Detroit – The former head of Operating Engineers Local 324 struck a plea deal with federal prosecutors Friday, admitting he forced union workers and officials to pay kickbacks that he blew on booze, meals and his daughter’s wedding.
John Hamilton, 62, of Rivera Beach, Florida, reached the plea deal three weeks before he was scheduled to stand trial in federal court. Hamilton faces up to five years in federal prison and has agreed to pay $250,000 restitution to victims of the crime, prosecutors said Friday.
He will be sentenced Jan. 16 by U.S. District Judge Bernard Friedman.
Hamilton, who was indicted two years ago, admitted conspiring to violate the Hobbs Act with at least two other leaders of Detroit-based Local 324, which represents 18,000 heavy equipment and crane operators throughout the state.
“Union officials should be dedicated to promoting the best interests of their rank and file members, not their own personal enrichment,” acting U.S. Attorney Dan Lemisch said in a statement. “This prosecution demonstrates that union officials will be held to account if they abuse their positions of trust to force their employees, under threat of termination, to pay kickbacks to their union bosses.”
On Friday, Hamilton admitted forcing business agents and union employees to pay kickbacks of more than $5,000 from their annual salaries to the “Team Hamilton Slate Fund,” which ostensibly was created to pay for union election campaign expenses.
Instead, Hamilton, who served as the union’s business manager from 2003-12, treated the fund like his personal piggy bank, prosecutors said, and gave $5,000 to his daughter as a wedding present.
Hamilton fired one union business agent who complained and threatened to fire others, prosecutors said.
After losing re-election in 2012, Hamilton pocketed $71,000 from the fund and gave more than $70,000 to two union officials, Steven Minella and David Hart.
Minella, the former Local 324 president, and Hart, the union’s financial secretary, have pleaded guilty to felonies and will be sentenced in October.
“With the plea agreement between the U.S. Attorney and disgraced ex-union official John Hamilton, Operating Engineers 324 can finally close this unfortunate chapter in our history,” the union said in a statement Friday. “When the facts around these actions came to light, the brothers and sisters of our union came together, ousted the corrupt regime, and ushered in the era of democracy and transparency that we have today.”