Teamsters Chief Accused of Being Told of Illegal Funds Scheme

Reuters Limited

Teamsters Chief Told of Illegal Funds Scheme-Accuser

By Peter Szekely

Mar 11, 1998 Eastern

WASHINGTON (Reuters) - Teamsters union president Ron Carey's chief accuser of fund raising improprieties said

Wednesday that he alluded to an illegal contribution swap scheme only once with Carey in a brief, sketchy conversation.

Jere Nash, who managed Carey's reelection campaign, said he told Carey in October 1996 that making a particular contribution to a liberal group that Carey had earlier rejected would help fund raising efforts for Carey's personal campaign. With that, he told a special hearing, Carey reversed himself and approved the contribution to the group, Citizen Action, telling Nash, ``Well, hell, no one ever told me about it.''

Carey narrowly defeated James Hoffa, the leading candidate for the Teamsters presidency, in 1996.

After the election, Hoffa allies filed charges against Carey and an investigation turned up an illegal fund raising scheme in his campaign.

The hearing before a court-created Independent Review Board (IRB) provided the first public forum at which Nash has explained his involvement in the illegal scheme and has been subject to cross-examination by Carey's attorneys.

The IRB is considering whether to expel Carey and the union's former political director, William Hamilton, from the 1.4 million-member International Brotherhood of Teamsters (IBT), of which Carey has been a member for 40 years and a paid officer for 30 years.

Carey's reelection over Hoffa was nullified last fall after the fund-raising scandal in his campaign came to light. Despite his denials that he knew of the scheme, Carey has been barred by another court-appointed official from running in a new election this summer.

Under cross-examination by Carey attorney Mark Hulkower, Nash said the telephone conversation in which he told Carey

that the Citizen Action contribution could help his campaign fund raising may have lasted only 15 seconds and that he never referred to it as an illegal swap scheme.

``You didn't tell him that there was anything improper about this?'' asked Hulkower.

``No, sir,'' replied Nash.

``You didn't say, 'this is something you've got to keep under your hat, Ron?''' Hulkower asked.

``No,'' answered Nash.

Much of the case against Carey is based on his approval of union donations of more than $700,000 to certain liberal

groups. While the payments were legitimate when taken in isolation, they were later found to be illegal because some of the money later went to the Carey campaign.

Hulkower tried to get Nash to acknowledge that, given the lack of detail in his brief explanation to Carey of the importance of contributing to Citizen Action, Carey conceivably could have assumed that the contribution could have legally benefited him by enhancing his standing with liberal donors.

``That's fair,'' said Nash.

``Given the reputation of these organizations, there would be nothing sinister about the IBT giving money to them?'' Hulkower asked.

``That's right,'' replied Nash.

Nash and former Carey campaign fund-raiser Martin Davis have pleaded guilty to criminal charges stemming from the illegal fund raising scheme in which union funds went to the Carey campaign. They are awaiting sentencing.

The case is still under investigation by U.S. Attorney Mary Jo White in New York. But Carey's lawyers have said they have been told he is not a target of the probe.