Criminal Probe Casts Shadow on Union Contracts

Ex-UAW officer Virdell King (inset left) had already pleaded guilty, and prosecutors seemed to be closing in on current UAW bosses like Cindy Estrada (right), when U.S. Sen. Elizabeth Warren addressed a UAW conference in February. Credit Inset: King Facebook,; Warren Jessie Jesson/UAW Local 686; Estrada Twitte.

 

Workers Charge That UAW Bosses Scammed Them as Guilty Pleas Mount

According to a federal indictment unsealed late last July, the United Auto Workers (UAW)-Chrysler National Training Center in Detroit was surreptitiously used for at least six-and-a-half years to funnel millions of dollars into the pockets of corrupt union bosses and Fiat Chrysler Automobiles (FCA) executives.

According to prosecutors, starting in 2009, then-FCA head of labor relations Al Iacobelli, then-UAW Vice President General Holiefield, and Monica Morgan, at the time Mr. Holiefield’s girlfriend and subsequently his wife, began using training center funds as their personal piggy bank.

Mr. Holiefield (who passed away in 2015) allegedly pilfered a total of $1.2 million from the training center. Since it is a tax-exempt charity, taxpayers as well as workers were victims of the scam.

Financial Analyst Allegedly Funneled $4.5 Million in Training Funds to UAW Dons

Since last summer’s indictments, the multimillion-dollar scandal implicating top UAW officials and union boss-“friendly” auto manufacturing executives has continued to widen.

In early August, former FCA financial analyst Jerome Durden pleaded guilty to filing false tax returns and could face as many as 37 months in prison. Mr. Durden, who allegedly funneled more than $4.5 million in worker training-center funds to crooked UAW bosses, is now believed to be cooperating with prosecutors.

Later that month, former UAW Associate Director Virdell King admitted to one felony count of conspiracy to violate the Labor Management Relations Act. Ms. King, who had been accused of stealing more than $40,000 in worker training funds, faces up to 16 months in prison and a $15,000 fine.

Early this year, Mr. Iacobelli and Ms. Morgan entered guilty pleas.

Personal ‘Charities’ Linked To UAW Bigwigs an ‘Area of Interest’ For Prosecutors

According to Crain’s Detroit Business, Mr. Iacobelli now admits “he and other FCA executives and employees transferred hundreds of thousands of dollars ‘in prohibited payments’ to tax-exempt organizations controlled by UAW officials . . ..”

One example is the dodgy “Make Our Children Smile Foundation” maintained for years by former UAW Vice President Norwood Jewell, who abruptly retired at the end of 2017.

Ms. Morgan, who allegedly paid off the $262,000 mortgage on a home she owned with the late Mr. Holiefield with stolen funds, pleaded guilty to one count of subscribing a false tax return. Prosecutors are evidently hopeful she will cooperate in the ongoing union corruption probe.

At the end of February, Automotive News reported shadowy personal “charities” linked to at least seven former and current UAW bosses, including current President Dennis Williams and current Vice Presidents Cindy Estrada and Jimmy Settles, remain an “area of interest” for federal prosecutors.

Mr. Williams continues to profess his personal innocence and insists the fact that Mr. Holiefield, Ms. King, and very possibly other union officials were accepting large sums of money that ultimately came out of FCA coffers did not affect UAW-boss negotiations with the FCA corporation.

However, judging by UAW-“represented” workers’ comments made on Facebook and other social media, large numbers of them aren’t buying Mr. Williams’ claims that UAW contracts are clean.

And in January, several FCA workers in Detroit filed a class-action suit seeking refunds of all the forced union dues they paid to UAW union chieftains from 2009 through 2015.

(Union dues for FCA employees in Michigan did not become voluntary under the Wolverine State Right to Work law until the 2015 contract took effect.)

‘Everyone Paid [Forced] Dues, But No One Knew What Was Going on’

Raymond Sterling, the Bloomfield Hills (Mich.) attorney who is representing the workers, explained to the Detroit News: “Everyone paid [forced] dues, but no one knew what was going on. We know [now] it went on for years.”

National Right to Work Committee Vice President Greg Mourad agreed that considering what appears to be systematic corruption among the UAW officers who were charged with negotiating contracts with FCA and possibly also other unionized auto companies, the former forced-dues payers should be reimbursed.

“The still-unfolding scandal implicating UAW bosses and auto executives alike is just another illustration of why Michigan lawmakers and Gov. Rick Snyder did the right thing when they passed and signed legislation banning forced union dues and fees at the end of 2012,” added Mr. Mourad.

(Click here to download the April 2018 National Right To Work Newsletter)