Ex-FBI Official Becomes Laborers' Union Cop (Part 1 of 2)

By Stephanie Mencimer
Washington Post Staff Writer

Sunday, June 7, 1998;

When W. Douglas Gow moved onto the fifth-floor of the Washington headquarters of the Laborers' InternationalUnion of North America (LIUNA) in 1995, he changed the locks and swept for bugs. He demanded file cabinets impervious to firebombing and hacker-proofed his computers using the protocols of his former employer, the FBI.

The quintessential G-man with starched white shirt and spit-shined shoes, Gow was thus ensconced in the belly of the beast -- a union whose alleged organized crime ties date back to Al Capone. A retired FBI deputy director, he had been hired by LIUNA to conduct an extraordinary experiment in labor reform -- a self-policing plan that many saw as fraught with conflicts. Working from within, Gow was placed in charge of a no-holds-barred investigation designed to weed out allegedly corrupt LIUNA members.

Some of them worked just outside Gow's office door.

Three years later, Gow and the internal strike force have shaken the roots of the 750,000-member blue-collar union and been blasted along the way by everyone from ditch diggers to members of Congress. The effort, just extended by the Justice Department for another year, has been slow, expensive and decidedly uphill. Its long-term effects on union leadership are still unclear.

But as experiments go, the mob-busting efforts of Gow and his team have been viewed by reformers as a promising new tool in reconstructing the culture within a historically troubled union. Since the 1930s, the government has fought against organized crime's labor influence -- first with select prosecutions of tainted members, and more recently with broad court supervision of union affairs and elections stemming from civil lawsuits brought under the Racketeer Influenced and Corrupt Organizations Act.

LIUNA's approach offers a third option -- letting the union itself bear the cost and responsibility for keeping its membership clean. LIUNA hired Gow as inspector general in 1995 to avert a threatened Justice Department RICO suit. A draft complaint alleged that four LIUNA presidents - including current President Arthur A. Coia -- had been controlled by organized crime. It identified more than 80 LIUNA officials who had been convicted of major crimes and said that criminal influence was evident at the local and international levels. It demanded Coia's removal, threatening to seize control of LIUNA as it had the Teamsters in 1989.

Coia and a team of white-collar defense lawyers offered a compromise: To avoid a lawsuit, the union would create an internal -- but completely autonomous -- strike force of former federal agents and prosecutors to enforce a strict new ethics code. If the effort failed, LIUNA would yield to a government takeover. Justice accepted the deal and has been closely monitoring the progress.

Gow set out on tricky footing. One of his first tasks was to investigate Coia himself. At 55, Coia was a Democratic Party stalwart touted by LIUNA as the new face of American labor.

But Gow's team reopened unresolved issues from Coia's past and honed in on the Justice Department's allegation of organized crime affiliations. Its findings led attorney Robert Luskin, acting as internal prosecutor, to file disciplinary charges against Coia last November. If "barred conduct" is proven during the ongoing hearings, Coia could lose his $254,000-a-year job.

In a letter last fall to LIUNA's board, Coia expressed confidence that "when the truth is brought forward, I will be totally, completely and finally vindicated."

Coia's case stands out among hundreds of investigations now underway, a job that Gow says "is much larger than I imagined." Dozens of LIUNA members have been ousted and 30 locals and district councils have been taken over by the international.

But Coia's critics say Gow's work is far from finished. They complain that some already disciplined by Gow's team remain in union jobs. Because all the strike force members are on the union payroll, some question whether Gow and his colleagues are beholden to Coia and unlikely to discipline him or other high-ranking union officials.

Gow brushes off the suggestion. "You've probably heard that Mr. Coia tells us what to do and when to do it, but that's just baloney," he said in an interview in his spartan office. "I can't recite one instance where he has interfered with anything we have done."

Alex Corns, business manager of a LIUNA local in San Mateo, Calif., complained that Gow is up against an impossible challenge. "There's just not enough resources to fight what they've got to do. It would be like trying to fight a forest fire with six people."

When Gow took the $140,000-a-year job, the Justice Department handed him a road map to alleged corruption within LIUNA's international headquarters and 600 locals -- a 212-page draft racketeering complaint describing a union dominated by organized crime.

In LIUNA -- a union representing construction workers, chicken pluckers, hazardous waste handlers and various other trades -- organized crime had a 70-year grip on union business, prosectors alleged. The complaint spelled out criminal influence in matters ranging from the selection of officers to the awarding of service contracts. LIUNA's pension and welfare funds -- more than 300 in all totaling tens of billions of dollars -- were a magnet for organized crime, the complaint alleged. In the early 1990s, for example, prosecutors discovered that New York City's Mason Tenders District Council, a LIUNA affiliate, lost $50 million in pension funds through real estate investments allegedly controlled by organized crime.

Coia's leadership since 1993 had been troubling to the Justice Department, which described him in a memo to the White House as a "mob puppet." Coia was indicted in Florida in 1981 on racketeering charges, but the case was dropped after a judge ruled the statute of limitations had expired. He was accused of taking kickbacks from an insurance agent who dealt with LIUNA locals. Coia has said the charge was groundless and has denied being influenced by organized crime.

In recent years, Coia has had high visibility within the Democratic Party. He oversaw $1.4 million in union donations to the Democratic National Committee in 1994 and played golf with President Clinton. He supported one of first lady Hillary Rodham Clinton's favorite charities, the U.S. Botanic Gardens, and gave personally to Clinton's legal defense fund.

LIUNA invited Hillary Clinton to speak at a 1994 convention, but Paul Coffey, the former head of the Justice Department's organized crime and racketeering section, warned her in a memo that she should "avoid any direct contact with Coia, if possible" because the department was preparing to file a RICO suit. The first lady turned down the invitation.

Coffey was the same official who later approved Coia's cleanup plan, a decision that some Coia adversaries charged was politically motivated. Coffey denied that, testifying in a 1996 congressional hearing that Justice dropped the LIUNA lawsuit because, "we never had a union that said, 'We'll take on the mob before you file.' "

Gow recruited more than 60 former federal agents to examine whether members had engaged in "barred conduct" under LIUNA's rewritten ethics code. It called for expulsion of members who had been found guilty of crimes. But it also forbade members to assert their Fifth Amendment rights in a criminal case or obstruct Gow's investigations. Members could be expelled if a hearing officer determined after closed hearings that the ethics code had been broken.

An elaborate internal justice system was set up to provide due process. Defense attorney Luskin was hired as chief prosecutor -- or as he put it in an interview "to get the cockroaches out." The son of a Chicago labor arbitrator, Luskin once worked for the Justice Department's organized crime section and now has a Georgetown private practice. He said the union has paid his firm about $4 million since November 1994.

As its disciplinary judge, LIUNA hired Peter F. Vaira, a former U.S. attorney in Philadelphia. To hear appeals, it retained W. Neil Eggleston, a former White House lawyer and House Iran-Contra committee special counsel.

LIUNA's team honed in on notoriously troubled locals and district councils around the country.

First on the list was Buffalo's Local 210 with 1,200 members, a local whose alleged organized crime ties worried then-Attorney General Robert F. Kennedy in the early 1960s. The local had not had a contested election since 1974, when John Cammilleri, a union member and alleged organized crime associate, was gunned down after supporting an opposition candidate.

Gow's agents assembled evidence to justify a trusteeship, a legal mechanism that allows the international to take over a local to correct financial malpractice or undemocratic practices.

Gow could no longer use traditional FBI tools -- tapping telephones or reading secret grand jury testimony. But he had help from Ronald Fino, Local 210's longtime business agent, who was in the federal witness protection program.

Gow said of the local's history: "They had all the common schemes -- contract rigging, no-show jobs, kickbacks, investments going wild and kickbacks on the investments."

Local 210's officers agreed to step down without a hearing, and Luskin appointed Gabriel Rosetti Jr., a 31-year union member from Rochester, N.Y., for a two-year stint as supervisor. Rosetti expected a smooth transition but arrived at the union hall on his first day -- Palm Sunday 1996 -- to find it blocked by 200 members chanting "Gabe go home!" The insurgents occupied the hall for three weeks until a federal judge ordered them out. Insurgency leader John Tomasello was expelled for leading the protest. He complained in an interview that lawyers for the international "made it look like everybody in that union -- especially the Italians - like they're criminals."

Some of Rosetti's tactics grew out of necessity, officials say. He said he discovered that the union was giving high-paid construction jobs to alleged Buffalo crime family associates. The local's finances were a mess, but officers had been leasing five Grand Cherokees at twice the market rate from a company in distant Rhode Island. Rosetti cut the local's staff and reduced the auto fleet to a single Buick Regal. But his effort to coax new leadership out of the rank-and-file was sabotaged, he believed, by former leaders who hoped eventually to return to power.

In early 1996, Luskin asked Vaira to eject 28 Local 210 members. Their cases were pending for 18 months, meaning that Rosetti not only had to live with the accused, he had to pay some of them.

Three on Luskin's list -- including Sam Capitano, the former business manager's son -- had been elected to $25,000-a-year advisory board positions created by Luskin.

Capitano attacked Rosetti at one meeting, grabbing a microphone and yelling "Gabe, you got no balls." The next day, the two got into a fistfight and Rosetti fired Capitano from the board -- an action Capitano has contested before the National Labor Relations Board. He is suspended from the union.

Vaira finally expelled most of the questioned members in early April and extended the local's supervision indefinitely. Luskin expects the local to appeal the decision in federal court.

When Gow traveled to Chicago in 1995 to investigate the Chicago Laborers District Council, a threatening message waited on his hotel voice mail: "Who do you think you're [expletive] dealing with? A bunch of kids from Waco?"

The anonymous call was a blunt reminder that the real seat of the union's power was in Chicago, LIUNA's birthplace.

The Justice Department alleged in the draft RICO complaint that Anthony "Joe Batters" Accardo, an alleged high-ranking organized crime figure who died in 1992, endorsed all of LIUNA's international officers. In 1989, when Coia sought to replace his ailing father on LIUNA's executive board, he flew to Chicago and consulted with Vincent "Innocent" Solano, Accardo's right-hand man, according to Coia's testimony in a 1995 lawsuit.

The Chicago District Council, the collective bargainer for 21 locals and 19,000 workers, had been investigated by two Senate committees and the President's Commission on Organized Crime before the Justice Department accused it again of organized crime ties in the draft RICO complaint.

When Gow arrived, Bruno Caruso was council president. His father, Frank "Skids" Caruso, was described in the RICO draf complaint as a boss of gambling and extortion rackets. Based on Gow's work, in February hearing officer Vaira put the council under a trusteeship and Luskin appointed Chicago labor lawyer Robert Bloch as trustee.

Caruso, now out of a $186,000-a-year job, believes Gow's campaign is retaliation against him engineered by Coia, who he said sees him as a rival. He denied any criminal ties, saying the allegations stem from Italian American stereotypes.

"Winston Churchill, he smokes a cigar, he's astute. Other guys, they don't button their collar, they're casual," said Caruso in an interview. "I smoke a cigar, don't button my collar, I'm a wise guy."

Caruso argued that the "so-called reform" would destroy the council's bargaining power in negotiating new contracts for construction workers.

Bloch took over the negotiations this spring. He invited representatives of all 21 locals to participate.

On May 29, after a 20-hour marathon session, the council emerged with a contract promising major improvements and a 35 percent pay increase.

"People are telling me this is the best contract they've ever had," Bloch said. "It is a tangible sign that things are really moving forward."

The challenge faced by Gow's team was nowhere more evident than the 1996 Laborers' convention in Las Vegas, a dazzling affair with Elvis impersonators, laser shows and swarms of federal agents keeping tabs on LIUNA's first contested presidential election in 25 years.

Coia was considered a shoo-in. Most members gathering from across the country had never seen the Justice Department's draft RICO complaint because Vaira barred dissidents from distributing it.

LIUNA's agreement with Justice required that the rank-and-file vote for president by secret ballot.

Giving them someone to vote for was another matter. Almost no one wanted to challenge Coia, who ran as a reformer.

The last attempt to oust an incumbent left an imprint. In 1981, when dissidents tried to nominate a challenger to run against President Angelo Fosco, then under a racketeering indictment, they were beaten on the convention floor, according to a report by the President's Commission on Organized Crime.

Coia's LIUNA pull dated back to his father, Arthur Ettore Coia, the international's secretary-treasurer for 20 years. The elder Coia built LIUNA into a Rhode Island political force while cultivating ties to Raymond L.S. Patriarca, a one-time reputed head of New England's major crime family, according to the draft RICO suit.

The younger Coia had moved into the top job with little experience doing the low-paid labor of most of his members. Coia's Providence law firm, which represents LIUNA members and trust funds in New England, has allowed him to drive a Ferrari, play golf and breed Rottweilers. He splits his time between Washington and Rhode Island. He is still president of the Providence local his grandfather founded.

In 1989, LIUNA's board appointed Coia secretary-treasurer. He was named president when Fosco died in 1993.

The draft RICO complaint alleged that he had long associated with organized crime and conspired with the Buffalo crime family up through 1994 to create regional training centers in New York that were allegedly to be run by organized crime. Coia has denied any organized crime involvement. After some prodding, Bernard Scanlon of Long Island volunteered to run against Coia, calling himself the "sacrificial lamb." Chicago council President Caruso also jumped in. In the end, only a small percentage of LIUNA's membership voted. Coia was reelected overwhelmingly. Scanlon never rallied enough support to get on the ballot. Caruso got 30 percent of the vote.

Stephen Goldberg, a Northwestern University law professor who served as LIUNA's election officer, considered the election a limited success. In a report to the Justice Department, he wrote, "Although some progress has been made in transforming LIUNA into a participative political democracy, that progress is both limited and fragile." Coia may have triumphed, but his trials are not over. He spent most of April at his own disciplinary hearing, facing charges that he was influenced by organized crime and took vendor kickbacks. Coia and his lawyer, Howard Gutman, declined to comment but Coia has publicly denied the charges in the past. Dissidents who have monitored the case worry that the prosecutors and the judge, all paid by the union, will treat him with kid gloves.

LIUNA officials are confident that Coia will remain in power. Chief of staff Terence O'Sullivan said, "If it wasn't for him, we would not be sitting here talking about cooperative reform."

And some members say Coia's removal would not cure union problems. Robert Brown, a local business manager in Rochester said that if Coia steps down, his most likely successor is LIUNA Vice President Peter J. Fosco, son of former president Angelo Fosco. A new generation of Fosco leadership, dissidents say, would be like handing over the Teamsters to James P. Hoffa, son of James R. Hoffa, the longtime head of the union who disappeared in 1975. Fosco, whose father preceded Coia as president, said in a telephone interview he supports Coia's reform and declined to speculate on succession.

But one thing has changed. In the old days, the Justice Department contends, no one could make it past LIUNA's board to the presidency without first winning approval from the mob.

This year, if the board is forced to replace Coia, their candidate will have to pass muster with Douglas Gow first.

INVESTIGATING THE BIG 4

In 1986, the President's Commission on Organized Crime recommended that the Justice Department go beyond criminal prosecutions of union members and use the civil Racketeer Influenced and Corrupt Organizations (RICO) Act to make systemic union reforms. It targeted the "big four" unions that the FBI alleged were "substantially influenced and/or controlled by organized crime" and in need of major cleanup. Here's a status report:

President: Arthur A. Coia, appointed in 1993

Membership: 750,000. The union represents construction workers, mail handlers, hazardous waste haulers, chicken pluckers and others.

Status: LIUNA headed off a RICO suit in 1995 by promising an internal cleanup. To date, dozens of members have been expelled, including two former vice presidents. More than 60 members quit before their cases resulted in disciplinary charges. Twenty-two matters have been referred to law enforcement for prosecution.

The international has placed 30 locals and district councils in trusteeship or under supervision. Disciplinary charges are pending against Coia that could result in his ouster.

In 1996, for the first time, rank-and-file members directly elected their general executive board officers by secret ballot. Previously, convention delegates chose the president and other officers. The three-year agreement with the Justice Department was extended for another year in January.

President: Ron Carey

Membership: 1.4 million, the nation's largest union. It represents truck drivers, industrial workers, and others.

Status: A RICO suit against the international resulted in a 1989 consent decree forcing the union to hold rank-and-file elections and naming a court monitor to root out corrupt members. More than 300 members have been expelled, 80 locals have been put into trusteeship and $15 million in pension money has been recouped.

The reform paved the way for the 1991 election of Ron Carey, a longtime member of Teamsters for a Democratic Union. Carey was reelected in 1996 by a narrow margin, defeating James P. Hoffa. But late last year, the election was overturned in the wake of a campaign finance scandal. Carey was disqualified, and three of his operatives pleaded guilty to criminal conspiracy. Another was recently indicted on embezzlement charges. Congress is now investigating how a scandal erupted while the union was under government oversight.'

President: Edward Hanley, in office since 1973.

Membership: 300,000. It represents bartenders, housekeepers, waiters and casino workers.

Status: In 1995, HEREIU was put under federal supervision after the Justice Department settled a RICO suit against an Atlantic City local. The federal monitoring ended March 5, but a Public Review Board, headed by former Illinois governor James Thompson, will continue to oversee the union's internal reforms.

Forty officials, members and union associates have been barred permanently or otherwise disciplined, but the monitorship ended this March without a supervised election, considered a crucial element to union reform.

On May 20, the U.S. District Court in Trenton, N.J., unsealed a February agreement in which Hanley agreed to retire and leave office by July 31. Hanley had been a controversial figure. He asserted his Fifth Amendment right against self incrimination when questioned before a presidential commission about alleged ties to organized crime.

President: John Bowers, in office since 1987

Membership: 65,000. It represents shipping and dock workers.

Status: The union, which the AFL-CIO expelled for corruption in 1953 (but reinstated in 1959), was the inspiration for the movie "On the Waterfront." In 1990, the government filed a RICO civil suit against six ILA locals that represented workers on the New York and New Jersey waterfront. The suit described the influence of Gambino family head John Gotti and Genovese family boss Anthony "Fat Tony" Salerno.

Monitors were appointed to oversee the locals. Nine members and officers were removed, and Bowers, who was president of three of the locals, was barred from holding office in any of the locals. The government has not sought to takeover the union's international operation.

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