By ANDREW JULIEN and MARK PAZNIOKAS
Courant Staff Writers .

May 30, 1995

The men recruited to engineer a sweeping reform of the Laborers' union are professional investigators, former FBI and Justice Department officials. But four years ago, when a tip that Hartford union boss Dominick Lopreato might be corrupt made its way to top officials at the Laborers' International Union of North America, the response was decidedly different. To investigate the allegation that Lopreato had taken a gold Rolex watch for investing union pension money with his friends at Colonial Realty Co., the Laborers sent a union employee who moonlights at car leasing company. The two men had lunch together.

Little' changed in Hartford after the investigation. Lopreato continued to run Local 230, a union of more than 5,000 workers who do the hauling and digging of construction. Even after Lopreato's indictment last fall, the Laborers took months to suspend him from office. He was convicted of bribery earlier this month, and faces more than 30 years in prison.

The Laborers say things are different now. Just three months ago, the union ducked a possible government takeover by vowing to eliminate corruption within its ranks. The union adopted a tough ethics code and recruited a battery of former law enforcement officials with impeccable credentials to make the code work. The unusual agreement followed a far-reaching federal probe of organized crime influence inside the Laborers.

But given the union's history, critics are wondering whether the Laborers have the ability - or will - to wipe out decades of corruption. The Laborers insist they are committed to change, and point to their recent actions as reason to be optimistic.

Their track record in the Lopreato case gives critics reason to be cynical. "If you simply go into court and remove the leading crook, who's going to take his place'" asked Herman Benson, secretary-treasurer of the Association for Union Democracy, a watchdog organization.

A gold watch

An early clue that Lopreato might have had a personal stake in the ill-fated schemes of Colonial Realty was the Rolex,

An anonymous letter that made its way in 1991 to top officials at the 700,000-member Laborers International said that Lopreato, then leader of the union's statewide council in Connecticut and its Hartford local, had accepted the watch as a reward for investing union pension funds with Colonial.

The Laborers dispatched Salvatore Romano to investigate. Romano works part time for the union and part time for the same car leasing company in East Providence, R.I., that provided Lopreato with his union-leased Cadillac.

The man who sent Romano to investigate was a lawyer in the Providence firm of Arthur A. Coia, now general president of the Laborers' international and a staunch advocate of reform. At the time, he was the union's second in command.

Romano s investigation consisted primarily of lunch with Lopreato. He never called anyone at Colonial to ask them why the company had given Lopreato a watch with a retail price of about $12,000.

Federal law prohibits pension trustees from accepting anything of value that is intended to influence them. In addition to his other labor post, Lopreato was co-chairman the pension plan's board of trustees. At Lopreato's kickback trial in U.S. District Court, Romano testified that Lopreato told him he had been summoned to Colonial's office in West Hartford in December 1989.

Lopreato said he was surprised with a watch by the company's partners Jonathan Googel, Benjamin Sisti, William Candelori and Frank Shuch. "He said to me they had appreciated his help getting an audience or appointment with the trustees," Romano said.

And he accepted it? a prosecutor asked.

"Yes, he accepted the watch," Romano said. "He thanked them and that was it."

After learning the gold Rolex was, in fact, valuable, Romano testified, Lopreato returned it. Asked whether the watch affected the manner in which Lopreato voted as a pension trustee, Romano offered a simple answer.

"Oh, no." he said.

Off the stand, Romano said he never called anyone at Colonial to get their side of the story. "They were all targets of a major league investigation," he said. "There was no point."

The full extent of Lopreato's involvement only came to light after Colonial principals Googel and Sisti -- facing the possibility of long prison terms - agreed to cooperate with federal investigators after the spectacular collapse of the real estate empire.

But even after Lopreato was indicted in September 1994, the Laborers took several months to remove him from power.

Lopreato immediately surrendered his unpaid position pension trustee after his arrest, but kept his paying union jobs. It took five months - and the adoption of an ethics code - for the laborers in late March to suspend Lopreato from his union leadership posts.

Six weeks later, a jury convicted Lopreato of taking $350,000 in kick-backs. The jurors took only five hours to conclude he had taken the money and the Rolex in return for the Laborers' investing $8 million in three failed Colonial deals.

Robert D. Luskin, the former Justice Department official recruited to lead the Laborers' reform efforts' says the union would now handle the Lopreato case differently. To meet the terms of its agreement with the government, the Laborers have toughened their procedures for handling corruption.

A new code of ethics was adopted in January. To enforce it, the union has installed a former top FBI official as an independent inspector general and brought in a former U.S. attorney to conduct disciplinary hearings. A special hot line has netted hundreds of calls.

''I'm comfortable that if something like this were to come to light now, they would do a thorough complete job," Luskin said.

As for the, delay in removing Lopreato from office, Luskin said the Laborers' international was tied up during the early part of the year finalizing its agreement with the government and the new disciplinary measures. The Laborers' old by-laws included no provision to easily suspend Lopreato.

"It's entirely possible there was some delay," Luskin said. "We were working 20 hours a day in December, January and February."

Jobs and Power

The story of Dominick Lopreato was as much about union politics as personal greed. His conviction on bribery charges ties him to a sorry thread in the history of organized labor

The building trades have proven especially vulnerable. The cyclical nature of the construction industry makes it impractical for contractors to keep a full-time work force. Instead, they rely on unions to provide supply of skilled labor on demand.

That puts tremendous power into the hands of the people running the unions. Contractors who cross a powerful union leader can see their projects stalled by strikes. Political enemies inside the union can find themselves out of work.

In the fall of 1985, laborer Gary R. Wall made the mistake of openly challenging Lopreato. Defying the boss's directive, Wall refused to collect money from fellow laborers for a political campaign, according to testimony during proceedings at the National Labor Relations Board.

The tension between Lopreato and Wall escalated during the months that followed, culminating an open argument at a union meeting. A month later, Wall and a crew of laborers were laid off from a job. Within two weeks, the entire crew - save Wall - was back at work..

The labor relations board ruled that the union had illegally pressured the contractor to keep Wall out of a job. "Wall had become an unruly and dissident presence on the jobsite," a Judge wrote, "who was posing a threat to Lopreato's control over the union."

Wall's effort to unseat Lopreato failed. His Committee to Reform Local 230 lost to Lopreato's ticket by a considerable margin.

Lopreato's days of controlling the 5 500-member local now appear to be over. His conviction bars him from union activity for 13 years, making it unlikely at age 73 that he will reclaim his position of power The local will elect new officers in June.

But although Lopreato may no longer be an issue himself, the power that comes with controlling jobs still has the potential to create a crucible for corruption.

The Laborers, Luskin said, have imposed new hiring rules in an effort to change that. They are aimed at guaranteeing that merit and the amount of time on the hiring list will determine who works, not politics.

But the recent history of Local 230 has shown how ostensibly fair structures can be manipulated. In the NLRB case involving Wall, other laborers testified that they had been blackballed for running afoul of Lopreato.

Although jobs at the union hiring hall were supposed to be handed out on a first-come, first-served basis, several men testified that the rules were sometimes bent to take work away from Lopreato's opponents.

Joseph DiLoretto who ran for union office on the slate against Lopreato's, said he was at the hiring hall when a one-day job at Bradley Airport was offered to the crowd. He was the only one interested in the job but did not get it. Other workers told similar stories.

"It's the jobs," said Benson, of the Association for Union Democracy. "If you start criticizing the business agent, you don't work."

The same cast

Laborers do hard work They dig holes, shovel cement and haul debris. Lopreato used their pension money for personal gain. His power made workers dependent on his good graces for jobs'

The Laborers say they are committed to changing that system. In the first three months of their deal with the government, they brought in an array of troubleshooters with strong credentials. Luskin, for one, was chief counsel in the organized crime and racketeering section at the Department of Justice.

Coia on the other hand, has wielded power at the Laborers for years. Following his father into office, Coia was elected to the international's No. 2 job in 1989 and to the presidency in 1993.

In the draft version of a federal civil racketeering lawsuit against the Laborers outlined in a story by the Providence Sunday Journal, the government said Coia had associated with people involved in organized crime. The union and the government reached an agreement to reform the Laborers from the inside before the complaint was ever filed.

Luskin, speaking for the union, dismissed much of the information in the draft complaint as old news. And he said, it certainly doesn't mean that Coia should not be trusted to reform the organization. "Mr. Coia's voted with his feet there," Luskin said. `'He's led the way."

And if evidence of wrongdoing points to Coia himself?

"There's not a one of us who would protect someone who needs to be punished," Luskin said. "What gives the thing credibility is its independence and the reputation of the people involved."

The Justice Department has the right to appoint its own officers to reform the union if it is not satisfied with the Laborers efforts over the next three years. A spokesman said the department is pleased with the union's progress so far.

But Benson, at the Association Union Democracy, questions whether Coia can change the Laborers from the top down. He says no significant grass-roots groups have stepped up at the local level to lend momentum to Coia's campaign.

And Luskin admits that federal laws designed to assure local control have provided ammunition for union officials bent on fighting the directives from Washington. The international is fighting an array of lawsuits filed by local officials across the nation.

"This problem is so widespread throughout the union that in order to clean it up you would to have a major reform campaign that really involves rousing the members to throw out bums and put in decent leaders," Benson said. "If you send one guy to jail and make no fundamental change, his brother or sister or mother is going to take his place."