Former UAW President Gary Jones Charged in Union Embezzlement Scandal

• Federal prosecutors have charged former UAW president Gary Jones with embezzlement, making him the 14th person charged in a corruption scandal involving the auto union.
• Jones had been president only since June 2018 but is charged with stealing more than $1 million from the union to buy condos, custom golf clubs, cigar humidors, and other luxuries in actions dating back to 2010.
• The UAW issued a statement condemning the actions by Jones and others, and under current president Rory Gamble has vowed to “ensure our union is free from the type of corrosive corruption we have witnessed from those who betrayed our trust.”

The United Auto Workers president who led a five-week strike against General Motors last October has been charged with embezzlement and fraud as a federal corruption probe cuts further into the union’s topmost ranks.

Gary Jones is the 14th labor official to fall since the Justice Department began investigating UAW directors and Fiat Chrysler executives for engaging in a decades-long scheme to corrupt the bargaining process between the automaker and union. Jones has been charged with similar allegations of bribes, dodged taxes, and embezzling union funds as part of a racketeering activity—crimes of which 13 previously charged individuals—the majority of them UAW leaders—have pled guilty and are now serving or awaiting prison sentences.

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Jones was president from June 2018 through October 2019. Starting in 2010 he was assistant director and later director of the UAW Region 5, a group of states the union has now disbanded and moved into two other regions. He is charged with embezzling more than $1 million in union funds and properties to buy “luxury condos” in California, “lavish” dinners with “premium liquor,” five sets of custom-made golf clubs, horseback riding on a beach, and other non-union expenses that prosecutors allege the UAW covered up by mislabeling them as payments to vendors or meals for UAW officials, according to Matthew Schneider, U.S. Attorney for the Eastern District of Michigan.

“Instead of that cash and property going to help the men and women of the union, Mr. Jones spent it on his own personal enjoyment and on the whims of other high-ranking union officials,” Schneider said at a press conference on Thursday.

Among other expenses that Jones allegedly made with UAW funds that were “completely unrelated to union business” were $60,000 worth of cigars and humidors along with spa dates that totaled more than $8000, he said. Everything was covered up with “fake vouchers” and “false receipts” that tricked UAW accountants, Schneider said. As a result, Jones and the UAW owe money and potential penalties to the Internal Revenue Service for filing false tax returns.

“As we continue to move forward under the leadership of President Rory Gamble and the IEB, we are continuing to implement the critical reforms necessary to ensure our union is free from the type of corrosive corruption we have witnessed from those who betrayed our trust,” the UAW said in a statement.

Not an Isolated Problem

Jones was raided in August before Edward Robinson, president of another UAW outreach group, was charged with similar crimes in November. Former regional director Vance Pearson pled guilty last week. Both Pearson and Robinson were named as co-conspirators to Jones in the lawsuit, along with four other unnamed UAW officials who are expected to be charged. The union just recently listed a 1000-acre property in northern Michigan with a lakefront home—built with non-union labor for former president Dennis Williams, who is also allegedly under investigation—for $1.3 million.

“We are not done, and we cannot predict exactly when we will be done,” said Matthew Schneider, U.S. Attorney for the Eastern District of Michigan. “We are another step closer to ridding the UAW of its corrupt leadership and returning the union to the hard-working men and women who work there.”

Federal prosecutors in 2017 brought fraud and conspiracy charges against FCA labor relations chief Alphons Iacobelli and several UAW officials for siphoning millions of dollars—paid in large part by UAW member dues—into lavish vacations, cars, plane tickets, and jeweled $37,000 pens. Iacobelli is serving more than five years in prison while another FCA labor employee, Nancy Johnson, is serving a year.

Former UAW vice president Norwood Jewell pleaded guilty in April 2019 to accepting tens of thousands of dollars’ worth of meals and golf expenses from FCA. He is serving 15 months in prison. Former vice president General Holiefield was also targeted for funneling more than $260,000 to pay off his mortgage and another $200,000 to buy furniture and jewelry but escaped the charges since he died in 2015. His widow, Monica Morgan, is serving 18 months in prison. Virdell King, a UAW leader who helped negotiate FCA contracts in 2011 and 2015, served two months in prison. Many more UAW leaders who have pled guilty or have been charged are listed here.