11 Plead Guilty in Construction Union Bribery Scheme

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A contractor gave New York construction union officials envelopes stuffed with cash in restaurant restrooms to help win contracts.
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Eleven former New York construction union officials – including the ex-president of a 200,000-member trades council – have pleaded guilty to charges related to accepting bribes and other illegal payments paid by a contractor to win construction contracts.

James Cahill, who was the president of the New York State Building and Construction Trades Council at the time, received bribes and illegal payments of about $45,000 between October 2018 and October 2020 and another $100,000 or so before that, according to the U.S. Attorney’s Office for the Southern District of New York. The council represents more than 200,000 union members.

Cahill was the ring leader of the scheme, accepting envelopes stuffed with cash in restaurant restrooms from a construction contractor whose name was not revealed by the attorney’s office. Cahill introduced the contractor to many of the 10 others who pleaded guilty. Some of the other union officials accepted anywhere from thousands to tens of thousands of dollars in illegal payments. Cahill also directed the contractor on how to win union favors yet not have to hire union workers.

According to the attorney’s office, the contractor would pay the bribes to the union officials to win projects in the jurisdiction of Steamfitters Local 638 in New York City and Long Island and Plumbers Local Union 200 in Nassau and Suffolk counties. In return, the union officials would support the contractor’s bids on projects in which the unions negotiated project labor agreements, which are required in New York on certain major projects. In some cases they would sign labor agreements that enabled the contractor to pay union members hourly rates lower than their experience levels merited, as well as hire non-union members. The union officials would also let the contractor falsely claim to other developers that the contractor employed union workers when the contractor did not.

The projects the contractor bid on or won would have hired Local 638 or 200 members, according to the attorney’s office. The contractors’ employees were not members of those unions but would have been eligible for membership.

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“The defendants exploited their union positions and hard-working union members to feed their own greed,” says U.S. Attorney Damian Williams. â€śThey accepted bribes to corruptly favor non-union employers and influence the construction trade in New York.”

The 11 former officials pleaded guilty to various crimes that carry differing maximum penalties. They were indicted on the charges in 2020.

The most serious crime was “honest services fraud conspiracy,” which carries a max penalty of up to 20 years in prison. Cahill and former Local 638 Business Agents Christopher Kraft and Patrick Hill each pleaded guilty to this federal offense, which is defined as a “scheme to defraud another of the intangible right to honest services,” such as bribery.

Six others pleaded guilty to felony violation of the Taft-Hartley Act, which outlines federal law governing unfair labor practices. The following face up to five years in prison for this offense: Matthew Norton, William Brian Wangerman, Jeremy Sheeran and Andrew McKeon, who were Local 638 business agents; Robert Egan, former Local 638 secretary-treasurer; and former Local 200 Business Agent Arthur Gipson. Kevin McCarron, who was a Local 638 business agent, faces up to one year in prison for misdemeanor Taft-Hartley Act violation. Scott Roche, former business agent at-large for Local 638, is the only one sentenced so far. He got two years of probation and a $10,000 fine for misdemeanor Taft-Hartley Act violation.

The remaining 10 former union officials face sentencing at various dates between December and March 14.

“These convictions highlight a shocking level of corruption among powerful labor officials in New York State,” says Suffolk County District Attorney Raymond A. Tierney, who partnered with the U.S. attorney’s office in prosecuting the case. “Through their greed and self-dealing, these defendants betrayed the hard-working members of their respective unions, and undermined the protections meant to be afforded by organized labor. While their members were performing difficult work at job sites throughout the region, these defendants sold out their membership by accepting bribes and cash payments in restaurant bathrooms.”