Disgraced pioneering UAW official faces reckoning
A United Auto Workers official who betrayed rank-and-file workers by pocketing as much as $15,000 in bribes from Fiat Chrysler executives during a conspiracy to keep labor leaders" fat, dumb and happy" was sentenced Tuesday to 60 days in federal prison.
The sentencing by U.S. District Judge Paul Borman caps a steep fall for Virdell King, 66, of Detroit, the first African-American woman elected president of a UAW/Fiat Chrysler local who sat on the prestigious committee that negotiated bargaining agreements with the automaker impacting more than 45,000 workers.
King was the first UAW official to cooperate with an ongoing investigation that started at least three years ago and provided invaluable insight into a conspiracy involving Fiat Chrysler executives bribing labor leaders to "grease the skids" of labor negotiations, prosecutors said.
Her ongoing assistance has led to criminal charges against four people so far, including convicted Fiat Chrysler Vice President Alphons Iacobelli. King also has helped investigators open a new line of inquiry involving UAW officials spending more than $1 million of member dues and automaker money on condominiums, liquor, food and golf in Palm Springs, California.
On Tuesday, King called herself a "fighter in the labor movement" during a tearful speech while thanking relatives, her bishop and former UAW colleagues for their support and apologizing for her actions. Those actions included spending Fiat Chrysler money funneled through the jointly operated UAW-Chrysler National Training Center on purses, designer shoes, jewelry, luggage and other personal luxuries.
"I truly apologize for disappointing you, but I thank you for allowing all the good work I've done as a fighter in the labor movement and not letting this lapse in judgment speak for me," King said.
King won't have to report to prison for at least six months, if at all. That's because she continues to assist the government and could receive a lighter sentence if her help proves substantial.
"Instead of being focused on zealous representation of the rank and file union members and their families, King was interested in buying clothes and lavish meals for herself and others," Assistant U.S. Attorney David Gardey wrote in a court filing.
The sentencing comes at a crossroads in an investigation and prosecution that has led to seven convictions, caused upheaval at the top ranks of the auto industry and raised questions about the sanctity of labor negotiations.
“Here, you have Fiat Chrysler executives attempting to grease the skids and curry favor with UAW officials,” Gardey said.
King, a former associate director of the UAW's Fiat Chrysler department, helped oversee the training center and served on a national negotiating committee in 2011 and 2015. She pleaded guilty to conspiracy to violate the Labor Management Relations Act in August 2017.
As part of a plea deal, King faced up to 16 months in prison and $15,000 restitution; her lawyer had pushed for probation. King has no prior criminal record, cooperated with the government and readily accepted responsibility for her role in the conspiracy, defense lawyer John Shea said.
“Taking the money was wrong,” Shea said. “This was a top-down conspiracy with the bosses on the union side up to their elbows in the conspiracy (and) management side, who far outranked her up to their elbows as well.
“She did wrong. She knows it and she knew it then.”
Probation would not have sent the wrong message to people, Shea said.
“Anybody with their eyes open and their ears open following this have seen the wreckage this investigation has created in the lives of those who committed crimes,” Shea said.
King, who served under the late UAW Vice President General Holiefield, helped oversee the jointly operated UAW-Chrysler National Training Center and, in 2012, received a credit card paid by the automaker.
"She did not ask for it. Rather, Vice President Holiefield arranged for it and told Ms. King that it would make it easier for her to carry out her job responsibilities, especially those involving planning of events and conferences," Shea wrote.
Soon after receiving the card, King noticed Holiefield using his credit card to make personal purchases.
Her conviction stems from illegal benefits King received that were charged to the credit card. Holiefield encouraged her to make personal purchases, telling her it was authorized by Fiat Chrysler.
"...although it seemed wrong to her and she acknowledges that she knew better, over the next three years Ms. King used the NTC credit card to make purchases that personally benefited her, to the tune of between $10,000-$15,000 worth of items," Shea wrote.
Holiefield died in 2015 before he could be charged with a crime.
King made additional purchases for her superiors, including Holiefield and his successor, Norwood Jewell, her lawyer said.
Jewell, who retired in January, has been implicated in the scandal, but he has not been charged. His home was raided by investigators and he was the guest of honor at a party paid for with more than $30,000 worth of training center funds that featured “ultra-premium” liquor and strolling models who lit labor leaders’ cigars.
King used a training center credit card to buy a $2,180 shotgun for Jewell as a birthday present, two sources told The News. Jewell's top administrative assistant, Nancy Adams Johnson, told King to buy the firearm for the UAW vice president, one of the sources said.
"Persons like Ms. King are beholden to their superior, and if such a person outlasts her or his welcome that person is demoted or, worse, terminated from the International (UAW) and, if the person wants to keep the union job, sent back to the plants," Shea wrote.
King was not merely following orders while using the credit card, prosecutors said.
"As a high-ranking UAW official and former local union president, King knew better," Gardey wrote. "However, her greed got the best of her, and she chose to break the law. The fact that she was one among many other UAW officials to take advantage of their positions for their own personal gain does not minimize the seriousness of her own crime."
Adams Johnson, meanwhile, has pleaded guilty and and faces up to 18 months in prison. She received tens of thousands of dollars in illegal payments and benefits from Fiat Chrysler, including $1,100 designer Christian Louboutin shoes, first-class flights to California and resort stays.
Here are the five Fiat Chrysler and UAW officials sentenced so far in the case:
• Former Fiat Chrysler Vice President Alphons Iacobelli, 59, of Rochester Hills.
Iacobelli was sentenced to 5½ years in prison for stealing money from the automaker and buying a Ferrari, a backyard pool and two solid-gold, bejeweled Montblanc fountain pens that cost $35,700 each.
• Michael Brown, 61, of West Bloomfield Township, the automaker's former director of labor relations, was sentenced to one year and a day in prison for helping cover up the conspiracy. Brown deliberately provided misleading and incomplete testimony during the grand jury investigation, enabling the conspiracy to continue for years.
• Holiefield's widow Monica Morgan-Holiefield, was sentenced to 18 months in federal prison for a tax crime stemming from the scandal. The 55-year-old Harrison Township resident received training-center funds, including more than $32,000 worth of flights, a $43,300 pool and $260,000 to pay off her mortgage.
• Former Fiat Chrysler financial analyst Jerome Durden, 62, of Rochester, was sentenced to 15 months in federal prison for filing misleading tax returns that concealed the labor conspiracy and helping steer more than $386,400 to Holiefield's phony charity, the Leave the Light On Foundation.
• Former UAW official Keith Mickens, 65, of Clarkston, who was Holiefield's right-hand man, was sentenced to a year and a day in prison for buying more than $7,000 worth of personal items with training-center funds. He also approved more than $700,000 in illegal payments from Fiat Chrysler to Holiefield and Holiefield's widow.
"The UAW is appalled at the actions of a few former officials who stole money from the Chrysler Joint Program Center for their personal benefit," union spokesman Brian Rothenberg said in a statement Tuesday. "Fortunately, the UAW has layers of checks and balances in contract negotiations, including voting by the entire membership, and we are confident the terms of our collective bargaining agreements were not impacted. We are also confident in the changes we have advanced to prevent this type of rogue individual behavior."