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FCA-UAW corruption charges

by David Zatz on

According to a Detroit news station, a former Chrysler/FCA executive and the surviving wife of a late UAW vice president, General Holiefield, have been indicted for tax evasion and conspiracy to violate the Labor-Management Relations Act.

General Holiefield at Sterling Heights plant event

General Holiefield at Sterling Heights plant event

Former FCA vice president for employee relations Alphons Iacobelli is also being charged with paying prohibited money and items of value to union officials, conspiracy to defraud the government, false tax returns, and willful failure to file a tax return. Iacobelli was the FCA official in charge of negotiating with the UAW.

Holiefield died in March 2015 of pancreatic cancer; his wife, Monica Morgan, is not being charged as a survivor, but because she allegedly played a key role. Morgan, according to the indictment, created a company (“Wilson’s Diversified Products”) and used it to disguise over $425,000 in funds.

Iacobelli retired unexpectedly at the age of 55, in 2015. Sergio Marchionne took over negotiations personally. The suddenness of his retirement was unexplained then, but FCA’s statement, released today, indicates that he was “separated” from the company when the alleged arrangement was discovered.

According to the indictment, Iacobelli and other FCA representatives illegally gave $1.2 million to Holiefield over six years, from 2009 to 2015, paying off Holiefield’s $262,219 mortgage and providing free travel, furniture, and apparel to Holiefield and Morgan. FCA analyst Jerome Durden allegedly e-mailed Iacobelli in 2011, regarding first-class travel for Morgan; Iacobelli allegedly replied that they would pay, but not put it in writing. The total bill for airfare, over time, according to the indictment, was $30,000.

FCA’s official response was released moments ago:

FCA US and the UAW were the victims of malfeasance by certain of their respective employees that held roles at the National Training Center (NTC), an independent legal entity. These egregious acts were neither known to nor sanctioned by FCA US. Upon learning of possible malfeasance in June 2015, the Company investigated the matter and, as a result, Mr. Iacobelli and Mr. Durden were promptly separated from the Company upon FCA US obtaining credible evidence of wrongdoing. The Company has also worked with the UAW to implement governance, auditing and structural reforms to improve the accountability and transparency of the NTC.

FCA US has cooperated fully with the U.S. Attorney’s office in its investigation of this matter. We remain committed to ensuring that the Company and its employees act in a manner consistent with high standards of legal compliance, ethics, integrity and quality.

The Company intends to pursue all potential legal remedies against Mr. Iacobelli and any other culpable parties. As the U.S. Attorney’s investigation is ongoing, the Company cannot comment further.

Original source

David Zatz founded Allpar in 1998 (based on a site he had begun in 1993-94), after years of writing reviews for retail trades. He has been quoted by the New York Times, the Daily Telegraph, the Detroit News, and USA Today. Before making Allpar a full-time career, he was a consultant in organizational psychology. You can reach him by using our contact form (much preferred) or by calling (313) 766-2304

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