By MIKE STANTON and JOHN E. MULLIGAN
Journal Staff Writers
Feb. 1, 2000

BOSTON -- Arthur A. Coia was snared in a net of his own making, a federal prosecutor said yesterday.

But if Coia's federally mandated union reforms led to his demise as president of the Laborers' International Union of North America, his efforts also helped cushion his fall.

The onetime president of one of North America's most powerful unions pleaded guilty in federal court yesterday to a felony charge that he defrauded Rhode Island taxpayers of nearly $100,000 in car taxes on three Ferrari sports cars that he had purchased, for prices ranging from $215,000 to $1 million.

Coia, who became a key fundraiser for President Clinton and an influential labor voice in Washington, could have received up to five years in prison and a $250,000 fine.

Instead, under a deal negotiated with federal prosecutors, Coia was sentenced to two years' probation and fined $10,000. He agreed to pay $100,000 in restitution to the State of Rhode Island and the Town of Barrington, where he lives, for the unpaid car taxes.

The deal also bans Coia from holding any positions of power within the Laborers for life, but allows him to collect his $250,000 salary as "general president emeritus," a ceremonial post created for him upon his retirement at the end of December.

Coia, 56, of 20 Payne Rd., Barrington, looking tanned and solemn in a dark blue suit, crisp white shirt and silver tie, took advantage of his brief remarks to the judge to reflect on four decades as a Laborer, a union in which his father, Arthur E. Coia, a confidant of New England mob boss Raymond L.S. Patriarca, had risen to secretary-treasurer.

"For the last 42 years, I've had the privilege of being a member of the Laborers' International union," Coia said.

The last 10 years have been particularly difficult, said Coia, citing his two bouts with cancer and the struggles over reform -- "leading me here today, which is very difficult."

"I apologize for my actions," Coia said. "I take full responsibility. I regret that this happened."

Ironically, Coia received leniency because of his efforts in creating the internal union-reform process that eventually tripped him up, said assistant U.S. Attorney Alex Whiting.

"It's very unusual for the head of a union with longstanding ties to organized crime to take an extraordinary effort to rid the union of those ties," Whiting told U.S. District Judge George A. O'Toole.

Whiting painted a Jekyll-Hyde portrait of Coia as a union executive who launched "unprecedented" reforms in 1995, in the face of government accusations that he and other union leaders were controlled by the Mafia, while simultaneously conspiring with a major union vendor to evade car taxes. "He himself was charged in his internal-reform process, as he probably expected he would be," said Whiting.

The reforms began with a 212-page draft complaint that the Justice Department delivered to Coia in November 1994 ironically, the same day that President Clinton sent Coia a warm, handwritten note, following a private audience in the Oval Office, thanking him for a gift of a handmade golf club and congratulating him on a new grandchild.

The draft complaint identified Coia and other union officials as puppets of the mob.

To stave off a threatened government takeover, akin to the Teamsters union in the 1980s, Coia hired high-powered Washington lawyers and negotiated a unique agreement whereby he hired former federal prosecutors and FBI agents to clean up the union.

As a result, Whiting said yesterday, more than 200 union officials have been forced out throughout the country. Ten days ago, he added, the Justice Department relaxed its oversight of the Laborers' International, pronouncing the reforms a success.

Howard W. Gutman, Coia's lawyer, said that Coia, while deserving to be punished for his crime, also merited leniency for his "commitment and will to change the [union] culture of fighting the government and cleaning up the union" -- actions that saved the government hundreds of millions of dollars.

Gutman said that nothing in Coia's agreement precludes him from consulting for other labor unions, and that Coia has several, unspecified offers. Gutman added that Coia's banishment from positions of authority in the Laborers' International is moot, since Coia retired in December.

But Whiting said that Coia's retirement was a direct result of his negotiations with the federal government on the tax-evasion case.

When Coia's plea agreement was filed in court last Thursday, the Laborers' issued a statement saying that Coia's tax evasion, "while regrettable," was "essentially a personal matter where there was no loss or detriment to the union."

During yesterday's hearing, Judge O'Toole noted that the prohibition on Coia's union activity was not a punishment that fit the crime to which he was pleading guilty.

Afterward, prosecutor Whiting said that removing Coia from union power was an important ingredient of the deal. "Our view is that this criminal conduct was something that he did while he was the union's president, and with a union vendor," said Whiting. "Because he was the general president, his actions represented an abuse of his position and a failure to live up to his responsibility."

Last year, a union hearing officer found Coia guilty of a conflict of interest and fined him $100,000 for his dealings with the vendor, Viking Cadillac, of Middletown.

Viking, which reaped millions of dollars for leasing cars to Laborers' executives throughout the country, was controlled by Coia's lifelong friend, Carmine Carcieri.

According to the crime that Coia pleaded guilty to yesterday, he and Carcieri participated in a scheme, from 1991 to 1997, in which Coia failed to report either his ownership or his proper address, thereby defrauding Rhode Island and Barrington of taxes owed on three vintage Ferraris that Coia had purchased.

Carcieri, who testified before the grand jury that investigated Coia, was not charged. The Laborers' were ordered to sever ties with Viking in 1996 because of its alleged ties to organized crime.

Coia declined to speak to reporters after yesterday's hearing.