Michael Bologna Chicago

Friday, January 23, 1998

No. 15

The Laborers' International Union of North America and the Justice Department have negotiated a one-year extension of the three-year oversight agreement to allow the union to complete investigations and hearings associated with its internal reform program aimed at ridding the union of organized crime influence, the union announced Jan. 22.

''Our innovative internal reform program has made significant headway, and we have operated in good faith to eliminate corruption and organized crime from our union,'' said Michael Bearse, LIUNA general counsel.
''However, our general executive board recognizes there is still work to be done to make this union the best possible union for our members. There are major issues under investigation or awaiting hearing that are unlikely to be resolved before late in 1998.''

The oversight agreement, originally scheduled to expire Feb. 11, 1998, was extended to Jan. 31, 1999. Under the terms of the agreement, the Justice Department may impose the terms of a consent decree approved by the parties that would allow the federal government to take control of the union at any time if the government, in its sole discretion, decides that adequate progress is not being made toward cleaning up the union.

Support for the extension was not unanimous among the GEB's 15 members. One member voted against the extension and another abstained, according to government sources.

''Reform is a continuing part of our organization,'' according to Arthur A. Coia, president of the union. ''We have, through our code of ethics, institutionalized these initiatives and have implemented significant changes in the way LIUNA conducts its business.''

Among those changes, he said, was conducting the first rank-and-file election for general president in December 1996, under the supervision of an independent election officer, and introduction of significant changes in local hiring hall procedures. He added that a number of operations within the union have been reviewed by a team headed by W. Douglas Gow, LIUNA's inspector general. Gow is a 30-year veteran of the FBI.

During the past three years, according to LIUNA, more than 400 investigations have been opened resulting in the imposing of 21 trusteeships and supervisions, the filing of 104 charges and complaints, and the resignation or removal of more than 226 individuals from the union.

Extension of the oversight agreement was negotiated with the Justice Department by Bearse and Robert D. Luskin, the in-house prosecutor and attorney for LIUNA's general executive board.

''There is nothing more or less than meets the eye,'' Luskin said of the extension. LIUNA remains ''committed to reform'' with or without the oversight agreement, he said. While much has been accomplished under the agreement over the past three years, Luskin said, ''a great deal remains to be done.''

Extension of the oversight agreement for a year was assurance needed by the federal government that ''LIUNA would not falter as it continues down the reform road,'' he said.

''We and the government will continue doing tomorrow exactly what we are doing today. This does not affect the everyday process of reform. Everything we are doing is completely transparent,'' he said.

Among a wide range of internal reforms, LIUNA proposed a trusteeship for the Chicago District Council of Laborers. In a June 16, 1997, complaint, Luskin sought to rid the council of organized crime influence, correct past financial malpractice, and restore democratic principles.

He asserted that criminal elements affected council operations for at least the past 25 years. Closed-door hearings were conducted over a nearly six-month period by Peter Vaira, the union's independent hearing officer. A ruling on the trusteeship complaint from Vaira is imminent, sources familiar with the matter said Jan. 22. Vaira is a former U.S. Attorney for the Eastern District of Pennsylvania and the former executive director of the President's Commission on Organized Crime.

Similar action was taken by LIUNA against its district council in New York City where the first election of officers was conducted after trusteeship was imposed three years ago.

The extension agreement was announced in Chicago by Scott Lassar, U.S. Attorney for the Northern District of Illinois. The Justice Department has primarily mounted its law enforcement effort against LIUNA from Chicago. The department believes organized crime in Chicago has traditionally controlled the leadership of the internationalunion.

In a statement, Lassar said LIUNA had made some significant reforms since the establishment of the oversight agreement three years ago. Among other things, he pointed to the ethics and disciplinary code, which have been instituted, and major investigative efforts in Chicago; Buffalo, N.Y.; and Washington, D.C.; and in New York and New Jersey.

In addition, Lassar pointed to the union's first-ever contested, nationwide, direct rank and file election for officers, held in 1996. The election was supervised by an independent monitor, Professor Stephen B. Goldberg of Northwestern University's School of Law. He also noted that the international union has agreed to have an independent officer supervise the next international election, scheduled for 2001.

Lassar conceded, however, that the reform effort has not progressed without delays and disappointments. Still, he said the process is proceeding in the best interest of the union and taxpayers.

''While we are often impatient with the speed of reform and do not agree with everything that the union has done, this extension agreement gives this unprecedented experiment the chance to work,'' Lassar said in a statement. ''If the reform process remains successful, then the union will be less corrupt and more responsive to its members. As an extra benefit, the process keeps government interferences to a minimum, and the union assumes the financial burden for its own reform.''

But a LIUNA reform group, known as Laborers for Justice and Democracy, criticized the extension agreement. The group said a single year of additional oversight will do nothing to speed up the exceedingly slow pace of reform and provide honest union members with no protections or tools for regaining control of their union from the mob.

''This is totally inadequate in terms of reforming the union, it gives us no confidence,'' said Jim McGough, a Chicago Laborer and a spokesman for the reform group. ''This is a situation where people are getting beat up at union halls and dissidents have to ask for police protection to attend union meetings.''

McGough was also critical of the Justice Department's oversight activities, saying the department has failed to use its leverage to push the international union toward swift and meaningful reforms. He noted that a cleansing of the Chicago District Council of LIUNA--which should have been a top priority--has not yet occurred.

Luskin, the GEB attorney, did not file a trusteeship complaint against the allegedly mobbed-upcouncil until last summer, he said. The 19,000 LIUNA members affiliated with the Chicago District Council are still waiting for a decision from Vaira, LIUNA's independent hearing officer, to decide whether the body should be placed under the control of a trustee.

McGough said he believes Luskin, Vaira and Gow, are doing a good and fair job of investigating, prosecuting and adjudicating reform cases, but they don't have adequate resources to accomplish the massive mop-up operation required within LIUNA. He said the Justice Department should demand that the international union provide adequate resources for the imposition of swift and effective reforms, or do the job itself.

''The Justice Department, beginning with Janet Reno, just doesn't have any balls,'' McGough said. ''They've got a trigger, pull it. They've got ammunition, use it. Washington's tolerance level for corruption is way too low. This whole experience is teaching me that organized crime is a low priority.''

But Craig Oswald, an assistant U.S. attorney who has been monitoring LIUNA's progress for the Justice Department, said reforming the union is an intensely complicated process that cannot be accomplished overnight.

Like Lassar, he expressed some frustration with the pace of reform, but noted the Justice Department would not hesitate to ''pull the plug'' on the program and file the consent decree against the union if it thought real reform would never be achieved.

Oswald said the Justice Department continues to have confidence in the process developed for reform and in the people associated with that process. He noted that the department has had concerns about the adequacy of resources, but was able to convince the union to add manpower for the investigation and prosecution of cases. With a large number of cases now being forwarded to LIUNA's independent hearing officer, Oswald said the union may have to direct additional resources to the hearing process.

''I think it is coming to the point that Mr. Vaira, unless he does something about it, is facing some serious strains in terms of issuing decisions and hearing cases,'' Oswald said.

By Brian Lockett and Michael Bologna

Copyright © 1998 by The Bureau of National Affairs, Inc., Washington D.C.