UAW’s Pearson Pleads Guilty to Embezzlement

The outcome couldn’t have been more inevitable for Vance Pearson. And it couldn’t have been less welcome for the people ranking above him. Last Friday, February 7, Pearson, former regional director for the United Auto Workers and a member of the union’s international board, pleaded guilty in Detroit federal court to conspiracy to embezzle hundreds of thousands of dollars in union funds, enabling him and other UAW officials to live large – or at least larger – for nearly a decade. In so doing, he may have brought prosecutors one step closer to bringing charges against former Auto Workers President Gary Jones and his immediate predecessor, Dennis Williams. The action follows a probe by the FBI, the IRS, and the U.S. Labor Department’s Office of Labor-Management Standards and Office of Inspector General.

As Union Corruption Update indicated a couple of weeks ago, Vance Pearson, now 58, a resident of St. Charles, Mo., was a key reason why the U.S. Attorney’s Office in Detroit has concluded that the 400,000-member union is a “racketeering enterprise.” He and six other UAW members allegedly conspired during 2010-19 to siphon union money for villa rentals, golf equipment, cigars and other indulgences unrelated to union business and then to conceal these unauthorized expenses as part of regional conferences. Pearson, who in November resigned his post as director of UAW Region 5, initially was charged with embezzlement in September, but was slapped with additional charges on January 6. Five co-defendants were listed in the indictment under assumed names. A sixth, however, Edward “Nick” Robinson, had been charged in October for his role in obtaining around $1.5 million in bogus reimbursements and splitting part of the money with ex-Presidents Jones and Williams. Though neither Jones or Williams were charged, the prospect of their indictment has become much more real. And because the union has been cited as a “racketeering enterprise,” the prospect of federal supervision also has become more likely.

The guilty plea of Pearson brings to a dozen the number of former UAW officials and associates convicted in the ongoing three-year investigation of corruption at the UAW, which focused initially on the union’s Fiat Chrysler Department and then on its General Motors Department. Three persons in the latter group of cases – Michael Grimes, Jeff Pietrzyk and Joe Ashton – have pleaded guilty and are awaiting sentencing. As part of his plea deal, Pearson will forfeit a combined nearly $120,000 from two union funds plus a set of custom golf clubs.

Federal officials are confident that justice has been done. Thomas Murray, district director of the U.S. Labor Department’s Office of Labor-Management Standards, stated, “Vance Pearson failed his fiduciary duties as a UAW officer when he used his position to embezzle over $100,000 of UAW funds so he and his co-conspirators could live a lavish lifestyle at the expense of the union members he was elected to represent.” U.S. Attorney Matthew Schneider said, “Today’s guilty plea is one more leap forward in our drive to prosecute corruption at the highest levels of the United Auto Workers union.” In a prepared statement, the union rebuked Pearson but also expressed support for its new president, Rory Gamble.