Loosening
Mob's Grip On A Union
July 13, 1997
BY TOM MCNAMEE STAFF REPORTER
Contributing: Francine Knowles
When reputed mobster James DiForti was charged earlier this month
with murdering a Chicago businessman, the one fact that shocked nobody
was this:DiForti is an officer in the Laborers International Union.
The Laborers International is one of the most mobbed-up unions in
the United States, according to the U.S. Justice Department. It is held in the grips of
organized crime by means of ``force, violence and fear.''
So entrenched is the mob's influence in the union that when the
Justice Department two years ago laid out its entire case in a 146-page draft complaint,
the union barely peeped. Desperately seeking to avoid a federal takeover, the union asked only for time to reform, and promised to banish the wiseguys.
The Laborers International represents a wide range of largely
low-skilled laborers, mostly in the construction field, including concrete
pourers,bricklayer assistants, trash collectors and ditchdiggers. Some city Streets and
Sanitation workers are in the Laborers union.
A major step toward reform is scheduled for Wednesday in the Loop,
when the International begins two weeks of hearings on a proposal to place its Chicago
District Council under trusteeship.
The outcome, many labor observers say, is a
foregone conclusion. The International must and will place the Chicago council under
trusteeship to demonstrate its commitment to reform.
The real question, experts say, is whether cracking down on the
Chicago council truly is an act of reform or a gambit by the mob to placate federal
investigators and retain their grip on the union.
``I like to think it's a start,'' said Tom Kirkpatrick, president
of the Chicago Crime Commission. ``You go up the stairs. First you go after a couple of
locals, then the district council and up from there. You squeeze it out
of the toothpaste tube.''
If the International concludes a trusteeship is necessary, the
Chicago council's four-man leadership would be dismissed and an appointed trustee would
take over operations for at least 18 months. The trustee's immediate job would be to
encourage more democracy in the union and open the financial books
to the rank and file.
Organized crime has been linked to the Laborers International
Union of North America since its founding in 1907.
``Big Jim'' Colisimo, a crime boss in Chicago in the days before
Prohibition, helped establish the union by organizing the local street cleaners. Today,
the International boasts about 450,000 dues-paying members,including about 14,000 in the
Chicago council.
Joseph Moreschi, president of the International
for four decades, was indicted in 1944 on charges of embezzling the union's money. Peter
Fosco,who succeeded Moreschi, had ``ties to organized crime'' that date back to Al Capone,
according to a 1982 Justice Department memo. And when Fosco died in 1975, his son Angelo took over in an election engineered
by Anthony Accardo,the late Chicago mob boss.
``Angelo Fosco has followed in his father's footsteps. He is the
tool of the crime syndicate,'' states the 1982 memo. ``Major decisions regarding Laborers'
union contracts are made by organized crime leaders, not Angelo Fosco.''
The Laborers International was always secretive, famous then and
now for a reluctance to engage in open political debate. Pressured by critics, the
International in 1941 held a rare national convention. It would hold more
conventions,officials said then, but a poll of the union's members showed they preferred not to.
The celebrated newspaper columnist Westbrook Pegler discovered
just why the union's members preferred no convention--they would be assessed $2 each for
transportation costs.
When Angelo Fosco died in 1995, Arthur A. Coia assumed the
presidency and,with the Feds bearing down, vowed to clean up the union. But Coia is by no
means above reproach himself.
His father, Arthur E. Coia, as secretary-treasurer
of the International, was a close associate of Raymond Patriarca, boss of the New England
mob. In 1981, both Coias were indicted for allegedly taking kickbacks, but the case was
dismissed because the statute of limitations had run out.
The Justice Department's 1995 draft complaint
describes Coia as the latest union president ``to have been associated with, and
controlled and influenced by, organized-crime figures.''
Indeed, Republican critics complain, were it not for Laborers'
generous financial contributions to President Clinton and the Democrats, the Justice
Department by now would have placed the union under trusteeship, as it
did the Teamsters, and driven Coia from power.
From 1991 through 1996, the Laborers gave more
than $3 million to the Democratic Party, which Clinton apparently appreciated. At a
private meeting in the Oval Office in 1994, the president gave Coia one of his personal
golf clubs, a nine-iron.
When the Laborers' International gathers at the Midland Hotel
Wednesday, then, the surreal scene unfolding will be of a notoriously crooked national
union grilling a notoriously crooked local affiliate, the Chicago council.
In another twist, the hearing officer will be Philadelphia
attorney Peter F.Vaira, who is already on record as saying the Laborers
union, including the Chicago council, is a ``captive'' of organized crime.
As head of the Justice Department's Chicago Strike Force in 1982,
Vaira co-wrote the internal memo that spelled out the union's mob ties.
But Vaira said Friday that it is common practice for unions
attempting to clean house to choose former judges and prosecutors as
hearing officers to give the proceedings credibility.
In going after the Chicago council, the International goes after
the larger family of organized crime in Chicago.
One of the Chicago council's four top officers, vice president
John Matassa, reputedly is a powerful captain in the Chicago ``outfit,'' having moved up
in rank after a slew of upper-echelon mob convictions in the 1980s.
A second officer, secretary-treasurer Joseph
Lombardo Jr., carries the name of one of Chicago's most infamous mob bosses. Joseph Sr.,
released from prison five years ago, keeps a low profile in his old
Grand Avenue neighborhood, but law enforcement agents suspect he remains in the game.
Among the other princes of the mob who stand to lose if the Chicago council is turned over to a trustee are Craig Kumerow, a Local 1001 field representative and Accardo's grandson; Michael Palermo, vice president of Local 1001 and an Accardo son-in-law, and Anthony Solano, director of the
Chicago councils' Training Center in suburban Carol Stream and son
of mob captain Vincent Solano.
A trusteeship for the Chicago council, most
labor experts appear to agree, is a welcome reform--but only if handled right.
Out of trusteeships have grown some of the ``most vital'' union
locals in the country, said Kate Bronfenbrenner, director of labor education research at
Cornell University.
But the trustee must rebuild the union ``from the bottom'' before
moving on, she said, or ``the mob will come back.''
When organized crime grabs hold of a union, it squelches dissent,
siphons off every possible dollar and leaves the average union Joe out in the cold.
Mobsters pay themselves excessive salaries.
Some schemes result in union members' paying inflated dues. Others
destroy the reputation of the union, making legitimate businesses reluctant to offer jobs.
Still other schemes indirectly
put the bite on the average consumer and taxpayer, who must pick up the tab for the higher
price of building a road or building.
When the mob grabs hold of a union, the payroll is padded with
wiseguys who do no work but need to show the Internal Revenue Service a legitimate source
of income.
They extort kickbacks from businesses, usually by threatening
physical harm.
They ignore union contract provisions, such as a strict adherence to overtime pay, in return for secret cash kickbacks.
They force legitimate businesses to hire mob associates as ghost
employees.
They farm out lucrative union contracts at inflated prices to
mob-owned businesses.
A few examples, all cited in the Justice
Department's 1995 draft complaint:
In 1975, high-ranking officials of the Laborers International
Union of North America used threats of assault to extort cash kickbacks from a company
providing group life insurance. The kickbacks inflated the price of the insurance, forcing
union members to pay higher dues.
In the mid-'70s, officers of a Chicago local of the Laborers union
extorted kickbacks from a Near West Side dental clinic hired to serve union members.
In the early 1980s, the Columbo crime family in New York City
routinely extorted money from construction employers, especially
concrete contractors,by threatening work slowdowns and stoppages.
In the early 1980s, La Cosa Nostra commission in the New York
area--a board of directors of all the New York crime families--established a ``Two Percent
Club'' for concrete pouring contractors. On any construction job exceeding $2 million, the
commission designated which contractor would be permitted to make the successful bid. The
winning bidder paid the commission 2 percent.
In 1989, officers of a Laborers union local in Brooklyn spent
pension funds to purchase six buildings at ``grossly inflated prices''
in a scheme to siphon off the money to themselves and their underworld associates.
--TOM MCNAMEE
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The executive officers of the Chicago District Council of the
Laborers Union International of North America:
Bruno Caruso, president and business manager. Gross salary:
$171,641.
Both his father, Frank ``Skid'' Caruso, and his brother, Frank Jr., are described by the
U.S. Justice Department as formally initiated members of the Chicago mob. Bruno Caruso's
predecessor as president was Ernest Kumerow, a son-in-law of the late Anthony Accardo, the
Chicago mob's top boss. Caruso also is paid
$100,218 as president and business manager of Local 1001.
Joseph Lombardo Jr., secretary-treasurer. Gross salary: $155,314.
Lombardo is the son of Joseph ``Joey the Clown'' Lombardo, a convicted
racketeer who once was--and still may be-- among two or three most powerful mob bosses in
Chicago.
John Matassa Jr., vice president. Gross salary: $23,424.
Described by the Justice Department as ``an associate and suspected
member of the Chicago La Cosa Nostra family.'' Matassa is a reputed North Side lieutenant
of mob boss Joseph Andriacchi. Matassa also is paid $119,852 as president of Local 2.
Leo Caruso, sergeant at arms. Gross salary: $8,000.
Cousin of Bruno Caruso. Leo Caruso was named sergeant at arms two years
after his cousin Frank Caruso--Bruno's brother--was dismissed from the job because he was
a known mobster. Caruso also is paid in excess of $33,000 as president of Local 1006.