The International Association of Iron Workers seemed willing to overlook a lot of things that had gone wrong at Riggers Local 136 in the Chicago suburb of River Grove, Illinois. Former longtime local boss Fred Schreier had pleaded guilty in federal court to graft. The Department of Labor this July filed a lawsuit alleging financial irregularities in the pension and welfare accounts of this and other Iron Workers locals. And the Justice Department had begun a probe into long-suspected mob influence at Local 136. But when local bosses stopped forwarding dues, it was time for the international union to take over the show.
A few days after Thanksgiving, the Washington, D.C.-based IAIW placed the local under receivership, stripping elected officers – including President Frank DiMarco – of their authority, and removing the local’s seats from various pension boards. The supervision period, say international officials, will last up to two years. “It was a matter of revenue and expenditure issues – having too much (sic) expenditures for the revenue they take,” said Eric Dean, an Iron Workers representative in the Chicago area. “They (Local 136) obviously fell behind on their international dues.” He and other top officials estimate the amount in arrears at around $50,000.
It’s better late than never, say members of the machinery-movers’ local, who’d grown tired of financial irregularities, unpaid medical bills, favoritism, and retribution against critics. “They (the IAIW) will put up with just about anything, but they won’t put up with you not paying them,” said one veteran rigger. “It’s not a super lot of money, but no effort was made to straighten it out.” There wasn’t much effort to straighten out a more pressing problem either: a long history of ties to the Chicago underworld.
Local 136 of the Machinery Movers, Riggers and Machinery Erectors sets up and breaks down exhibits for trade shows at the McCormick Place convention center in Chicago. This and other unions had an employment pipeline to the lakeside facility that led directly from “the Outfit,” Chicago’s famed crime syndicate (at least what’s left of it). It’s true that many workers are clean. But a lot of others got their jobs through belonging to a mob-controlled labor pool of ex-cons. “When the guys got out of jail, that (McCormick Place) was where they sent them to work,” observed Robert Cooley, a mob attorney-turned-federal informant whose testimony helped put the Outfit’s top members away. According to Sharon Campagna, who worked in the Riggers’ office for 16 years before she was forced out, said, “When I first met these people, I thought, ‘You must have to have a criminal record to get into the union.’”
Apparently a well-paying union job hasn’t been enough to lead criminals down that straight and narrow path. Stories of thefts, ghost-worker hiring, and bookmaking abound. Thefts, in particular, have been a problem; vendors who fail to pay kickbacks to the union have discovered items for booth display “missing.” One exhibitor, Robert Cappiello, an industry vice president for the National Hardware Show, recalled the time he watched the contents of his booth loaded onto a freight elevator. He had requested the opportunity to be on the elevator, but was denied access. Cappiello then went to meet the elevator on the appropriate floor, but when the doors opened, “nothing came out,” he noted. “The whole booth was gone.”
The leadership of Local 136, however, has been called to account for its dealings with benefit fund managers. The now-deposed Fred Schreier pleaded guilty in federal court in Rockford, Ill. in October 2004 to graft. He’d illegally converted $18,000 in pension money into cash, and also received an unauthorized gift – a Harley Davidson motorcycle valued at around $19,000 – from a Chicago-area pension manager, Michael Linder. Linder also had given a Harley to Thomas Kisting of Rockford, who had been business manager of Local 136 and plan administrator for two of Local 498’s pension funds. In September 2004, a federal jury found Kisting guilty. More recently, this July, the Department of Labor filed a civil suit against Michael Linder, his wife Elizabeth Linder, their two companies, Joseph/Anthony & Associates Inc. and Liz/Mar & Associates, Inc., plus three benefit plan trustees. The department sought recovery of allegedly undisclosed and improperly charged fees involving all 12 plans under their control. In addition to bribing Schreier and Kisting, alleges the suit, Michael Linder made or arranged for unauthorized payments for a variety of expenses, including the motorcycles.
In this light, the takeover of Local 136 by the Iron Workers international union was a welcome and overdue step. But it will take more than balanced books and timely dues payments to set its house in order. The Justice Department’s road ahead hopefully will lead straight to McCormick Place. (Chicago Sun-Times, 12/5; other sources).