‘Federal Racketeering Case Against UAW’ Looms?

The FBI’s August 28 raids on the home of UAW President Gary Jones (inset), and “five other homes or offices of former UAW officials around the country,” indicate “the federal government could now be targeting” Mr. Jones. Main photo credit: Junfu Han/Detroit Free Press Inset credit: AP Photo

Residences of Current and Former Union Chiefs Raided by FBI, IRS

Four years after the FBI launched a corruption probe into the misappropriation of millions of dollars supposedly allocated for training union members by United Auto Workers (UAW) union bosses and corporate executives, the criminal investigation is metastasizing.

In fact, the headline of a Detroit News story published in the paper’s August 29 print edition went so far as to suggest that a “federal racketeering case against” the UAW union itself is increasingly likely.

In the words of News reporters Ian Thibodeau, Robert Snell, and Keith Laing, on August 28:

The FBI “raided the home of UAW President Gary Jones and five other homes or offices of former UAW officials around the country . . . signaling the federal government could now be targeting,” Mr. Jones.

The agency is continuing to investigate “bribes, kickbacks and attempts by auto executives to influence negotiations with the UAW . . . . The home of former UAW President Dennis Williams was included in the Wednesday raids.”

While Mr. Jones and Mr. Williams had not been charged with a crime as this Newsletter edition went to press just after Labor Day; five UAW officials involved in the scandal have been convicted.

Evidence Collected Included ‘“Wads” of Cash and Files’

The raids on the Jones and Williams homes could be a sign “the U.S. Attorney’s office feels it has reached a dead-end and [is] getting stonewalled,” according to Peter Henning, a Michigan law professor and former federal prosecutor quoted by the News.

The next step, suggested Prof. Henning, might be for the Justice Department to turn control of the UAW over to a “trustee or monitor,” who could “come in and open up the books and make them available to the U.S. Attorney’s Office.”

A separate August 29 story for the News said the raids of UAW bosses’ homes and offices had allegedly “uncovered evidence” that “could bolster federal investigations into UAW leaders spending of [often forced] dues” paid by blue-collar workers “on personal luxuries, vacations, and private villas . . . .”

The evidence collected reportedly included, “‘wads’ of cash,” along with “files” that UAW bosses had apparently failed to turn over to federal authorities over the past four years.

Along with FBI agents, representatives of the IRS and the U.S. Labor Department participated in the raid on Mr. Jones’ residence.

While the FBI is not saying exactly what it was looking for, the News recalled that last year federal investigators let it be known that they were “questioning UAW officials’ use of almost $1 million of membership dues on liquor, food and golf” in Palm Springs, Calif.

Mr. Jones, the News added, held annual conferences in Palm Springs before ascending to the UAW presidency in 2018. 

Roll-Back of Union Financial Disclosure Rules Evidently Facilitated UAW-Boss Fraud

The ever-expanding UAW/automotive corporate executive scandal, in connection with which nine people have already pleaded guilty to federal labor-law violations by early September, illustrates why Right to Work supporters have fought for years for better federal oversight of union financial schemes.

As the guilty plea entered by former UAW Vice President Norwood Jewell this April acknowledges, over the years, executives of Fiat Chrysler Automobiles (FCA) again and again used the National Training Center (NTC) jointly managed by the company and the union for illicit purposes.

Specifically, FCA executives used the NTC to furnish Mr. Jewell with lavish gifts at the same time that he was head union negotiator of the workplace contract governing FCA’s front-line employees across the U.S.

Auto executives who sat across the table from Mr. Jewell paid for these gifts with corporate treasury money funneled through the NTC, which as a consequence of a 2010 Obama Administration roll-back of federal oversight of union finances, does not have to disclose to the Labor Department how it spends its funds!

“Unfortunately, President Trump’s first labor secretary, Alexander Acosta, dragged his feet about reinstating the union disclosure requirements quashed by the Obama team during his two-and-a-half years in office,” noted National Right to Work Committee Vice President Greg Mourad.

“It is only now, a couple of months after Mr. Acosta’s resignation, that the Labor Department’s proposed enhanced disclosure rules are finally close to going into effect.

“Until Congress is ready to repeal all the forced-dues and monopoly-bargaining provisions in federal law so that union financial support is completely voluntary, such requirements will be necessary and proper.”