UAW-Chrysler Training Center Suing to Recoup $4.4 Million of Embezzled Funds

The UAW-Chrysler National Training Center, which remains in the midst of a multimillion-dollar federal corruption scandal, is suing Fiat Chrysler Automobiles officials and a union leader’s widow for over $4.4 million in damages. If you’ll recall three FCA employees filed a federal lawsuit against the automaker and the UAW seeking hundreds of millions of dollars in damages over allegations that union officials colluded with company executives to influence collective bargaining earlier this year.

Now it’s time for the National Training Center to get a piece of the action. The lawsuit, filed Friday in Oakland County Circuit Court, targets former FCA labor negotiator Alphons Iacobelli; Monica Morgan-Holiefield, the widow of former UAW Vice President General Holiefield; and ex-FCA financial analyst Jerome Durden. Money was believed to be funneled through the training facility by a policy created by company officials to bribe UAW leaders into giving the automaker favorable treatment during collective bargaining.

Iacobelli has already stated as part of his plea deal that he and other FCA employees transferred hundreds of thousands of dollars in illegal payments to tax-exempt organizations controlled by UAW officials. Court documents state that he “knowingly and voluntarily joined a conspiracy in which FCA and FCA executives and FCA employees [agreed] to pay and deliver, and willfully paid and delivered, money and things of value to officers and employees of the UAW.”

Investigators have already put together a laundry list of items the money was used to purchase, some of it it wildly frivolous. Alphons himself is alleged to have used the money to improve his mansion, purchase a Ferrari, and buy two Montblanc fountain pens priced at $35,700 apiece. Holiefield and his widow are similarly accused of having used the funds to renovate their home, install a pool, and take several extravagant vacations. However the full extent of the financial misappropriation remains unknown. The investigation is ongoing and has even expanded. Last November, the FBI admitted that it was looking into Ford and General Motors as well.

“This is really an egregious victimization of the [National Training Center], which had to be addressed,” Walter Piszczatowski, one of the center’s lawyers, told The Detroit News. “When somebody takes money that doesn’t belong to them and puts it in their pocket, they need to pay it back and be held accountable.”

The lawsuit accuses Iacobelli and Durden of fraud, fraudulent concealment, breach of fiduciary duty, unjust enrichment and civil conspiracy. The training center also sued Iacobelli’s wife, Susanne, under the assumption that center funds were used to pay for over $868,000 in personal charges on her credit card. Morgan-Holiefield was also slapped with $539,219 in damages while Durden and Mr. Iacobelli saw charges of $70,300 and $2,661,189, respectively.

Interestingly, the National Training Center is not listed as a victim of the conspiracy in the federal court documents and is not entitled to restitution paid by those who have pleaded guilty so far in the criminal case. That money goes to the government, as none of the seven people indicted thus far were ever officially charged with defrauding the center or embezzling money. The National Training Center’s lawsuit also doesn’t reference all of the individuals that have been indicted, possibly because it’s unclear how much they’ve benefited.

[Image: FCA]