UAW-Chrysler training center sues to recoup $4.4M
TheUnited Auto Workers-Chrysler National Training Center sued two former Fiat Chrysler Automobiles officials and a labor leader's widow Friday to recoup more than $4.4 million, portraying itself as a victim of a conspiracy that has jolted the auto industry and labor movement.
The UAW-Chrysler National Training Center lawsuit targets several of the key figures charged so far in an ongoing conspiracy case. They include former FCA labor negotiator Alphons Iacobelli; Monica Morgan-Holiefield, the widow of former UAW Vice President General Holiefield; and Jerome Durden, a former FCA financial analyst.
The training center wants to recoup millions it claims was embezzled by Iacobelli that led to a criminal case involving a broader conspiracy of Fiat Chrysler executives funneling illegal payments and benefits to UAW leaders. The money was funneled through the training center under a policy created by the auto company’s officials to keep UAW leaders “fat, dumb and happy” and wring concessions favoring the automaker, according to the federal government.
The 20-page complaint filed in Oakland County Circuit Court on the eve of thousands of UAW officials arriving in Detroit for the union's Constitutional Convention, also attempts to refocus attention on the training center's good deeds that have been overshadowed by indictments and headlines about illegal payments and conspiracy.
The lawsuit noted several programs — including new-hire orientation, skilled-trades and diversity training and classes aimed at preventing discrimination and sexual harassment — that have reached approximately 750,000 people in the last seven years.
The federal investigation, started with Fiat Chrysler and the UAW, has led to charges against seven people and has since expanded to Detroit’s other automakers and UAW training centers.
“Alphons Iacobelli and Jerome Durden were participants in crimes committed against the (training center)," the center's co-directors Shawn
Fain and Tom Rolands said in a statement. "Their conduct not only victimized the (training center) but also has resulted in indictments and convictions for violations of federal law.”
Iacobelli and others spent millions on luxuries and sundries, including a $365,000 Ferrari, two pools, a house, new carpet and two solid-gold, bejeweled Montblanc fountain pens that cost $35,700 each, according to federal prosecutors.
“This is really an egregious victimization of the (national training center), which had to be addressed,” said Walter Piszczatowski, one of the center’s lawyers. “When somebody takes money that doesn’t belong to them and puts it in their pocket, they need to pay it back and be held accountable.”
Morgan-Holiefield, 55, pleaded guilty to filing a false tax return and could spend up to 27 months in federal prison. She also agreed to pay almost $191,000 restitution to the government.
The lawsuit reiterates allegations contained in the federal indictment, specifically, that more than $262,000 in training center funds were used to pay off the mortgage on the Holiefields' home.
Keith Mickens, another former UAW official, admitted buying more than $7,000 worth of personal items with money that was supposed to help train blue-collar workers and using more money to help General Holiefield buy a pool.
Mickens, 64, of Clarkston, who served on the UAW-Chrysler National Training Center, used the facility’s credit cards to buy luggage, electronics, designer clothes and golf equipment.
Durden, 62, of Rochester, meanwhile, pleaded guilty to conspiracy to defraud the U.S. and failure to file a tax return. Durden, who allegedly used some of the training funds for $4,300 in new carpeting at his home, faces up to 37 months in prison.
Lawyers for Iacobelli and Morgan-Holiefield declined comment. Durden's attorney did not respond to a message seeking comment.
The 10-count civil lawsuit filed Friday accuses Iacobelli and Durden of fraud, fraudulent concealment, breach of fiduciary duty, unjust enrichment and civil conspiracy.
The training center also sued Iacobelli’s wife, Susanne, alleging that training center funds were used to pay for more than $868,000 in personal charges on her credit card.
The civil lawsuit differs sharply with the federal government’s characterization of the conspiracy. None of the seven people indicted so far were charged with defrauding the training center or embezzling money.
The training center is not listed as a victim of the conspiracy in federal court filings and is not entitled to restitution paid by those who have pleaded guilty so far in the criminal case.
The training center wants the following judgment:
• $2,661,189 from Alphons Iacobelli
• $1,145,736 from Susanne Iacobelli
• $539,219 from Morgan-Holiefield
• $70,300 from Durden
Since the scandal was uncovered, training center officials say they have enacted changes to prevent similar illegal activity. That includes internal accounting controls, strict enforcement of expense policies and hiring an independent accounting firm.
"The (National Training Center" was unaware of defendants' illegal activities due to the active concealment of such activities by defendants Alphons Iacobelli and Jerome Durden and due to the fact that the (training center) reposed trust, faith and confidence in (Iacobelli and Durden) that they were properly performing their legal duties," the training center's lawyer Michelle Harrell wrote in the lawsuit.