Current, past UAW leaders implicated in spreading corruption probe

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© Reuters. FILE PHOTO: United Auto Workers President Gary Jones delivers remarks at the opening plenary session of the National Association of the Advancement for Colored People's annual convention in Detroit© Reuters. FILE PHOTO: United Auto Workers President Gary Jones delivers remarks at the opening plenary session of the National Association of the Advancement for Colored People’s annual convention in Detroit

By Nick Carey and Ben Klayman

DETROIT (Reuters) – United Auto Workers (UAW) President Gary Jones and his predecessor are unnamed officials listed in a federal criminal complaint this week that detailed alleged corruption involving massive misuse of members’ dues by the labor union’s leaders, a source familiar with the matter said on Friday.

The complaint referred frequently to various unnamed figures, in particular “Official A,” who is Jones and “Official B,” his predecessor Dennis Williams (NYSE:WMB), the source said.

The news was originally reported by the Detroit News, citing three sources.

The federal complaint released Thursday detailed charges against Jones’ former second in command and successor as head of the UAW’s “Region 5” Vance Pearson.

The charges against Pearson came just two days before the UAW’s contracts with Detroit automakers were due to expire.

UAW negotiators already faced contentious talks with General Motors Co (NYSE:GM), Ford Motor (NYSE:F) Co and Fiat Chrysler Automobiles NV (FCA). The focus is on thorny issues like healthcare costs and profit-sharing at a time when U.S. new vehicle sales are declining.

But Saturday’s contract deadline could be overshadowed by the latest revelations in a mushrooming corruption scandal, of vast sums being spent on lavish entertainment by labor leaders.

Neither Jones nor Williams have been charged with any wrongdoing. A UAW spokesman did not have an immediate comment on the report implicating Jones and Williams.

The union had hoped to put the federal probe behind it by electing Jones, a former regional director for the union, as president in 2018. However, Thursday’s arrest implicated the second in command in the region Jones ran.

Jones was chosen as he seemed far removed from the scandal.

But two weeks ago, the FBI raided Jones’s home, a union retreat and multiple other locations as part of the corruption probe.

The federal complaint filed on Thursday said government agents had seized $30,000 in cash from the residence of Official A.

An attorney for Jones could not be reached for comment after the charges were announced against Vance Pearson, Jones’ successor as regional director.

But the union said on Thursday after the complaint was filed that it believed the government had “misconstrued” facts.



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