Boston Union Wants Secret Corruption Report Disclosed

The Board of the Mass. Bay Trans. Auth.’s Retirement Fund abruptly canceled its monthly meeting Oct. 19 after dozens of Boston Carmen’s Union members invaded the session demanding the release of a report examining executive director John J. Gallahue Jr.’s acceptance of apparent kickbacks from a convicted racketeer. “The members paid for the report. We ought to be able to see what’s in it,” said John Clancy, an MBTA bus driver.

But the Board refused to allow a vote on the issue, which was fiercely debated for nearly two hours before several members left the meeting, said James E. Lydon, a Broad member and president of Carmen’s Union Local 589. Lydon said it is time to end the secrecy in the $2 billion Fund’s activities. “The whole place needs an enema,” said Lydon. “We want full disclosure. No more secrets here.”

The session quickly turned nasty with board member Janice Loux, a Gallahue supporter and president of Hotel Employees & Restaurant Employees Int’l Union Local 26, accused Lydon of leaking confidential information to the public. She called him a “coward” and a “snitch.” The Board’s lawyer, Thomas Kiley, threatened Lydon with a suit if he released the report.

The report, prepared by attorneys at Foley, Hoag, cost to the Fund $600,000. It reportedly concluded Gallahue breached fiduciary duties in his dealings with convicted felon Francis K. Fraine. Gallahue allegedly pushed the Board to lend $7 million in loans to Fraine, a corrupt developer and admitted arsonist connected to fugitive crime boss James J. “Whitey: Bulger. Gallahue’s dealings with Fraine are under federal and state criminal investigations. The Board voted in Sept. to let Gallahue, who was on paid leave for 9 months from his $191,000-per-year job, resume work for 6 months.

The Boston Herald said: “when board members came face to face with the people they purport to represent, they took the same coward’s way out they have taken with regard to Gallahue’s conduct–they simply canceled their monthly meeting…The retirement board’s conduct has been shameful.” [B.H. 10/20, 10/23/01]

“I certainly do not want these people intimately involved in my children’s education and I believe most parents would share my concerns if they knew we were considering a partnership with the Laborers.”
-Steve Stycos, Member, Cranston School Committee, Providence (R.I.) J.-Bull., Oct. 29, 2001. The Committee is currently considering trade school partnership with the Laborers’ Int’l Union of N. Am. Stycos contends that the schools should not join hands with a corrupt union under federal supervision, connected with organized crime, and dominated by nepotism.