For almost three years, Michael Kelly avoided detection when it came to stealing from his union. Now his greatest concern will be how to avoid a prison sentence. On July 2, the U.S. Attorney’s Office for the Northern District of Ohio filed an information count against him for embezzling $97.970.71 from United Transportation Union Local 586, where he had served as secretary-treasurer. Prosecutors allege that Kelly used various methods to embezzle funds from the Crestline (near Mansfield), Ohio local and then cover up his acts. The union represents workers of CSX Transportation Inc. in Crestline and other northern Ohio communities.
Federal prosecutors say that during January 2004-November 2006, Kelly, a former CSX employee, issued numerous unauthorized union checks payable to himself that he knew either to be unauthorized or well in excess of his salary and expenses. At times, those checks were made out either to a family member or a third party on behalf of a family member. He then would enter these amounts in financial records as “salary and expenses.” To conceal his misrepresentations, Kelly allegedly used the following four methods: 1) forged the signature of the union local president; 2) issued and negotiated checks that contained only his signature; 3) falsely recorded the payee’s name on the union disbursement control ledger; and 4) allowed family members to make and forge his name as a signer. The information count follows a probe by the U.S. Labor Department’s Office of Labor-Management Standards.