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ESA News Release: [05/15/2008]
Contact Name: Loren Smith or Richard Manning
Phone Number: (202) 693-4676
Release
Number: 08-0675-NAT
U.S. Labor Department enforcement agency announces 7 criminal convictions and 9 indictments for April 2008
Bulk of cases involve embezzlement of union funds
WASHINGTON — The U.S. Department of Labor's Office of Labor-Management Standards (OLMS) today announced its criminal enforcement data for April 2008. During the month, OLMS obtained seven convictions, nine indictments and court orders of restitution totaling $225,615. The office's totals for fiscal year 2008 (which began on Oct. 1, 2007) now stand at 59 convictions and 76 indictments. The bulk of the cases involved the embezzlement of union funds.
"OLMS investigations continue to result in indictments and successful prosecutions of individuals who abuse their union positions," said Deputy Assistant Secretary for Labor-Management Standards Don Todd. "We remain fully committed to protecting union members against the criminal behavior of a small minority and to ensuring democratic elections and financial integrity and transparency within labor unions."
OLMS is the federal law enforcement agency responsible for administering most provisions of the Labor-Management Reporting and Disclosure Act of 1959 (LMRDA). The agency's criminal enforcement program includes investigations of embezzlement from labor organizations, extortionate picketing, deprivation of union members' rights by force or violence, and fraud in union officer elections. The agency's civil program receives and publicly discloses unions' annual financial reports, conducts compliance audits of labor unions and seeks civil remedies for violations of officer election procedures. In certain cases, OLMS also conducts joint investigations with other Labor Department agencies, including the Employee Benefits Security Administration and the Office of Inspector General, as well as other law enforcement agencies including the Federal Bureau of Investigation.
OLMS's public disclosure Web site at www.unionreports.gov contains union annual financial reports and additional reports required to be filed under the LMRDA as well as copies of collective bargaining agreements. Other information, including synopses of OLMS enforcement actions, is available at www.olms.dol.gov.
Editor's Notes: A listing of selected OLMS enforcement actions during April 2008 is below. An indictment is the method by which a person is charged with criminal activity. As in all criminal cases, each defendant is presumed innocent until proven guilty beyond a reasonable doubt. Criminal charges and indictments noted in these materials are accusations only.
Selected Enforcement Actions in April 2008
Office of Labor-Management Standards
U.S. Department of Labor
Sentencings
Former Union Local Treasurer Sentenced for Embezzling More Than $71,000 in Union Funds
On April 7, 2008, in the U.S. District Court for the Western District of Washington, Michael Rutowski, former treasurer of the American Federation of Government Employees (AFGE) Local 2913 (located in Blaine, Wash.) was sentenced to one day in jail and two years supervised release, and ordered to pay restitution for embezzling union funds in the amount of $71,295.75, and making a false statement and representation of a material fact, knowing it to be false, on the local's annual financial report. On Jan. 18, 2008, Rutowski pled guilty to one count of making a false and fraudulent representation to a federal agency. The sentencing follows an investigation by the OLMS Seattle District Office.
Former Union Employee Sentenced for Making False Entries
On April 9, 2008, in the U.S. District Court for the Southern District of Ohio, Linda Leonard, former office secretary of Laborers Local 216 (located in Dayton, Ohio), was sentenced to two years supervised probation for making false entries in union records. Leonard also was ordered to pay $5,213 in restitution. On Jan. 16, 2008, Leonard pled guilty to one count of making false entries in union records. The sentencing follows an investigation by the OLMS Cincinnati District Office.
Former Union Officer Sentenced for Falsifying Union Records
On April 11, 2008, in the U.S. District Court for the Northern District of Ohio, Kathleen Drake, former secretary-treasurer for Machinists Lodge 2339-C (located in Cleveland, Ohio), was sentenced to one year probation and ordered to make full restitution in the amount of $17,035. On Jan. 8, 2008, Drake pled guilty to one count of falsification of union records. The sentencing follows an investigation by the OLMS Cleveland District Office.
Former Union Officer Sentenced for Embezzling More Than $10,000 in Union Funds
On April 14, 2008, in the U.S. District Court for the Northern District of Indiana, Fredrick W. Jones, former vice president of Glass Molders and Plastics Union Local 285 (located in Fort Wayne, Ind.), was sentenced to six months home confinement and one year probation, and ordered to pay a $100 special assessment fee. Also, Jones must submit to drug testing during his period of probation. On Jan. 16, 2008, Jones pled guilty to embezzlement of union funds in the same approximate amount. The sentencing follows an investigation by the OLMS Chicago District Office.
Former Union Officer Sentenced for Embezzling More Than $97,000 in Union Funds
On April 21, 2008, in the U.S. District Court for the District of Delaware, Stephen Priest, former financial-secretary of United Auto Workers Local 516 (located in Middletown, Del.), was sentenced to 24 months probation and $100 special assessment. He previously made restitution to the union totaling $97,899.19. On Dec. 21, 2007, Priest pled guilty to embezzling union funds in the same amount.
Former Union Employee Sentenced for Embezzling More Than $17,000 in Union Funds
On April 29, 2008, in the U.S. District Court for the Western District of New York, Mary Hartsock, former office manager of Laborers Local 1358 (located in Elmira Heights, N.Y.), was sentenced to five years probation and ordered to make restitution in the amount of $17,958. On Oct. 29, 2007, Hartsock pled guilty to one count of embezzling union funds in the same amount. The sentencing follows an investigation by the OLMS Buffalo District Office
Former Union Officer Sentenced for Falsifying Records
On April 30, 2007, in the U.S. District Court for the Southern District of Ohio, Sandra Gorman, former treasurer of the American Federation of State, County and Municipal Employees (AFSCME) Local 11's Ohio Department of Transportation Assembly (located in Columbus, Ohio), was sentenced to three years probation and ordered to make full restitution in the amount of $4,642. On Oct. 17, 2007, Gorman pled guilty to one count of falsification of union records. The sentencing follows an investigation by the OLMS Cleveland District Office.
Guilty Pleas
Former Union Officer Pleads Guilty to Theft
On April 1, 2008, in the U.S. District Court for the Southern District of Ohio, Michelle A. Meek, former treasurer for AFGE Local 3435 (located in Columbus, Ohio), pled guilty to one count of theft within the special maritime and territorial jurisdiction of the United States. The guilty plea follows a joint investigation by the OLMS Cleveland District Office and the Departments of Labor and Housing and Urban Development Offices of Inspector General.
Former Union Official Pleads Guilty to Embezzling More Than $75,000 in Union Funds
On April 4, 2008, in the U.S. District Court for the District of Columbia, Zona Albritton, former manager of general services for AFSCME, pled guilty to one count of embezzling union funds in the amount of $75,446. On March 17, 2008, a criminal information was filed charging Albritton with one count of embezzlement of union funds in the same amount. The plea follows an investigation by the OLMS Washington District Office.
Former Union Officer Pleads Guilty to Embezzling More Than $70,000 in Union Funds
On April 4, 2008, in the U.S. District Court for the Western District of Virginia, a criminal information was filed charging Darrell Pendergrass, former president of International Alliance of Theatrical Stage Employees Local 699 (located in Bristol, Va.), with one count of embezzling union funds in the amount of $70,336 and one count of willfully evading the payment of taxes. Subsequently, Pendergrass pled guilty to both counts. The criminal information and plea follow an investigation by the OLMS Washington District Office and the Internal Revenue Service.
Former Union Officer Pleads Guilty to Embezzling More Than $85,412 in Union Funds
On April 4, 2008, in the U.S. District Court for the Western District of Washington, Karimah Bailey, former treasurer of AFGE Local 3197 (located in Seattle, Wash.), pled guilty to embezzling union funds in the amount of $85,412, and making a false statement and representation of a material fact, knowing it to be false, on the local's annual financial report. The guilty plea follows an investigation by the OLMS Seattle District Office.
Former Union Bookkeeper Pleads Guilty to Embezzling $140,000 in Union Funds
On April 7, 2008, in the U.S. District Court for the Southern District of Texas, Heather Lott, former bookkeeper of Teamsters Local 19 (located in Houston, Texas), pled guilty to one count of embezzling union funds in the amount of $140,000. Lott also was ordered to make full restitution. On Oct. 18, 2007, Lott was charged with one count of embezzling union funds in the same amount. The plea follows an investigation by the OLMS New Orleans District Office.
Former Union Officer Pleads Guilty to Bank Fraud
On April 14, 2008, in the U.S. District Court for the Southern District of Ohio, Brian Dolney, former president of Machinists Lodge 2333 (located in Dayton, Ohio), pled guilty to bank fraud in the amount of $11,565. On Feb. 7, 2008 an information was filed charging Dolney with one count of bank fraud in the same amount. The plea follows an investigation by the OLMS Cincinnati District Office.
Former Union Officer Pleads Guilty to Embezzling More Than $11,000 in Union Funds
On April 16, 2008, in the U.S. District Court for the Eastern District of Wisconsin, Kim M. Van Handel, former president and acting treasurer of Steelworkers Local 1980 (located in Appleton, Wis.), pled guilty to embezzling union funds in the amount of $11,500. On Jan. 15, 2008, Van Handel was charged with one count of embezzling union funds in the same amount. The plea follows an investigation by the OLMS Milwaukee District Office.
Former Union Officer Pleads Guilty to Embezzling More Than $31,000 in Union Funds
On April 30, 2008, in the U.S. District Court for the Northern District of Ohio, Amy J. Cross, former secretary/treasurer of Utility Workers Local 308 (located in Lima, Ohio), pled guilty to embezzling union funds in the amount of $31,887. On April 7, 2008, an information was filed charging Cross with one count of embezzlement in the same amount. The plea follows an investigation by the OLMS Cleveland District Office.
Criminal Charges and Indictments*
Former Union Employee Charged with Embezzling More Than $51,000 in Union Funds
On April 3, 2008, in the U.S. District Court for the Southern District of Georgia, Louella M. Zieman, former office secretary of Ironworkers Local 709 (located in Port Wentworth, Ga.), was indicted on one count of embezzling union funds in the amount of $51,684 and on one count of making false entries in the union's financial records. The indictment follows an investigation by the OLMS Atlanta District Office.
Former Union Officer Charged with Theft
On April 9, 2008, in the County Court for Lorain, Ohio, Gary Smink, former president of Steelworkers Local 1-962 (located in Elyria, Ohio), was indicted on one count of theft totaling $770. The indictment follows an investigation by the OLMS Cleveland District Office.
Former Union Employee Indicted for Embezzling More Than $17,000 in Union Funds
On April 16, 2008, in the U.S. District Court for the Middle District of Florida, Sheila Rushing, former office secretary for Bakery, Tobacco & Grain Local 482 (located in Jacksonville, Fla.), was indicted on one count of embezzling union assets in the amount of $17,133.01, and destruction of union records and making false entries in required union records. The indictment follows an investigation by the OLMS Tampa Resident Investigator Office.
Former Union Officer Charged with Embezzling More Than $43,000 in Union Funds
On April 24, 2008, in the Cambria County Court, Pennsylvania, Richard J. Vincent, former treasurer of AFGE Local 3951 (located in Altoona, Pa.), was charged in a criminal complaint with two counts of embezzling union funds in the amount of $43,694.85. The charges follow a joint investigation by the OLMS Pittsburgh District Office and the Department of Labor's Office of Inspector General.
Former Union Officer Charged with Theft of Funds
On April 29, 2008, in the County Court of St. Louis County, Minnesota, Kathleen Kordish, former financial secretary of Steelworkers Local 9349 (located in Hibbing, Minn.), was charged with one count of theft of funds by false representation in excess of $2,500. The charge follows an investigation by the OLMS Minneapolis Resident Investigator Office.
Enforcement Actions and Civil Complaints
Department of Labor Wins Lawsuit Seeking New Election
On April 1, 2008, the U.S. District Court for the District of Oregon granted the department's motion for summary judgment adopting in its entirety the magistrate's decision concerning Plumbers Local 290's Jan. 3, 2006, election for president and business manager. The magistrate found that the union failed to take reasonable efforts to update its mailing list resulting in ballots not being sent to eligible members; allowed owner members who were not eligible to vote under the union's constitution to vote; and improperly used union funds to disseminate a letter disparaging a candidate. Based on the court's order, OLMS will supervise new nominations and a new election for president and business manager. The judgment follows an investigation by the OLMS Seattle District Office.
Union Enters into Voluntary Compliance Agreement with OLMS
On April 22, 2008, the department entered into a voluntary compliance agreement with Operating Engineers Local 547 (located in Detroit, Mich.) concerning the challenged election of officers conducted on Aug. 31, 2007. In that election, some candidates were not notified that they could identify and list themselves as a slate on the election ballot. The local has agreed to conduct new nominations, if necessary, and a new election under OLMS supervision for the offices of business manager, vice president, recording secretary, financial secretary, treasurer, three trustees and three auditors. The agreement follows an investigation by the OLMS Detroit District Office.
Union Enters into Voluntary Compliance Agreement with OLMS
The department has entered into a voluntary settlement agreement with American Postal Workers Union Local 732 (located in Dallas, Texas) concerning the challenged election of officers conducted on May 19, 2007. OLMS investigators found that, in that election, the union discriminated against other candidates by using union funds to support incumbent candidates for re-election. Also, the investigators found that the use of union mailing lists was limited to incumbent candidates. The parties agreed that the Department of Labor will supervise a new election for the officer and delegate positions of president, executive vice president, sergeant-at-arms, trustee (one position only), director-human resources, clerk craft assistant director, clerk craft business agent #4, clerk craft delegates (13 of the 29 positions), maintenance craft business agent #2, maintenance craft delegates (three of the six positions), and motor vehicle service craft delegates (two of the three positions). The agreement follows an investigation by the OLMS Dallas District Office.
* Indictments and informations are the methods by which people are charged with criminal activity. As in all criminal cases, each defendant is presumed innocent until proven guilty beyond a reasonable doubt. Criminal charges and indictments noted in these materials are accusations only.
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