The highest-ranking United Auto Workers official implicated in a federal corruption investigation into the misuse of funds for a joint UAW-Fiat Chrysler Automobiles initiative pleaded guilty to felony.
Nancy Adams Johnson, a former top official in the UAW’s FCA Department, pleaded guilty to violating federal statutes prohibiting union officials from receiving cash or other emoluments from any employer. Adams Johnson also agreed to cooperate with federal prosecutors looking into the misuse of training funds, but still could face up to 18 months in prison.
While unelected, Adams Johnson’s appointment as the top assistant first to the late UAW Vice President General Holiefield and later UAW Vice President Norwood Jewel makes her the highest ranked UAW official implicated. She was also a member of the joint training center’s board of directors.
From a period of June 2006 until the end of 2017, first Holiefield and then Jewel had headed up the union’s bargaining with FCA.
(Holiefield’s widow gets 18 months for role in scandal. Click Here for the story.)
Holiefield, according to court papers, accepted more than $200,000 in cash payments diverted from the training funds to pay off the mortgage and his home in Macomb Township, Michigan, northeast of Detroit.
Holiefield’s widow, Monica Morgan, was recently sentenced to 18 months in prison for income tax evasion linked to the unfolding federal investigation.
One of the stories widely circulated among union members was that former FCA CEO Sergio Marchionne also had helped arrange a lavish honeymoon trip to Italy following for Holiefield and Morgan following their 2012 wedding. The facts behind the wedding trip have never been made public, however.
Jewel has never been charged but his home near Flint was searched by federal agents and he was blocked from re-election by the union’s Reuther Caucus and ultimately resigned from his union post last December.
“Today’s conviction of yet another senior UAW official further exposes the dishonorable scheme between UAW officials and Fiat Chrysler executives to corrupt the collective bargaining process at the expense of rank and file union members,” U.S. Attorney Matthew Schneider said in a statement.
(Click Here for details about the Feds securing a new indictment in FCA-UAW scandal.)
“The conviction reveals that part of this scheme involved the wrongful use of UAW funds for extravagant meals, entertainment, golf, and travel for little, if any, union-business purpose,” he said.
Adams Johnson, who was forced out her union post as the scandal was uncovered, was accused of taking more than $33,000 for entertainment and expensive shoes and golf equipment. She will be sentenced Nov. 19, and could be forced to pay an undetermined amount of restitution.
Former FCA Vice President of Labor relations, Alphons Iacobelli, who was ousted in 2015, said in his guilty plea that he had set the payment to Holiefield, Adams Johnson and other union officials was set in motion in 2011 to gain influence with key union officials. Two other FCA officials also have plead guilty to federal charges, including financial officer, Jerome Durden, who ultimately signed off on diverting the funds.
Iacobelli now faces eight years in prison.
The scandal has unsettled FCA’s relations with the UAW, which will be under heavy pressure next year to take a hard line with the company during contract talks next year. The UAW has insisted the illicit payments never had any impact on the union’s contracts negotiated in 2011 and 2015.
(UAW, FCA head to court to retrieve stolen funds. Click Here for the story.)
“The misconduct by Nancy Johnson and certain other individuals, in this case, has been very disturbing,” the union said in response to the latest development in the scandal. “The UAW has taken strong measures to prevent a reoccurrence of this type of misconduct and our new leadership team continues to oversee improvements in our operations and financial controls.”