On May 11, former United Auto Workers (UAW) President Dennis Williams was sentenced to 21 months in prison for embezzling hundreds of thousands in union funds – money taken from members’ paychecks. Williams is the highest-ranking UAW official to be sentenced in the ongoing UAW corruption scandal.
It was nearly two years ago when agents from three federal agencies conducted raids in six locations, spread across four states, connected to UAW, including the homes of Williams and UAW’s then President Gary Jones. There has since been more than a dozen convictions and even more indictments against high-ranking UAW union officials.
There have been countless stories about this historic corruption scandal, as multiple generations of UAW leadership have admitted to embezzling members’ dues for personal expenses such as golf clubs, green fees and even extravagant meals with high end liquor and cigars totaling over $750,000. What has received less coverage in the labor world is that on March 1, Fiat-Chrysler pled guilty to corrupting the collective bargaining process by making over $3.5 million is illegal payments to union officials. UAW’s leadership happily accepted these payments and sold out its members in exchange for contracts that were more favorable to Fiat-Chrysler. Full DOJ press release here.
Last summer General Motors (GM) filed a lawsuit against Fiat-Chrysler, alleging that the bribes received by UAW officials has resulted in GM getting saddled with a contract that amounted to over $1 billion in additional labor costs than the similar contracts negotiated by UAW for Fiat-Chrysler. The lawsuit also alleged that private investigators found millions of dollars in foreign bank accounts, not uncovered by the federal investigation, which were set up and funded by Fiat-Chrysler for UAW officials. The lawsuit has been dismissed but welcomed GM to come forward with any information pertinent to the corruption investigation.
The illegal payments to UAW officials took various forms, including extravagant meals, rounds of golf, lavish parties for the UAW International Executive Board, an Italian-made shotgun, clothing, designer shoes, and other personal items paid for with credit cards issued by the joint training center. FCA executives also paid off the $262,000 home mortgage of former UAW Vice President General Holiefield.
Acting United States Attorney Mohsin said, “Through its participation in this conspiracy, FCA violated federal labor law and undermined the collective bargaining process and the faith of the UAW’s membership in their leaders. By seeking a $30 million fine and three years of oversight by a court-appointed monitor, we are holding FCA accountable and sending a message to other companies that these types of crimes will not be tolerated.”
“FCA US LLC conspired to make improper labor payments to high-ranking UAW officials, which were used for personal mortgage expenses, lavish parties, and entertainment expenses. Instead of negotiating in good faith, FCA corrupted the collective bargaining process and the UAW members’ rights to fair representation. We will continue to work with our law enforcement partners to root out systemic corruption and fraud involving unions,” stated Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General.
Thus far, as part of this investigation of illegal payments by FCA to UAW officials, as well as fraud and embezzlement by other UAW officers, fifteen individuals have been convicted of convicted of federal crimes, including three former FCA executives. They include former UAW Vice President Joseph Ashton (30 months in prison) former FCA Vice President for Employee Relations Alphons Iacobelli (66 months in prison), former FCA Financial Analyst Jerome Durden (15 months in prison), former Director of FCA’s Employee Relations Department Michael Brown (12 months in prison), former senior UAW officials Virdell King (60 days in prison), Keith Mickens (12 months in prison), Nancy A. Johnson (12 months in prison), Monica Morgan, the widow of UAW Vice President General Holiefield (18 months in prison), former UAW Vice President Norwood Jewell (15 months in prison), former senior UAW official Michael Grimes (28 months in prison), and former UAW Midwest CAP President Edward “Nick” Robinson (12 months in prison). In addition, the following UAW officials have pleaded guilty and are awaiting sentencing: former UAW President Gary Jones, former senior UAW official Jeffrey Pietrzyk, former UAW Region 5 Director and UAW Board member Vance Pearson, and former UAW President Dennis Williams.
GM has asked for a reconsideration of that dismissal.