GM, Ford Cooperating As Federal Investigators Look Into Possible UAW Corruption

Matt Posky
by Matt Posky

A federal investigation that started with corruption charges against a former Fiat Chrysler labor executive and the wife of a deceased United Auto Workers vice president has expanded to include training centers created by both General Motors and Ford. Investigators issued subpoenas in recent weeks to amass information on the centers, which are jointly operated between the automakers and the UAW.

In the FCA case, company and union officials are alleged to have misappropriated an estimated $4.5 million earmarked for employee training. That money is believed to have gone into personal accounts and used to buy suspiciously extravagant items. The FBI appears to be concerned that similar activities could be happening at Ford and GM-backed training sites.

While the federal probe into Ford is less than clear, The Detroit News reports that authorities are “interested” in Joe Ashton, a retired UAW vice president who was eventually appointed to GM’s board, and Cindy Estrada, his successor in charge of the union’s GM department since 2014.

Ford has stated it is cooperating with the investigation and seems unconcerned that something might be wrong at its training center. When the union corruption charges emerged against FCA employees over the summer, Ford said it had no intention of reviewing the finances of the UAW-Ford National Programs Center. It reiterated that statement this week, saying it has confidence in the site’s current leadership.

General Motors has also said it will be working with authorities, simultaneously launching an internal investigation of is own, while the FBI and UAW have yet to make public statements on the matter. The automaker also suspended Alphons Iacobelli, the former FCA employee involved in the original corruption investigation, in August.

Officials believe that Iacobelli was at the center of a plot where, from 2009 through 2014, he pocketed $1 million and helped syphon $1.2 million from the UAW-Chrysler center to former UAW Vice President General Holiefield, who has since died.

Iacobelli and Holiefield, who led contract negotiations between the manufacturer and the union in 2011, and others used a charity, multiple businesses (including fake hospices), and credit cards to hide the money provided by FCA to the training center and use it personal purchases. That money was allegedly used to pay for a mortgage, numerous vacations, camera equipment, a $350,000 Ferrari 458 Spider, two Montblanc pens costing $37,500 apiece, and more.

Matt Posky
Matt Posky

A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.

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  • Civicjohn Civicjohn on Nov 03, 2017

    Man, they better get into TSLA fast!

  • Conundrum Conundrum on Nov 03, 2017

    I love to see how people manage to extend the behavior of a crooked FCA executive and an equally crooked UAW official to blanket condemnation of unions. I'd say oligarch propaganda has become ingrained in the general populace. Grunt, grunt, unions bad, working in an Amazon warehouse for $12 an hour, now, baby, that's freedom!

    • Mikey Mikey on Nov 04, 2017

      @conundrum... Right ! "Investigators issued subpoenas in recent weeks to amass information on the centres , which are jointly operated between the automakers and the UAW" I too am shocked . Who knew high level white collar folks would ever skim off the top ? In my years at the plant we heard many nasty rumours. It wasn't uncommon to hear, or witness, mid -level white collar guys being escorted out the door...Something about "kick backs" from suppliers ???

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  • AZFelix Fun duo who lived and worked in China for many years have a candid and crushing assessment on their EV manufacturing.
  • Vatchy Just think how many electric vehicles could be charged from a new nuclear power plant...
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