By on August 16, 2019

A federal probe that’s been dropping United Auto Workers staff like flies has another one in its crosshairs, this time with ties to General Motors. Up until now, the investigation has primarily involved members connected to the union’s Fiat Chrysler Automobiles department or the UAW-Chrysler National Training Center. But, according to court records filed Wednesday, retired UAW-GM Center for Human Resources board member Michael Grimes is also formally accused of corruption.

Grimes becomes the ninth individual to be slapped with corruption charges and the first with links to an automaker outside of FCA. He is not, however, alone. Court documents suggest he’s one of several UAW officials suspected of accepting bribes and kickbacks from automakers; they’ve just yet to be named. 

Reports from Automotive News claim the court is specifically interested in Grimes due to his working “closely with the UAW Vice President and Director of the GM Department” between 2006 and 2018.

If you recall, former union VP Norwood Jewell was sent to prison earlier this month after becoming entangled in the corruption probe. It was presumed that he would work with authorities to identify other staffers who were on the take. The accusations leveled against Grimes may be a direct result of these convos.

From Automotive News:

Court records accuse Grimes, who also was on the executive board of the UAW-GM Center for Human Resources, of demanding an unnamed vendor provide a mortgage for $60,000 so that he could buy a property in Michigan. He also recommended that the vendor provide 23,000 watches to the center to distribute to one of GM’s powertrain divisions, the filing states.

Prosecutors say that after the 2006 watch order, Grimes continued to accept cash bribes and kickbacks from the unnamed vendor almost monthly. Payments ranged from $1,800 to $3,800.

Prosecutors claim Grimes concealed the bribes by having the vendor make checks payable to one of his relatives or to “KKG Consulting,” which was a “sham” company in the name of his relative.

From November 2010 to about October 2017, “Grimes accepted from “Vendor A” approximately 27 checks totaling almost $900,000 payable to his relative or to KKG Consulting,” prosecutors wrote.

The official charges leveled against Grimes include wire fraud, conspiracy, and money laundering. The Detroit News reports that the government believes he received roughly $1.99 million in kickbacks. However, it’s also believed that some of the money went to other union officials. This turn also places new pressures on sitting UAW Vice President Cindy Estrada, who worked directly over Grimes prior to his retirement, and implicates General Motors in a broader corruption scheme.

“This is the first shoe to drop involving General Motors and the UAW,” said Peter Henning, a Wayne State University law professor and former federal prosecutor. “It raises the question of what kind of monitoring the UAW was doing, or was there any?”

The UAW has disavowed Grimes, saying he should be prosecuted and subjected to the full extent of the law. Meanwhile, GM has stuck to its standard mantra. The automaker says it is cooperating with the government and cannot comment on an ongoing investigation.

[Image: James R. Martin/Shutterstock]

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28 Comments on “UAW Corruption Probe Fingers Another Union Official, Implicates General Motors...”


  • avatar
    TheDutchGun

    What a shocker…

  • avatar
    SCE to AUX

    Do the members really believe:

    1. Their dues are being used wisely?
    2. The UAW will protect their jobs?

  • avatar
    dal20402

    As a former union member whose brothers/sisters would never have tolerated any shenanigans like this, I’m honestly surprised that workers in the plants haven’t tried to decertify the UAW and certify another union in its place.

    • 0 avatar
      mason

      Honestly what positive does a union do for America today. We are at the top of the global food chain, wages, insurance, retirement, vacation, bonuses, and on and on. Many of these things don’t even exist in other countries. All they (the union) does is artificially inflate all of the above to an unmaintainable level. Just look at UAW pension as an example.

      • 0 avatar
        dal20402

        Corporate management is the most powerful it’s ever been, thanks to the extremely hands-off regulatory approach the U.S. has taken over the last 40 years. If you want U.S. workers to stay at the top of the global food chain, you need a force more powerful than scattered individuals to push back against management.

        Collective bargaining is how we got to the top of the food chain, and it’s how we can stay there. Union governance is often a weak point — and international unions should spend a lot more time teaching both locals and their members about it — but that doesn’t mean unions are unnecessary.

        • 0 avatar
          mason

          What exactly has the UAW accomplished for it’s members in the last 20 years again?
          There are plenty of non union automotive facilities in other parts of the country that are not only getting along just fine without them, their jobs aren’t disappearing by the thousands.

          • 0 avatar
            JoeBrick

            Higher wages. Less Hours. A LOT less hours.

          • 0 avatar
            golden2husky

            Those non-union plants get by just fine because management does not want the plants unionized – so they offer enough to keep the workers happy without union representation. If the union “threat” did not exist, you can be sure wages and benefits would stagnate and all the extra profit would be Hoovered up by the fat cats and stockholders. The real problem is that the top union officials become as selfish as the management team they are supposed to protect the rank and file from. Kind of like the end of the book “Animal Farm”…you couldn’t tell them apart anymore.

            Labor in the US is at its weakest point in decades. Wage disparity is spreading and income inequality is growing. You can blame whomever you want but the future does not look good for a large percentage of the country.

    • 0 avatar
      Lokki

      As a former Labor Relations Manager for a company with 50,000 employees, I can tell you that it is almost impossible to vote a union out. It requires a verified card count of 30% of represented employees to get the NLRB to hold an election and then a “50% + 1” vote to decertify. Management may in NO WAY participate, sponsor, encourage, or even comment on the effort. The Union, however, can do…whatever it takes… to stay in. The union -always- files unfair labor charges claiming management violations, and upon losing, files another charge, and meanwhile the election is postponed until resolution….the process can be delayed for years.

      In fact, here’s a challenge for you: do a web search and -try- to find a report of a successful decertification; I don’t think you will find even one.

  • avatar
    redgolf

    dal20402 – ya don’t burn down the house just to get rid of a few rats!

  • avatar
    DenverMike

    I’ll bet this is just another old dog who’s been getting away with it since forever. It’s defined as “corruption” now, but it used to be just normal everyday “perks of the trade”.

  • avatar
    chris724

    Unions are just organized crime. All their negotiations are based on the implied threat of violence.

    • 0 avatar
      highdesertcat

      Well, there was a time when unions were needed. And back then unions actually did a lot of good.

      But then the power unions wielded over owners/shareholders/productivity/profits got to the union-management heads and corruption took over.

      Back in the dark ages when I was in full-bore pursuit of my MBA, one of my research assignments was Labor Unions, and I had to give an in-depth oral and written presentation about the pro’s/con’s of organized labor in industry. Few people realize just how large and intricate a typical union-organization is. If depicted on an Organizational Chart, a union could easily resemble the management organization of a large city, with all its departments, line and staff divisions, profit and loss centers, revenue sources, liabilities and assets.

      The problem comes in when the checks and balances on the union managers’ accountability are lost.

      I hope the Feds rip America’s unions a new one.

      Finally, a DOJ that’s going after the ‘crat union crooks.

  • avatar
    hamtrelvis

    The UAW went downhill after the assassination of Walter Reuther on 9 May, 1970.

  • avatar
    ultramatic

    Ya gotta do something to make living above a bowling alley and below another bowling alley worthwhile.

  • avatar
    redgolf

    No Comprende! Bowling alley? Ya mean Roll With the Punches?

  • avatar
    mikey

    Full disclosure ..I am a retired UAW and CAW member, and I reside in Canada .

    Did Union officials get over compensated ? Did union officials find a way to get paid obscene overtime hours, while supposedly working on “union business” ? Did barely literate union leaders manage to pay themselves Skilled Trade rate (over $6.00 an hour more than production rate )..?

    Answer: Yes, to all of the above…and then some.

    I’ve been retired for nearly 11 years. I spent 36 years working for a huge American company. The plant I worked in employed over 25000 UAW/CAW members . Come January that number should sit around 300. How this situation came about has been debated endlessly .

    Each month I receive a (frozen at 2008 rate) pension . Not quite as much as was promised but liveable. I also don’t have the so called “Gold plated benefit plan” that was promised . Though what I have is adequate.

    As a guy that never finished High school , I ask myself these questions. My wife and I lived a good middle class life. We put both kids through university. Could we have accomplished that without UAW/CAW negotiated agreements ? Last Monday I picked a 2019 LZ Premium Impala and wrote a cheque for it. Would I have been able to pull that off without my UAW/CAW negotiated pension ?

    Answer : No…. not a chance..

    • 0 avatar
      Lokki

      Mikey –

      As I have mentioned above, I worked as a Management Labor Official for quite a few years for a large company, and I am willing to state publicly that where I had good union officials to work with, I liked having a union in the plant. There were often stupid management officials wanting to do stupid things and a call from a Union Rep could let me know what was happening so I could put the kibosh on it before things spiraled out of control. I would always try to act right away if the Union told me about a problem; we had a good relationship and so we knew if a problem came up it was really something that needed attention. The good Union would stand back when we fired people who needed to be fired, or just present a token defense if they had to for show business reasons. It also gave me space to deal with only serious labor problems because the poor Union Rep had to sit and listen to all the whiners; otherwise they’d have been in my office bitching. I enjoyed having a Union when we had to start up a third shift, and had to select current employees to change to working nights. That’s an ugly task. The Union and I agreed on a number of people and then I let them choose who would be in that number. (As long as the shift is filled with workers who can do the necessary jobs -who those workers are- is irrelevant to management). They set up a panel and did the dirty work.

      Having said that, the problems come in when the union has been around for a while, and the realization sets in that being a Union Rep is hard and often unpleasant work (see above on choosing 3rd shift workers). Thanks to the work of the earlier Reps things are going pretty well and there aren’t many big problems. So the good people quit signing up to be Reps, and they only people coming forward are those who are mad that they were disciplined for something, the power hungry, or the perpetual malcontents. They get to be Stewards because there is no one else to choose from. Then, a few years later they get to be Local Presidents because nobody cares enough to vote, and the crazies vote each other in. Management then starts to get unfair labor practice charges for moving the Soda Machine from one place in the break room to another without notifying the union (“change of working conditions!”) and everything goes to hell. At one point, I personally had 26 Unfair Labor Practice charges against me filed by a crazy Local President. The FLRA got tired of playing and sent a team out, investigated on site, and dismissed all of them at one go.

      After a while, it gets easier for management to bribe these guys than to try to reason with them. At first you trade them reserved parking places for important things that management wants. The next time you need something big, you trade them a nicer office space….and so it goes. The bad officials are easily bought with something of personal benefit to themselves. I can see where on a major level like the UAW, it becomes tempting to shell out half a million dollars to avoid negotiating about implementing new work practices or, say, cutting wages for workers hired in the future. Very sad, but I totally understand it. Remember management has zero control over whom they negotiate with; the union chooses its own representatives. If the Union membership chooses poorly, well, management still has a business to run, so if it’s a choice of a year of negotiations with an idiot who doesn’t understand how business works or sending for ‘training’ for three weeks in Hawaii. Then, obviously, after a while even the Union Negotiators who aren’t idiots begin to act like ones because: three weeks in Hawaii.

      For what it’s worth.

  • avatar
    EBFlex

    Sounds right. Unions are never actually about the employees.

    But I don’t understand why the behavior is illegal. Our politicians do it, only they call it “lobbying”.

    • 0 avatar
      golden2husky

      This. The corrupting factor is always money. Want to improve government? Neuter the lobbyists and overturn Citizens United. The Department of Justice now focuses on the UAW – fair enough. But what happened to all the subpoenas from SDNY court against Trump allies…they died never to be heard of again. Unless you are even handed and unbiased you are a kangaroo court.

      • 0 avatar
        ToddAtlasF1

        You do know that Citizens United was a response to labor unions’ unchecked ability to buy corrupt politicians, right? It sure sounds like you think other people don’t know it and want to restore the status quo of politicians selling out voters to the SEIU or employers to trade unions that cause businesses to relocate outside the US.

  • avatar
    hamtrelvis

    UAW VP Joe Ashton is the next shoe to drop:

    https://www.detroitnews.com/story/business/autos/general-motors/2019/08/18/uaw-joe-ashton-linked-bribery-probe/2019473001/

    And prolly he’ll implicate others. Sad…

  • avatar
    hamtrelvis

    Confucius say “For every union boss on the take, there’s a corrupt business boss on the give.”

    Do the math. It all cancels out, and only the working peons (i.e., most people) get shafted in the end. It’s a universal law of nature (what’s left of nature, that is.)

    • 0 avatar
      ToddAtlasF1

      Who doesn’t want to pay for an extra level of corruption? If not for people who hate those who actually create things, leftists would be run out of town on a rail.


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