Hector Lopez is paying a high price for using his union as a private slush fund. And it’s doubtful that too many members are feeling too badly. On November 21, Lopez, former president of Metal Polishers Local 8A-28A, an affiliate of the International Union of Painters and Allied Trades (IUPAT), was sentenced in Brooklyn, N.Y. federal court to four years in prison for masterminding mail and wire fraud schemes and for filing false tax returns. He also was ordered by U.S. District Judge Allyne Ross to pay $800,371 in restitution to the Queens union and forfeit another $371,517 to the government. Lopez, who was arrested and indicted in September 2012 following a joint U.S. Department of Labor-Internal Revenue Service probe, had pleaded guilty last April.
Union Corruption Update covered this case twice before (here and here). The 1,400-member Local 8A-28A had been in a protracted conflict with IUPAT, a battle triggered by Hector Lopez’s attempt at disaffiliation. The international union responded by ordering a full audit of the local’s finances. The investigation turned up a treasure trove of self-dealing by Lopez, who appeared to have siphoned large sums from a local benefit fund to buy a home, a Cadillac Escalade and other personal items. IUPAT turned over the results to the Labor Department and the IRS. The federal probe concluded, among other things, that Lopez, now 55, a resident of Oakland (Bergen County), N.J., over a seven-year period had accepted nearly $750,000 in kickbacks from a third-party benefit fund administrator so the latter could keep his position. Moreover, he accepted kickbacks from an employer trustee of the fund in exchange for authorizing what were fraudulent invoices for the renovation of the union hall and the installation of a new sprinkler system. The investigation also concluded that by failing to report over $300,000 in personal income from these schemes, Lopez caused a tax loss of more than $100,000.
The evidence would prove sufficient for prosecution. On September 18, 2012, Lopez was arrested at his home and indicted on 15 counts related to embezzlement, fraud, money-laundering and tax evasion. After initially pleading not guilty, he changed his plea to guilty last April 9. Loretta Lynch, U.S. Attorney for the Eastern District of New York, announced at the defendant’s November 21 sentencing: “The hard-working members of Local 8A-28A trusted Hector Lopez to safeguard their welfare fund. Instead of representing their best interests, Lopez corrupted his leadership position and abused his authority to the tune of over $1 million.”