The New York Times

U.S. Says Labor Union Leader Will Resign and Admit Fraud

By STEVEN GREENHOUSE

October 1, 1999

Arthur Coia, the president of the laborers' union, one of the nation's largest building trades unions, has agreed to resign in October and plead guilty to fraud charges as part of a deal with federal prosecutors, government officials said on Thursday.

The officials said Coia would step down in the next few weeks and would soon after plead guilty to charges involving his purchase of a $450,000 Ferrari from a supplier to the 750,000-member union, the Laborers International Union of North America. The plea agreement, one government official said, would not result in a prison term but would bar Coia from any future contacts with the union.

David Roscow, a union spokesman, denied that Coia was resigning, insisting that Coia was the victim of leaks from government officials out to hurt him. "Mr. Coia is not resigning, he has not been indicted, and there is no agreement," Roscow said. "For the past four years, certain law-enforcement officials have engaged in irresponsible leaks designed to pursue their own agenda and tarnish the union and Mr. Coia."

One government official said Coia might still pull out of the plea agreement out of concern that he would be stepping down under a cloud. Numerous times in the past, union officials said, Coia was about to resign in the face of possible charges, but then decided to dig in and battle the accusations against him, to help preserve his reputation.

Over the last year, some aides also hinted that Coia could retire at any time because he has been fighting prostate cancer for three years, although his health has improved in recent months.

The deal said to have been reached between Coia and the government follows an anti-corruption investigation that the union conducted under an earlier agreement with the government. In March, the three-year investigation cleared Coia of accusations that he had associated with members of organized crime. But at the same time, the union's hearing officer, Peter Vaira, fined Coia $100,000 for a conflict of interest over the purchase of the Ferrari. The union's in-house prosecutor, Robert D. Luskin, discovered that Coia had bought the sports car with the help of a Rhode Island company that leased cars to the union.

Luskin found that Coia bought the car while the car-leasing company continued to hold the title, letting Coia avoid more than $40,000 in luxury taxes. This also enabled Coia to resell the Ferrari, a limited edition model, as a new vehicle three years later.

When Vaira fined Coia, the laborers' in-house investigators turned over evidence about the car purchase to the U.S. attorney's office in Boston. Coia has repeatedly denied any wrongdoing regarding the car.

Samantha Martin, a spokeswoman for the U.S. attorney in Boston, declined to comment on Thursday. Luskin also declined to comment about Coia's plea deal, which was reported on Thursday by The Daily Labor Report published by the Bureau of National Affairs, a private research group in Washington.

Coia's father, Arthur E. Coia, was secretary-treasurer of the union, which used to be considered one of the nation's most corrupt. Prosecutors say the elder Coia associated closely with Raymond Patriarca Jr., New England's long-time crime boss.