DETROIT — The acting president of the United Auto Workers said Wednesday that a corruption scandal plaguing the union will get worse before it gets better, but that he’s confident he can fix the mess and turn over a clean house to the next leader.
Rory Gamble, a union
In an interview with The Associated Press, Gamble pledged to put financial controls in place to stop the bribery and embezzlement uncovered in a widening federal investigation that has so far snared 13 people.
“We’re going to plan for going forward and how we fix this great union,” Gamble said. “Right now, that’s my charge and what I came to this job to do, to make sure I hand to the next president a very clean and uncorrupted union.”
Gamble, a former director of a union region based in Detroit, has a tough job to do.
Earlier Wednesday, a retired union
Joe Ashton is accused of receiving thousands of dollars in kickbacks from a contractor who made watches for union members. The 58,000 watches are still in storage five years later.
Ashton was charged with conspiracy to commit wire fraud and conspiring to commit money laundering. The case is filed in Detroit federal court as a “criminal information,” which means a guilty plea is expected.
The Associated Press left a message seeking comment from Ashton’s lawyer, Jerry Ballarotto.
Ashton was a powerful official who headed the UAW’s General Motors department. He also was a member of the GM board but resigned in 2017 after being implicated in the corruption probe.
The federal charges against Ashton are the latest fallout in the mounting corruption investigation. Federal agents have also searched the Detroit-area home of Jones, the union president, and the Corona, California, home of former president Dennis Williams.
According to court papers filed by prosecutors Wednesday, Ashton and two other officials of a joint GM-UAW training
Ashton convinced a Philadelphia chiropractor identified only as “Vendor B” to loan $250,000 to a construction company owned by an Ashton associate in 2010, prosecutors allege. Two years later, the company stopped making payments on the loan.
Prosecutors say Ashton then proposed a way for the chiropractor to be repaid, by setting up a company that would supply the UAW with 58,000 watches. The chiropractor found a company to provide the watches, with Ashton taking part in the design, production and pricing. They say he negotiated a deal for the chiropractor to buy the watches for $2.29 million, or $42.90 per watch. Then Ashton told the chiropractor to submit a bid to Pietrzyk for a total price of $3.97 million, or $68.50 per watch, the documents allege.
Ashton and Pietrzyk steered the watch contract to the chiropractor, with Ashton demanding a $250,000 kickback. The chiropractor delivered cash to Ashton’s home from May 2013 through early 2015, prosecutors allege. Some payments were made by check to Grimes and Pietrzyk with “antique furniture” in the memo line to conceal the scheme, according to the documents.
Ashton ended the payments in the fall of 2016 when news broke about a federal investigation into corruption in the UAW and Fiat Chrysler Automobiles, prosecutors alleged.
Checks from the chiropractor to Pietrzyk and Grimes
GM said in a statement that it was “deeply disturbed” by the allegations against Ashton and said it had not been aware of the scheme until it was revealed recently in the government investigation.
UAW members recently ratified a new four-year contract with GM after a 40-day strike, and it has reached a tentative agreement with crosstown rival Ford, where workers are voting on the deal. It will then shift the bargaining focus to Fiat Chrysler.
Many union members are suspicious of leadership because of the federal corruption probe, with several at GM wondering if the strike was called merely to show that leadership is on the workers’ side.
Pietrzyk, of Grand Island, New York, pleaded guilty in October to accepting more than $120,000 in bribes and kickbacks from union contractors. His plea agreement calls for federal prosecutors in Detroit to seek no more than two years and three months in prison.
He was an administrative assistant who worked closely with Ashton.
In September, Grimes, of Fort Myers, Florida, pleaded guilty to money laundering and conspiracy in a scheme to take about $2 million in kickbacks from UAW vendors. He faces four years or more in prison.
Grimes worked at a UAW-General Motors training
Ed White And Tom Krisher, The Associated Press