National Legal and Policy Center

1309 Vincent Place, Suite 1000

McLean, Virginia 22101

Tel: (703) 847-3088/ Fax: (703) 847-6969

Organized Labor Accountability Project


June 15, 1998 -- Vol. 1, Issue 1


Rerun Election Set for October

Due to the campaign money-laundering scandal which funneled at least $538,100 into the disgraced Carey reelection campaign, Teamsters will vote this fall for a new president. On Jun. 3, U.S. District Judge David Edelstein set Oct. 14 as the date for the mail-in ballots to be tallied.

The Court has already disqualified Carey from the rerun. Likely candidates for president are James P. Hoffa, Carey's 1996 opponent, and Tom Leedham who has the support of the influential liberal-activist group, Teamsters for a Democratic Union, as well as many other Carey supporters.

Related news: Rep. Peter Hoekstra (R-MI), chairman of the House committee looking into Teamsters corruption, told the Detroit News on Jun. 9, "I don't want the election to go forward with the conditions that exist today. I just don't know how you can run an honest election in this environment."

His concerns are a reminder of the $20 million of taxpayer funds that were squandered by the last election. The Justice Department, under Congressional pressure, is appealing a court ruling that the government has to pay for the rerun election which is estimate to cost $8.4 million. "I don't want taxpayers to be fleeced one more time," said Hoekstra.

Teamsters Scandal Briefs

*Business Week [06/15/98] reported that top DNC/Clinton-Gore fundraiser Terrence McAuliffe's conversations with 2 Democratic party staffers about a possible swap scheme with the Teamsters during the 1996 election are now "the focus of a federal grand jury in Manhattan that is investigating whether Democratic fundraisers conspired to find donors for Carey's campaign in hopes of getting back hefty union contributions."

*Business Week also said sources "close to the investigation said the U.S. Attorney is interested in whether [an AFL-CIO] credit-card deal played a role in the swap schemes." McAuliffe and Carey campaign consultant Martin Davis, who plead guilty to charges of conspiracy, mail fraud, embezzlement and making false statements to the court- appointed Teamsters election officer, were both under contract to "lobby the AFL-CIO Executive Council to switch its union credit card program" to Household International bank.a Jun. 3 ruling, Judge Edelstein rejected a Carey appeal of his disqualification from the rerun election. Separately, the Teamsters Independent Review Board was scheduled to meet Jun. 9 to discuss Carey's possible expulsion or suspension from the union. A decision is expected shortly. [BNA Daily Labor Report 06/04/98]

N.Y. Teamsters Indicted

6 Teamsters were arrested in connection with a 14-man crime-ring that was stealing and reselling electronic equipment, clothing and jewelry in N.Y. Each faces up to 10 years in prison. Many of the stolen items were sold to an undercover FBI agent in 67 transactions according to U.S. District Court records. The 6 were UPS drivers. UPS notified the FBI that it had suspected criminal activity. [A.P. 06/11/98]

Violent Teamsters Shut Down CA Port

The Port of Hueneme, near L.A., was shut down on Jun. 1 due to a violent Teamsters strike sparked by a dispute over 2 forklift workers' salaries. The reportedly illegal strike idled hundreds of workers and stranded 3 cargo-laden ships.

Police were present to stop Teamsters* violence against Longshoremen wishing to cross the picket line. All 250 members of the International Longshoremen's & Warehousemen's Union honored the picket line until an arbitrator ruled that the strike was illegal ordering them back to work.

Dozens of Longshoremen moved toward the picket line but retreated after threats and chants of "No scabs! no scabs!" were hurled by the Teamsters. ILWU leaders invoked a health/safety clause of their contract ordering members not to cross the violent picket line. Local 186 Teamsters' boss, Bill Elder is not reported to have denounced the violence. He just stated that the salary offer was 40% less than they wanted "and we can*t accept it." [L.A. Times & Ventura Co. Star 06/02/98]


Coia Warned Against Retaliating Against Witnesses

Rep. Harris W. Fawell (R-IL), chairman of a House subcommittee examining union abuses against members, sent letter to Laborers Int'l. Union of North America president Arthur A. Coia, warning him against acts of retaliation against individuals testifying before the committee.

Coia as long-been suspected of being under the influence of organized crime. In 1997, LIUNA's in-house prosecutor filed charges against Coia for knowingly associating with organized crime and permitting organized crime to influence LIUNA affairs. "We can not, and will not, tolerate any retaliation against any witness and we will take every step necessary and possible to protect them," wrote Fawell in the May 27 letter.

Stephen Manos, vice-president LIUNA Local 230 in Hartford, told the committee his Congressional testimony has "further exacerbated" acts of harassment, intimidation and retaliation against him, including a recent complaint filed in U.S. District Court by Local 230*s business manager Charles LeConche accusing him of defamation for appearing before Congress.

Manos testified that the LeConche physically assaulted him and literally threw him out of a board meeting for questioning union expenditures.

Luskin's Big Bucks from LIUNA

LIUNA's in-house prosecutor Robert D. Luskin, who is responsible for the integrity of LIUNA's "internal reform effort," admitted to being paid about $4 million from LIUNA since Nov. 1994 in the Jun. 7 Washington Post. It's a rare public account of what LIUNA has paid to Luskin and his 11-lawyer firm.$4 million over 44 months (11/94 to 06/98) equals $90,909 a month, or... $1,090,909 a year... $20,979 a week... $4,196 a day...$524 a hour (at 40 hours a week)... $8.74 a minute... all thanks to the mandatory unions dues of LIUNA members. Note too that LIUNA is not Luskin's only client.

Laborers Fired Over Pay Questions

On May 29, the Greater Orlando Aviation Authority upheld the firings of 2 LIUNA electricians at Orlando's airport for reportedly falsifying payroll records. The records in question show the 2 collected $34,000 for over 1,500 hours of allegedly bogus overtime. LIUNA Local 678's appeal for reinstatement was rejected, and the local's business agent said the LIUNA's executive board may seek a federal arbitrator to intervene. [Orlando Sentinel 05/06 & 05/30/98]

Pension Crimes Charged

2 Boston LIUNA bosses were recently charged in U.S. District Court with criminal offenses arising from violations of pension and labor laws. U.S. Attorney Donald K. Stern announced that Joseph P. Mandarini and his father, Louis A. Mandarini, Sr., were charged respectively, in a criminal information with making false statements in violation of the Employee Retirement Income Security Act and with failing to file financial disclosure documents required by federal labor law. J. Mandarini is the Sergeant-At-Arms of LIUNA Local 22, and L. Mandarini is the Business Manager of Local 22 and Board of Trustees Chairman of the MA Laborers' Pension Fund.

At the root of the complex scheme is the charge that MJM Asbestos Abatement, Inc., which employed LIUNA members and was a wholly-owned Mandarini business, had not paid approximately $120,000 in pension, health and welfare, and other ERISA benefits which it was obligated to pay to LIUNA members.


Clothing Union Corruption

According to Rep. Hoekstra's subcommittee, the bosses of the Union of Needletrades, Industrial & Textile Employees are profiting from their members job losses due to a special industry proviso in federal labor law.

The May 27 report states UNITE receives "liquated damages" from companies for contract breaches which include relocating production overseas. UNITE treats the payments as its own since no explicit obligation exists to distribute the money to its members."So as contracts leave the country and UNITE's members lose their jobs, UNITE itself continues to receive 'a piece of the action'... Over the past few decades garment unions have lost more than half of their membership to

overseas competition. Yet during that same time, UNITE and its predecessors became the richest of all unions, as measured on an assets per member basis. UNITE not only on owns the Amalgamated Bank of New York, but also owns much prime real estate in New York City. Despite its wealth, UNITE's fully vested pensions, we are told, are worth an average of only $85 per month," said the report.

Hoekstra's committee is also monitoring a RICO suit filed against UNITE in N.Y. and a separate suit by CA employees. Also, a FBI probe recently had 12 members and associates of the Luchese, Gambino & Genovese crime families indicted for an extortion racket in N.Y.'s garment district. Though no UNITE officials have been indicted, the FBI has said the investigation will probably go "into the union."


Sens.: Cohen Approval Doubtful

Lawrence J. Cohen, President Clinton's and the unions' choice for general counsel of the National Labor Relations Board, will not be approved predicted Sen. Don Nickles (R-OK) and Sen. Tim Hutchinson (R-AR). Both Senators statements came at the Associated Builders & Contractor's legislative conference on Jun. 10.


"We aren't quitting until we kick the butt of Northwest Airlines." * AFL-CIO Secretary-Treasurer Richard L. Trumka at a union rally near Minn.-St. Paul's airport [Star Tribune 05/23/98]. NWA pilots authorized a strike in May. Trumka invoked the 5th Amendment to avoid federal investigators' questions on the Teamsters scandal. Allegedly, he routed $200,000 to Carey's campaign.


CWA Accused of Inducing Fear About Disabled

In a June 2 letter, the Developmental Disabilities Council, a New Jersey watchdog group on state policy, accused the Communications Workers of America of threatening to expose the names of group home residents who have criminal records or a history of behavior problems in order to halt the closing of state institutions for the disabled. The group*s director Ethan Ellis said, "This degrades the public images of people with developmental disabilities irreparably. It is going to take years to repair that damage." [Bergen Co. Record 06/03/98]


Tainted Ex-President Reinstated

On June 3 in St. Louis, a U.S. District Judge had Service Employees Int'l. Union Local 50 to reinstated its ex-president William Stodghill. He was ousted from office and the union in 1996 amid allegations of wrongly spending the union's funds for his personal expenses. Current local

president Don Rudd said, "Stodghill was found guilty of improperly using members' money at four separate hearings held by the union. Nothing in the Judge's ruling disputes that fact." Stodghill intends to regain the presidency in the local's election this summer. [St. Louis Post-Dispatch 06/04 & 06/05/98]

Union Lies About Its Strength to Raid Workers

In an effort to lure members away from the United Industry Workers Local 424, SEIU Local 1212 based in Queens, NY made false claims about its size and strength according to Jun. 10 Newsday article. It claimed to be the largest transportation union in N.Y. state and its fliers stated: "Local 1212 knows your industry and has negotiated many outstanding contracts for employees just like you...We have a staff of over 30 business agents in the New York area, with 14 residing in Suffolk County."

However, Newsday*s examination of the union*s financial reports filed with the Labor Department destroy the claims. The report shows the union has only 5 officers and employees. Far from being N.Y.'s largest transportation union, the local, which was founded 3 years ago, has only 94 members. And, it is unclear whether any members are in the transportation industry according to Newsday.


Ex-AFSCME Boss Indicted

In N.Y., Lawrence Germano former associate director and executive director of Council 82 of the American Federation of State, County and Municipal Employees was indicted on Jun. 5 on federal charges of defrauding union members through a computer-consulting scam in 1993-94. The 14-count indictment included Germano's two brothers-in-law. This same AFSCME council had four bosses ousted in 1995 for misusing about $450,000 of union funds for out-of-state trips and visits to strip bars. [Albany Times Union 06/06/98]

VP Consorting with AFSCME Boss Implicated in Teamsters Scandal

Vice-President Albert Gore, Jr. had an "unusual" close-door meeting on Jun. 5 with 3 union bosses including AFL-CIO President John J. Sweeney and AFSCME President Gerald W. McEntee to discuss opposition to the proposed Freedom From Government Competition Act. McEntee has been implicated in the Teamsters money-laundering scandal. According U.S. District Court records, McEntee raised $20,000 for Ron Carey's reelection campaign which allegedly violated the ban on solicitation of funds for Teamsters candidates by union officials outside the Teamsters. [Washington Post 06/10/98]


Food Service Employees Ruin USC Graduation

L.A. Police arrested 37 members of the Hotel Employees & Restaurant Employees International Union, many disguised in caps and gowns, for unruly demonstrations during the University of Southern California's commencement. The demonstration was part of an on-going strike against USC. USC spokesman James Elmendorf said, "it's extremely tragic that this group would destroy, or attempt to destroy, one of the most significant days in the lives of the students and their families." [City News Service 05/08/98]


Herman's Independent Council Named

Announced May 26, Labor Secretary Alexis M. Herman will be investigated by Independent Counsel Ralph I. Lancaster, Jr. for an alleged swap scheme that traded campaign contributions to the DNC for favors to a business in which she had a financial interest during her time on the White House staff.

Herman is the 7th top Clinton administration official to be investigated by an independent counsel over suspected criminal activity. [Washington Times 05/27/98]

- - - - -

In addition to the unions and organizations covered in this Union Corruption Update, readers can look forward to news and information on the United Food & Commercial Workers, International Brotherhood of Electrical Workers, National Education Association/American Federation of Teachers, the United Auto Workers and other corrupt and abusive unions in future editions.

If you have ideas or suggestions for future editions of Union Corruption Update, please email NLPC at Thank 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 labor organizations. NLPC is a nonpartisan, nonprofit foundation promoting ethics and accountability in government through research, education and legal action.

- - - - -