Tidewater Virginia ILA Business Agent Pleads Guilty to $1M+ Ripoff

international longshoremen_s association logoFor 10 years, Robert Smith III stole freely from his union. He now is realizing the meaning of the saying, “Nothing in life is free.” On Friday, October 14, Smith, former business agent and financial secretary of International Longshoremen’s Association Local 970, pleaded guilty in U.S. District Court for the Eastern District of Virginia to one count of mail fraud in connection with his theft of more than $1 million from the Norfolk-based union. He had resigned his post in April following a joint investigation by the FBI and the U.S. Labor Department’s Office of Labor-Management Standards and Office of Inspector General. He faces up to 20 years in prison at sentencing this February.

Port of Virginia, located along Hampton Roads in the southeast coastal portion of the state, is home to four marine terminals – two in Portsmouth and one each in Norfolk and Newport News. The terminals and respective docks handle more than 80 million tons of cargo annually. They are also home to six affiliates of the International Longshoremen’s Association. One of them is Local 970, the finances of which were managed by Robert Smith III. Unbeknownst to rank and file, Smith used the union treasury as a personal wealth-building program. According to prosecutors, Smith, now 48, a resident of Virginia Beach, during March 2006-April 2016 deposited member dues and initiation fees in a union account and then diverted large sums of that money into a separate account he had established for personal spending. His withdrawals went primarily for food, gasoline, home improvement, clothing, entertainment and credit card payments. Belatedly, a suspicious union conducted an audit. And the audit discovered an “unauthorized and previously undisclosed account” into which “funds were deposited and withdrawn allegedly for non-union purposes.”

The union notified the Labor Department’s Office of Labor-Management Standards, which for some reason had not received an annual financial report from Local 970 in a decade. OLMS concluded that Smith stole a grand total of $1,072,668.30. This April 19, ILA Hampton Roads spokesman Thomas Little announced that Smith had resigned as Local 970 business agent-financial secretary. The almost inevitable guilty plea came two weeks ago on October 14. “Members of Local 970 trusted Robert Smith III to uphold his fiduciary responsibility to their union,” remarked Robin Blake, Special Agent in Charge for the Labor Department’s Office of Inspector General. “Smith betrayed members by committing mail fraud to embezzle more than $1 million from the union, hid his crime for 10 years by failing to meet the annual reporting requirement to the Department of Labor, and eventually lied to officials from the Department. We will continue to work with our law enforcement partners to safeguard the assets of union members and all American workers.”