August 5, 2019 / 8:27 PM / 4 months ago

Former United Auto Workers official gets 15 months in labor corruption case

DETROIT (Reuters) - A federal judge in Detroit on Monday sentenced the former United Auto Workers union vice president in charge of relations with Fiat Chrysler to 15 months in federal prison for misusing funds intended for worker training to pay for luxury travel, golf, liquor and parties for himself and other union officials.

FILE PHOTO: UAW Vice President Norwood Jewell addresses their Special Bargaining Convention held at COBO Hall in Detroit, Michigan March 25, 2015. REUTERS/Jeff Kowalsky

Norwood Jewell, 61, who led the UAW’s national contract negotiations with Fiat Chrysler in 2015, is the highest ranking UAW official to be sentenced in connection with a wide-ranging federal investigation of corruption within the union that represents U.S. factory workers at Fiat Chrysler Automobiles NV (FCHA.MI), General Motors Co (GM.N) and Ford Motor Co (F.N).

Jewell pleaded guilty in April to a single charge of violating the Labor Relations Management Act. At the time, prosecutors proposed a prison sentence of 12 to 18 months. U.S. District Judge Paul Borman rejected Jewell’s request to avoid prison and serve his sentence under house arrest.

“He betrayed his position,” Borman said from the bench.

Jewell is the eighth former UAW or Fiat Chrysler official sentenced as part of the federal criminal investigation of UAW finances. Federal prosecutors are continuing to investigate the misuse of company and union funds at the Detroit automakers.

Fiat Chrysler Chief Executive Mike Manley, during a meeting with reporters last week, declined to discuss whether the company is in talks with federal authorities or whether he has been interviewed by investigators.

Federal prosecutors have said Fiat Chrysler officials conspired in the misuse of $4.5 million in training center funds.

Fiat Chrysler’s former vice president of labor relations, Alphons Iacobelli, pleaded guilty in January 2018 to charges of violating the Labor Management Relations Act and filing false tax returns. Prosecutors charged Iacobelli with making hundreds of thousands of dollars in improper payments to charities controlled by UAW officials, and agreeing to pay off the mortgage of a now-deceased UAW vice president, General Holiefield.

Prosecutors said Jewell accepted over $90,000 in illegal payments from Fiat Chrysler for his own benefit and to pay for travel, golf outings, parties and other entertainment for senior UAW leaders. “The parties included thousands of dollars in Fiat Chrysler money spent on 20 boxes of cigars, ultra-premium liquor, personalized bottles of wine, and women paid to light the cigars of senior UAW leaders,” federal prosecutors said in a statement on Monday.

Jewell, in a statement to the court, portrayed himself as a leader betrayed by his staff, and expressed regret for being sloppy in accounting for expenses.

However, prosecutor David Gardey said Jewell and other senior UAW officials enjoyed a “high-flying lifestyle” of “premium liquor and fine steaks” on company and union money. Fiat Chrysler, Gardey told the court, wanted UAW officials to be “fat, dumb and happy.”

Mike Booth, president of UAW local 961, which represents a Fiat Chrysler axle plant in Marysville, Michigan, told Borman that Jewell and other UAW leaders who accepted company favors betrayed union members.

“This is not a victimless crime,” Booth said.

The UAW, in a statement issued on Monday after the sentencing, said the union’s new leadership “is determined to earn back our members’ trust” and “will draw the line on more concessions to an auto industry flush in profits.”

Local 961 has gone to court to block the transfer of the axle plant to a Fiat Chrysler supplier and has accused UAW officials of corruptly acquiescing to the sale.

Reporting by Joe White; Editing by Dan Grebler

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