Feds paint UAW widow as fraudulent tax cheat
Detroit — The widow of United Auto Workers Vice President General Holiefield stole $190,000 from honest taxpayers to bankroll a lavish lifestyle and should spend more than two years in federal prison, prosecutors said Friday.
Monica Morgan-Holiefield, 55, of Harrison Township, benefited "handsomely" from illegal payments to her late husband from Fiat Chrysler Automobiles NV and used shell companies to hide the income and criminal activity, according to the government.
The payments are central to an ongoing federal investigation that has led to criminal charges against seven people, caused upheaval at the top ranks of the auto industry and raised questions about the sanctity of labor negotiations.
In pushing for a 27-month prison sentence, prosecutors delivered a scathing counterpunch to her lawyer's request for leniency and labeled Morgan-Holiefield a jet-setting tax cheat and fraudster, a portrait at odds with the image she projects on social media of an accomplished photographer and society-column fixture.
Morgan-Holiefield will be sentenced July 13 by U.S. District Judge Paul Borman. Her lawyer is pushing for a non-prison sentence.
"Morgan was stealing from other taxpayers through her tax fraud, compounding her underlying criminal conduct by hiding her illegal income and avoiding paying her fair share," Assistant U.S. Attorney David Gardey wrote in a sentencing memorandum Friday.
Though Morgan-Holiefield struck a plea deal to a single tax crime, prosecutors focused on the underlying criminal activity that led to unreported income.
Morgan-Holiefield was indicted last year in a case that offered a detailed look at how, according to the government, officials at Fiat Chrysler tried to tilt contract negotiations in the automaker’s favor by lavishing labor leaders with first-class airfare, expense accounts and hundreds of thousands of dollars in illegal payments.
The payments included $43,300 for a pool at her home, prosecutors said, and the couple used more than $260,000 to pay off their mortgage.
Before reaching a plea deal, prosecutors alleged a Chrysler-UAW training center credit card was used to pay for a more than $32,000 worth of airline tickets for Morgan-Holiefield to fly to San Diego, Miami, Las Vegas and Los Angeles.
Morgan-Holiefield has paid $102,984 toward a $190,000 restitution bill.
"However, this argument is an attempt by Morgan to use her wealth and resources to buy her way out of prison," Gardey wrote.
Several prominent supporters are backing her bid to avoid prison. Letters from those supporters, including pastors, public officials and business owners are sealed in federal court and her lawyer has refused to release them.
Morgan-Holiefield needs to go to prison to promote respect for the law, prosecutors said. A probationary sentence would raise concerns about different treatment for wealthy defendants.
"Morgan’s wealth, high-flying position in the community, and her prominent supporters should not be used as a basis to avoid appropriate punishment," Gardey wrote.
Prosecutors scoffed at her lawyer's offer to have Morgan-Holiefield's punishment include teaching photography classes to underprivileged kids.
"This suggestion ignores the fact that Morgan used fake photography classes for the underprivileged as a mechanism to funnel over $80,000 from Fiat Chrysler to her husband’s 'charity,' the Leave the Light on Foundation, and then on to Morgan’s photography business," Gardey wrote.
Her photography classes at Woodbridge Community Youth Center were largely a sham and a fraud, the prosecutor wrote.
"Despite receiving tens of thousands of dollars, Morgan only taught a handful of classes," Gardey wrote. "In fact, the Woodbridge Community Youth Center terminated their connection with Morgan because of her excessive absenteeism and class cancellations."
Jerome Durden, a former Fiat Chrysler executive awaiting a possible prison sentence for his role in the scandal, said payments to Morgan for photography classes "smelled to high heaven," prosecutors wrote.
Concerns escalated in summer 2011 when then-UAW President Bob King confronted Holiefield about money being funneled to the UAW vice president's wife, prosecutors wrote.
"King told Holiefield that giving the money to Morgan was a 'bad idea' and could lead to people 'going to jail,'" Gardey wrote. "King then instructed Holiefield not to direct any more money to Morgan. As a result of this meeting, Morgan and Holiefield then created or secured new shell companies, including a fake hospice which received over $350,000 from Holiefield’s 'charity,' in an effort to conceal the flow of money from the FCA/UAW National Training Center to Morgan and Holiefield."
Morgan-Holiefield's lawyer paraphrased the Charles Dickens novel "A Tale of Two Cities" in pushing for a probationary sentence. The lawyer compared the media to Madame Defarge knitting at the guillotine and publicly trashing Morgan-Holiefield.
Prosecutors responded likewise.
"In a sense, however, a probationary sentence for Morgan would create a tale of two different cities," Gardey wrote. "In one city, the connected and the elite avoid jail time by hiring one of the best criminal defense attorneys in town, buying their way out of prison through restitution payments, getting their boosters to write letters on their behalf, and offering photography classes as an alternative to jail," Gardey wrote. "In the other city, no one is above the law, and people go to prison for committing the serious crime of stealing from their fellow citizens through tax fraud."