, there were nearly 2,100 protests filed during the drawn out process which entailed 1) the disgraced and ousted boss Ron Carey's narrow victory over Hoffa in 1996; Carey's subsequent disqualification for a campaign money-laundering scheme; and finally, the election of Hoffa as the union's new president late in 1998. [BNA 8/25/99] UNION DUES / TEACHERS (NEA) Indianapolis Local Loses Dues Case on Appeal In an important victory for workers' rights, the Indiana Court of Appeals ruled Aug. 5 an union contract's "fair share" provision requiring non-union-member teachers to pay agency fees to the Indianapolis EDU. Association in an amount equal to members' union dues violates the nonmembers' First Amendment rights. Despite the fact that the provision allowed refunds of the proportion of fees spent on political and ideological activities and the fees paid by objecting nonmembers were held in escrow, the court held that IEA failed to prove that its collection procedures were carefully tailored to minimize infringement of First Amendment rights. "Collection of full membership dues with a later refund creates the risk that those funds will be used for purposes other than collective bargaining and results in a loan to the Association of money to which it is not entitled," stated Judge William I. Garrard. He rejected IEA's argument that the escrow provision avoided constitutional violations saying that by requiring collection of fees equal to full membership dues, "the Teachers are deprived of the use of funds that the Association is not entitled to collect in the first instance." The contract between IEA and the Indianapolis school board for the 1993-94 school year forced teachers who chose not to join the union to pay the "fair share" fee to IEA and its affiliates -- the Indiana State Teachers Association and the National Education Association. Association -- that was equal to membership dues. The board capitulated and each nonmember was forced to submit a payroll deduction form to transmit deducted amount directly to IEA. The contract said that "[p]persons who refuse to sign an authorization form or who revoke an executed form have a continuing enforceable obligation to pay the fair share fee directly to the Association." It also provided that the fees of nonmembers who filed a legal challenge would be held in escrow pending final resolution of the claims. An arbitrator determined that nonmembers' fair share fee for the 1993-94 school year was $418.92. IEA then sued the nonmembers who refused to pay the fee. Although the nonmembers in the suit never actually paid any fees, Garrard decided that the contract term stating that nonmembers have "a continuing and enforceable obligation to pay" constituted a sufficient violation of their First Amendment rights to merit summary judgment in their favor. Note that Ind. law now prohibits "fair share" provisions in all contracts executed after Jul. 1, 1995. [BNA 8/16/99] COMMUNICATIONS WORKERS (CWA) Boss Embezzled $18,000 from North Dakota Local The ex-secretary-treasurer of the Communications Workers of Am. Local 14749 in Grand Forks, N.D., Steven C. Rude, pled guilty Jun. 2 to embezzling about $18,000 from union coffers. The boss was sentenced to two years of supervised probation and 50 hours of community service. The embezzlement occurred from 1991 to 1995. He allegedly made full restitution. Rude could have been sentenced to five years in prison and/or a $250,000 fine. [Grand Forks Herald 6/4/99] STAGE EMPLOYEES (IATSE) Akron Boss Charged with $8,000 Embezzlement Ex-business agent and secretary-treasurer of the Int'l Alliance Theatrical Stage Employees & Moving Picture Operators Local 912 in Akron, Margaret Smith, was charged Jul. 28 of embezzling over $8,000 from union coffers. She was charged with one count of union embezzlement and one count of falsification of union records. The U.S. Atty.'s Office in Cleveland said the boss wrote 21 checks to herself, totaling $8,612 from May 1994 to Jun. 1996. Smith has also allegedly forged the name of another union boss as co-signer on the checks. If convicted, she faces six years in prison and a $350,000 fine. [Akron Beacon Journal 7/29/99] South Dakota Boss Pleads Guilty to Embezzlement Robert J. McNeil, ex-business manager of IATSE Local 503 in S.D., pled guilty Apr. 29 to charges of stealing $2,000 from the union, according to Asst. U.S. Atty. Michelle G. Tapkin in Sioux Falls. Mitchell originally denied charges that he embezzled union funds. He was sentenced Jul. 13 to three years probation and ordered to pay $2,000 in restitution and $600 in fines and fees. [Aberdeen American News 3/22/99] STEELWORKERS (USWA) Akron Local Sues to Recover $1 Million from Boss Members of United Steelworkers of America Local 01-2-L are trying to prevent their ex-secretary-treasurer from keeping any of the money he stole from the union. William S. Demboski, Jr., pled guilty in Feb. 1999 to embezzling over $316,000 in union funds and falsifying records to cover up the theft. He was sentenced in May to two years in prison and ordered to repay $316,273 in embezzled funds, plus an additional $16,000 in costs associated with the investigation and audit. The local filed a lawsuit Jun. 11 seeking $1,025,000 from Demboski and his wife, Rebecca. The suit stated that unless Rebecca Demboski was included in the action, the embezzled union funds "could be considered marital assets and converted, hidden, transferred and otherwise lost to recovery." Local 01-2-L president Doug Werstler said the local filed the suit on the advice of federal prosecutors to make sure the union would recover its funds. Demboski, who handled the union's finances for 12 years until resigning in 1997 amid a Department of Labor investigation, never has commented in court on what he did with the stolen money. His lawyer said only that the funds were spent for personal use or unauthorized union expenses. [Akron Beacon Journal 6/12/99] LONGSHOREMEN (ILA) EEOC Files Class Action Discrimination Suit Against Chicago Union The Equal Employment Opportunity Commission alleged in a class action filed Aug. 16 that a collective bargaining agreement between the International Longshoremen's Association and two Chicago cargo firms violates the Age Discrimination in Employment Act. EEOC attorney, John Hendrickson, said ILA and the employers discriminated against workers over 70.5 years-old. The alleged discrimination comes from a provision requiring that such workers forfeit their seniority. The suit is the first of its kind filed by EEOC. Hendrickson said there are approximately 12 individuals in the class, but more may be identified during the discovery phase of the litigation. Defendants include ILA, ILA Local 19 and ILA's Great Lakes District, as well as, Ceres Terminal, Inc., and Federal Marine Terminals, Inc. The suit seeks back pay and damages for members of the class. The suit began by a charge filed by longshoreman Wardell Hart, who lost his seniority because he was older than 70.5 years. A 1998 contract specifies that seniority be forfeited by individuals collecting pension benefits from the Marine Terminal & Welfare Fund. Only individuals over 70.5 years can collect such benefits while working. Hendrickson said the provision severely limits class members' ability to work. Ceres President Chris Kritikos, expressed frustration with the suit, noting that the union, not the company, drives such contractual issues. "It is the union's contract that sets the retirement dates, and we, as the employers, must comply with the terms of the agreement," he said. [BNA 8/23/99] Union Corruption Update is part of NLPC's Organized Labor Accountability Project which is investigating and exposing corruption and extremism 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. Lewinsky Joins Weight Loss Plan http://www.conservativenews.org/ViewPolitics.asp?Page=\Politics\archive\1999 08\POL19990831d.html Bard Freedom will ring again, only when the Truth prevails. DECLARATION & DISCLAIMER ========== CTRL is a discussion and informational exchange list. Proselyzting propagandic screeds are not allowed. Substance—not soapboxing! These are sordid matters and 'conspiracy theory', with its many half-truths, misdirections and outright frauds is used politically by different groups with major and minor effects spread throughout the spectrum of time and thought. That being said, CTRL gives no endorsement to the validity of posts, and always suggests to readers; be wary of what you read. CTRL gives no credeence to Holocaust denial and nazi's need not apply. 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