James E. Cole, Int’l Ass’n of Bridge, Structural, Ornamental & Reinforcing Iron Workers’ general secretary, pled guilty to one count of embezzling of union funds, one count of “failing to disclose a material fact” in a report to the Dep’t of Labor, and one count of “making a false entry” in union records. In return, he will cooperate with the ongoing federal probe of BSORIW, under the terms of a plea agreement approved June 18 by U.S. Dist. Judge Thomas F. Hogan in Washington, D.C. Cole’s trial on 18 felony charges was scheduled to begin June 18. Cole is the fourth BSORIW boss to admit to crimes against his union in the three-year probe by the U.S. Atty.’s Office in D.C., FBI, and DOL.
Hogan did not set a sentencing date, but he ordered Cole to return to court on Sept. 26 for a status hearing. Cole faces a maximum sentence of up to seven years in prison and a fine of up to $450,000 when he is sentenced. But prosecutors may seek a shorter sentence if Cole provides them with substantial assistance. Currently under the plea agreement, Cole will pay a $15,000 fine within 30 days of signing the plea agreement and $15,000 in restitution for his embezzlements.
A federal grand jury indicted Cole in Jan., accusing him of embezzling more than $10,000. Among the allegations: he used union credit cards and other funds to pay for personal meals, trips, and entertainment for himself as well as his wife, family, and friends. For example, he allegedly used union funds for a Scotland vacation, a high school reunion trip, and anniversary flowers for his wife. Also, Cole allegedly arranged for BSORIW to pay for country club memberships that he and his wife often used for personal use.
Further, Cole allegedly submitted fraudulent claims for reimbursement of expenses he had not incurred and sought tax deductions for expenses he had not incurred. LM-2 reports to DOL were allegedly falsified by Cole to conceal the extent of union expenditures for himself, his wife, ex-BSORIW president Jake West, ex-gen. secretary LeRoy Worley, and ex-union bosses Fred G. Summers and Darrel E. Shelton. Specifically, he underreported the amount he and other bosses spent by concealing disbursements in general categories such as “office and administrative” expenses or “educational and publicity” expenses.
Additionally, Cole allegedly participated with Victor Van Bourg, ex-BSORIW gen. counsel, in obstructing the grand jury’s investigation by withholding documents related to the LM-2s. The documents were reportedly withheld for more than two years until Van Bourg died and Cole no longer served as custodian of the records.
Beyond Cole, three others have pled guilty and are aiding in the probe: Shelton, ex-BSOIW organizer, admitted embezzling up to $120,000; Summers, ex-executive director of organizing, admitted embezzling more than $50,000; and Michael J. Brennan, ex-head of the Iron Workers Political Action League, admitted stealing $7,000. To date, none have been sentenced.
Cole has served as secretary since 1999 but intends to resign after 16 years as an int’l union boss. From 1985-98 he was treasurer. Prior to pleading guilty, Cole had planned to run for another term together with BSORIW president Joseph Hunt, Jr., at the union’s convention Aug. 13-17 in Las Vegas. Hunt was elected by BSORIW’s council after West resigned in Feb. Joe Blaze, a Toledo local boss who hopes to unseat Hunt, said Cole’s guilty plea was “another nail in the coffin of the current administration.”
The federal probe have been examining BSORIW’s books since 1998 as an offshoot of an investigation into alleged D.C. police corruption. The link to both cases is West. Prosecutors are trying to determine whether West, a friend of ex-D.C. police chief Larry D.Soulsby’s, used union money to do favors for Soulsby and whether Soulsby did anything illegal in return. [Wash. Post 6/19/01, BNA 6/20/01]