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FCA reaches $30M deal to settle federal corruption probe

Robert Snell
The Detroit News

Detroit — Fiat Chrysler Automobiles, now part of Stellantis NV, has agreed to pay a $30 million fine to settle a criminal investigation into auto executives breaking federal labor laws, according to federal prosecutors.

The proposed deal for the automaker to plead guilty to one count of conspiracy to violate the Labor Management Relations Act ends prolonged negotiations stemming from a years-long corruption scandal involving the United Auto Workers. The investigation has led to more than a dozen convictions and revealed union 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.

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The automaker, which merged officially with Groupe PSA of France 11 days ago, also has agreed to the appointment of an independent monitor for three years. The monitor will oversee dissolution of a joint training center FCA operated with the UAW.

The proposed deal was announced six weeks after prosecutors secured a separate deal with the United Auto Workers that includes prolonged oversight of the troubled union.

U.S. Attorney Matthew Schneider will discuss the settlement during a 1 p.m. news conference.

As part of the deal, prosecutors filed a federal criminal case Wednesday that accuses Fiat Chrysler executives of knowingly and voluntarily conspiring with others to break labor laws.

The conspiracy lasted from January 2009 through approximately 2016 and executives paid more than $3.5 million in illegal payments to UAW officials, according to the criminal case.

That includes former Fiat Chrysler Vice President Alphons Iacobelli approving the payment of $262,000 to pay off the mortgage on UAW Vice President General Holiefield’s home in Harrison Township. Holiefield died in 2015 before he could be charged with a crime.

The home of the late UAW Vice President General Holiefield and wife Monica Morgan-Holiefield. She was convicted and sentenced to 18 months in federal prison.

Iacobelli, who is serving a four-year federal prison sentence, also authorized spending $25,000 for a party for UAW Vice President Norwood Jewell and members of the union’s governing board. Jewell also was convicted in the corruption scandal.

FCA chief failed to disclose gift to UAW, sources say

Iacobelli also approved spending more than $30,000 on meals for UAW officials at restaurants in Palm Springs and southern California, prosecutors said. Money to pay for the illegal benefits came from accounts funded by the automaker that were supposed to used to pay for worker training.

Come back to www.detroitnews.com for more on this developing story.