Ex-NYC Elevator Constructors Boss Sentenced for Racketeering

Charles Novak, former V.P. and Business Agent of Local 1 of the Intl. Union of Elevator Constructors was sentenced on Dec. 1 after a jury convicted him of racketeering, racketeering conspiracy, receiving unlawful labor payments in violation of the Taft-Hartley Act, mail fraud, making false statements about benefit funds, money laundering and money laundering conspiracy.


U.S. Dist. Judge David Trager (E.D. NY, Clinton) sentenced Novak to 9 years in prison, 3 years of supervised release, and was ordered to pay restitution of $289,000, and a $15,000 special assessment. In addition, the court entered a forfeiture judgment in the amount of $300,000 against Novak and directed him to report to prison on February 1, 2005.  U.S. Attorney Roslyn Mauskopf also announced that an additional 36 defendants have pleaded guilty in connection with her Office’s investigation of this wide-ranging no-show jobs scheme that included extortion, witness tampering and obstruction of justice.


The indictment, trial evidence and jury’s convictions establish that Novak led a racketeering enterprise that spanned three decades, coordinated dozens of co-conspirators, victimized high-rise construction sites throughout the greater New York City area and generated large kickbacks for himself and his lieutenants in exchange for Novak’s corrupt official actions.  


Between 1989 and March 2001, Novak’s racketeering enterprise caused contractors to pay more than $3 million in the names of no-show operators. In exchange for no-show money, chauffeur services and other things of value, Novak provided labor peace and compromised Local One’s rights to insist that contractors fully comply with their obligations under collective bargaining agreements with Local One.  Novak recruited and controlled operators, and, thus, obtained names for no-shows who were conduits for his kickbacks, by corrupting Local One’s hiring list and using his power to dole out and withhold work.


Along with the U.S. Attorney’s Office for the East. Dist. of NY, this case was also investigated by the FBI, the U.S.Dept. of Labor’s Office of Labor-Mgmt. Standards, and the DOL’s Employee Benefits Security Admin. [U.S.A.O. E.D. NY, 12/1/04]