DC37 Bosses’ $2 Million Slush Fund Uncovered

TTop DC37 bosses plundered union finances like a “private candy store” by fudging membership numbers to create a $2 million slush fund, charged AFSCME administrator Lee Saunders at a Dec. 18 media conference. DC37 based its 1998 annual report on dues from 115,000 members when it really had 124,000, thus creating a $2 million false surplus. Saunders didn’t say how long the scam has lasted and doesn’t know where the money went.  Dues vary widely in DC37’s 56 locals, but members pay an average of $600 annually. Saunders also announced that 10 DC37 bosses, including ex-boss Stanley Hill, ran up nearly $500,000 on corporate Am. Express cards with few receipts. Even more bosses took frequent, unapproved, lavish trips without proof of expenses. DC37’s assets have dropped from $22 million to $3.4 million since 1994 due mostly to “irresponsible spending without any controls.” Saunders suspended the DC37’s treasurer, Robert Myers, who approved much of the allegedly fraudulent spending and postponed severance deals for departing officials, like the $382,000 compensation package that 2 ousted bosses took off with in early Dec. [N.Y. Post 12/19/98]

$2 Million Stock Scam Tied to DC37
Michele Caridi, whose family owns the Friar Tuck, a Catskills resort, and her husband, Edward “Biff” Halloran, who disappeared in Oct., were charged Dec. 18 by Manhattan Dist. Atty. Robert M. Morgenthau with stealing $2 million in a phony stock scam. Halloran, who has alleged Genovese crime-family ties, was convicted of racketeering in 1987. DC37 bosses have held many lavish conferences at Caridi’s resort, and Morgenthau is allegedly investigating an possible kickback scheme between DC37 and the resort. One 700-guest conference held by ousted DC37 boss Charles Hughes in 1997 cost his local $1.2 million or about $1,600 per person for a 5-day junket. [N.Y. Post 12/21/98]

District Attorney Takes DC37’s Hard Drives
Amid allegations of rampant vote-rigging at DC37, Manhattan Dist. Atty. Robert M. Morgenthau seized multiple computers from DC37 offices during Christmas week. Investigators want to check the hard drives for records that could be evidence of ballot-stuffing in the 1996 citywide contract-ratification vote. Computers in the research-and-negotiations dep’t and accounting office, were taken. [N.Y. Post 12/25/98]