Thefts from Portland, Oregon Transit Local Larger than Suspected

The travails of Thomas Wallace have exacted a higher price than originally suspected. The previous issue of Union Corruption Update reported that Wallace, treasurer of Local 757 of the Amalgamated Transit Union in Portland, Ore., had embezzled an undisclosed amount of money from his union. Local President Jon Hunt indicated as much in a February 14 letter to rank-and-file members of the union, which represents employees of TriMet, the metro Portland transit system. Since then, details have emerged indicating Wallace’s haul had been of alarming proportions. TriMet General Manager Fred Hansen told the transit authority’s board of directors that the theft was “$200,000 to $400,000, perhaps as much as $500,000” from one account alone – there may have been others. Hansen added that the U.S. Department of Labor is conducting an investigation.       

By all accounts, Wallace, 49, had a gambling problem. To cover his losses, he embezzled from Tri-Met’s union-run Elder/Child Care account, set up in 1998, the year following Wallace’s election as treasurer. Late in 2004, TriMet officials suspected the numbers weren’t adding up. In March 2005, after repeatedly unsuccessful efforts to secure financial records from the union, the transit authority filed a complaint. Three months later, the agency withdrew the complaint, after a thorough review of union bank statements and other financial documents. In the end, the clean bill of health was an illusion. After a second review, Hunt concluded that Wallace had disguised the account’s true condition to cover his tracks. “Both TriMet and myself previously reviewed the records of the Elder/Child Care account and they looked in order,” Hunt wrote. “We now believe that Wallace altered bank statements and computer records to make the theft undetectable.” Wallace, who has not yet been charged with a crime, did not respond to requests for comment. (The Oregonian, 3/5/07).