The Laborers' International Union of North America, one of the nation's largest construction unions, thought it had gone far to end corruption several years ago when it pushed out top officials in union locals in New Jersey and Queens, accusing them of ties to the mob.þþBut allies of those officials continued to run the locals' health and welfare funds, and now the parent union is struggling to straighten out those funds, which hold hundreds of millions of dollars in assets.þþThe funds' officials are resisting efforts to oust them, with leaders of two laborers' locals in Queens moving to disband their local and form a new independent one, in part to dodge the laborers' investigative efforts. þþÿWe've got better and better at throwing the wiseguys out of the locals, but they realize they can find a happy home in the funds, knowing that there's a lot of money there,ÿ said Robert Luskin, the in-house prosecutor for the national union. þþThe union has undertaken its own cleanup after federal officials faulted it for pervasive corruption. It has nearly 600,000 members who do jobs like paving, concrete work and hauling construction materials. þþThe union's hearing officer, Peter Vaira, a former federal prosecutor, found nepotism and no-bid contracts at the benefits fund for Laborers' Local 734 in Rochelle Park, N.J. He tied those problems to August Vergalito, a former board member of the local who he said in a ruling was an associate of the Genovese crime family.þþThe parent union is battling to remove the fund's trustees, saying that they were close to Mr. Vergalito and that they improperly gave his wife, daughters and sons-in-law various jobs. All told, Mr. Vaira found, the fund paid Mr. Vergalito's relatives more than $3 million over nine years.þþMr. Vaira found that the fund paid one son-in-law $119,000 a year to administer a scholarship program that awarded $28,000 a year. Mr. Vergalito's daughter, he found, was hired as a confidential secretary to check phone messages and was paid $111,799 one year to answer 109 phone messages, coming to $1,025 a call. The fund, Mr. Vaira found, paid a dentist $123,000 one year to spend one or two afternoons a week reviewing claims.þþÿMost of the jobs held by the Vergalito family and friends were of little value to the operation of the Funds or Local 734, and were grossly overpaid,ÿ Mr. Vaira wrote in his ruling.þþMr. Vergalito's telephone number is unlisted, and he could not be reached. Angelo R. Bisceglie Jr., a lawyer for the fund's trustees, said the union was exaggerating the fund's problems. He said the trustees had cleaned up improper matters as soon as they learned of them.þþÿWhen we became aware of certain employment situations, I was asked to investigate, and I recommended that a number of people be terminated,ÿ Mr. Bisceglie said. ÿI didn't meet any resistance at all from the trustees.ÿþþMr. Bisceglie also recommended that the fund close a satellite office in Brick, N.J. þþIn April, Judge Dennis M. Cavanaugh of United States District Court in Newark granted an injunction to remove the fund's trustees and its administrator. The trustees have appealed to the United States Court of Appeals in Philadelphia. þþMr. Bisceglie disputed the charge that Mr. Vergalito was close to organized crime. He noted that Mr. Vergalito had not had a job in the local since 1997, although he has held various jobs at the fund. þþThe fight is as fierce and confusing at Laborers' Locals 1010 and 1018 in Queens, where Mr. Luskin, the parent union's prosecutor, has sought to remove the administrator of the locals' benefits fund, Anthony Franco. The parent union had previously expelled Mr. Franco for associating with members of organized crime and had also expelled his father, Salvatore, finding that he was a member of the Gambino crime family. Salvatore Franco was the president of 1018 and his son was secretary-treasurer. þþAfter Mr. Luskin threatened to put Locals 1010 and 1018 into trusteeship and to remove the trustees of their benefits fund, the trustees amended their charter so that only they could appoint new trustees. They also gave Anthony Franco a new five-year contract as administrator.þþWith Mr. Luskin seeking to have those moves declared illegal, the leaders of Locals 1010 and 1018 resigned, saying they were dissolving their locals and moving jurisdiction to a new independent union local outside the laborers.þþÿThese guys haven't run away, they've changed tactics,ÿ Mr. Luskin said. ÿThey've fought back. þþThe parent union has asked the National Labor Relations Board to declare that the locals' leaders improperly misled and threatened the locals' members to persuade them to join the new union local. þþRiccardo Iaccarino, a lawyer for the locals' leaders and the fund's trustees, said that the fund was in excellent financial shape and that its administrator, Mr. Franco, should not be ousted. ÿYou're not supposed to charge someone with the sins of his father,ÿ he said. þþMr. Iaccarino said the fund's trustees feared that the parent union would seek to merge the benefits fund into the less healthy funds of several other union locals.þþHe asserted the leaders of 1010 and 1018 were merely exercising their right to form another union.þþÿThe laborers' union takes the position almost like they're the only union in the world, like they're the government, almost,ÿ he said. ÿPeople can get together and start another union if they want.ÿþþ
Source: NY Times
