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Big Labor Criminal Enforcement – December 2018

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On December 20, 2018, in the United States District Court of Rhode Island, Adam Conheeny, former police officer and former Treasurer of Fraternal Order of Police (FOP) Lodge 8 (located in Newport, R.I.), was sentenced to three months of imprisonment followed by two years of supervised release.  Conheeny previously paid $20,000 in restitution.  On May 24, 2018, Conheeny, pleaded guilty, admitting that between August 2009 and December 2014, he used an FOP debit card, wrote checks from a union account payable to himself, and withdrew cash from an FOP bank account for his own personal use, totaling approximately $31,413, in violation of 18 U.S.C. 1343.  The sentencing follows an investigation by the OLMS Boston-Buffalo District Office, the Department of Labor’s Office of Inspector General, and the Rhode Island State Police.

On December 20, 2018, in the United States District Court for the District of Oregon, John Burgess, former President of Pacific Stainless Products Employee Association Local 304 (located in St. Helens, Ore.), pleaded guilty to one count of concealment or destruction of labor union financial records, in violation of 29 U.S.C. 439(c).  The guilty plea follows an investigation by the OLMS San Francisco-Seattle District Office.  

On December 19, 2018, in the United States District Court for Southern District of Iowa, Theodore “Ted” Watson, former business manager for Insulators Local 74 (located in Des Moines, Iowa), was indicted for embezzlement, mail fraud, and false statements, in violation of 29 U.S.C. 501(c), 18 U.S.C. 1341, and 18 U.S.C. 1001, respectively.  The indictment follows an investigation by the OLMS Denver-St. Louis District Office. 

On December 19, 2018, in U.S. District Court for the Eastern District of Virginia, Newport News Division, Benjamin Wisecarver, former President of International Alliance of Theatrical Stage Employees Local 264 (located in Hampton, Va.), pleaded guilty to one count of conspiracy to commit wire fraud and embezzle union assets for embezzling $57,310 from the union, in violation of 18 U.S.C. 371.  The guilty plea follows an investigation by the OLMS Washington District Office and the Department of Labor’s Office of Inspector General. 

On December 18, 2018, in the United States District Court for the Eastern District of Michigan, Nancy Adams Johnson, former senior official in the Chrysler Department of the United Auto Workers (UAW), located in Detroit, Mich., was sentenced to 12 months and 1 day in prison and 12 months of supervised release.  She was also ordered to pay a $10,000 fine and a $100 special assessment.  Restitution will be determined at a later proceeding.  On July 23, 2018, Johnson pleaded guilty to one count of conspiracy to violate the Labor Management Relations Act (LMRA), in violation of 18 U.S.C. 371, stemming from her receipt of over $45,000 in prohibited payments and things of value from Alphons Iacobelli, former Vice President of Fiat Chrysler Automobiles US LLC (FCA), and others acting in the interest of FCA.  The prohibited payments and things of value, which occurred or were received between 2010 and 2015, included purchases of luggage, electronics, clothing, and other golf equipment for the personal benefit of Johnson and other UAW officials.  The payments were made using the bank account and credit card account of the UAW-Chrysler National Training Center (NTC), which was established to provide for the education, training, and retraining of Chrysler workers.  The sentencing follows a joint investigation by the OLMS Detroit-Milwaukee District Office, the Department of Labor’s Office of Inspector General, the Federal Bureau of Investigation, and the Internal Revenue Service. 

On December 17, 2018, in the Jefferson County Circuit Court for the Commonwealth of Kentucky, Robin Ray Bishop, former Financial Secretary of Carpenters Local 2501 (located in Louisville, Ky.), was indicted on one count of theft by deception over $500, nine counts of criminal possession of a forged instrument, and one count of falsifying business records, in violation of K.R.S. 514.040, 516.060, and 517.050, respectively.  The indictment follows an investigation by the OLMS Cincinnati-Cleveland District Office.  

On December 14, 2018, in the United States District Court for the District of New Jersey, Lawrence Ackerman, the Chief Operating Officer of “shell” companies including Atlantic Business Associates (ABA) and Atlantic Medical Associates (AMA), pleaded guilty to a superseding information for Health Care Fraud, in violation of 18 U.S.C. 1347, as well as Aiding and Abetting, in violation of 18 U.S.C. 2.  Ackerman executed a scheme to defraud Horizon Blue Cross Blue Shield (BCBS) of New Jersey involving enrollment of ineligible participants who were purported employees of ABA and AMA, both sham companies, in the benefit plan of United Auto Workers (UAW) Local 2326 (located in South River, N.J.), which had an insurance contract with Horizon BCBS.  Ackerman entered into a collective bargaining agreement (CBA) with Local 2326; however, neither ABA nor AMA had any full-time employees eligible for participation in the benefit plan as required by the CBA and benefit plan trust agreement.  The resulting loss to Horizon BCBS was approximately $481,500 because of its payment of healthcare benefits for persons not eligible to receive such benefits.  The plea follows a joint investigation by the OLMS New York District Office, Employee Benefits Security Administration, and the Department of Labor’s Office of Inspector General led by the New Jersey US Attorney’s Office.  

On December 10, 2018, in the United States District Court for the Northern District of Ohio, Eastern Division, Johnnie Nicholas, former Financial Secretary of United Mine Workers Local 4994 (located in New Philadelphia, Ohio), was sentenced to seven days of incarceration and three years of supervised release.  On the day of sentencing, Nicholas made a remaining restitution payment of $17,650.  Nicholas was also ordered to perform 200 hours of community service and pay a $10,000 fine and a $100 special assessment.  On May 7, 2018, Nicholas pleaded guilty to one count of embezzling union funds in the amount of $37,900, in violation of 29 U.S.C. 501(c).  The sentencing follows an investigation by the OLMS Cincinnati-Cleveland District Office.

On December 7, 2018, in Circuit Court for Prince George’s County, Maryland, Keith Franzese, former President of Security, Police and Fire Professionals of America (SPFPA) Local 275 (located in Glenn Dale, Md.), was sentenced to 10 years in prison (suspended), 90 days of home detention, and five years of probation.  He was also ordered to pay restitution of $67,624.  On June 1, 2018, Franzese entered an Alford plea to one count of theft for stealing $67,624 from the union, in violation of Maryland Criminal Law Section 7-104(g)(1)(ii).  The sentencing follows an investigation by the OLMS Washington District Office.  

On December 6, 2018, in the United States District Court for the District of Massachusetts, Ivar Carlson, former Treasurer/Business Agent of Stage and Picture Operators Local 935(B), located in Worcester, Mass., was arrested and charged in a one-count complaint for embezzlement in the amount of $37,014, in violation of 29 U.S.C. 501(c).  The complaint follows an investigation by the OLMS Boston-Buffalo District Office. 

On December 4, 2018, in the United States District Court for the Western District of Washington, Gregory Normand, former Secretary-Treasurer of International Association of Sheet Metal, Air, Rail and Transportation Workers (SMART) Local 324 (located in Everett, Wash.), was sentenced to 18 months in a federal penitentiary and three years of supervised release.  He was also ordered to pay restitution totaling $217,260, and a $300 assessment.  On July 13, 2018, Normand pleaded guilty to one count of embezzling over $248,000 in union funds, in violation of 29 U.S.C. 501(c), and two counts of making false statements, in violation of 18 U.S.C. 1001.  The sentencing follows an investigation by the OLMS San Francisco-Seattle District Office. 

source: U.S. Department Of Labor (USDOL)