Solidarity: New UAW Corruption Scandal Details Implicate Union at Highest Level

Matt Posky
by Matt Posky

Remember the multi-million dollar corruption scandal involving UAW officials? Apparently, it was even more corrupt than previously reported. While the UAW-Chrysler National Training Center is suing both Fiat Chrysler and the union members involved, recent developments point to the money scheme being greenlit by former UAW President Dennis Williams.

As part of a plea agreement filed this week, ex-labor official Nancy Adams Johnson told investigators that Williams specifically directed union members to use funds from Detroit’s automakers, funneled through training centers, to pay for union travel, meals, entertainment, and more. If true, the accusation not only implicates the UAW of corruption at the highest level but also the potential involvement of staff from both Ford and General Motors — something the FBI is already looking into.

I believe the official industry term for something like this is a “shit show.”

Williams retired from the UAW in June after more than 40 years with the union. However, it’s the last four, when he served as president, that has federal investigators the most interested. A large portion of his work involved balancing the budget and helping the UAW keep the status quo during a period of stagnating wages and financial trouble. It now seems that he may have been involved in some downright grimy business on the side.

“To be clear: those who misallocated or misused training center funds betrayed our trust,” Williams told union members at the UAW’s Constitutional Convention for this year. “The UAW has zero tolerance for corruption, wrongdoing, at any level of this organization.”

While Adams Johnson’s plea agreement only identifies a “high-level UAW official” who made the directive to tap into the training center funds, sources familiar with the case told The Detroit News she mentioned Williams specifically. Williams has not been charged with any criminal wrongdoing, but it was believed that the FBI had already taken an interest in him during its investigation.

“Sometime in 2014 or 2015, a high-level UAW official directed senior UAW officials to use money supplied by automobile manufacturing companies through joint UAW training centers to pay for travel, including travel solely for purported union business, as well as lavish meal and other entertainment costs of senior UAW officials and their friends, family and allies,” read Adams Johnson’s plea agreement. “This directive was issued in order to reduce costs to the UAW budget from such expenditures because the UAW’s budget was under pressure.”

This also helps confirm FBI suspicions that looking outside Fiat Chrysler for cooperative corruption is a prudent course of action. By now, FCA’s role in the scandal is well understood. Former FCA labor negotiator Alphons Iacobelli, along with numerous UAW members, were caught with money they shouldn’t have had, leading to new plea agreements that led to additional indictments. The FBI now believes there is a very real possibility that both General Motors and Ford Motor Co. sent gifts to UAW officials in exchange for favorable bargaining. The FBI has already taken an interest in Joe Ashton, a retired UAW vice president appointed to GM’s board in 2014, and Cindy Estrada, his successor.

Former UAW Vice President Norwood Jewell could also be wading into hotter water. A person of interest for quite some time, Jewell was previously linked to the conspiracy involving Fiat Chrysler executives funneling illegal payments and benefits to UAW officials who wouldn’t fight quite so hard for workers. Iacobelli claimed he approved more than $30,000 in worker training funds on a party for Jewell in August of 2014 — which included models who lit labor leaders’ cigars, expensive booze, and wine bottles with Jewell’s name on them. As extravagant as that may sound, it pales in comparison to the amount Iacobelli spent on himself. If you’ll recall, he was the guy who bought himself a Ferrari and two bejeweled Montblanc pens.

While Jewell hasn’t been charged, his home was raided by the FBI in 2017. It’s believed investigators are currently building a case against him.

Since the corruption scandal began prior to Williams’ installment as president of the union, investigators also looked at his predecessor Bob King. However, that appears to be a dead end. According to the indictment charging Iacobelli and Monica Morgan-Holiefield (widow of former UAW Vice President General Holiefield), King opposed any dealings that could have been misinterpreted as shady.

According to court documents, King confronted Holiefield and Iacobelli about the selection of Holiefield’s wife as a vendor for the UAW-Chrysler National Training Center and a nonprofit controlled by Holiefield in 2011. He suggested that paying Monica Morgan was a bad idea and that they could “go to jail,” instructing them not to direct any additional business her way.

Of course, they did the exact opposite, and the nonprofit is now known to be one of several fronts for hiding the embezzled funds. Both Iacobelli and Morgan-Holiefield have plead guilty for their crimes relating to the scandal. She was sentenced to 18 months in federal prison on July 13th, while Iacobelli is awaiting a possible eight-year sentence — depending on his own plea agreement.

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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  • Erikstrawn Erikstrawn on Jul 27, 2018

    So we're throwing all of the blame on the bribed and not mentioning those who paid the bribes? Don't get me wrong, the UAW leadership deserves all the jail time they end up getting, but we shouldn't ignore the corporate executives who bought them.

  • Pwrwrench Pwrwrench on Jul 27, 2018

    " If workers accept housing assistance or food stamps they should not be paying union dues, why should taxpayers support private unions?" And the "taxpayers" should not be supporting the likes of WalMart and Uber who's workers often get food stamps and housing assistance.

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