As the direction of United Auto Workers corruption scandal seems to be pointing all the way to the top of the UAW, will the federal government appoint a special monitor to oversee the union? And, more importantly, will UAW members have to pay for it?
This much we know:
Leaders of the once-mighty United Auto Workers who represented employees at Fiat Chrysler (FCA) have been involved in a scandal that continues to shake the United Auto Workers to its core.
On Monday, former FCA executive Alphons Iacobelli was sentenced to more than five years in prison for his primary role in the bribery scandal.
However, it appears that his sentence could be reduced, as he apparently is cooperating with FEDs and ‘naming names,’ according to the Detroit News.
The specter of more people being charged during the ongoing investigation dominated Iacobelli’s sentencing. The full extent of Iacobelli’s ongoing cooperation is sealed in federal court, but prosecutors have identified additional targets and Iacobelli could spend less time in prison if his help proves substantial. [Emphasis added.]
In addition, the scandal may go beyond the UAW’s Fiat Chrysler account as, last month, recently-retired UAW president Dennis Williams was named in having instructed UAW employees to use auto makers’ funds to pay for UAW expenses.
The conspiracy was born, in part, out of the UAW’s financial problems.
Nancy Adams Johnson, a former labor leader awaiting sentencing for her role in the scandal, told federal prosecutors that UAW President Dennis Williams directed subordinates to use funds from Detroit’s automakers to pay for union travel, meals and entertainment.
This finger-pointing to the top of the UAW does not stop with the recently-retired Williams and other former UAW execs.
The UAW has developed a culture of nepotism that involves current UAW VP Cindy Estrada, who leads the union at General Motors.
Whether the scandal leads to more indictments is unknown. However, some are speculating that the UAW could be forced to accept federal oversight.
The alleged conspiracy involving the UAW and Fiat Chrysler could end in a settlement with the government that would require new internal controls, fines or an injunction, [Peter Henning, a Wayne State University law professor] said.
“There could be some kind of admission that they failed to oversee what was being done at the training center,” Henning said. “Or there could be an agreement to undertake certain measures to make sure this doesn’t happen again.”
Federal oversight of the UAW could be unprecedented for a union long considered a “clean union” – but not for organized labor. In 1988, the Justice Department sued the International Brotherhood of Teamsters, charging it with labor racketeering in a bid to stamp out corruption and Mafia influence at the union’s highest levels. Prosecutors have not taken any of those steps with the UAW.
If the UAW is required to accept federal oversight, even if it is not as severe as the Teamsters’ oversight, it is likely to come at a price to the union.
For example, federal oversight of the Teamsters’ cost Teamster union members millions of dollars each year and $170 million over the course of the government’s 25-year long oversight.