Leader of Carpenters’ Union and 9 Others Indicted in Corruption Inquiry

The New York TimesBy WILLIAM K. RASHBAUM | Published: August 5, 2009

Nearly two decades after federal authorities moved to loosen the mob’s grip on the New York City’s carpenters’ union and end a culture of contractor bribery, they announced new corruption charges on Wednesday against the union’s leader and nine other union officials and contractors. The charges include racketeering, bribery, fraud and perjury.

The men were named in a 29-count indictment that alleges crimes similar to some set out in a civil racketeering lawsuit that Manhattan prosecutors brought against the union, the New York District Council of Carpenters and Joiners of America, in 1990. That case led to a 1994 consent decree and, later, a court-appointed corruption monitor; both are still in place.

The indictment was unsealed in Federal District Court in Manhattan hours after a 6 a.m. roundup in which seven of the defendants were arrested, some as they prepared to go to work. It charges that in exchange for bribes valued at about $1 million, they helped corrupt contractors steal millions of dollars more from the union and its benefit funds by allowing contractors to pay members cash wages below union scale without benefits, hire illegal aliens and nonunion workers and skip contributions to the union’s benefit funds.

The 20,000-member district council, which oversees 11 local unions around New York City, has remained not only a major player in the city’s labor movement but also a major force in its politics, despite a history of mob influence, labor racketeering and bribery.

Indeed, six weeks ago, Mayor Michael R. Bloomberg’s re-election campaign put out a news release announcing that the union had endorsed his bid for a third term.

The release included a video clip showing Michael J. Forde, the district council’s executive secretary-treasurer, who is now indicted, giving the mayor a rousing introduction at a union event and sealing his support for Mr. Bloomberg with a hug.

Mr. Bloomberg, asked on Wednesday for his response to the indictment, said he was surprised and that he hoped the union members themselves would not be hurt, calling the situation “sad.”

“I don’t know whether any of the charges that I read about late this afternoon are true or not — I’ll leave that to the courts,” he said. “It’s the men and women of the carpenter’s union that have endorsed me, and I’m thrilled to have it.”

The charges, a result of a lengthy investigation by Manhattan prosecutors, the Federal Bureau of Investigation and the Department of Labor Inspector General’s Office of Labor Racketeering and Fraud Investigations, were not Mr. Forde’s first brush with such accusations. He and another district council official went to trial on bribery charges involving the union in state court twice in recent years, with the first case ending in a conviction that was later overturned, and the second in acquittal.

Lev. L. Dassin, the acting United States attorney, who announced the charges in a news release, said that the union’s leaders had failed to protect their members.

“Instead of protecting the financial interests of union members and their families, corrupt union officials and the contractors who bribed them are charged with betraying the carpenters’ union and its benefit funds to enrich themselves,” he said.

Gary Rothman, a lawyer for the district council, said he was reviewing the indictment. “We understand that the charges are serious, but we also believe in the presumption of innocence and we will have a further statement as the situation becomes clearer,” he said in a brief statement.

Two years ago, prosecutors unsuccessfully sought to remove the union’s court-appointed monitor, known as the independent investigator, saying his investigations were “superficial” and “incomplete.” The investigator, William Callahan, defended his tenure on Wednesday, saying he had been “aggressive” and “effective.”

Among the others charged in the new indictment with Mr. Forde and the other union officials was Joseph Olivieri, a benefit funds trustee and executive director of the Association of Wall, Ceiling and Carpentry Industries of New York. F.B.I. reports and law enforcement officials say Mr. Olivieri has a long history of ties to the Genovese crime family, the powerful Mafia clan that for generations has held sway over the union.

While the indictment makes passing mention of another Genovese figure, it does not charge that organized crime wielded any influence over the union. But law enforcement officials said the investigation was continuing.

“Rather than doing what they were elected to do — safeguarding wages and benefits for union members — they took cash and other bribes to turn a blind eye on contractors’ schemes to cheat the rank and file,” Joseph M. Demarest Jr., who oversees the New York F.B.I. office, said in the news release.

Mr. Forde, who was attending a conference in Canada, surrendered about 3 p.m. after returning to New York. The prosecutor in the case, an assistant United States attorney, Lisa Zornberg, said at his arraignment that he had tested positive for cocaine and marijuana.

His lawyer, Andrew M. Lankler, declined to comment, and a lawyer for Mr. Olivieri did not return a call seeking comment. Two defendants, Finbar O’Neil, a contractor, and Michael Brennan, a shop steward, remained at large.

An earlier version of this article misstated the outcome of Mr. Forde’s second trial as a mistrial.

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