In Northwest Indiana, the United Brotherhood of Carpenters and Joiners appear to be as adept at mishandling funds as they are at handling building materials. In 2005 Gerry Nannenga, formerly president of the union’s Local 1005 and then secretary-treasurer of the Indiana-Kentucky Regional Council of Carpenters, was sentenced to 18 months in federal prison after pleading guilty to taking a bribe years earlier to vote in favor of using $10 million in union pension money to buy 55 acres of choice real estate. This past September 21, a federal jury decided against two other union officials in a separate scandal. They are Paul Hernandez, Nannenga’s replacement as Local 1005 president, and Kenneth Castaldi, head of the local’s apprenticeship training program. Each was convicted on theft, mail fraud and other charges.
Hernandez and Castaldi were indicted in May 2005 for embezzling funds from a training grant from the State of Indiana. The money was intended to reimburse expenditures incurred by the union for scaffolding training, as mandated by the Occupational Safety and Health Administration (OSHA). Hernandez, who in addition to serving as president of the Hobart, Ind. local, was trustee of the Northwest Indiana United Brotherhood of Carpenters and Joiners Joint Apprenticeship Committee. He was accused of setting up a separate checking account designed to handle grant fund checks without prior knowledge by the state, committee or union. Hernandez designated himself and Castaldi as the account signatories.
During 1998 through December 2002, Hernandez allegedly had written checks to pay for more than $80,000 in personal expenses and tax payments. He also wrote checks to cover over $28,000 in credit card charges for items unrelated to scaffolding training. Castaldi, a former training director for the grant recipient school, wrote checks to himself in excess of $15,000 from sometime in 1998 until August 2001. The pair also wrote checks totaling more than $16,000 to pay a clerical secretary. Throughout the case, federal prosecutors worked closely with the Labor Department’s Employee Benefits Security Administration. (U.S. Department of Labor, Office of Inspector General, Semiannual Report to Congress, April 1 – September 30, 2006, Volume 56.).