Report to the President
and the
PRESIDENT'S COMMISSION ON
ORGANIZED CRIME
HONORABLE IRVING R. KAUFMAN, CHAIRMAN
* Commissioner Rodino, in view of his position as Chairman of
the Committee on the Judiciary of the United States House of Representatives, takes no
position concerning the recommendations included in Section Eleven of this Report.
THE INTERNATIONAL BROTHERHOOD OF TEAMSTERS
The Most Controlled Union
The leaders of the nation's largest union, the International
Brotherhood of Teamsters (IBT), have been firmly under the influence of organized crime
since the 1950's. Although many of the hundreds of IBT locals and joint councils operating
throughout the country are not criminally infiltrated, organized crime
influences at least 38 of the largest locals and a joint council in Chicago, Cleveland,
New Jersey, New York, Philadelphia, St. Louis, and other major cities.
Former Teamster president Roy L. Williams told the Commission, "Every big [Teamster]
local union...had some connection with organized crime.''1
These locals operate in the nation's major business and economic centers
and include the majority of the union's 1.6 million members. They are the foundation of
organized crime's union-wide influences.
For decades organized crime has exercised
substantial influence over the international union, primarily through the office of the
president. In the period 1952-1985 there have been five IBT presidents. The first, Dave
Beck, was convicted in 1959 for violating federal income tax laws. His
successor, James R. ("Jimmy") Hoffa, was convicted of jury tampering in 1964,
and disappeared (presumably murdered by organized crime) in 1975.
Although known to have accommodated organized crime, the next
president, Frank Fitzsimmons, was not indicted during his tenure
and died a natural death in office in 1981. His successor, Roy L. Williams, served as
president from 1981 until 1983, when he was convicted of conspiracy to
attempt to bribe a United States Senator.2
Hoffa and Williams were indisputably direct
instruments of organized crime. Fitzsimmons established a measure of detente whereby he
was allowed to head the union, while organized crime
stole the workers' benefit funds and used the unions for numerous criminal ventures. While
the precise current relationship, if any, between organized crime and the current IBT
president, Jackie Presser is not known to the Commission, Presser's past activities
indicate that he has associated with organized crime figures and that he benefited from
their support in his elevation to the IBT Presidency in 1983.
In the late 1950's Jimmy Hoffa convinced the American public that
corruption and the Teamsters were synonymous. His intransigence and
arrogance at the McClellan Committee hearings in 1957-1958 gave the public a
personification of the evils of corrupt leadership in a vital economic
institution in this country. According to Roy Williams, Hoffa was the first IBT leader
over whom organized crime had a "powerful hold." How organized
crime gained its control over Hoffa remains a matter of conjecture, even for IBT officers
like Roy Williams who were insiders during the decades of Hoffa's rise, fall, and eventual
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disappearance. Hoffa is reported to have begun an unholy alliance with organized crime to obtain "mob"
muscle to fight management in the rough and tumble years of the Teamster organizing drives
of the 1930's. Others have theorized that Hoffa came in contact with organized criminals
through his own personal ties.3 It is agreed, however, that Hoffa had
relationships with major organized crime figures, such as Nick Civella,
and Anthony "Tony Pro" Provenzano.4
It would be incorrect to explain organized crime's power over the
IBT solely in terms of the personal ties between Hoffa or any other individual and
organized crime. To understand organized crime's attraction to the IBT, one must look beyond personalities to the nature and structure of the trucking industry.
Trucking operates primarily in a local rather than a national
product market; that is, if truckers refuse to deliver materials to a plant or remove
materials from a construction site, the affected
company is frequently unable to secure alternative carriers. This was especially true
prior to deregulation. Control of the truckers thus provides leverage over thousands of
businesses dependent on Teamsters' deliveries. Moreover, trucking is characterized by
numerous under-capitalized firms, which have significantly less economic
staying power than the union itself. This disparity in power allowed Hoffa, and to a
lesser degree his successors, to whipsaw or threaten individual companies whose survival
would be imperiled by labor strife.
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Hoffa proved to be a master at manipulating individual companies in this manner, but anyone who held the office of IBT
president might have succeeded in obtaining the same results.
Organized crime has also been attracted to the IBT because it
oversees hundreds of individual benefit funds, including some of the
largest union benefit funds, such as the Central States Pension Fund, and because it
generates significant monies from the dues paid by its 1.6 million members. By controlling
the union racketeers can receive excessive salaries and benefits, put friends and
relatives on the payroll, and embezzle union monies.
In testimony taken by the
Commission, Roy Williams confirmed that organized crime has continued to maintain a firm
grip on the IBT long after Hoffa's reign. This chapter will examine both Williams's and
Presser's tenures at the IBT and analyze the methods that organized crime has used to
control the IBT. In addition, it will develop profiles of mob influence
at certain select locals and describe how organized crime uses violence and intimidation
to quash opposition. Finally, by describing the operations of a nationwide labor-leasing
scheme involving the LCN, corrupt Teamster officials, and legitimate corporations, it will indicate how organized crime can use corrupt unions to give
organized crime businesses an edge in the market place.
Organized Crime's Influence and Corruption: The
Williams Administration
Roy Williams's rise in the Teamsters from 1981
to 1983 was directly linked to his association with organized crime. Williams admitted to
the Commission what law enforcement believed for several decades: that Williams had a
"special relationship" with Nick Civella, the boss of the Kansas City family of La
Cosa Nostra. Williams and Civella were members of an informal but
powerful group of five men. The members of this group, which changed over time, included
Civella, Williams, Bill Cerman, Tim Moran, and Sam Gross, the former head of the Carpet
Layers, Dyers and Cleaners Union. The "group of five" met
periodically to settle disputes and to decide which candidates for public office would
receive political nominations in the Kansas City area.
The association between Williams and Civella began in the
mid-1950s after Williams, knowing Civella's position as the head of the Kansas City LCN,
met with Civella to discuss their "relationship." The two agreed to assist and
promote each other. Civella would promote Williams's IBT career with other mob-controlled
IBT leaders, especially Hoffa, and reward Williams financially.
Williams, in turn, would promote Civella's interests, by such means as the placement of
people that Civella favored in IBT or industry jobs, and the exertion of influence on
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the Central States Pension Fund to make loans and arrangements
that would benefit organized crime.5
Civella became the man to see to get favors from Williams and the
Teamsters. Chicago La Cosa Nostra territorial boss Joey "the Clown"
Lombardo, who was convicted with Williams for attempting to bribe a
United States Senator, was overheard by Federal agents importuning Civella:
Nick, you're the only one who can get to Williams, to have him listen and act. Williams has to be the one to do it, and it has to go through you.6
Other intercepts reveal that when members of the Chicago LCN
approached Civella to obtain favors from Williams, Civella sometimes adopted a protective
tone, saying, "I want to protect Roy. He's a friend of mine."
Illustrative of Civella's hold
over Williams is a 1979 meeting of Williams, Civella,
Allen Dorfman, and Sam Ancona in Kansas City. Dorfman wanted significant new Central
States Pension Fund business to be directed to Morris Shenker, Jimmy Hoffa's
lawyer-confidant. Williams disagreed. As a result of the disagreement, Williams had to
attend a midnight session at the house of an LCN associate at which Dorfman and Williams
presented their cases to Civella. Ultimately Civella sided with Williams and tore up
Dorfman's contract with Shenker.7 In this instance Williams, an IBT president
and a fiduciary for the
union, had
to appeal a union decision to the La Cosa Nostra crime boss of Kansas City.
Throughout the three decades of their arrangement Williams and
Civella met periodically. When Civella and Williams could not meet or talk on the phone
for fear of being observed or overheard, Sam Ancona--an associate of the Kansas City La
Cosa Nostra, president of Teamsters Joint Council 56, and IBT International representative--was messenger to both. Ancona and Williams exchanged
messages in the union's parking lot outside Williams' office. As a reward Ancona used
Williams's name and gained authority to obtain favors and other assistance from other IBT
officers.8
Roy Williams became president
of the IBT in large measure because he had the backing of organized crime. When incumbent
president Frank Fitzeimmons died, members of La Cosa Nostra set out to choose a new
Teamster president. Although there was agreement that someone controlled by La Cosa
Nostra should be chosen, the negotiations centered on which faction would
have its candidate elected. The key groups were the Kansas City, Chicago, Cleveland, and
New York families. One of the participants in these negotiations was Angelo Lonardo,
underboss of the Cleveland La Cosa Nostra. Lonardo, now serving a life sentence in
federal prison, has provided the FBI with inside information on precisely
what transpired.
Lonardo stated that the Cleveland LCN wanted
Jackie Presser to serve as IBT president, while the Kansas City LCN wanted Williams. Nick
Civella, boss of the Kansas City family, informed Milton "Maishe" Rockman, a
Cleveland LCN associate, that Kansas City was intent on Williams's candidacy. Civella
characterized Williams as someone the LCN could "talk to." To obtain support for Williams, Civella sought the assistance of the other crime
families across the country. They were asked to throw the support of IBT locals they
controlled to the Williams candidacy.
Ultimately, according to
Lonardo, Civella and Rockman made a deal. Rockman agreed that, if Jackie Presser were to
take Williams's place as head of the Central States Pension Fund, the Cleveland family
would see that Presser, persons loyal to Presser, and the Cleveland LCN family would
support Williams and seek to obtain the approval of the arrangement from the Chicago LCN
family. Cleveland representatives Lonardo and Rockman met with Jackie
Cerone and Joey Aiuppa, ranking members of the Chicago LCN. Cerone and Aiuppa claimed that
they were skeptical of Williams and stated that they were considering another candidate.
They were doubly suspicious of Presser, claiming that he was unreliable. Rockman reassured
them concerning Presser. The meeting broke up without a decision, but
within several days the Chicago LCN indicated its agreement. Rockman
told Lonardo that he had contacted Presser, who agreed to support Williams's candidacy by
producing delegates for Williams.
According to Lonardo, the Cleveland La Cosa Nostra family
is not an independent group. Its leaders report to and show "respect" to the New
York-based Genovese family. To obtain further support for their plans, the Cleveland representatives flew to New York to meet Anthony
"Fat Tony" Salerno, boss of the Genovese family. Lonardo and Rockman explained
Civella's plans for Williams and Presser. Salerno stated that he would throw his support
to Williams through Salvatore Provenzano's delegates. In return, Salerno
sought favors, including a Teamster local union charter for his friends.
As a result of these maneuvers, Williams was ultimately elected
president. Because Presser was never promoted to the Central States Pension Fund, Rockman
later instructed Presser not to cooperate with Williams.
Williams stated that while he was IBT president,
he physically stayed out of the northeast portion of the United States and did not attempt
to control or influence what he characterized as a Teamsters region dominated by the mob.
Williams identified locals in St. Louis, Chicago, Philadelphia, New York, New Jersey, the West Coast, and elsewhere, as dominated or influenced by organized crime. Williams admitted that these large locals had been under the
domination of organized crime for 30 years before he was elected President. He said that
trying to do something constructive about the Provenzano's Local 560 or Harry Davidoff's
Local 295 would be tantamount to entering a
"viper's nest," and that, as IBT president, he did not
have the power or the "interest" to take on organized crime in that manner.
Williams indicated that, during a period of
tension with the New Jersey branch of La Cosa Nostra, he received anonymous calls
at home telling him to "get right with Tony Pro [venzano]". He said that no
important IBT decision can be made without taking into account organized crime's control
of the key union locals. Williams stated his belief that any IBT president would be
relatively powerless in the face of this mob control: "They was
here a long time before any of us ever got here and they have got pretty powerful."9
Benefit
Fund Abuse Under Williams
Long before Williams assumed the presidency of the IBT, Jimmy
Hoffa shared pension fund kickbacks with Allen Dorfman, a former asset manager and service
provider to the Teamsters Central States Pension Fund. Before Hoffa
began serving his prison sentence in 1963 he convened a meeting of the Fund trustees to
state, unequivocally, that Allen Dorfman was his spokesman while he, Hoffa, served time in
jail. Hoffa and Dorfman were the moving forces behind the Central States
Pension Fund's entry into speculative real estate loans in Las Vegas, an
action that eventually robbed the Teamsters of millions of pension fund dollars and
resulted in the government's decision to place the Fund in receivership.10
During the Williams administration the mob's desire to plunder the
Central States Pension Fund continued. In 1979, at a meeting at the Crown Center Hotel in
Kansas City, Nick Civella met Central States Pension Fund
"representatives" Allen Dorfman and Sol Schwartz, and Chicago LCN member Joey
Lombardo. In their discussion about regaining control of the fund from the
government's asset managers, Joey Lombardo stated:
We got a lot of work to do. We got to get the Fund back. Get good lawyers. Got moves to make, lot of scheming to do . . . . we got to try to put it back together like it was. For now and for the future . . .11
Similar conversations took place at meetings attended by Williams,
Civella, and Dorfman.
The history of Allen Dorfman's dealings with the Teamsters benefit
funds illustrates the problems that have plagued other multi-employer benefit funds. Even
after his conviction for accepting a $55,000 bribe or kickback while acting as a special
consultant to the Teamsters Central States Pension Fund,12 insurance companies that Dorfman controlled continued to receive substantial fees for
handling various Teamsters funds' insurance business. When Dorfman's contract to service
the Fund was scheduled to be re-evaluated, he offered Roy Williams, IBT president, 17
acres of land at a California resort, known as La
Costa, in return for an automatic contract renewal. Williams claims that
he turned down the bribe, but the contract was renewed in any case.13
Any possibility that Dorfman would disclose what he knew about the
Teamsters-LCN association ended on January 20, 1983, when he was gunned down in a parking
lot in Lincolnwood, Illinois. Dorfman's murder took place one month after a federal jury
convicted Dorfman, Williams, Chicago LCN boss Joseph Lombardo, a trustee of the Teamsters
pension fund, Thomas F. O'Malley, and an employee of the pension fund,
Andrew G. Massa, for conspiring to attempt to bribe United States Senator Howard Cannon of
Nevada, then Chairman of the Senate Commerce Committee. The defendants conspired to offer Cannon favors from the Central States
Pension Fund in return for his influence to block or delay a measure to deregulate
trucking freight rates.
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Williams used the Central States Pension Fund, the Central
Conference of Teamsters, and the IBT to pay for his million dollar defense of conspiracy
charges. Massa and O'Malley received $1.3 million dollars from the fund for their defense expenses. Dorfman received $1.7 million dollars
for his defense fees from his insurance firms, whose sole customers were
Teamsters entities. Both Dorfman and Joey Lombardo received the
considerable benefit of private investigators and transcription services, for which the
Central States Pension Fund paid.
In addition to paying the legal expenses of Massa and O'Malley,
another Teamster entity, the Central Conference of Teamsters, paid Roy Williams $76,000 as
its chairman during the trial years. Neither Frank Fitzsimmons, Williams' predecessor a
chairman of the Central Conference, nor his immediate successor, Jackie
Presser, received a salary while occupying that position at the Central Conference. During
the same period, some members of O'Malley's family received IBT-related jobs paying high
salaries.14
In a consent decree with the Department of Labor, the Central
States benefit fund's insurance companies agreed to pay the Fund $6.5 million for the
payments of the legal defense of IBT president Williams and his co-defendants, and for
other improper expenditures. In the one-year period after the repayment, the Central
States insurance premium was increased 352 percent, to a staggering $2.7
million. None of the money was
ever recovered from Williams or the other Labor racketeers who
benefited from it.
Organized Crime's Influence and Corruption:
The Presser Administration
Presser's Election
Angelo Lonardo, underboss of the Cleveland LCN,
who provided the FBI with details of the LCN's influence over Roy Williams's election,
also told the FBI how the LCN "chose"
Presser as Williams's successor. According to Lonardo, after Williams's conviction of
conspiracy to attempt to bribe Senator Cannon, the LCN families again maneuvered to pick
an acceptable candidate. This time the Cleveland family took the lead
for their candidate, Jackie Presser. Lonardo participated in this effort by seeking the
Chicago family's support for Presser from Jackie Cerone. Cerone again indicated that
Chicago had its own candidate. Lonardo then traveled to New York to seek the support of
Anthony "Fat Tony" Salerno and the Genovese family. Salerno agreed to back
Presser for the job. The methods that Salerno used to support Presser
have not been revealed, but Salerno's backing ultimately made possible Presser's elevation
to the Teamster presidency.
In addition to the LCN's help,
Presser's rise to power, like Williams's, was facilitated by the governance structure of
the IBT. Its structure and constitution have remained substantially unaltered since
Hoffa's reign. The officers of the international
consist of a president, secretary-treasurer, 16 vice presidents,
and numerous employees. All officers are elected, but the union membership does not
necessarily vote directly for the candidates. The
international officers are elected by local delegates at a union convention held every
five years, the maximum interval permitted under the Landrum-Griffin
Act. The locals send delegates to the convention in proportion to their membership
strength. If organized crime influences a local, it names the delegates to the convention.
Once international officers are in office, they
are able to favor and advance their allies through the IBT's election and appointment
system. The president and all vice presidents, although drawn from different areas of the
country, are elected at large. To win union-wide office as a vice president, a union member needs the support of the IBT president or persons who can influence the president. With that support, the would-be office-holder can
be appointed to a vacancy in an international office and serve during the long period
between conventions. At the convention he enjoys the benefit of
incumbency, and his election is no more than a ratification of his prior appointment.
The early years of Presser's career in the IBT
are instructive. Presser was initially appointed to head a new local, Local 507, in
Cleveland. Later, Frank Fitzsimmons, at the urging of Roy Williams, appointed Presser a
Teamster vice president to fill a vacancy created by Bill Presser's ill
health.
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Presser's fellow vice presidents then elected
him IBT president to fill the remainder of convicted former president
Roy Williams' term. Thus Presser advanced to the IBT presidency without ever having
initially to submit himself to the ordeal of an election by rank-and-file members for his
various offices.
A review of the IBT vice presidents who serve or have served on
the union's executive board that elected Roy L. Williams or Jackie
Presser demonstrates how unlikely it is that a reform minded Teamster president can be
elected in the near future. The following profiles describe only a handful of the
Teamsters vice presidents.
Maurice Shurr, former Philadelphia area vice
presider built his career at IBT Local 929 in Philadelphia, and was particularly energetic
in the benefit fund area. Shurr was convicted of racketeering activities, including
receiving payoffs to provide labor peace over 11 years. Convicted with Shurr was Harry
Roetsky, a union business agent.15
Joseph Morgan, the Southern Conference area vice
president, was appointed to his post at the same time that Roy Williams became an IBT vice
president. Soon after his imprisonment Hoffa sent a message, through his lawyer, to Frank
Fitzsimmons that both Williams and Morgan should be made vice presidents.
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According to Williams, Morgan is significantly influenced by
organized crime figures.16
Joseph Treretola is an international vice president in the New
York area and president of Joint Council 16, the largest of the IBT joint councils. He
obtained his vice presidential post only after the New
York LCN gave its approval. Roy Williams stated that, although he had no reason to doubt
Treretola's personal honesty, he knows that Treretola is blind to the rampant
mob control of the locals that constitute Joint Council 16, and to the influence of
organized crime in the IBT generally.17
M. E. "Andy" Anderson was a powerful director of the
Western Conference of Teamsters. Roy Williams stated that Anderson had a very close
relationship with labor consultant Sidney Korshak; according to
Williams, organized crime controlled Anderson's local.18 In 1979 Nick Civella
stated, "Anderson has trouble with his own people. The union guys hate him. He was supposed to be eliminated a long time ago. It was my
firm, firm understanding that he was out.''l9
Harold J. Gibbons was an IBT vice president who,
for a time, turned his St. Louis local into a model of achievement on behalf of his
workers. By the end of his career in the early 1980's, however, Gibbons had learned to
co-exist with organized crime. He had an understanding with Jimmy Hoffa to refrain from
publicly criticizing Hoffa's dealings with the Provenzanos and Allen
Dorfman. Gibbons's reluctance to renounce organized crime's
involvement in the IBT is attributed to his greed or fear that Hoffa would have him killed
if he crossed Hoffa or the gangsters.20
Salvatore "Sammy" Provenzano of New Jersey succeeded his
brother, LCN Genovese family soldier Tony Provenzano, as international vice president.
Judge Harold Ackerman, who ordered the Provenzanos'
Local 560 into trusteeship under the civil RICO statute characterized
Salvatore Provenzano, a 30-year IBT veteran, as a person who wields great power for
corrupt purposes:
....Sam and Nunzio played musical chairs in minding the store for Tony to satisfy the technical requirements of the law. At some point in the '70's, Sam came into his own. With power at his finger tips, he ran the show and still does. Did he stay 'more or less' clean. . . .He did not. Most of the time he helped to steer the ship the way Tony wanted it and made sure the same crew remained on board. . . .Was he naive, blind or deaf? No. Salvatore Provenzano, in my judgment, knows the truth and is oblivious to it.21
Union Abuses Under Presser
Even before assuming the IBT presidency, Jackie Presser had
compiled an extensive record of organized crime associations. Presser ascended in the
union hierarchy through organizations, particularly Cleveland Local 507 and Cleveland
Joint Council 41, that were infested with LCN associates and convicted felons. For example, officials of Presser's hometown Local 507 included
John Trunzo, a former business agent of Local 507, convicted for
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"shaking-down" Cleveland employers for labor peace
payments; John J. "Skippy" Felice, Jr., an associate of the Cleveland La Cosa
Nostra, convicted of embezzling funds from IBT Local 73, where he was vice president, and
from Local 293, where he was secretary-treasurer; and John Nardi, a
Local 507 "ghost" employee, convicted of embezzling $110,000, and chauffeur and
bodyguard for Cleveland La Cosa Nostra member Anthony Liberatore.
This record belies Presser's promise, in Senate testimony, of a
"new era" for the Teamsters Union.22
In the 1970's, Presser and his longtime associate Harold Friedman,
two of the top officers in Local 507, paid themselves almost 40 percent of the members'
dues as salaries. When he became IBT president, one of Presser's first appointments was to
name Friedman, a convicted felon, as an IBT vice president. In 1984
Presser earned approximately $755,000 for his services as IBT president, president of the
Central Conference of Teamsters, president of the Ohio Conference of Teamsters, president
of Joint Council 41, and secretary-treasurer and business manager of Cleveland Local 507.23
While Presser served as secretary-treasurer of Local 507, Allen
Friedman, Presser's uncle, was also on the payroll of the local and received $1,000 per
week. Friedman was a "ghost" employee who performed no work, and he was convicted of embezzling $165,000 from the local. Presser relied on the
"ghost" investigation as a basis for refusing to answer the
Commission's inquiries.24
Although the Department of Justice's Organized Crime Strike Force in Cleveland recommended
prosecution of Presser on charges of fraud and conspiracy, because he
signed the payroll checks for Friedman and other "ghost" employees, officials in
the Department decided not to indict Presser. Recent press accounts have stated that
Presser had been a government informant, and have attributed the demise of the Strike
Force investigation to that relationship. In any case, Friedman and Nardi have now been
released from imprisonment, thereby making further public disclosures on this subject
unlikely, although the United States Senate Permanent Subcommittee on Investigations and the Committee on Labor and Human Resources have announced intentions to
investigate the matter further.
In the
1970's, Jackie Presser was also an integral part of a multi-year contract between the IBT
and Hoover-Gorin and Associates, a public relations firm. Under the terms of the contract,
the IBT was to pay the firm $1.3 million per year for advertising and public relations
work, including a $350,000 retainer. The choice of Hoover-Gorin and Associates was a
surprise because, prior to obtaining the IBT contract, the firm had gross receipts of less
than $20,000 per year, and the firm's partners were completely inexperienced in public
relations work. Hoover was a Nevada disc jockey and car rental agency
employee. His partners, Abner Gorin and Harry Haler, had no public relations experience.
IBT officers instructed Hoover-Gorin and Associates to spend some
of the IBT public relations money in Cleveland. Cleveland LCN capo Anthony Liberatore, an
official of Laborers Local 860, received $2,000 per month for a job promoting the
Teamsters. Liberatore, who served 20 years for killing two policemen, actually did nothing
for this monthly retainer. Another associate of the Cleveland LCN family
and a distant relative of Liberatore, Tom Lanci, also received $2,000. Lanci rented an
office to Hoover-Gorin, but it was simply a front. Lanci told the Commission that he had
also been a ghost employee and did nothing to earn the salary paid to
him by Hoover-Gorin.25 Subsequent to his involvement with Hoover-Gorin, Lanci
was convicted of participating in the murder of Danny Green, a Teamster
official. Both Liberatore and Lanci were convicted of bribing an FBI clerk to obtain the
names of secret informants on the Cleveland LCN family.
According to Hoover-Gorin partner Harry Haler, Presser received
substantial kickbacks from various participants who profited from the
Hoover-Gorin public relations contract. The Justice Department investigated Presser's role
in the Hoover-Gorin affair, but ultimately took no action against him.
Presser's past also includes other instances of misconduct.
including a bribe offer to Roy Williams as trustee of the Central States
Pension Fund, the alleged receipt of payoffs in a corrupt labor-leasing scheme, and
questionable investment transactions in the Front Row Theater in Cleveland.
According to sworn testimony by Roy Williams, in 1974 or 1975
Jackie Presser, then a trustee of the Central States Pension Fund, offered a bribe to
Williams, who was then an IBT vice president and Central States Pension
Fund trustee. Presser sought Williams's active support and vote for a loan related to the
Tropicana Casino and Hotel in Las Vegas, Nevada. The meeting between Williams and Presser
took place probably in Chicago. The bribe was not consummated, however,
and the Tropicana loan allegedly sought by Presser was never made.26
Although Presser and Williams were alone when the bribe was offered,
Central State Pension Fund records indicate that in 1975 Tropicana made a one-page loan
application seeking $49 million for the Hotel Conquistador, Inc., doing business as
Tropicana Hotel and Country Club of Las Vegas.
Receipt of Payoffs Related to the Labor-Leasinq Schemes of
Eugene Boffa
In the 1970's Eugene Boffa, an associate of La Cosa Nostra boss
Russell Bufalino, of Wilkes-Barre, Pennsylvania, and the Provenzano family of New Jersey's
IBT Local 560, created and
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owned a series of labor-leasing companies throughout the country
These labor-leasing companies provided truck drivers and labor peace to the corporations
that hired them. The corporations would fire all of their drivers, Boffa
would rehire them at a reduced wage, and they would resume work for their previous
employer. Boffa received contractual payments and the corporations reduced their labor
costs. If a corporation did not voluntarily hire one
of Boffa's companies, Boffa employees or corrupt union officials created labor disputes to
suggest the need for labor peace, which then could be
"guaranteed" through the use of Boffa's leased labor.
Roy Williams confirmed that certain Teamster officials-including
international vice president Sam Provenzano, Teamster joint council president and Kansas
City La Cosa Nostra family associate Sam Ancona, IBT Local 326 president Frank
Sheeran, and then-international vice president Jackie Presser--helped
Boffa to mollify and threaten honest Teamster officials into accepting
Boffa's way of doing business. The high-ranking officers occasionally
arranged bribes to local officials for selling out their membership. Boffa was ultimately
convicted of racketeering and sentenced to imprisonment, largely because of the testimony
of self-described "leg-breaker" Robert Rispo, who later became a protected witness.
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In testimony before the
Commission, Rispo stated that Jackie Presser was a recipient of Boffa's bribes. On at least one occasion, Rispo testified he was the courier who delivered
a cash payment directly to Presser. Afterwards, Presser told Boffa not to use Rispo or
anyone else to make such payoffs. Rispo described instances where Presser intervened on
behalf of Boffa, when the bribe paid to a Teamster local official was less than the
official had expected.27 Presser also participated in making
arrangements to switch to Boffa's labor-leasing companies. In a typical switch, agreements
were drawn to reduce compensation to union workers and actions were taken to dismiss
dissidents from employment.
When he appeared at Commission depositions and at the public hearing, Presser consistently refused to answer questions
concerning his actions, invoking his Fifth Amendment privilege against compulsory
self-incrimination.
The Front Row Theatre
The Front Row Theatre in Cleveland, Ohio, is a
theater-in-the-round which features live performances by entertainers.
In late 1974 Jackie Presser invested a nominal sum in the Theatre, and he has been quoted
as acknowledging that he became a millionaire through this investment.28
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Two months after Presser became an investor in the Theatre, he
began a one-year tenure, from February 1975 to February 1976, as a trustee of the Central
States Pension Fund, while his father Bill Presser was imprisoned for one year.
The transactions involving the Theatre, its purchase by a group of
investors that include Presser, and its sale and subsequent sale back to the group of
original owners minus Presser, are highly suspect. A
review of the records obtained by the Commission -- including documents subpoenaed from
the Theatre's lending institution, the Theatre's accounting firm, the company that
purchased and then sold back the Theatre, and the published remarks of Presser -- raises
questions whether the Front Row Theatre was used as a vehicle to provide approximately one
million dollars to Presser for unspecified favors, and whether Jackie Presser breached a
fiduciary duty by failing to disclose to the Department of Labor his
profit from the sale of the Theatre. The sale was to an entity that employed Teamsters and
was consummated during the time Presser served as a fiduciary of the Teamsters Central States Pension Fund. Presser himself invoked his Fifth Amendment privilege
in refusing to answer the Commission's questions about his transactions
with the Front Row Theatre on the ground that his answers might
incriminate him. The Commission has referred this matter to the Department of Justice for
possible criminal follow-up.
Violence as an Instrument of Organized Crime's Control
of the Teamsters
Violence
Against Teamster Rank and File
Title I of the Labor Management Reporting and
Disclosure Act (LMRDA) guarantees all union members various rights, including the right to
nominate candidates, to vote in elections or referenda of a labor organization, to attend
membership meetings, to participate in the deliberations, and to vote on business at such
meetings. Members also have the right to meet and assemble freely with other members and
to express their views, arguments, and opinions.
Organized crime-influenced unions, including the IBT, rely on fear and violence to deny these rights to members. The
violence takes many forms, literally ranging from verbal harassment to
murder, to quell all forms of dissent, criticism, and opposition. Violence need not be an
everyday occurrence. Occasional "examples" are often sufficient to persuade
members that any opposition may create a substantial risk of injury or death.
Within the IBT there is an organized dissident group of Teamsters,
known as Teamsters for a Democratic Union (TDU). TDU is extremely critical of the union's
current leadership, as it
has been of past IBT leaders. On October 15-16, 1983, TDU held its
annual meeting at a Hilton Hotel in Romulus, Michigan, outside of Detroit. TDU members
rented rooms and a meeting hall and met to express their view.
On the first day of the TDU convention, another
group of Teamsters--the Brotherhood of Loyal Americans and Strong Teamsters (BLAST), which
was founded to oppose TDU and to support the IBT international leadership--set out to
disrupt the meeting. BLAST is composed of Teamster members and officials and is backed by incumbent Teamster officials in Ohio and Michigan, including IBT president Jackie Presser. BLAST members travelled to
Romulus in cars and at least nine chartered buses, from Cleveland, Youngstown, Columbus,
Dayton, and Toledo, Ohio, and from Jackson, Flint, and Detroit, Michigan.
At the TDU meeting site, the BLAST members shouldered aside a
policeman, tried to wrest his service revolver out of his holster, and
pulled his keys and hat off and threw them away. The BLAST group took over the microphone
at the podium, ran the TDU members out of the meeting hall, and tore down banners. Order was restored only after local, county, and state police arrived on
the scene.
On the following day, TDU members at the
convention received anonymous bomb threats at the Hilton Hotel. Police searched the
premises but found no bombs. The BLAST participants in the
October 15 raid were not rank and file Teamsters. Records from the
National Labor Relations Board indicate that the participants in this raid included two
local IBT presidents, one local IBT vice president, two IBT secretary-treasurers, three union trustees, one organizer, and at least ten IBT business agents.
The BLAST raid is not simply another instance of violence against
dissenters. It is violence specifically endorsed by the union president,
which demonstrates the ability of the president's officers and close
associates to carry out such violence with impunity. At the October 31, 1983, meeting of
Teamsters Joint Council 41, in Cleveland, Ohio, IBT president and president of Joint
Council 41, Jackie Presser, praised Teamster officials who led the raid against the TDU
convention. The Commission subpoenaed copies of this transcript from the IBT in which
Presser remarked:
I want to say something to you. I know all about that BLAST program taking Place in Michigan. I must have gotten a hundred calls. I know exactly what happened there. I was pleased to see that there are Teamsters that want to stop all that crap, but I want to say something to all of you that I think is very dramatic, okay.
* * *
The thing that affected me the most about last Sunday in Detroit, Michigan, was that there were a lot of guys there, I got the pictures of who was there. I could have imagined a lot of stronger, tougher guys going there, and tough truck drivers, but I was looking through the pictures, and you know who was in the front line of a real wild fight with state highway patrolmen and police there?
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The Secretary/Treasurer of our Joint Council, Bill Evans, who's had two heart attacks. I wouldn't have let him go there in a hundred years. . . . There's plenty of locals that can send 4, 5, 10 guys. I really got upset because I saw Bill there. His value is too great to me and to this Council.
. . . Bill, I want to tell you, you're a hell of a guy to take it on yourself. I would have been there, but I'm not you.
He was screaming and fighting and shoving and pushing and swinging like the rest of them, so you know, when the chips are down, that's where it's all at.
I'm going to tell you something. We should be doing more of that. I'm going to tell you, I'm not going to let up on these people. . . . (emphasis added).
Presser also praised other union officers from Michigan and Ohio
who participated in the BLAST raid. IBT officials distributed copies of Presser's comments
for display at union halls in Ohio. Presser invoked his Fifth Amendment privilege when questioned about this incident.29
Finally, evidence before the Commission suggests that union funds
may have been used to support the activities of BLAST. While the secretary-treasurer of
IBT Joint Council 41, William Evans, disclaimed all knowledge about the source of payment for the buses used in the BLAST raid, he told the Commission that no
collection was taken up to pay for the buses. In addition, the IBT local and Joint Council
officers who attended or sanctioned their members' participation in the BLAST raid were
respondents in civil litigation seeking injunctions against their activities, a National Labor Relations Board complaint for the same subject, and a
civil damage action. The Commission questioned Jackie
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Presser and IBT counsel John Climaco about whether union monies
were spent to support the raid and its legal aftermath. Despite several oral and-written
requests for a response, there has been no definitive response from- the
IBT or Presser. It is therefore possible to infer that IBT members' dues were used to rent the buses and to hire lawyers to defend the participants in
the raid.
The BLAST raid is not the only
instance in which IBT members have resorted to violence against union dissidents. For
example, on December 4, 1983, the Detroit metro chapter of TDU held a membership meeting
in Detroit, Michigan. Toward the end of that meeting, BLAST members, who had previously
left when police arrived, returned and broke down a door that was being held secure by TDU
members. In their subsequent attempt to gain entry to the meeting, the BLAST members
assaulted several TDU members. At least one TDU member required stitches, and another was cut with a knife.
Indeed, even the Commission's own investigations have been
affected by violence. A six-foot four-inch shop steward
of Chicago IBT Local 705 beat a rank-and-file member because he attended the Commission's
public hearing on labor racketeering in Chicago. While beating him, the shop steward asked
the member if he wanted to go to more "hearings."
The plight of rank-and-file members, once their unions slip under
the control of mobsters, was vividly described by Charles Allen,
self-confessed killer and "strong arm" man for LCN members
Russell Bufalino and Tony Provenzano in IBT and HEREIU union locals in the Pennsylvania,
New Jersey, and Delaware areas. In 1982, in testimony before the Senate Permanent
Subcommittee on Investigations, Allen described his responsibilities for the 10,000-member
HEREIU Local 54 of Ralph Natale and Albert Diadone in Atlantic City and
the 2,500-member IBT Local 326 of Frank Sheeran in Wilmington, Delaware:
I actually did anything I was told to do, from murder to selling drugs, from extortion to beating up people, highjacking. Whatever they told me to I did.
And as a matter of fact, by your testimony, you would do what was asked of you?
Allen:
Yes.
Sen. Rudman:
So that if it looked like some legitimate union or a person were going to move into the leadership position in the union and you were told to go down and make sure they were discouraged or something like that, you would do that?
Allen:
Yes.
Including beating up people?
Allen:
Yes.
Sen. Rudman:
Including murdering people?
Yes, sir.30
The point of recounting instances of evidence related to violence
is not simply to demonstrate that they occur. It is to show that the aggregate effect of
such violence is to sap the ability and willingness of rank-and-file members to regain
control of corrupt locals. Until IBT members are free to criticize their union officers
without fear of retaliation, there is little or no chance that efforts other than those of
law enforcement can turn the union back to its members.
The "Electric Chair":
Organized Crime Threats to Teamster Presidents
There is no doubt that organized crime is fully capable of
terrorizing and killing rank-and-file Teamsters. The disappearance of Hoffa in 1975
suggests that such terrorist tactics can also be directed at union leaders. Hoffa's
disappearance was only one event in a pattern of mob terrorism against
IBT presidents and high-ranking officers. Both before and after that disappearance, every Teamsters president since Dave Beck has been threatened with death
by organized crime.
Such threats serve to remind
Teamsters presidents that the LCN should get whatever it wants and expects from the IBT.
To reinforce this understanding is important to organized crime, as a series of Teamsters
leaders in the past 30 years were beholden to, or deeply in fear of, the LCN. The
following exchange in 1979 between Joseph Hauser, who looted the Central States Pension
Fund of millions of dollars, and New Orleans La Cosa Nostra boss
Carlos Marcello, shows that the individual
officers are not of interest.
Hauser:
Who you closer with, the guy in Kansas City [Roy Williams] or the guy from St. Louis, Missouri [Harold Gibbons]?
Marcello:
It don't make no difference, either one of 'em. It's all the same.31
During the 1960's, as they left a hotel, IBT
president Jimmy Hoffa directed Roy Williams not to walk near him. Hoffa
told Williams to do this for his own safety because the Detroit La Costa Nostra
family was violently displeased with Hoffa and had sent a signal that Hoffa would be
killed. According to Williams, Hoffa made a
pilgrimage to Detroit to rectify the problem. Williams remarked that Hoffa did not
"make a move" without the approval of the "boys" [LCN in Detroit.32
During his imprisonment in the 1960's, Hoffa shared quarters at
one time with Tony Provenzano. Provenzano later told Roy Williams that he developed an
intense dislike for Hoffa during that period. Partly because of
Provenzano's opinion, Williams said it was no surprise to him that Hoffa was murdered in
order to prevent him from making another bid for the international leadership.33
Frank Fitzsimmons was also the target of mob death threats. At one
point during his presidency, Fitzsimmons confessed to Williams that he was "in worse
trouble in Detroit than Jimmy Hoffa ever was."34 Eventually, Fitzsimmons
achieved a measure
of detente with the Detroit LCN, apparently
agreeing to give them authority in their running of IBT locals.
Prior to becoming president of the IBT, Jackie Presser allegedly
characterized that office as an "electric chair" and a "death chair."
Presser discussed the success of government prosecutions of IBT presidents Beck and Hoffa
and noted:
[I]f you are totally honest and if you try to clean up the union. . . and you try to do it fast enough and without accommodations so the government won't get you, the other guys - the hoods - will get you. Just like they got Hoffa when he threatened them. So that's a death chair either way.35
During the 1970's, when two factions of the Cleveland La Cosa
Nostra engaged in a bloody battle for control of illegal businesses in that city,
Presser was the target of such death threats. Presser told Roy Williams that he, Presser,
had backed the "wrong" faction in the mob and that his life
was in danger. During this period, Presser relied on personal
bodyguards and, according to Williams, eventually things returned to normal.36
Organized Crime and Teamster Locals
Organized crime cannot control a union's
international officer without controlling important locals in that union. The list of
locals controlled or influenced by organized crime is long and
sobering. On the basis of information from federal law enforcement
agencies, the Commission has found a documented relationship between La Cosa Nostra
organized crime factions and 36 influenced Teamster local unions, 1 joint council, and a
conference. Profiles of several IBT locals demonstrate the pervasive hold that organized
crime has over various local Teamster bodies.
New Jersey Local 560: Organized
Crime "Captures" a Local
For more than two decades, organized crime controlled Teamsters Local 560 in Northern New Jersey. Its control was so
pervasive that in 1984, the civil racketeering provisions of a federal law (RICO) were
used for the first time to impose a trusteeship on a local union. Judge Harold Ackerman,
who presided over the case, found that organized crime had "captured" Local 560,
its welfare and pension funds, and its severance pay plan. He ordered all members of Local
560's executive board removed and put the local into trusteeship until such time as the
membership can freely nominate and elect new
officers.37
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Under the leadership of Anthony Provenzano, Local 560 was used for more than 20 years by a "group of gangsters, aided and abetted by their relatives and sycophants," who engaged in a "multifaceted orgy of criminal activity" against the rank-and-file membership.38 Anthony "Tony Pro" Provenzano began as a business agent for Local 560 in 1954, became president of the Local in 1958, and later served as secretary-treasurer between 1975 and 1978. Lapses in his union service were ceased by several prison sentences he served for offenses ranging from extortion to murder.
First convicted of extorting labor peace payoffs between 1952 and
1959, Provenzano was later convicted of conspiracy to receive kickbacks
relating to a proposed loan from a Teamsters benefit fund. In 1978, he
was sentenced to life imprisonment for the 1961 murder of Local 560 secretary-treasurer
Anthony Castellito, who was a contender for Provenzano's office in Local 560. Finally, in
1979, Provenzano was convicted on RICO charges for receipt of labor
peace payoffs from the Seatrain Corporation.
Convictions and jail sentences did not deter Provenzano from
consolidating and exercising his control over Local 560. His brothers,
Nunzio and Sam, acted for him in his absence. The Provenzanos and their organized crime
associates were allegedly responsible for the May 24, 1963, murder of
IBT member Walter Glockner, who protested the appointment of a member
of the Provenzano ring as a business agent. After a shouting and pushing incident at the
union hall, Glockner was murdered in
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front of his house. The members of Local 560 never again made a
serious attempt to protest the Provenzanos' rule. Union members knew that dissent could
earn them a death sentence. As Judge Ackerman wrote in connection with the murder of Anthony Castellito:
The disappearance [of Castellito] generated a perception among the membership that anyone who represented an actual or potential threat to the Provenzano Group's dominance and control over Local 560 ran the risk of physical injury. The nature and intensity of that perception has been such that it survives to the present day.39
Tony "Pro" Provenzano used his control of the local to
increase his salary between 1962 and 1963 from $20,000 to $95,000. Business agent Stephen
Andretta--later convicted of loansharking, counterfeiting, and
extortion--had his salary raised to $95,000 a year during the same
period. Both Provenzano's and Andretta's salaries exceeded IBT
president Jimmy Hoffa's salary at the time. Provenzano family members
were also provided with jobs. Tony "Pro's" daughter, Josephine Provenzano, was
elected secretary-treasurer at age 23, and received a salary of $64,000. Asked to state
why she was appointed, she told the court "because. . . I was a Provenzano."40
Other criminals also participated in the looting of Local. For his
part in the Castellito murder, Salvatore Briguglio was rewarded with
the role of business agent. Briguglio was later convicted of grand larceny and
counterfeiting, and was suspected of having participated in the
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murder of Jimmy Hoffa. Ironically, Briguglio himself was
eventually murdered at the time of the indictment of Castellito's killers.
The officers of Local 560 also used the union to extort millions of dollar. from trucking companies which paid for labor
peace and the right to do business. They took millions more in payoffs from cooperating
companies eager to enter into sweetheart contracts providing for reduced labor rates. Some
employees of Local 560, forced to work under
sweetheart contracts signed by the Provenzanos, received few of the promised benefits of
the IBT Master Freight Agreement. The officers of Local 560 also conspired with benefit
plan administrators to embezzle in excess of $160,000 from the union's dental program and
to cover the theft by falsifying documents. Some of the conspirators received thousands of
dollars of free dental services, while rank-and-file members had to pay for their
treatment.
Roy Williams stated in Commission testimony that the officers of
the international were fully aware of the violence, extortion, and embezzlement that Local
560 officers were committing. Williams stated that even as IBT president he could do
nothing about the problem.41 The reason for this was that after capturing Local 560, the Provenzanos and other organized crime
nominees "captured" the international.
For two decades a member of the Provenzano family was a member of
the IBT's Executive Board. The Provenzanos were consulted on the appointment of other
union vice-presidents. Salvatore Provenzano was named leader of the Eastern Conference of
Teamsters. Instead of placing the local in a trusteeship and electing a clean slate of
officers, the international confirmed the control of the Provenzanos. Only extraordinary
effort by the Departments of Justice and Labor, including the first use
of the civil provisions of the RICO statute, led to the unprecedented
decision by a federal court to take control of the local and wrest it from the hands of
organized crime.
New York Local 814
IBT Local 814, which services moving companies, is influenced by
the Bonanno and Genovese organized crime families. Organized crime uses the local to
extort labor peace payoffs from moving and storage companies in the New York area. The
depth of organized crime's influence has led witnesses to refuse to testify
before grand juries concerning the local, perhaps because they are afraid of organized
crime's retaliation should they answer. In January
1984 the United States District Court for the Eastern District of New York held John
Konovitch, shop steward for Local 814, in contempt and ordered his
incarceration for failure to answer grand jury questions.
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The corruption within the union spills over into the industry. In
January 1984, the same District Court ordered Frank Narcisco, owner of the largest moving
and storage company in New York City, held in contempt and jailed for
his failure to answer questions before a grand jury.
Potential witnesses' fear of violence is not unfounded. In 1982,
Anthony Gilberti, the vice president of Local 814, was shot nine times but survived, and
has since entered the government's witness protection program.
Lonq Island Locals 295 and 851
IBT Local 295 in New York
represents the truck drivers and warehousemen of the air freight forwarding and trucking
businesses. This representation enables Local 295 substantially to
control John F. Kennedy Airport in Queens, New York. Recent
court-authorized electronic surveillance indicates that Local 295 is controlled by the
Davidoff family. Harry Davidoff, the patriarch, is a veteran of Murder, Inc., a 1930's-era
group of organized crime hit men. His son and daughter are also employees of the locals.
Frank Calise, an LCN associate, is the local's president.
IBT Local 851 also represents employees at John
F. Kennedy Airport, including clerical employees who review bills of
lading of the air freight forwarding companies. In certain respects,
however, Locals 851 and 295 are indistinguishable: their benefit
funds are inveated jointly, and Harry Davidoff, who has served Local 295, is the vice
president of Local 851 and his son Mark Davidoff is
secretary-treasurer.
Davidoff's partnership with the Luchese crime
family is currently the subject of an indictment in the Eastern
District of New York. The indictment charges that Davidoff engaged in a variety of
racketeering activities at the airport with LCN capo Paul Vario and LCN soldier Frank
Manzo, and his associates, John Russo and William Barone. The complaint specifically
alleges that certain air freight forwarding companies were not allowed
to merge until certain payoffs were made to organized crime.
Local 813
Local 813, which serves the carting industry in New York, is
operated by Bernie Adelstein. Adelstein's power in
the Teamsters is reflected in the fact that he ran for an IBT Joint Council office to keep
the son of Anthony Corallo, boss of the LCN Luchese family, from winning the position.
Adelstein has a long-standing relationship with the Luchese family and with Paul
Castellano, deceased boss of the Gambino family.
A recent investigation by
the New York State Organized Crime Task Force produced a number of court-authorized
electronic
surveillance intercepts concerning Local 813. One conversation
indicates that while Adelstein continues to work with La Cosa Nostra, the families
are dissatisfied with their degree of control. To increase their control in the carting industry, Salvatore Avellino, a member of La Cosa Nostra, discussed
with two carters the need to create a new local, Local 813A. On June 28, 1983, LCN member
Salvatore Avellino began this conversation by discussing the
"control" issue:
Salvatore Avellino:
813 is yours, "A" is ours and yours together. But now that we know it's the dog wagging the tail 'cause if we gonna go work. . . and we're gonna put these, ah, ah, 200, 300 people in it. Not let's take somebody, let's take a son, son-in- law, somebody put them into the office. They got a job. Let's take somebody's daughter, whatever -she's the secretary. Let's staff it with -
Thomas Ronga:
Our people
Salvatore Avellino:
--With our people, and when we say go break this guy's balls-
Thomas Ronga:
They go
Salvatore Avellino: --
They're there 7:00 o'clock in morning to break this guy's bails
With an "A" or whatever, and there we won't be under Bernie [Adelsteinl all the way, and meantime it will be-
Salvatore Avellino:
You follow me.
Emedio Fazzini:
Ya, I--
Salvatore Avellino:
Let Bernie [Adelstein] have all the five (5) boroughs, Nassau/ Suffolk is "A".
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Thomas Ronga:
What them two rebels [Aponte and Gonzalez]42 wanted to do.
Salvatore Avellino:
Right
In a subsequent conversation, Avellino provides
evidence that the LCN already controls the carters management
association (the Private Sanitation Industry Association of Nassau/Suffolk
Counties, Incorporated), but wants total control of the union itself, which it believes is
better than controlling the employers:
Emedio Fazzini:
You've got to control the man; that's the power
That's the power
.
Emedio Fazzini:
You gotta control the workers (inaudible) right now you control the employers
Salvatore Avellino:
Do you understand me, now when you got a guy that steps out of line and this and that, now you got the whip. You got the [expletive deleted] whip. This is what he [Corallo] tells me all the time, "a strong union makes money for everybody, including the wise guys." The wise guys even make more money with a strong union.
True.
Salvatore Avellino:
Because, because the envelopes [kickbacks] could be bigger and better
The IBT, Labor-Leasinq corporations, and Organized Crime
One case study demonstrates most clearly how the cooperation of La
Cosa Nostra, corrupt Teamster officials, and corporations can result in a concerted
scheme to obtain a commercial "edge."
Beginning in the late 1960s, Eugene Boffa, Sr. created and controlled more than 30 labor-leasing companies throughout
the country. The companies were located in 30 states--including California, Illinois,
Missouri, New Jersey, New York, Pennsylvania and Texas, as well as in
Canada and Puerto Rico. While these companies held themselves out as separate and
individual concerns, in fact all of them were controlled by Boffa, and
later his son, Robert Boffa. Many of the legitimate corporations, which used the services
of these labor-leasing companies, were fully aware that the various entities were all
connected to Boffa.
A Boffa labor-leasing company acted as the employer of
IBT-organized truck drivers and warehousemen. A corporation needing drivers at particular
locations would contract with the Boffa company and receive the needed
drivers, as well as their replacements, when regular
employees were sick or on vacation.
Boffa promoted his business by creating labor problems at both
organized and unorganized job sites, frequently through a corrupt union official who had
been bribed. At an unorganized shop, the bribed union official would threaten a union
recognition campaign and then "suggest" that Boffa's intervention
could alleviate such problems. If the job site was already organized, the official would threaten wildcat strikes
and slow downs. Once a Boffa company was selected as the labor leasing source, the company
would fire its work force and "lease" the same labor services from Boffa. Boffa
generally hired only those "discharged" employees who were not expected to be
troublesome or to question the new arrangements. Boffa would then "lease" the
services of those employees to their former employers.
Boffa's contracts invariably hurt the workers affected by the leasing arrangements. Sometimes wages would be reduced
but, more generally, changes would be made in less obvious contract items. For example,
routine work rules would be suspended for the
benefit of the corporation. Drivers would not be paid "clean up" time or for the
periods they remained in the terminal. Mileage and other indirect wage formulas might be
altered. Troublesome employees not weeded out at the beginning of the labor-leasing
contract would be discharged or offered work at distant locations. Because union officers
were receiving kickbacks from Boffa, fired individuals seldom obtained favorable rulings
from these officers at their grievance hearings. Drivers were often
required to use unsafe equipment. Furthermore, because Boffa was the "employer,"
striking workers could only picket Boffa's office, not the corporation utilizing their
services. In these and other ways a Boffa contract benefited the
employer, who paid Boffa approximately 10 percent above his gross payroll
costs as a "service fee." One Boffa labor-leasing
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official remarked that the central benefit of
labor peace "was a return to plantation days for employers."43
Boffa's operation could not have succeeded
without his La Cosa Nostra connections. Boffa was an associate
of the powerful La Cosa Nostra boss Russell Bufalino of Wilkes-Barre, Pennsylvania.
In addition, the New Jersey Provenzano family acted as his partner, protector, promoter,
and base of power, as well as a connection to the New York Genovese family.
Boffa combined these organized crime partnerships with assistance from corrupt union
officers who were willing to accept bribes and kickbacks. Teamster vice
presidents Sam Provenzano and Jackie Presser, and Joint Council president Sam Ancona were
the most important of these individuals because they provided a network of union friends
who could be influenced and exert influence on behalf of Boffa. Frank Sheeran, president
of Local 326 in Wilmington, Delaware, was another partner of Boffa in creating labor
problems or guaranteeing labor peace, whichever was required under the particular scheme. Sheeran also reported to Russell Bufalino. Boffa
himself was the conduit for almost all bribes paid to LCN members and union officials. LCN
associate Nicholas Robilotto of IBT Local 215 in Albany, New York worked with Boffa, as
did Robert Groves of IBT Local 910 in Ohio.44
Occasionally, Boffa's corporate clients demanded that Boffa reduce
labor costs even further. Boffa accomplished this by engaging in corporate shell games
designed to reduce the wages
and benefits of the employees who worked for him. First, Boffa
terminated all employees and the existing contract with a corporate
client. Another Boffa-controlled company would then be chosen to supply labor services and
would sign a new contract for less money, thus cutting the wages and benefits of the newly-rehired workers. As Robert Rispo, an enforcer for Boffa,
described it, the drivers had no choice but to accept 90 percent or 80 percent of their
former salary because "half a job is better than no job."45 Any
worker who protested too much was not rehired, and payoffs to union officials left the
workers without an avenue for redress of grievances.
David Kelly, traffic manager for the Continental
Can Corporation, told the Commission that Boffa companies won the right to enter into
leasing contracts with his company by submitting the most attractive bid, and that he was
unaware that Boffa owned more than one company involved in the shell games.46
His testimony was refuted at trial by several witnesses, and the record before the
Commission shows that most corporate managers knew or should have known
exactly what was occurring. As Bobby Rispo noted, "it boils down to without the
union, the corporate people, and us [Boffa and his connections], the scheme wouldn't
work."47
Eventually, Boffa's scheme
unraveled. Several cars driven by LCN members and union officials in Detroit at the time
of Jimmy Hoffa's disappearance were traced back to a leasing
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operation owned by Boffa. The cars were used as
payoffs to favored union officials. Subsequent investigation uncovered
Boffa's empire of companies. Law enforcement authorities used federal RICO forfeiture
provision. to seize Boffa's companies, including assets of $200,000 in
cash and $150,000 in accounts receivable. For his role in the labor
leasing scheme, Boffa received a 20-year prison sentence and was fined $47,000. IBT Local
326 president Sheeran was sentenced to 18 years in prison; his conviction was overturned
and a retrial resulted in a plea of guilty and a three-year sentence.
Subsequent events indicate that the Boffa organization and
operation continues even today. When law enforcement efforts prevented his companies from
continuing to operate, Boffa simply formed new
corporations. He controlled these companies from his prison cell,
calling his employees several times each day to give directions concerning their
operation. In addition, financial benefits continued to flow to the Boffas. Robert Boffa's
wife was paid $750.00 per week for leasing company clerical work. Tens
of thousands of dollars were paid to Eugene Boffa, Jr., an attorney and brother of Robert
Boffa, for legal services that were either overpriced or undelivered. When subpoenaed to
testify concerning the operations of the labor leasing business, both Robert and Eugene
Boffa refused to answer questions and invoked their Fifth Amendment privilege.
Many corporations--including such large, prominent corporations as
Inland Container: J. C. Penney; Spiegel: GAF: Atlantic Cement, Iowa
Beef; continental Can, Crown Cork & Seal; Crown Zellerbach and various soda bottling
companies -- did business with Eugene Boffa and his companies.48 Some
corporations did business with Boffa while he was under indictment and even after his
conviction. Philip Silver, the recently-named President of Continental Can, admitted in
retrospect that his company "should have disengaged more promptly and completely
following Mr. Boffa's conviction."49 Continental Can has adopted a
constructive corporate policy designed to avoid such problems in its future
labor leasing operations. Other companies were less responsive.
Business arrangements with the Boffa family continued unabated for Crown Cork and Seal as
of June 1985. In fact, when Crown Cork and Seal was formally notified
of the Commission's interest in labor-leasing companies and invited to send a spokesman to
the Commission's public hearing, the company's general counsel sought
to obtain an affidavit from an employee of the Boffa company, which would exonerate
Crown's corporate officers by stating that Crown did not know with whom it was dealing.
The proposed affiant, Samuel Solomon, refused to sign such a statement because he was
certain Crown Cork personnel knew that Boffa continued to control the companies.50
Page 137
At both the international and local levels, the IBT obviously
continues to suffer from the relationship with organized crime. Indeed, so pervasive has
this relationship become that no single remedy is likely to restore
even a measure of true union democracy and independent leadership to the IBT. Sustained commitment of governmental resources to dislodge organized crime from the
IBT through a combination of criminal prosecutions, civil action, and administrative
proceedings is the only approach that offers even a modest hope of success in the long
run. If the Local 560 case is representative of the depths of the problem, systematic use
of trusteeships by the courts may be necessary to prevent organized crime from continuing
to do business as usual in the IBT.
ENDNOTES
1 Deposition of Roy L. Williams by the President's
Commission on Organized Crime, September 13, 1985 [hereinafter cited as Williams
Deposition].
2 See United States v. Williams, 565 F.Supp. 353
(M D. Ill.), cert. denied,__U.S.__ (1985).
3 D. Moldea, The Hoffa Wars 26 (1978).
4 Williams Deposition, supra note 1.
6 FBI Report, March 30, 1979, known
as the Crown Center Overhear, for the particular hotel that served as the site of the
meeting of Civella, Dorfman, Lombardo, Tamburello and others. [hereafter Crown Center
overhear]
7 Debriefing of Roy L. Williams by Commission staff
[hereinafter cited as Williams debriefing].
9 Williams
Deposition, supra note 1.
10 In 1977, the assets of the Teamsters Central States
Pension Fund were $1.59 billion of which 60.6 percent was in real estate; at that time
$260.6 million of the real estate portfolio was invested in Nevada,
nearly all of that in gaming assets. By 1985 the fund had grown to $$5.3 billion in
assets, but the mix was quite different. Real estate investments were down to $336 million, or 6.3 percent: Nevada real estate had been reduced
to $34.7 million. The dramatic shift in the Fund's investment direction came after years
of protracted litigation with the U.S. Department of Labor. This litigation culminated in
the signing of consent decrees in 1983, enforceable in U.S. District Courts,
for both the pension and health and welfare funds. The main provisions of the decrees are
that the funds will be managed by a named fiduciary with complete responsibility and
authority for the investments of the funds, the funds will maintain a qualified internal
audit staff; an independent special counsel will monitor the funds' compliance with the
consent decrees; and any fiduciary or administrator who has been
convicted of certain crimes will be removed from the funds' service
upon conviction, rather than at the conclusion of the appeals process.
Lastly, the funds took over, with Court approval
in 1983, the assets of the late Allen Dorfman's Amalgamated Insurance Company, and began
processing claims in-house. This step was not just significant for the funds in terms of
the benefit monies saved which had been diverted to Dorfman and his cronies -- it was
highly symbolic and accelerated the process of the fund's severing its ties with Dorfman's
operation.
11 Crown Center
overhear, supra note 6.
12 United States v. Dorfman, 470 F.2d 246 (2d Cir. 1972), cert. denied, 93 S. Ct. 1561
(1973)
13 Williams Deposition, supra note 1.
l4 Deposition of Thomas F. O'Malley by the President's Commission on Organized Crime, April 5,
1985.
15 United States v. Shurr,
(E.D. Pa. 1983).
16 Williams Deposition, supra note 1.
19 Crown Center Overhear, supra note 6.
20 S. Brill, The Teamsters,
352-400 (1978).
21 United States v. Local 560, 581
F. Supp. 279, 293 (D.N.J. 1984).
Page 140
22 Oversiqht of Teamsters Union, 1983: Hearing
Before the U.S. Senate Committee on Labor and Human Resources, 98th Cong. 1st Sess. 10
(1983).
23 This figure includes salaries, allowances and
expenses, but no multiple pensions to which Presser will be entitled.
Compiled from financial reports filed with the Department of Labor for
fiscal year 1984.
24 Presser sought to quash the Commission's subpoena,
in part, on the ground that the criminal investigation into the Local 507 payroll-padding
scheme was pending at the same time. The U.S. District Court rejected this argument and
ordered Presser to appear at a deposition. At two depositions on March 26, 1985 and August
13, 1985, as well as at the Commission's public hearing on April 29, 1985, Presser invoked
his Fifth Amendment privilege against self-incrimination in response to all questions, including inquiries about the history of the IBT, the criminal convictions of his predecessors, use of
union-sanctioned violence against dissident groups, and payment of bribes and kickbacks to
IBT officials. The Commission's active investigation of Presser ended when the
Commission's request for authority to compel Presser's testimony was
rejected by the Justice Department.
25 Interview of Thomas Lanci, April 1985.
26 Williams Deposition, supra note 1.
27 Organized Crime and Labor-Management
Racketeering: Hearings before the President's Commission on Organized Crime, April
1985, at 209 [hereinafter cited as Labor-Management Racketeering
Hearings.
28 G.. Stricharchak, "The Teamsters Jackie
Presser," Cleveland Magazine, October 1980, at 71.
29 Transcript of the Commission's March 26, 1985 deposition of Jackie Presser, which states in pertinent part:
Q. You have spoken harshly about rank and file men who oppose your
administration. Do you support the use of union sanctioned violence
against such dissident rank and file members?
A. Upon the advice of counsel I wish to invoke the Fifth Amendment
right to not to testify.
Q. What explanation can you offer the
Commission for your extensive statements supporting such violence, made by you on October
31, 1983, to Joint Council 41?
A.Upon the advise of counsel I wish to invoke the Fifth Amendment
right not to testify.
Because Presser asserted his Fifth Amendment privilege in response
to the Commission's questions about his support of violence against dissidents, the
Commission subpoenaed William Evans, the Secretary/Treasurer of IBT Joint Council 41 and the individual whom Presser praised for his role in the raid. Evans provided testimony to the Commission under a grant of immunity in
March 1985.
The depth of loyalty that Presser commands was evident in Evans's
deposition. In an effort to exonerate himself and Jackie Presser, Evans
dismissed Presser's remarks as exaggerated and boastful. On other points, Evans's
testimony and his views of the facts differed significantly from other eyewitnesses'
accounts on record concerning the BLAST raid. For example, Evans claimed he went to
Romulus because he heard TDU had open meetings, and he thought it would be an
"educational experience" to attend this convention. He claimed he did not know
who organized the trip, who arranged or paid for the buses, or which persons
led the group. He stated that he recognized only two
other persons who travelled from Ohio to Michigan for the event. Evans claimed that he was
simply trying to order breakfast when he came upon the fracas at the hotel, and that he
could not remember any violence or threats of violence. He also maintained he does not
know what the BLAST acronym means. He stated he did not see BLAST signs
or hear conversations to indicate that activities at the Romulus convention were in any
way sponsored by BLAST .
The Commission also subpoenaed Wendell Quillen, a trustee of Joint
Council 41, and Secretary-Treasurer of Local 957, to provide testimony concerning the
BLAST raid. Quillen refused to answer questions on the basis of his Fifth Amendment
privilege. Subsequently, Quillen told Dayton Daily News reporters he
went to the T W meeting to "see what it was all
about," and said of his refusal to testify before the Commission, "Why should I
tell them anything...."
Page 142
30 Hotel Employees and Restaurant Employees
International Union: Hearings Before the Permanent Subcommittee on Investigations of the
Senate Committee on Governmental Affairs , 97th Cong., 2nd Sess. 69
(1982).
31 Court authorized electronic
surveillance of a conversation between Joseph Hauser and Carlo.
Marcello at the Maison Dupuy Hotel in New Orleans, Louisiana on April
2, 1979.
32 Williams Deposition supra note 1
33 Id.
35 Presser was
asked by the Commission to confirm or deny making this statement, as quoted in S. Brill, The
Teamsters, at 349. He refused to answer this question at his deposition on March 26,
1985, on the grounds that the answer might incriminate him.
36 Williams Deposition, supra note 1.
37 United States v. Local 560, 581
F. Supp. 279 (D.N.J. 1984).
39 Id. at 312.
40 Id. at 293.
41 Williams Debriefing, supra note 7.
42 In 1976, "rebels" Ray Aponte and Reuben
Gonzalez attempted to begin a rival carters union.
Shortly afterward, they were murdered and found in the trunk of a car.
43 Labor-Manaqement Racketeering Hearings, supra
note 27, at 197.
44 Deposition of Robert Rispo, February 14, 1985
[hereinafter cited as Rispo Deposition].
46 Deposition of David Kelly, before
the President's Commission on Organized Crime.
47 Rispo Deposition, supra note 44.
49 Labor-Management Racketeering Hearings, supra
note 27, at 276.