If you’ve ever wondered why employee retraining programs are so ineffective, this story recounted by the editors of the Wall Street Journal, about massive corruption on the part of a now-deceased UAW vice president, should cause you to wonder no more:
An indictment unsealed last week claims the labor chief, who died of cancer in 2015, secretly teamed up with his bargaining-table opponent at Fiat Chrysler, Alphons Iacobelli. The feds say they and other conspirators skimmed millions from the UAW National Training Center, a tax-exempt, Fiat Chrysler-funded entity that was supposed to help union automotive workers get job training.
The indictment claims Mr. Iacobelli availed himself of National Training Center money, buying limited edition gold Montblanc pens and a $350,000 Ferrari. He also allegedly installed a swimming pool, outdoor kitchen and spa at his Michigan home, renovations that cost $375,000, and paid off a relative’s student loans.
The indictment says the training center also spent $425,000 at a swag company owned by Holiefield’s wife, Ms. Morgan, while an additional $70,000 was funneled from the fund to the union boss’s nonprofit to his wife’s photography business. More training center cash paid for Ms. Morgan’s first-class plane tickets, her $12,400 four-night stay at the luxe Beverly Hills Hotel, and the $262,000 mortgage on the townhouse she and Holiefield owned, the indictment says. Happy wife, happy life, we guess.
That’s in addition to the $924,000 Holiefield received in legal union compensation between 2009 and 2014, purportedly for representing the interests of UAW members. He and Mr. Iacobelli were responsible for negotiating contracts between Fiat Chrysler and the union over pay, bonuses and working conditions.
The editorial is full of presumably unintentional jokes and one-liners. For example:
Detroit’s FBI chief said last week that the indictment “calls into question the integrity of contracts negotiated during the course of this criminal conspiracy,†which the feds say ran for six and a half years.
Yuh think? But I laughed out loud at this:
“The UAW has zero tolerance for corruption or wrongdoing of this kind at any level,†union President Dennis Williams said of the scandal, adding that it is cooperating with investigators.
Okay, I’ll bite. What kinds of corruption and wrongdoing do they tolerate? The editorial goes on to catalogue just that and it’s a long list.
The problems revealed in this story are many. Union leaders are notoriously lightly scrutinized by the rank and file. It’s practically impossible to give sufficient scrutiny to retraining programs and, not surprisingly, a lot of the money is either siphoned away or just plain squandered. The list goes on.
The thing to ponder is why this would surprize anybody. If you think that any part of the system is not rigged, you should have your head examined.
For those who still believe that their little world is above-board, the UAW guy is corrupt; the Fiat-Chrysler guy is corrupt;, the prosecutor(s) who brought the indictment is corrupt; the FBI is corrupt; the judge will be corrupt; the prison officials will be corrupt.
The question is “who is not corrupt?”
TB- This executive was making tons of money, yet he still siphoned off money from the training program (The union guy was making about $200k/year). Yet, the spoons weren’t safe. This belief that some people have that if you put rich people in charge it will be safer since they won’t need to steal has never made any sense to me.
Steve