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From the July-August 2005 issue of Union Democracy Review #157
In the construction trades: Top Plumbers international officers expelled
By James McNamara
Last August, after the U. S. Labor Department ordered Martin Maddaloni and Thomas Patchell removed as trustees of the union's seven ERISA-covered pension funds, the two agreed to resign their offices as international president and international secretary of the 325,000-member United Association of Plumbers and Pipefitters [UA.] They were among the four trustees ordered to pay $10.8 million in reimbursements and penalties.
The UA General Executive Board, in familiar fashion, awarded the discredited duo the usual golden parachutes, including full salaries, benefits, and free use of union cars until the end of 2006. The GEB concluded, "...in light of their resignations, the GEB considers the matter closed."
But it would not remain closed!
The case was reopened after a report by a Special Independent Hearing Panel convened by the GEB. On May 24, 2005, the panel permanently expelled both from the union and fined Maddaloni $700,000 and Patchell $400,000, to be paid immediately. Their alleged conduct, the panel found, "resulted in the loss of massive amounts of UA moneys." In June, a scathing report was issued "To members only."
The panel decreed that "...any photographs, plaques, awards or items of a similar nature, which contains the likeness, signature, or name of Brother Maddaloni or (Brother Patchell) be permanently removed from any displaycunder the control of the United Association." In this connection, it ordered that any charters issued and signed by Maddaloni be reissued.
Reckless investments concealed from the GEB: The panel found that Maddaloni had pledged the union's treasury "...for a 20 million dollar loan for his friends and acquaintances so that they could purchase the Clarion Hotel in Hollywood Florida ...never told the GEB of the guarantee and repeatedly lied to the U. S. Labor Department ca massive fraud." The panel charged that Maddaloni, while serving as a director of Union Labor Life Insurance, had personally profited in an improper stock dealt at the expense of the UA and its members.
The suspect or fraudulent transactions go on and on: seven million lost in Dot Com investments; multimillions in the purchase and renovation of the Florida Hillcrest Country Club; massive cost overruns in the construction of two regional training centers; a "debacle" in the $800 million Diplomat hotel and country club in Florida.
The GEB appointed William O. Hite as president to fill out the balance of Maddaloni's term of office. He has undertaken the task of straightening out the union's financial affairs. In April he reported that lengthy meetings had been held with the U.S. Labor Department, at its request. "I strongly believe," he said,"that the DOL will not be taking steps to impose supervision over the UA."
In Washington, DC, the mayor and City Council propose to build a new convention hotel. The financially strapped UA, which is negotiating the sale of its headquarters building and parking lot, hopes to close a deal.
The union's international convention is scheduled for August 2006 in Las Vegas. Hite faces a challenge from Tommy Preuett, who has already announced his candidacy for the top spot. He made a strong showing at the union's 2001 convention when he ran as an insurgent against Maddaloni, garnering 1,233 delegate votes to Maddaloni's 2,002. In his campaign, Preuett has warned the delegates of the reckless spending of the UA's assets and benefit funds. By now all his charges, and more, have been fully vindicated.
About 320 locals will be represented at the convention. Delegates elect the top officers and 34 international representatives. Preuett is a member of Local 669 which is usually entitled to about 100 delegates.
Other articles on the UA:
UA Local
375 hiring hall rule provides for member recourse
How
the Ironworkers and Pipefitters rig trusteeships
Hiring
hall procedures in the construction trades
The
eternal quest for fair hiring in construction
Last
year's scandal hangs over next Plumbers convention
Top
Plumbers international officers expelled
UA's
Maddaloni and Patchell ousted after disastrous pension investments in Florida
hotel
Interview
with UA reformer Frank Natalie
New voices at AUD construction
trades conference
Court orders Plumbers
and Fitters to remove anti-democratic rule
Pipefitters win
points in battle for democracy.
Links to UA member sites.
Previous Article: Battling corruption in the ILA, a partial chronology
Next Article: Action in Operating Engineers Locals 18 and 66
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