Senate Cmte. Prepares to Subpoena Directors

The U.S. Senate’s Governmental Affairs Cmte. is preparing to subpoena 6 current or frmr. board members of the Union Labor Life Insurance Company, five of whom opposed returning their profits from selling ULLICO stock at the expense of the union pensions that own the company.  Five of the six are also current or retired union officials.  They are: William Bernard, ret. pres. of the Int’l Assn. of Heat & Frost Insulators & Asbestos Workers: Marvin Boede, ret. pres. of the United Assn. of Plumbers & Pipefitters: James La Sala, current pres. of the Amalgamated Transit Union: Billy Casstevens, ret. secy.-treas. of the United Auto Wrkrs. and Joseph Maloney, secy.-treas. emeritus of the AFL-CIO’s Bldg. & Construction Trades Dept. (BCTD)

When Robert Georgine, frmr. BCTD chief, resigned as ULLICO president last May, he asked to bail out these particular directors who bought ULLICO stock knowing its price would rise along with the telecom firm Global Crossing, in which ULLICO had bought into at the ground floor.  Later, those directors were allowed to sell back their ULLICO stock before its price collapsed along with Global Crossing’s as the telecom bubble burst in 2000 and 2001. Unable to take advantage of the same deal because they owned far more ULLICO stock than the individual directors were the pension funds that have largely owned ULLICO since its inception in 1925.

Senator Susan Collins (R-Maine), who chairs the cmte., is concerned that some of these recalcitrants are still on the Board as it considers Georgine’s demands for increased retirement and severance compensation.  She also said that all 6 had been asked to testify, but had refused, thus necessitating the subpoenas.