BY ROBERT MANOR

AND CAM SIMPSON

Staff Reporters

March 10, 1999

The Laborers' International Union of North America on Tuesday exonerated its president of internal charges that he allowed organized crime to influence the union. Arthur Coia will retain his position. He is the first major official of the union to escape conviction in an internal anti-corruption probe.

The union has 750,000 members, 19,000 of them in Chicago

The decision by union hearing officer Peter Vaira dealt a blow to organized crime prosecutors who have long said the Laborers union is a mob stronghold. Vaira declined to comment Tuesday. Vaira did find Coia guilty of conflict of interest in a deal where he obtained use of a Ferrari from an auto dealership that sold vehicles to his union. Coia, who is paid $254,000 a year, must pay a $100,000 fine.

Justice Department officials criticized Vaira's decision, saying "the opinion contains serious factual and legal errors." A joint statement from Scott Lassar, the U.S. attorney in Chicago, and James K. Robinson, the assistant U.S. attorney general in Washington, said they will urge union lawyers to appeal the case. For four years, the Justice Department has had a signed decree that would allow them to put the union in trusteeship. They can impose the decree if they believe they union has not done enough to purge itself of organized crime.

The department would not say Tuesday whether officials were closer to taking over the union in the wake of Vaira's ruling. Until Tuesday, the union had never lost a case against its upper-level officials.. About 200 union officials have been thrown out of the union, and many locals along with the Laborers' Chicago District Council are now in trusteeship because of the anti-corruption drive. Coia said his exoneration shows the union is committed to reform. "When charges were first filed against me, I said that we had chosen the path of reform and needed to go wherever it might lead," Coia said. "And while that process may have been personally painful, it was necessary to preserve the integrity of our reform."

Last year, Coia was charged with 16 counts of wrongdoing by Robert Luskin, who serves as the union prosecutor. "Coia knowingly associated with members of organized crime, knowingly permitted organized crime members to influence the affairs" of the union, Luskin said at the time.

On Tuesday, he defended his case against Coia. "We would not have brought the charges if we did not believe in good faith they were warranted," Luskin said. Some of the most serious charges against Coia involved his dealings with John Serpico, a former top laborers union official and the chairman of the Illinois International Port Authority, the sprawling industrial harbor on the South Side.

Serpico has been identified in congressional testimony as an associate of organized crime. He has been appointed chairman of the port authority by every governor since 1975, with the exception of Gov. Ryan, who has not decided on his tenure. Documents released Tuesday by the union describe a 1988 meeting between Coia, Serpico and the late North Side mob boss Vincent Solano. Coia was seeking Serpico's support to become secretary-general of the union. "Coia contacted Serpico and agreed to meet with him in Chicago," the report says. "When Coia arrived at Chicago's O'Hare Airport, Serpico led him to a small coffee shop inside the terminal and introduced him to Vincent Solano."

Solano was a laborers union official who also ran the mob's gambling and rackets in the Rush Street, Gold Coast, Old Town and Rogers Park neighborhoods. ; Solano said Coia could become secretary-general, but could not expect to rise higher in the union. "I want you to understand this-that John Serpico will be the next general president of the union," the report quotes Solano as saying. "We're grooming that man there to be the next general president of the union."

Through a spokesman, Serpico declined to comment Tuesday.

Coia later became president anyway, and made Serpico the union's chief judicial officer with a salary of $100,000. But Vaira, the hearing officer, said Coia had promoted Serpico "not to perpetuate Serpico's organized crime influence on the union, but as a method to facilitate his removal from the union." Coia later testified against Serpico at hearings that eventually led to Serpico losing his office at the union.