Rockford, Ill. Laborers Office Manager Pleads Guilty to $200K Theft

Skimming contributions long has been a favored method of theft by union embezzlers. But the odds of getting caught eventually catch up. Just ask Grace Rathke. On January 3, Rathke, formerly office manager for Laborers Union of North America Local 32, pleaded guilty in U.S. District Court for the Northern District of Illinois to stealing more than $190,000 in funds from the Rockford union. She had been indicted in August 2011 on 10 counts of embezzlement following an investigation by the U.S. Labor Department’s Office of Labor-Management Standards and Office of Inspector General.

Federal prosecutors had charged that Rathke, now 57, a resident of Loves Park, Ill., during November 2004-March 2009 engaged in a scheme to divert payments of dues and fees to her own purposes. Instead of depositing the cash and check payments into the union bank account, she placed them in a personal account and credited them in the ledger as having been made. This April, Rathke faces a maximum sentence of five years in prison to be followed by three years of supervised release, plus an order to pay full restitution to the union.