The main American auto union announced on Monday, December 14, it had reached an agreement with United States authorities to bring to an end a far-reaching corruption scandal that has ensnared two union presidents.
United Auto Workers (UAW), which represents workers at the “Big Three” carmakers, has been working for a year to clean up following the theft and bribery scandal that led to convictions for 15 union or Fiat Chrysler executives.
“This civil resolution brings to a close the government’s investigation and is testament to the hard work that has been done to make the necessary structural and cultural changes,” UAW president Rory Gamble said in a statement.
“Under our current leadership, the UAW has proactively weeded out individuals who put their personal benefit over our members’ interests and who abused their positions of trust to defraud our union and our membership,” he said.
Under the terms of the proposed settlement to the corruption and fraud charges, a federal court would appoint an independent monitor with powers to investigate possible misconduct and discipline UAW officials.
The oversight would last for 6 years but could be ended earlier, according to the statement.
The scandal that shook up the once all-powerful union involved two UAW presidents and their underlings who siphoned off $1.5 million from the membership.
In addition, a UAW vice president and other executives received $2 million in kickbacks involving contracts with worker-training centers.
The union said it already paid back over $15 million to the training centers.
The UAW also agreed to resolve a tax investigation by making a payment of $1.5 million to the Internal Revenue Service.
Cigars and golf
The scandal – which took down former UAW presidents Gary Jones and Denis Williams – involved several years of bribes and kickbacks as well as revelations that some union officials and auto executives effectively stole money meant for worker training and spent it on golfing outings, pricey cigars, and fancy meals.
Alphons Iacobelli, former Fiat Chrysler US labor relations chief, was also convicted in the case, for among other things buying jewelry, designer clothes, furniture, electronics, and other luxuries for FCA UAW members, and paying off the mortgage of former UAW vice president General Holiefield, who died in 2015.
Under the settlement, the union will hold a referendum on changing the UAW’s election method to a direct model, where the entire membership can vote for the president and executive board members.
US Attorney Matthew Schneider praised Gamble for his efforts to reform the union.
“The men and women of the UAW deserve honest and faithful leaders dedicated to serving the best interests of the membership,” he said in the statement. – Rappler.com
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