DETROIT/WASHINGTON -- UAW President Gary Jones and his predecessor are unnamed officials listed in a federal criminal complaint detailing alleged corruption and embezzlement by union leaders, a source familiar with the matter said on Friday.
The complaint was released on Thursday, just two days before the UAW’s labor contracts with Detroit 3 automakers expire on Saturday, raising questions about the status of ongoing negotiations.
The Detroit News, citing three unnamed sources, also reported late Thursday that Jones and his predecessor, Dennis Williams, were two of four union unnamed union officials implicated in the complaint.
The complaint detailed charges against Jones' former second-in-command and successor as head of the UAW's "Region 5," Vance Pearson. It also referred frequently to several unnamed figures, in particular "Official A," who is Jones and "Official B," Williams, Reuters reported. Neither Jones nor Williams have been charged with any wrongdoing.
The union has targeted GM as the first automaker to negotiate and conclude a new contract covering wages, benefits and job security, setting a pattern deal to be used at Ford and FCA US.
This year's talks were widely expected to be contentious, focusing on thorny issues such as healthcare costs and profit-sharing at a time when U.S. new vehicle sales are declining.
Jones remained the union’s president following a three-hour emergency meeting of the union’s International Executive Board Friday afternoon at a metro Detroit hotel conference room. Jones, along with the union’s three vice presidents and other IEB members, were spotted at the meeting, but all approached by Automotive News declined comment as they left.
The UAW quoted Jones in a press release on Sunday announcing plans to strike General Motors at midnight.
The union had hoped to put the growing federal probe behind it by electing Jones, a former regional director for the union, as president in 2018. However, Thursday's arrest implicated the second in command in the region Jones ran.
Jones was chosen as he seemed far removed from the scandal.
But two weeks ago, the FBI raided Jones's home, a union retreat and multiple other locations as part of the corruption probe.
The charges released Thursday said that senior UAW officials stole hundreds of thousands of dollars in union money to spend on luxury villas in Palm Springs, Calif., cigars, liquor, lavish meals, golf and other extravagances.
Pearson, 58, a 17-year UAW employee who succeeded Jones as Region 5 director in Missouri last year, is among the current and former officials cited in an investigator’s affidavit as authorizing and concealing union-funded purchases of “luxury items and accommodations for their own personal benefit.” He was arrested and charged Thursday in Missouri.
He is due to appear for a hearing in U.S. District Court in Missouri on Tuesday, Sept. 17, but won't be formally arraigned until he is transfered later to federal court in Detroit. Pearson's attorney, Jan Paul Miller of St. Louis, could not be reached for comment.
Pearson as of Sunday remained a member of the UAW's International Executive Board, according to the UAW website. He is one of the few officials that prosecutors identified by name, as the others have not yet been charged with any crimes.
The documents cite cooperation from several unnamed witnesses who were already prosecuted or cut deals with the government in the ongoing investigation and that "UAW Official C" provided evidence in exchange for an agreement not to use the evidence against the official.
A lawyer for Jones could not be reached for comment by The Detroit News or by Reuters.
“Our highest priority is maintaining the trust and confidence of United Auto Worker members," the UAW said in a statement issued late Thursday afternoon. "While these allegations are very concerning, we strongly believe that the government has misconstrued any number of facts and emphasize that these are merely allegations, not proof of wrongdoing. Regardless, we will not let this distract us from the critical negotiations underway with GM to gain better wages and benefits for the more the 400,000 members of our union.”
GM issued an emailed statement on Thursday saying it was “outraged and deeply concerned.”
“These serious allegations represent a stunning abuse of power and trust,” the automaker said. “There is no excuse for union officials to enrich themselves at the expense of the union membership they represent.”
The accusations released Thursday paint a gaudy picture of the union’s “upper echelon” living it up on members’ dues for months at a time under the auspices of attending conferences and participating in other business-related activities.