Ex-United Auto Workers Boss Pleads Guilty to Embezzlement

(Bloomberg) -- Former UAW chief Gary Jones pleaded guilty to embezzlement and racketeering, making him the highest-ranking ex-official of the labor union to admit to a role in the sprawling corruption scheme.

Jones, who served as president of the United Auto Workers, acknowledged conspiring with at least six other high-level former union officials to steal over $1 million in dues. He is the 14th defendant to be convicted in a sweeping U.S. investigation into embezzlement and illegal payoffs to union executives by officials of Fiat Chrysler Automobiles NV, according to a statement Wednesday by federal prosecutors in Detroit.

Jones, 63, admitted that he and other officials spent more than $750,000 on personal pleasures, including golf clubs, private villas and high-end liquor and meals, according to the statement. In just one year, he used union money to buy over $13,000 in cigars for UAW brass, prosecutors said.

He faces as long as 10 years in prison.

“Gary has accepted responsibility for his mistakes and done everything he can to make amends to the UAW members he formerly represented,” said J. Bruce Maffeo, a lawyer for Jones. “The UAW would be well advised to follow his example.”

Jones relinquished his role and resigned his union membership after being implicated in the corruption scandal. Federal agents raided his home in August, seizing $30,000 in cash.

The plea moves the Justice Department into “a new phase” of its probe, U.S. Attorney Matthew Schneider said in the statement. “While our criminal cases and the investigation of criminal conduct by individuals and entities continue, we will shift our focus to reforming the UAW so it serves the working men and women of the union first and foremost.”

After Jones was charged in March, Schneider reiterated what he had been saying for months -- that the union hadn't cooperated with the government and that federal oversight was a possibility. Government overseers just stepped aside after helping manage the International Brotherhood of Teamsters for 30 years.

The UAW will always be “more powerful and resilient than any single individual or obstacle,” the union said in a statement.

“Together, we've overcome insurmountable challenges from the Great Depression and the near-collapse of the American auto industry to the GM-UAW strike and now COVID-19,” it said, adding that the acts of those convicted in the scandal were “against everything we stand for.”

The UAW said it would continue to focus on implementing reforms to protect its members and that it is operating under new transparency protocols including far-reaching ethical and financial oversight.

“While these reforms are just the beginning, they are significant and will be expanded upon to ensure the crimes we've seen never happen again,” UAW President Rory Gamble said in the statement.