SUBSCRIBE NOW
$1 for 3 months. Save 97%.
SUBSCRIBE NOW
$1 for 3 months. Save 97%.

Disgraced UAW leader Ashton deserves almost three years in prison, feds say

Robert Snell
The Detroit News

Former United Auto Workers Vice President Joe Ashton should be sentenced Tuesday to 34 months in federal prison for pocketing kickbacks, prosecutors said. 

Ashton, 72, of Ocean View, N.J. — who also served on the board of General Motors Co. — would be the highest-ranking auto industry figure sentenced in a corruption scandal that has led to 15 convictions, including former UAW President Gary Jones and past President Dennis Williams.

Joe Ashton

Such a sentence would be the second-longest during a years-long crackdown on corruption within the U.S. auto industry, behind Former Fiat Chrysler Automobiles NV Vice President Alphons Iacobelli's 5 1/2-year sentence. A federal investigation has revealed labor leaders and auto executives broke federal labor laws, stole union funds and received bribes and illegal benefits from union contractors and Fiat Chrysler Automobiles executives.

The sentencing will cap Ashton's plummet from the boardroom of an iconic auto company to a prison cell. Ashton resigned from the GM board in December 2017, one month after The Detroit News reported investigators probing corruption within the U.S. auto industry were interested in him and UAW Vice President Cindy Estrada

Ashton deserves such a long sentence because he betrayed union workers, violated the public's trust and conspired with his chiropractor to rig a $4 million contract for UAW-branded watches that were never distributed to workers, prosecutors said. Ashton received at least $250,000 in kickbacks from the chiropractor and left the 58,000 watches to rot on pallets as the batteries died in a UAW warehouse.

Ashton's crimes have helped push the UAW to the verge of prolonged and expensive federal oversight and led to the closure of a union training center, which left at least 71 people unemployed.

"He had the power, prestige, and influence that came with being a high-ranking UAW official. But that was not enough," Assistant U.S. Attorney Frances Carlson wrote in a sentencing memorandum. "Motivated by greed, Ashton corruptly used his power and influence to illegally and unethically benefit himself."

Former UAW Vice President Joe Ashton steered a $4 million contract for commemmorative union-branded watches to his personal chiropractor. Ashton received $250,000 in kickbacks.

U.S. District Judge Bernard Friedman is scheduled to sentence Ashton at 1 p.m. Tuesday via a Zoom conference.

Ashton pleaded guilty in December to one count of conspiracy to commit wire fraud and one count of conspiracy to commit money laundering. The crimes carry a maximum penalty of up to 20 years and 10 years, and $250,000 fines.

Ashton, a father of four adult children, asked for leniency. And his lawyer, Jerome Ballarotto, suggested a sentence of home confinement, probation and community service so Ashton can care for his wife, who is coping with multiple sclerosis. Ashton liquidated assets and his savings in order to pay $250,000 to the court Tuesday.

“It is very clear that he is completely ashamed and remorseful for what he has done and the damage he has caused his family, friends and the UAW,” his lawyer wrote. “He takes full responsibility for his actions feeling that he has ruined (50) years of work with the UAW and that he lost the respect of all of his members.”

The defense lawyer's sentencing memo was heavily redacted but unsealed after The News filed a public information request. The sentencing memo indicated dozens of supporters wrote letters on Ashton's behalf, including one unidentified member of Congress.

Ashton, who retired in 2014 and was appointed as the union's representative on the board of GM, was charged three months after The News identified him as the unnamed union official accused in a federal criminal complaint of demanding $550,000 in kickbacks and bribes from vendors.

In return, a list of vendors that included Ashton's personal chiropractor received contracts to produce more than $15.8 million worth of union-branded trinkets, including backpacks, jackets and commemorative watches.

Federal court records portray Ashton as a powerful union boss who steered a $4 million deal to his personal chiropractor and then collected cash kickbacks hand-delivered to his home near the New Jersey shore.

"His hard work and diligence caused Ashton to rise swiftly through the union ranks," the prosecutor wrote. "However, rather than use this increased power and influence to serve the UAW, Ashton corruptly served himself by lining his pockets with money that was not his to take."

He was accused of scheming with two other UAW officials: his top aide Jeff Pietrzyk and Mike Grimes, who worked for Cindy Estrada. Estrada has not been charged with wrongdoing.

UAW Vice President Cindy Estrada

One part of the alleged conspiracy stems from a failed business deal in 2010. At the time, Ashton was a regular client at Oxford Rehabilitation Center, a clinic in Philadelphia co-operated by chiropractor Marc Cohen.

Cohen is not identified by name in federal court records. But sources familiar with the investigation confirmed Cohen is the unnamed chiropractor.

In 2010, prosecutors say Ashton convinced Cohen to loan $250,000 to a construction company owned by one of Ashton’s associates, according to federal court records. By 2012, the construction company had stopped repaying the loan. By September 2012, the debt had ballooned to $283,000 and led to a lawsuit, according to court records.

Marc Cohen

Ashton pitched a plan to repay the construction loan — and help himself. In 2012, the UAW was planning to buy more than 50,000 watches. Ashton contacted Cohen, telling him to create a company that could win the contract and supply the watches, according to the government.

Ashton drafted the deal, helped award it to his chiropractor and demanded a $250,000 kickback in spring 2013, according to court records. Cohen's watch contract described by prosecutors included steep profits. The watches cost less than $2.3 million to produce, but the contract was for $3.97 million.

"The only thing that curbed Ashton's greed was his fear of getting caught once the federal investigation into the corrupt activities of the UAW began being publicly reported in mid-2016," the prosecutor wrote. "By then, Ashton already had received approximately $250,000 in kickbacks...."

Cohen, 60, a chiropractor from Cherry Hill, New Jersey, has not been charged with a crime and U.S. Attorney Matthew Schneider has declined to talk about the contractor.

Ashton's corruption had devastating impact.

The watches were awarded by the jointly operated training facility, the UAW-GM Center for Human Resources.

The UAW-GM Center for Human Resources, which provides training to workers, is under scrutiny as part of a widening federal probe into whether money and illegal benefits to union leaders corrupted the bargaining process.

"Ashton's criminal conduct directly resulted in the closing of the CHR building, the termination of those individuals who were employed or assigned to the CHR, and the lost training opportunities for UAW-represented GM workers," the prosecutor wrote. 

So many relatives of UAW officials have worked there — including Estrada's stepdaughter — that some nicknamed the facility the "Center for Hidden Relatives."

Ashton's crime spree has helped erode trust among rank-and-file workers, according to a UAW local president who wrote a letter to the judge. Prosecutors redacted the president's name.

"Those of us who worked on the shop floor and on the assembly lines want Mr. Ashton to get much more than the five years in prison," the president wrote, "even though more time in prison won't even start to repair the damage he has caused this once great union."

rsnell@detroitnews.com

Twitter: @robertsnellnews