One of Fiat Chrysler Automobiles’ top labor negotiators and the spouse of a now-deceased UAW vice president have been charged in connection with a conspiracy to give money and goods worth more than $1.2 million to officers and employees of the United Auto Workers.
Alphons Iacobelli and Monica Morgan, the wife of former UAW Vice President General Holiefield, were charged with violations of the Labor Management Relations Act, which is better known as the Taft-Hartley Act.
The law is designed to restrict the activity and power of labor unions, but it also prohibits employers or subordinates from paying, lending or delivering money or other valuables to officers or employees of labor organizations.
Iacobelli is a former FCA executive, who left the company in 2015 and joined General Motors in 2016. It is not clear if he is still employed by GM. Holiefield, who died in 2015, was the UAW’s top negotiator with Fiat Chrysler. Holiefield took a leave of absence in 2014 after accidently shooting Morgan.
(UAW eyeing production levels at GM’s U.S. plants. Click Here for the story.)
Iacobelli and others at FCA were indicted making more than $1.2 million in illegal payments from 2009 to 2014 to Morgan, Holiefield and others. The indictment claims designer clothing, jewelry, furniture and paying off a $262,219 mortgage on Holiefield and Morgan’s residence were among the payments, according to the Detroit News.
“Today’s indictment exposes a disturbing criminal collaboration that was ongoing for years between high ranking officials of FCA and the UAW,” David P. Gelios, special agent in charge of the Detroit Division of the FBI, said in a statement.
“The funds misapplied deprived working men and women of critical workforce and professional development opportunities and calls into question the integrity of contracts negotiated during the course of this criminal conspiracy.”
The payments were made while Iacobelli and Holiefield oversaw talks between the UAW and FCA and came from accounts and credit cards tied to the UAW-Chrysler National Training Center in Detroit, which provides training for union FCA employees.
Jerome Durden, who was a financial analyst with FCA’s corporate accounting department and from 2008 through 2015, was also was charged with conspiracy to defraud the U.S. He served as controller of the UAW-Chrysler National Training Center.
“FCA US and the UAW were the victims of malfeasance by certain of their respective employees that held roles at the National Training Center (NTC), an independent legal entity,” according to a statement from Fiat Chrysler.
(Click Here for details about the UAW’s upcoming organizing vote in Mississippi.)
“These egregious acts were neither known to nor sanctioned by FCA US. Upon learning of possible malfeasance in June 2015, the company investigated the matter and, as a result, Mr. Iacobelli and Mr. Durden were promptly separated from the company upon FCA US obtaining credible evidence of wrongdoing. The company has also worked with the UAW to implement governance, auditing and structural reforms to improve the accountability and transparency of the NTC.”
The automaker added it has been cooperating with the U.S. Attorney’s investigation and intends to pursue all potential legal remedies against “Iacobelli and any other culpable parties.” Iacobelli’s employment status with GM is unknown.
“The UAW is appalled at the allegations contained in the Department of Justice’s (DOJ) indictment, which constitute a betrayal of trust by a former vice president of our union,” said UAW President Dennis Williams in a statement.
“The UAW has zero tolerance for corruption or wrongdoing of this kind at any level. While the UAW-Chrysler National Training Center (NTC) is a separate entity from the UAW that receives no union dues, the fact is that the abuses alleged in the DOJ indictment dishonored the union and the values we have upheld for more than 80 years.”
He added that the union had no idea about the activities in the indictment and that the organization was also working with the U.S. Attorney’s office in the investigation. Williams added that the union is conducting an internal investigation using an “independent counsel.”
(New car sales have peaked in the U.S., new study shows. Click Here for the story.)
The UAW is also implementing new internal controls to ensure this doesn’t happen again, he said.