Monday, January 10, 2011

Review of Carpenters’ Union Shows Corruption Persists

by William K. Rashbaum

Federal Watchdog Dennis Walsh.
More than a year after its parent union placed the New York City District Council of Carpenters under supervision because its leader was charged with racketeering, the council remains influenced by the mob and is still a source of cash and illicit benefits for a select few, according to a recent assessment.

Dennis M. Walsh, a court-appointed reviewer, issued a 71-page report on the New York City District Council of Carpenters.

The assessment, filed last month by a court-appointed review officer, shows some progress in cleaning up the district council and its constituent locals, and proposes a number of substantive reforms.

But it also presents a troubling picture of a deeply ingrained culture of corruption, and some aspects of the assessment raise questions about with the stewardship of the supervisor appointed by the parent union, the United Brotherhood of Carpenters and Joiners of America.

The report contains no direct criticism of the supervisor, Frank Spencer, who was installed by the parent union in August 2009, days after the federal racketeering indictment was unsealed charging the district council’s leader, Michael J. Forde, and nine others, including union officials, contractors and the head of an industry association.

But the 71-page document, the First Interim Report of the Review Officer, which was filed in federal court in Manhattan, accompanied by hundreds of pages of exhibits, includes evidence and troubling allegations that some of the same kinds of misconduct that led to the 2009 charges have continued under Mr. Spencer’s supervision.

“My office has deep historical knowledge and is developing current information about actual and attempted influence of organized crime over the affairs of the district council and the funds,” the review officer, Dennis M. Walsh, wrote in the report. “We have developed sufficient information to reasonably suspect that there are certain district council employees who have been and are currently under the influence of La Cosa Nostra figures.”

The report said individuals involved in running some of the local unions were under scrutiny for similar ties, something Mr. Walsh said was “a matter of grave import” that remained under investigation.

Mr. Walsh was appointed in June by a federal judge presiding over a two-decade-old civil racketeering lawsuit brought by the federal government against the district council charging corruption and mob control. That case resulted in a 1994 consent decree meant to clean up the union, a task that, based on the 2009 criminal case and Mr. Walsh’s report, remains far from complete.

Mr. Forde and eight union officials and contractors have pleaded guilty in the criminal case. Joseph Olivieri, the former head of the Association of Wall-Ceiling and Carpentry Industries of New York, went to trial and was convicted in late October of perjury for lying about his ties to organized crime figures. Mr. Forde was sentenced in November to 11 years in prison, and a union shop steward, Michael Brennan, was sentenced to five years. The other eight men are to be sentenced this year.

Since the consent decree was signed, Mr. Walsh, who says in the report that his staff is made up of former law prosecutors and investigators with experience in organized crime cases and unions, is the fourth outsider assigned either to investigate allegations of corruption or to monitor the district council.

The report provides a detailed review of excessive spending by senior officials of the district council and the local unions, and a range of other financial improprieties, most of which occurred before Mr. Spencer’s supervision began.

But some troubling spending practices continued under his watch, according to the report. Among them was a retirement party for Denis Sheil, a longtime officer and business manager of Local 1536 and the District Council vice president since 2002.

Upon his retirement in 2009, Mr. Sheil was given a $15,064 all-terrain vehicle by the local and an $8,328 gold Rolex watch by the district council. He was initially allowed to keep about $30,000 in cash that remained in a fund set up for his retirement dinner after the $14,176 bill was paid, according to the report. Mr. Sheil later returned the money.

And at a January 2009 dinner at the Old Homestead Restaurant in Manhattan, Mr. Spencer was present with Mr. Forde and seven other district council officials and staff members to swear in new officers, according to expense reports filed as exhibits with Mr. Walsh’s report. The bill for the meal, which took place five months before Mr. Forde’s indictment, was $2,233.59, or nearly $250 a person.

A spokesman for the parent union, Scott Widmeyer, defended Mr. Spencer’s tenure. And while Mr. Widmeyer did not respond to a question about Mr. Sheil’s retirement gifts, he said Mr. Spencer recalled that he presided over the swearing-in ceremony and stopped by a restaurant afterward, but that he did not stay for dinner

“We view this as a work in progress,” Mr. Widmeyer wrote in an e-mail late last month. “Frank Spencer characterizes this as peeling an onion. Each time you peel, you find another problem. So we keep peeling away.”

Mr. Widmeyer said that under the emergency supervision, 17 employees had been terminated for issues like misusing funds, excessive spending, drug use and manipulating the out-of-work lists.

“We are making progress, and more needs to be made and will be made,” he said, adding, “Today there is far greater transparency, and organizing efforts are succeeding.”

He said the parent union’s recent closing of Local 608, one of the district council’s more troubled units, indicated that the effort was continuing and aggressive.

But, as Mr. Walsh points out in his report, the challenge facing the District Council is not insignificant. It has been for decades, he noted, “a fiefdom for brutes, thieves, con men and other species of racketeers who have subjugated and robbed its members and vitiated its democratic and benevolent purpose.”

“The record also demonstrates,” he wrote, “that efforts to achieve systemic reform have been trampled by the seemingly limitless capacity of racketeers to blithely disregard the orders of this court and the risk of criminal prosecution as they pursue wealth, political power and satisfy their sybaritic yearnings.”

In an e-mail, Mr. Walsh said his goal was “to build a strong institution that can police itself, is ethical, uses technology to surmount ancient racketeering methods, hires people on merit, reviews their performance objectively and spends money prudently and with close internal oversight and provides a fair justice system for its members.”

(John's note: In October Spencer posted a propaganda video on the NYCDC website saying among other things, "We had the issues with corruption....but that's yesterday." The video was taken down and is no longer available on the councils site, I have it posted here.)

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