DETROIT -- The UAW paid roughly $218,000 in legal fees last year for former UAW Vice President Norwood Jewell, despite the embattled officer retiring at the end of 2017.
Federal prosecutors charged Jewell last month with one count of conspiracy to violate the Labor Management Relations Act for receiving more than $40,000 worth of travel, lodging and meals from people acting on behalf of Fiat Chrysler Automobiles from at least 2014 to 2016.
Jewell pleaded guilty to the charge on Tuesday in U.S. District Court in Detroit. He will be sentenced Aug. 5.
"I own the fact that we did not apportion costs appropriately and that's why I'm standing here today," Jewell said during the hearing.
He faces a maximum sentence of five years, but the agreed guideline range is 12-18 months. The maximum fine is $250,000 and a maximum supervised release would be three years.
"We're hoping for probation," said Jewell's attorney, Michael P. Manley (no relation to current FCA CEO Michael M. Manley). "I think that's a fair sentence, but, obviously, that will be up to the judge. We're going to work very hard on that."
The UAW released a statement on Tuesday following the plea.
"As his plea makes evident today, Norwood Jewell exhibited poor judgment," the statement said. "This is a troubling moment for our organization, and our members are appropriately angry and frustrated.
"Our members will always be our highest authority, and so we pledge to continue to change the way that we do business. Our Clean Slate reforms are being implemented, and will be expanded. These reforms will make sure that transparency and accountability are at the forefront, and will bring this chapter to a close, once and for all."
Federal officials, in a statement after the guilty plea, signaled that they will continue the investigation.
“Mr. Jewell chose to forsake his obligation to serve the rank and file of the UAW when he accepted and authorized his subordinates to spend in excess of $40,000 in FCA funds on lavish meals, liquor, and entertainment," said Irene Lindow, acting special agent-in-charge for the Chicago Region of the U.S. Department of Labor Office of Inspector General.
"We will continue to work with our law enforcement partners to investigate those who facilitate illegal payments to union officials entrusted to negotiate on behalf of union members."
U.S. Attorney Matthew Schneider added: "Today’s conviction of a UAW Vice President demonstrates that our efforts to clean up labor corruption will not rest until the 400,000 UAW members and their families are represented by union officials of honor and integrity. Labor leaders must always put the best interests of the hard working men and women of the union over their own personal interests."
Policies under review
It's union policy to pay legal fees for current and former officials if it involves union business, according to UAW spokesman Brian Rothenberg. The payments, he said, ceased once Jewell indicated he would plead guilty.
The policies for paying such legal fees are under review, according to Rothenberg.
"We're reviewing and making policy changes throughout this process and we do have more reforms to come," he told Automotive News. "The payments stopped as soon as he said he was pleading guilty."
The payments were detailed in the union's annual filing to the U.S. Department of Labor. Jewell, according to the report, received $219,495 from the UAW in 2018, including $1,844 in salary and $217,651 for "official business" disbursements, which the UAW confirmed were legal fees.
It's unknown how much the union has paid to cover legal fees for other officials as part of the investigation, which stemmed from the misuse of jointly operated training center funds.
Multiyear investigation
Jewell is the seventh person -- three from FCA US and four associated with the union -- to be charged in connection to a multiyear investigation.
Despite not being charged until last month, Jewell had been a target of federal prosecutors for some time, which could explain the attorney fees. Federal officials, as first reported by Automotive News, raided his home in late 2017.
The compensation for Jewell last year made him the fifth-highest compensated official in the UAW, according to the filing. He only trailed President Gary Jones ($260,243), Secretary-Treasurer Raymond Curry ($222,663), Vice President Terry Dittes ($235,873) and UAW Region 5 Director Vance Pearson ($222,672).
UAW delegates last year approved 31 percent salary increases for the union's international leaders, but the highest-paid officials each received tens of thousands of dollars in compensation for "official business." It's unclear what those payment entailed and whether or not they also included legal fees related to the federal investigation.
