Benefits Manager for NYC Sandhogs Union Pleads Guilty

Melissa King, belatedly, has admitted to wrongdoing. But she still insists she’s small-time. King, former benefits administrator for Local 147 of the Laborers International Union of North America, “the Sandhogs,” pleaded guilty in Manhattan federal court on October 21 to embezzling union benefit funds and filing false personal income tax returns. Though prosecutors have put her total take at more than $40 million, King believes that’s inflated. “I plead guilty, but I don’t plead guilty to millions of dollars,” she told U.S. District Judge John Koeltl. Evidence, however, reveals a woman possessed of a limitless desire for material extravagance at the expense of the roughly 1,000 members of the New York City underground construction union. The exact total of the thefts will be determined later. She faces a maximum eight-year prison sentence in February.

Union Corruption Update has been covering this story – in all likelihood, the largest case of sole-perpetrator embezzlement in the history of American organized labor – since it broke nearly two years ago. On December 1, 2009, King, a resident of Irvington-on-Hudson, N.Y., was charged with stealing a combined $42 million from three Local 147 benefit funds during 2002-08 through her home-based company, King Care LLC. She had been arrested the previous day. King, now 60, allegedly had diverted the money to bank accounts under her control. She had been handling union benefits since 1980. Though she denied wrongdoing, a federal grand jury in February 2010 proceeded to indict her.

There was much to indict. Court documents show that King, a four-time divorcee, transferred money out of Sandhog benefit funds and into a King Care account in order to finance her sybaritic tastes. The alleged take included the following minimum totals: American Express card personal charges ($7 million); buying, maintaining and transporting horses ($5.5 million); fine and antique jewelry ($1 million); home mortgage payments ($900,000); women’s clothing at Neiman-Marcus ($300,000); luxury cars ($300,000); stays at the Ritz-Carlton Palm Beach ($150,000); private jet travel ($99,000); and rental payments for a Park Avenue apartment in Manhattan ($25,000 per month). Since her arrest, federal agents have seized assets, including her home and four luxury cars, to satisfy union claims. At her plea hearing, King stated: “I knew I was not entitled to the money. I accept full responsibility.” Responsibility for how much, however, remains to be determined.


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