Embattled union honchos’ lavish spending exposed: Villas, four-figure dinners, $60,000 cigar bill
Work hard, play hard — and on the union’s dime.
That might as well have been the motto for some former top officials at the United Automobile Workers, whose lavish spending on luxuries including high-end cigars, four-figure dining and California villas has been exposed in painstaking detail by federal prosecutors.
It’s a case that threatens to cause serious problems for top auto union bosses, including Gary Jones, who resigned as president last month under pressure. A complaint filed in September in Michigan federal court against union leader Vance Pearson refers to several unnamed individuals, but union officials have told the New York Times that one of them, UAW “Official A,” is, in fact, Jones, whose home was raided by federal agents.
And Official A’s wild expenses are all over the court documents, allegedly including $13,000 at a cigar store.
“A December 2015 Gary’s Sales invoice issued to ‘UAW c/o [UAW Official A]’ for a $13,046.91 purchase that included an order for 12 boxes of Ashton Double Magnum cigars at $268.00 per box (totaling $3,216) and 12 boxes of Ashton Monarch Tubos cigars at $274.50 a box (totaling $3,294),” was among the purchases listed in court documents. The documents listed another $13,000 purchase invoiced to Pearson from the same store the following year, part of an alleged $60,000 on cigar- and tobacco-related purchases between 2014 and 2018.
Gary Jones (AP Photo/Paul Sancya, File)
This is just one example of expenses allegedly made by Jones, Pearson and others, which prosecutors say were made via accounts set up with hotels such as the Royal Palm Springs Hotel (RPSH) and Loews Coronado Bay Resort, where they had training conferences. The hotels then paid outside vendors on the UAW officials’ behalf, “as a way to conceal the embezzling of union funds for their own personal use,” the complaint says.
The Times detailed a slew of these expenses in a lengthy story Thursday, noting that another official referenced anonymously in court documents is Jones’ predecessor as president, Dennis Williams. Neither has been charged. An attorney for Jones downplayed the accusations as part of filings “in which Gary was not charged,” according to the Times, while a source close to Williams reportedly rejected accusations that he urged the misuse of funds.
Through the RPSH, union officials spent more than $400,000 at local businesses between 2015 and 2017 on expenses including off-site condominiums and villas for themselves, prosecutors claim. An additional amount of nearly $400,000 was spent on “training” and “conference” expenditures at the Loews Coronado Bay Resort. These allegedly included meals and “excursion expenses” for senior union officials and their spouses, including the San Diego Zoo’s Safari Park and horseback riding on the beach.
The Times detailed how a “master account” was billed for over-the-top dinners, including one at LG’s Prime Steakhouse that ran over $6,500.
According to a Detroit Free Press report, prosecutors allege top union officials misused upward of $1.5 million. Pearson is facing charges including embezzlement of union funds, filing false reports and maintaining false union records, money laundering, conspiracy, and mail and wire fraud.
Jones resigned as president in November before facing internal charges that would have removed him both from office and the union entirely. Jones’ attorney Bruce Maffeo did not immediately respond to Fox News’ request for comment, but he previously told The Detroit News that Jones’ decision to resign “was reached before learning of the internal charges” that had been filed.
The case against Pearson is part of a larger investigation of UAW and Fiat Chrysler Automobiles that has gone on since 2015 and has already resulted in nine convictions. Many of these have been related to UAW officials improperly receiving things of value from Fiat Chrysler, and another involved a UAW official taking kickbacks from vendors in exchange for union contracts.