UAW Corruption Probe Fingers Another Union Official, Implicates General Motors

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.

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